Richard Burger's Reviews > China Shakes the World: A Titan's Rise and Troubled Future -- and the Challenge for America

China Shakes the World by James Kynge
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Feb 23, 12

Read in August, 2009

When I first came back to China in January 2007, I was talking with my office director about books on China, and he told me, "The best book on modern China has to be China Shakes the World. Get a copy as soon as you can." He gave a copy to our company president in New York, who promptly bought 100 copies to give to clients interested in dong business in China. Essential reading has a whole new definition.

My manager was right. This book is unsurpassed in terms of exploring and analyzing just how enormous an effect China is having on the entire world. And anyone who doesn't acknowledge that China is shaking the world is either in a state of willful denial or is living in a cave.

The book gets its title from an unconfirmed and in all likelihood mythological quote attributed to Napoleon Bonaparte: "Let China sleep; for when she wakes, she will shake the world." Well, China has woken and the quote has proven to be accurate, no matter who actually said it. What makes this book special is its approach to the subject, focusing on the effect of China's rise on other countries and other peoples. It's not just another roundup of stories about the "China miracle" and how much Western CEOs are loving doing business in China.

The book begins at what was once the site of Germany's largest steel mill, now only "a scar." Kynge describes how the Chinese bought the ailing business and transported the entire mill - 25 football fields in size, 250,000 tons in weight, with 45 tons of documents telling how to reassemble the plant - to China. 10,000 German jobs were gone, and a 100-year-old business, the lifeblood of the city of Dortmund, vanished. (It was not China that caused the mill to go bust; that process started before China's meteoric rise, due to fierce competition mainly from South Korea.) Kynge's description of how the Chinese took the mill apart, dangling from walkways 60 meter above the ground without safety harnesses and completing the job months earlier than planned, is spellbinding. It's funny, and it's heartbreaking. The mill is a metaphor for many of the traditional businesses that for decades, even centuries, the Europeans thought of as "their own," only to discover that competition from Asia threatened their very existence.

The China "economic miracle" has been in the headlines since the 1990s. The first sign that China was about to shake the world, however, occurred in 2004, when manhole covers began to disappear from streets all over the world. This was a wake-up call: China's thirst for raw materials was about to affect all of the world's markets. It was with the disappearing manhole covers, Kynge says, that China "telegraphed its arrival" to the world. "Whatever else happened, China had to be fed...A new era in international relations dawned, one defined by the geopolitics of scarcity."

Looking over the book now, I see that I've dog-earred just about every page and written notes in many of the margins. There's so much, it's hard to condense it into a single blog post. So allow me simply to give some impressions of various points Kynge makes, in no particular order.

What Kynge manages to do better than any author I've read to date is to capture in words just how strange a trading partner China is, and how it resembles no other great power. Examples are plentiful - companies that make semiconductors and tomato catsup; companies that thrive on the theft of intellectual property; companies that produce an insane over-supply of products; companies that operate on an entirely different moral and cultural plane from their global counterparts. Kynge's vivid anecdotes paint a picture of a country that in many ways is downright freakish and unbelievably unfair and corrupt. A country that is just so different.

And yet.... Kynge is always clear-headed and balanced to a fault. After enumerating the many bizarreries that make China seem so peculiar, he offers some important balance:

"It must be said that from a global perspective, China's emergence is of enormous economic benefit. The value created by the release of 400 million people from poverty, the migration of over 120 million from farms where they perhaps raised chickens to factories where they churn out electronics, the quantum leap in educational standards for tens of millions of children, the construction of a first-class infrastructure, the growth of over 40 cities with populations of over a million, the commercialization of housing and the vaulting progress up the technology ladder have helped unleash one of the greatest ever surges in general prosperity."

You come away from this book enraged at China and in awe of China, hating it and admiring it. Perhaps the most hackneyed phrase about China is that it's a "land of contradictions," but such phrases only become hackneyed because they contain a strong element of truth. Kynge brings us all the contradictions and spins them into a narrative that kept me turning from page to page throughout my flight to Munich. One story about a girl whose life is for all intents and purposes stolen from her by a corrupt official who stole her identity so his daughter could get into a good university will bring tears to your eyes. And stories of the sheer guile of Chinese workers , like those who dismantled the Dortmund steel mill, will make you smile. And his description of just how inequitable the competition from China can be will leave you hopelessly frustrated:

"The Chinese fixed the value of their currency against the US dollar, keeping it undervalued so as to give their exports greater competitiveness. They provided little or no welfare for their workers, so their costs were artificially low. There were no independent unions in China, so the safety standards...in Chinese factories would have been illegal in America. The state banking system provided cheap credit to state companies that could default without consequence. The central government gave generous value added tax rebates to exporters that were not available to US retailers. Restrictions on emissions were lax, so companies had to pay relatively little to keep the environment clean. Chinese companies routinely stole foreign intellectual property, but it was difficult to prosecute them because the courts were either corrupt or under government control. Finally, the state kept the price of various inputs, such as electricity and water, artificially low, thereby subsidizing industry."

Kynge is outspoken on Western Europe's (in particular Germany's and France's) lack of competitiveness underscored by Germany's 35-hour and long vacations. And yet, how can they possibly compete against China, no matter how many hours a week they work, when all of the cards are stacked in China's favor, mostly due to maddeningly unfair government intervention (or lack of intervention)?

But for all of China's ruthlessness and seemingly unstoppable growth, crushing anything that gets in its path, Kynge leaves us more with a sense of doubt than of fear (though there's plenty of fear, too). Doubt, because China's problems (and here comes another hackneyed clichee) are so immense, so overwhelming that its ascension to the status of a global superpower still remains in question. And if it does join the superpower club, surely it will be the strangest member. There has never been a superpower quite like it.

"Although China is poised to overtake the UK to become the world's fourth largest economy, on a per capita basis it ranks just above the world's poorest nations, with an average income of just over $1,000 a year. Even if the country's gross domestic product one day becomes as large as that of the US, simple mathematics ordains that its people at that time will on average be only one-sixth as wealthy as Americans."

Again, I can't offer anything more than a snapshot; there's so much here, and I can't recommend this book highly enough. In terms of balance, perspective and brilliant analysis of what China is today and where it is going tomorrow, this is the best book you can buy.
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