Chrystia Freeland

China’s economic model isn’t the answer for the U.S.

Chrystia Freeland
Aug 30, 2010 17:03 UTC

This piece first appeared in The Washington Post.

Forget the “Ground Zero mosque,” Michelle Obama’s Spanish holiday and even the oil spill in the Gulf of Mexico. When future historians look back to the summer of 2010, the event they are most likely to focus on is China’s emergence as the world’s second-largest economy.

Mostly, this is a very good thing. The rise of China, and the related, albeit slightly slower, emergence of India, is the story of hundreds of millions of very poor people joining the global economy and getting a little richer. Gross domestic product per capita in those two countries was basically stagnant from 1820 to 1950. Then, it increased 68 percent from 1950 to 1973, and a whopping 245 percent from 1973 to 2002.

But we need to be careful not to draw the wrong lessons from China’s resurrection. The most dangerous one is that authoritarianism works.

That notion has become particularly tempting at a time when so many Americans, on the right and the left, are skeptical of the efficacy of their government. By contrast, many, particularly in the U.S. business and political elite, openly admire the effectiveness of China’s state-controlled version of capitalism. Indeed, a popular intellectual trend, as Stefan Halper, Ian Bremmer and others have noted, is to suggest that, especially in the wake of the global financial crisis, China’s economic model — a.k.a. “the Beijing consensus” — could replace the U.S. model.

That’s plain wrong. Centrally planned economies tend to be good at wrenching societies out of agricultural poverty into the industrial age — especially when the technologies needed to accomplish that shift have been invented elsewhere. Remember that in the 1930s, ’40s and even ’50s the Soviet model seemed viable, for precisely that reason.

Business journalism’s image problem

Chrystia Freeland
Aug 23, 2010 19:28 UTC

In this past weekend’s New York Times, Chrystia channels Mikael Blomkvist, the muckracking protagonist in Steig Larsson’s Millenium trilogy, and argues that he would be horrified that the best writing on the financial crisis — Michael Lewis’ The Big Short and Andrew Ross Sorkin’s Too Big to Fail — has come from insiders with access:

Lewis is “eternally grateful” to his subjects for their cooperation. Sorkin, a reporter and columnist for The New York Times, is “truly grateful” to his. One can imagine Blomkvist sputtering with rage, but you don’t have to be a fictional Scandinavian social democrat to wish that business journalism in the United States was more about afflicting the comfortable and less about cozying up to them. In the spring, the high priests of American journalism at the Columbia Journalism Review published a tough critique of Sorkin by Dean Starkman, who argued that “Too Big to Fail” was on one side — the wrong side — in the “mini-struggle” between “deal journalism and the work of accountability-oriented reporters.”

Chrystia goes on to say that the most worrisome divide is not between “access” and “investigative” business journalists, as Blomkvist would have us believe. Rather, in an interconnected, global economy, what differentiates the best reporters from the rest is the ability to make sense of data and complex systems:

Booming businesses, weakened workers

Chrystia Freeland
Aug 20, 2010 16:34 UTC

I appeared on PBS’s Nightly Business Report yesterday to talk about a serious fault line that’s running through the U.S. economy: businesses have figured out how to thrive in a global economy while workers have been left behind. Unless American businesses can find a way to include the sagging middle class in their success, they will soon face a populist backlash which will make Barack Obama look like Milton Friedman. Below is the video and my full remarks:

Watch the full episode. See more Nightly Business Report.

My full remarks:

Here’s the good news about China’s emergence as the world’s second largest economy — U.S. business has figured it out. And here’s the bad news– while U.S. companies can go global, most U.S. citizens can’t. The result in this age of globalization, is a growing tension between the interests of America’s business leaders and the interests of much of its middle class. Indeed, the most important fault line in American politics today may not be between Democrats and Republicans. It is between those businesses and business people who are succeeding in the global economy and those who aren’t.

This clash of values and interests upends our usual ideas of left and right. Consider immigrants. It’s no accident that Mike Bloomberg and Silicon Valley bosses are squarely on the side of diversity and liberal immigration laws. But CEO’s are less thrilled about the Democrat-driven imposition of more regulation and the promise of higher taxes.

Mosque madness and midterms

Chrystia Freeland
Aug 16, 2010 15:52 UTC

On “This Week” with Christiane Amanpour, Chrystia says President Obama’s speech in support of the Cordoba House mosque that would occupy a building two blocks from Ground Zero in downtown Manhattan displays leadership and conviction.

Later on “This Week” during a roundtable discussion on mid-term elections, Chrystia says the real question is, can an American political party or political movement come up with a powerful economic plan?

Chrystia asks, doesn’t this all come down to the economy? She picks up on what former governor of New Jersey Jon Corzine said earlier about this recession. It is not only following a financial crisis, but also is the final act of America’s structural adjustment to globalization and the technology revolution.

Richard Holbrooke: don’t repeat the mistake

Chrystia Freeland
Aug 11, 2010 16:31 UTC

Richard Holbrooke, U.S. Special Envoy to Afghanistan and Pakistan, and Fred Kempe, president & CEO of Atlantic Council, emphasize that securing Afghanistan is impossible without the help of Pakistan.