Rare earth elements aren’t the secret weapon China thinks they are

Despite the name, rare earths just aren’t that rare

 

America’s trade war with China has been quietly escalating for years, but this week it took a turn for the disastrous. Huawei, once the rising star of China’s tech industry, has been cut off from US suppliers, leaving the company effectively stunted. China is likely to respond somehow, but with a multitude of options on the table, many in the tech industry are now considering nightmare scenarios.

One particularly chaotic option would be a ban on the export of rare earths — raw materials that are crucial for electronics. These elements are produced mostly in China, and used in the US for everything from electric cars to wind turbines, smartphones to missiles.

Chinese state media have backed the idea, calling America’s dependence on Chinese rare earths “an ace in Beijing’s hand.” President Xi Jinping hinted at that possibility when he visited a rare earth facility at the beginning of this week. (As a ministry spokesperson commented with what seemed like a nod and a wink: “It is normal that the top leader investigates relevant industrial policies. I hope everyone can interpret it correctly.”)

Rare earth elements are sometimes described as the “vitamins of chemistry,” as small doses produce powerful salutary effects. A sprinkle of cerium here and a pinch of neodymium there makes TV screens brighter, batteries last longer, and magnets stronger. If China suddenly shut off access to these materials, it would be like rewinding the tech industry back a few decades. And no one wants to ditch their iPhone and go back to a BlackBerry.

Experts in the field, though, are much less concerned about such a chilling scenario. They say that while a restriction on rare earth exports would have some immediate adverse effects, the US and the rest of the world would adapt in the long run. “If China really cuts off supply entirely then there are short term problems,” Tim Worstall, a former rare earth trader and commodities blogger tells The Verge. “But they’re solvable.”

Far from being an ace in the hole, it turns out rare earths are more of a busted flush.

China currently dominates the world’s supply of rare earth elements. Credit: USGS
The reasons for this are numerous, and span geography, chemistry, and history. But the most important factor is also the simplest to explain: rare earths just aren’t that rare.

A group of 17 elements, rare earths are what the USGS (United States Geological Survey) describe as “moderately abundant.” That means they’re not as common as oxygen, silicon, and iron, which make up the vast majority of the Earth’s crust, but some are on a par with elements like copper and lead, which we don’t consider exotic or scarce. Significant deposits exist in China, but also Brazil, Canada, Australia, India, and the United States.

The challenge with producing rare earths (and the reason they were given their name) is that they’re rarely found in concentrated lumps. These are chemically sociable elements, happy to bond with other compounds and minerals and tumble about in the dirt. This makes extracting rare earths from common earth like convincing a drunk friend to leave a raucous party: a lengthy and harrowing procedure.As Eugene Gholz, a rare earth expert and associate professor of political science at the University of Notre Dame puts it: “Once you take it out of the ground, the big challenge is chemistry not mining; converting the rare earths from rock to separated elements.”

Unlike convincing that drunk friend, though, this process involves a series of acid baths and unhealthy doses of radiation. This is one of the reasons that countries like the US have been more or less happy to cede production of rare earths to China. It’s a messy, dangerous business, so why not let someone else do it? Other factors also helped, including lower labor costs and the existence of Chinese mines that produce rare earths as a byproduct.

China’s sway in the rare earths market is a fairly recent state of affairs. Between the 1960s and the 1980s, the majority of the world’s supply was actually produced in America, from the Mountain Pass mine in California. The mine’s processing plant was shut down in 1998 after problems disposing of toxic waste water, and the whole site was mothballed in 2002.

It’s only from the 1990s onward that China has shouldered the bulk of production, along with the associated environmental costs. (In 2010, the Chinese government estimated that the industry was producing 22.05 million tons of toxic waste each year.) An oft-referenced figure is that China now produces some 95 percent of the world’s rare earths, but Gholz says this statistic is “wildly out of date.” The USGS pegs China’s part as closer to 80 percent.

China’s Consumption Of Coal Steadily On The Rise
Low labor costs and lax environmental regulations precipitated China’s rise in rare earth mining. Photo by China Photos/Getty Images
That’s still a substantial chunk of the world’s supply, though, and with no doubt that these are important commodities, the question is: what happens if China does cut off the US?

Luckily, we have a very good idea of what would happen next because it’s already happened before. Back in 2010, China stopped exports of rare earths to Japan following a diplomatic incident involving a fishing trawler and the disputed Senkaku Islands. Gholz wrote a report of the fallout from this incident in 2014, and found that despite China’s intentions, its ban actually had little effect.

Chinese smugglers continued to export rare earths off the books; manufacturers in Japan found ways to use less of the materials; and production in other parts of the world ramped up to compensate. “The world is flexible,” says Gholz. “When you try to restrict supplies to politically influence another country, people don’t give up, they adapt.”

He says that although his report examined the rare earth industry as it was in 2010, the “conclusions are pretty much the same” in 2019.

If China did turn off the rare earth tap, there would be enough private and public stockpiles to supply essential sectors like the military in the short term. And while an embargo could lead to price rises for high-tech goods and dependent materials like oil (rare earths are essential in many refining processes), Gholz says it’s highly unlikely that you would be unable to buy your next smartphone because of a few missing micrograms of yttrium. “I don’t think that’s ever going to happen. It just doesn’t seem plausible,” he says.

Even though a ban on rare earth exports is just speculation at this point, companies have begun to preempt any new Chinese restrictions. American chemical firm Blue Line Corp and Australian rare earth miner Lynas have already proposed new production facilities in the US, and rare earth stocks around the world have surged in response to the threat.

“IT’S NOT LIKE STARTING FROM SCRATCH.”
In the event of a ban, one of the most important backstops would be America’s Mountain Pass mine. Although the mine was closed after Chinese rare earths drove down prices, the facility is intact and resumed production last January. Recent estimates suggest it’s already supplying one-tenth of the world’s rare earth ores (though not their processing), and in the event of an embargo, it would be possible to bring Mountain Pass back up to speed.

“By far the cheapest and fastest way to bring more material into the market — if there was a disruption — is just sitting there in California,” says Gholz. “It’s not like starting from scratch.”

Worstall agrees: “Producing rare earth concentrate is near trivially simple,” he says. “I, or any other competent person, could produce that from a standing start within six months in any volume required.”

The kicker, both say, is how much that process might cost. Especially as any refining and separation plants built in the US would have to meet far higher environmental standards.

As we’re seeing with Huawei and other casualties of Trump’s trade war, the real question isn’t whether adaptation is possible in the future, it’s how much pain you can stomach in the present.

Trump’s Trade Secret: Exploiting China’s Relative Weakness

Rising debt levels and an unsustainable economic model leave Beijing at Washington’s mercy.

The Chinese Communist Party has always relied on deception to wrong-foot rivals and attain the advantage in negotiations. Deng Xiaoping famously counseled, “Hide your strength, bide your time.” But Xi Jinping prefers to exaggerate China’s economic strengths and conceal its vulnerabilities.

Mr. Xi’s brazen approach conditions other countries to believe that Beijing enjoys a superior hand, that China’s rise and dominance are inevitable. These erroneous beliefs weaken the will of injured parties, including Western nations, to resist predatory Chinese behavior.

President Trump and Mr. Xi confirmed a “phase 1” trade agreement Friday. Both need the deal for domestic political and economic reasons. But in every negotiation, pressure is relative, and the U.S. has more political and economic leverage than China. This insight will help the U.S. during the more difficult second phase of negotiations.

Consider why China engages in predatory, illegal economic behavior. It needs to grow rapidly to maintain fiscal stability, manage its debt and advance its strategic and military ambitions. China can’t become the dominant power in the Indo-Pacific without sustained growth. The only reliable way Beijing has of maintaining adequate growth is to support its companies with cheap credit. The rise in Chinese corporate debt since the 2008-09 financial crisis has been one of the largest and most rapid—in relative and absolute terms—for any 10-year period in peacetime economic history.

China cannot significantly deleverage without drastic changes to its political economy. The model involves offering state-owned enterprises and national champions such as Huawei cheap finance and privileged domestic-market access at the expense of an independent private sector. China showers state businesses with subsidies and stolen intellectual property, and shields them from foreign competition.

The Chinese domestic economy is slowing because of chronic overinvestment. This provides the economic rationale behind plans such as the Belt and Road Initiative and Made in China 2025. The former is a scheme to export excess capacity and lock in new regional markets for Chinese firms, especially in infrastructure. The latter is a new export-oriented approach based on dominating increasingly important advanced and high-technology sectors in global markets. Both attempt to create external commercial opportunities for protected, unreformed Chinese firms without the need to reform the country’s main economic and political institutions.

Mr. Xi believes doubling down on this approach offers the party the best prospect to retain its hold on power and opportunity. As with virtually all major economic developments in China, the party soaks up praise when things go well and wears blame when they don’t. As Chairman of Everything, Mr. Xi faces acute pressure. His success depends on preventing the emergence of a genuinely independent middle class, which is what led to democratic transitions in Japan, South Korea and Taiwan.

That brings us to the question of negotiating leverage.

The current Chinese model is self-defeating. Less-deserving companies continue to receive the bulk of finance and opportunity. The staggering misallocation of capital is worsening, which makes the mushrooming debt even harder to manage. And allocation of opportunity is political. This means that the private sector, and therefore household income, will continue to remain artificially suppressed—putting even more pressure on Beijing to stimulate growth through further credit expansion.

The U.S. has a far more adaptive and diverse economy than China. China’s economy is inefficient, bloated, dysfunctional—plagued by institutions and policies that are not fit for their purposes. If the tariff war resumes, it will continue to prove much more disruptive to China than to the U.S.

Moreover, by calling attention to the seriousness of Chinese trade violations, Mr. Trump is properly recasting China as the main threat to a fair and sustainable global economic system. Multinational companies are gradually assessing the commercial risk that sovereign risk poses to them—the possibility that China will arbitrarily alter laws or regulations or fail to honor government bonds when they mature.

In recent years, Mr. Xi has been openly accused by former senior officials and influential journalists and academics of mismanaging the relationship with America, decisively abandoning any market-based reforms that would make the Chinese economy more resilient and agile, and overreaching with his aggressive promotion of Belt and Road and Made in China 2025. Leaks about the abhorrent treatment of Uighurs in Xinjiang seem designed to undermine him, while continued protests in Hong Kong are a stark rejection of his authoritarianism.

Mr. Xi’s purging of more than 1.5 million officials, including top generals and party members, will come back to bite him. In addition to holding a weaker economic hand, Mr. Xi is far more vulnerable to internal rebellion, and therefore more desperate for economic pain relief, than the American president.

Mr. Trump has threatened to walk away if any agreement—including the final details of the phase 1 deal—is not to his liking. He indicated in “The Art of the Deal” that his style is to aim high and keep pushing and pushing until he gets what he wants. Let’s hope he follows through. The national interest depends on it.

Eric X. Li: A tale of two political systems

It’s a standard assumption in the West: As a society progresses, it eventually becomes a capitalist, multi-party democracy. Right? Eric X. Li, a Chinese investor and political scientist, begs to differ. In this provocative, boundary-pushing talk, he asks his audience to consider that there’s more than one way to run a succesful modern nation.

 

Why democracy still wins: A critique of Eric X. Li’s “A tale of two political systems”

Earlier this year, economist Yasheng Huang (watch his 2011 TED Talk) sparred with Eric X. Li in the pages of Foreign Affairs on a similar topic to today’s TED Talk. The TED Blog asked Huang to expand on his argument in his ongoing conversation with Li.

Imagine confusing the following two statements from a cancer doctor: 1) “You may die from cancer” and 2) “I want you to die from cancer.” It is not hard to see a rudimentary difference between these two statements. The first statement is a prediction — it is saying that something may happen given certain conditions (in this case death conditional upon having cancer). The second statement is a preference, a desire, or a wish for a world to one’s particular liking.

Who would make such a rudimentary mistake confusing these two types of statements? Many people, including Eric X. Li, in today’s TED Talk. The Marxian meta-narrative drilled into Li’s head — and mine in my childhood and youth in the 1960s and 1970s — is a normative statement. When Marx came up with his ideas about evolution of human societies, there was not a single country in the world that even remotely resembled the communist system he advocated. The communist system Marx had in mind had no private property or of ownership of any kind. Money was also absent in that system. The Marxian version of communism has never come to fruition and, most likely, never will. Marx based his “prediction” on deduction; his successors did so by imposing their wish, enforced by power and violence.

Eric X. Li: A tale of two political systemsEric X. Li: A tale of two political systems

By contrast, the narrative that was apparently fed to Li when he was a “Berkeley hippie” is based on the actual experience of human affairs. We have had hundreds of years of experience with democracy and hundreds of countries/years of democratic transitions and rule. The statement that countries transition to democracy as they get rich is a positive statement — it is a prediction based on data. In the 1960s, roughly 25 percent  of the world was democratic; today the proportion is 63 percent . There are far more instances of dictatorships transitioning to democracies  than the other way around. The rest of the world has clearly expressed a preference for democracy. As Minxin Pei has pointed out, of the 25 countries with a higher GDP per capita than China that are not free or partially free, 21 of them are sustained by natural resources. But these are exceptions that prove the rule — countries become democratic as they get richer. Today not a single country classified as the richest is a single-party authoritarian system. (Singapore is arguably a borderline case.) Whether Li likes it or not, they all seem to end up in the same place.

Are democracies more corrupt? Li thinks so. He cites the Transparency International (TI) index to support his view. The TI data show that China is ranked better than many democracies. Fair enough.

I have always thought that there is a touch of irony with using transparency data to defend a political system built on opacity. Irony aside, let’s keep in mind that TI index itself is a product of a political system that Li so disparages — democracy (German democracy to be exact). This underscores a basic point — we know far more about corruption in democracies than we do about corruption in authoritarian countries because democracies are, by definition, more transparent and they have more transparency data. While I trust comparisons of corruption among democratic countries, to mechanically compare corruption in China with that in democracies, as Li has done so repeatedly, is fundamentally flawed. His methodology confounds two effects — how transparent a country is and how corrupt a country is. I am not saying that democracies are necessarily cleaner than China; I am just saying that Li’s use of TI data is not the basis for drawing conclusions in either direction. The right way to reach a conclusion on this issue is to say that given the same level of transparency (and the same level of many other things, including income), China is — or is not — more corrupt than democracies.

Yasheng Huang: Does democracy stifle economic growth?Yasheng Huang: Does democracy stifle economic growth?

A simple example will suffice to illustrate this idea. In 2010, two Indian entrepreneurs founded a website called I Paid a Bribe. The website invited anonymous postings of instances in which Indian citizens had to pay a bribe. By August 2012 the website has recorded more than 20,000 reports of corruption. Some Chinese entrepreneurs tried to do the same thing: They created I Made a Bribe and 522phone.com. But those websites were promptly shut down by the Chinese government. The right conclusion is not, as the logic of Li would suggest, that China is cleaner than India because it has zero postings of corrupt instances whereas India has some 20,000 posted instances of corruption.

With due respect to the good work at Transparency International, its data are very poor at handling this basic difference between perception of corruption and incidence of corruption. Democracies are more transparent — about its virtues and its vices — than authoritarian systems.  We know far more about Indian corruption in part because the Indian system is more transparent, and it has a noisy chattering class who are not afraid to challenge and criticize the government (and, in a few instances, to stick a video camera into a hotel room recording the transfer of cash to politicians). Also lower-level corruption is more observable than corruption at the top of the political hierarchy. The TI index is better at uncovering the corruption of a Barun the policeman in Chennai than a Bo Xilai the Politburo member from Chongqing. These factors, not corruption per se, are likely to explain most of the discrepancies between China and India in terms of TI rankings.

Li likes to point out, again using TI data, that the likes of Indonesia, Argentina and the Philippines are both democracies and notoriously corrupt. He often omits crucial factual details when he is addressing this issue. Yes, these countries are democracies, in 2013, but they were governed by ruthless military dictators for decades long before they transitioned to democracy. It was the autocracy of these countries that bred and fermented corruption. (Remember the 3,000 pairs of shoes of Mrs. Marcos?) Corruption is like cancer, metastatic and entrenched. While it is perfectly legitimate to criticize new democracies for not rooting out corruption in a timely fashion, confusing the difficulties of treating the entrenched corruption with its underlying cause is analogous to saying that a cancer patient got his cancer after he was admitted for chemotherapy.

The world league of the most egregious corruption offenders belongs exclusively to autocrats. The top three ruling looters as of 2004, according to a TI report, are Suharto, Marcos and Mobutu. These three dictators pillaged a combined $50 billion from their impoverished people. Democracies are certainly not immune to corruption, but I think that they have to work a lot harder before they can catch up with these autocrats.

Li has a lot of faith in the Chinese system. He first argues that the system enjoys widespread support among the Chinese population. He cites a Financial Times survey that 93 percent of Chinese young people are optimistic about their future. I have seen these high approval ratings used by Li and others as evidence that the Chinese system is healthy and robust, but I am puzzled why Li should stop at 93 percent. Why not go further, to 100 percent ? In a country without free speech, asking people to directly evaluate performance of leaders is like asking people to take a single-choice exam. The poll numbers for Erich Honecker and Kim Jong-un would put Chinese leaders to shame.

(Let me also offer a cautionary footnote on how and how not to use Chinese survey data. I have done a lot of survey research in China, and I am always humbled by how tricky it is to interpret the survey findings. Apart from the political pressures that tend to channel answers in a particular direction, another problem is that Chinese respondents sometimes view taking a survey as similar to taking an exam. Chinese exams have standard answers, and sometimes Chinese respondents fill out surveys by trying to guess what the “standard” answer is rather than expressing their own views. I would caution against any naïve uses of Chinese survey data.)

Li also touts the adaptability of the Chinese political system. Let me quote:

“Now, most political scientists will tell us that a one-party system is inherently incapable of self-correction. It won’t last long because it cannot adapt. Now here are the facts. In 64 years of running the largest country in the world, the range of the party’s policies has been wider than any other country in recent memory, from radical land collectivization to the Great Leap Forward, then privatization of farmland, then the Cultural Revolution, then Deng Xiaoping’s market reform, then successor Jiang Zemin took the giant political step of opening up party membership to private businesspeople, something unimaginable during Mao’s rule. So the party self-corrects in rather dramatic fashion.”

Now imagine putting forward the following narrative celebrating, say, Russian “adaptability”: Russia, as a country or as a people, is highly adaptable. The range of its “policies has been wider than any other country in recent memory,” from gulags to Stalin’s red terror, then collectivization, then central planning, then glasnost and perestroika, then privatization, then crony capitalism, then the illiberal democracy under Putin, something unimaginable during Lenin’s rule. So the country “self-corrects in rather dramatic fashion.”

Let me be clear and explicit — Li’s reasoning on the adaptability of the Chinese Communist Party (CCP) is exactly identical to the one I offered on Russia. The only difference is that Li was referring to a political organization — the CCP — and I am referring to a sovereign state.

The TED audience greeted Li’s speech with applause — several times in fact. I doubt that had Li offered this Russian analogy the reception would have been as warm. The reason is simple: The TED audience is intimately familiar with the tumult, violence and astronomical human toll of the Soviet rule. Steven Pinker, in his book The Better Angels of Our Nature, quoted the findings by other scholars that the Soviet regime killed 62 million of its own citizens. I guess the word “correction” somewhat understates the magnitude of the transformation from Stalin’s murderous, genocidal regime to the problematic, struggling but nonetheless democratic Russia today.

I do not know what a Berkeley hippie learned from his education, but in Cambridge, Massachusetts, where I received my education and where I am a professor by profession, I learned — and teach — every day that words actually have meaning. To me, self-correction implies at least two things. First, a self-correction is, well, a correction by self. Yes, Mao’s policies were “corrected” or even reversed by his successors, as Li pointed out, but in what sense is this “a self-correction?” Mao’s utterly disastrous policies persisted during his waning days even while the chairman lay in a vegetative state and his successor — who came to power through a virtual coup — only dared to modify Mao’s policies after his physical expiration was certain. If this is an instance of self-correction, exactly what is not a self-correction? Almost every single policy change Li identified in his talk was made by the successor to the person who initiated the policy that got corrected. (In quite a few cases, not even by the immediate successor.) This is a bizarre definition of self-correction. Does it constitute a self-correction when the math errors I left uncorrected in my childhood are now being corrected by my children?

The second meaning of self-correction has to do with the circumstances in which the correction occurs, not just the identity of the person making the correction. A 10-year-old can correct her spelling or math error on her own volition, or she could have done so after her teacher registered a few harsh slaps on the back of her left hand. In both situations the identity of the corrector is the same — the 10-year-old student — but the circumstances of the correction are vastly different. One would normally associate the first situation with “self-correction,” the second situation with coercion, duress or, as in this case, violence. In other words, self-correction implies a degree of voluntariness on the part of the person making the correction, not forced or coerced, not out of lack of alternatives other than making the correction. The element of choice is a vital component of the definition of self-correction.

Let me supply a few missing details to those who applauded Li’s characterization of 64 years of China’s one-party system as one of serial self-corrections. Between 1949 and 2012, there have been six top leaders of the CCP. Of these six, two were abruptly and unceremoniously forced out of power (and one of the two was dismissed without any due process even according to CCP’s own procedures). A third leader fell from power and was put under house arrest for 15 years until his death. That is 3 strikes out of 6 who did not exit power on their intended terms. Two of Mao’s anointed successors died on the job, one in a fiery plane crash when he tried to escape to the Soviet Union and the other tortured to death and buried with a fake name. Oh, did I mention that 30 million people were estimated to have died from Mao’s disastrous Great Leap Forward, and probably millions of people died from the violence of the Cultural Revolution? Also, do you know that Mao not only persisted in but accelerated his Great Leap Forward policies after the evidence of the extent of famine became crystal-clear?

Li calls the policy changes after these wrenching tumults “self-corrections.” His reasoning is that an entity called the CCP, but not anybody else, introduced these policy changes. First of all, doesn’t that have something to do with the fact that nobody else was allowed a chance to make those policy changes? Secondly, this fixation on who made the policy changes rather than on the circumstances under which the policy changes were made is surely problematic. Let’s extend Li’s logic a little bit further. Shall we rephrase the

  • American Independence Movement as a self-correction by the British? Or maybe the ceding of the
  • British imperial authority over India as another British self-correcting act? Shall we re-label the
  • Japanese surrender to end the Second World War a self-correction by the Japanese? Yes, there were two atomic bombs dropped on Hiroshima and Nagasaki and all of that, but didn’t the representatives of Emperor Hirohito sign the Japanese Instrument of Surrender on the battleship of USS Missouri?

To a hammer, everything is a nail. Li sees ills of democracies everywhere — financial crises in Europe and the United States, money politics and corruption. I readily agree that money politics in America is a huge problem and that it is indeed making the system utterly dysfunctional. But let’s be very clear about exactly how and why money politics is dysfunctional. It is dysfunctional precisely because it is fundamentally antithetical to democracy.  Money politics is a perversion of democracy. It undermines and invalidates a canonical pillar of democracy — one person, one vote. To be logically consistent, Li should celebrate money politics because it is moving the United States in the direction of the authoritarian way of politics that he is so enamored of.

This may be a shocking revelation to Li, but US and European democracies did not patent financial crisis. Many authoritarian regimes experienced catastrophic financial and economic crises. Think of Indonesia in 1997 and the multiple junta regimes in Latin America in the 1970s and the 1980s. The only authoritarian regimes that go without suffering an explicit financial crisis are centrally planned economies, such as Romania and East Germany. But this is entirely because they failed to meet a minimum condition for having a financial crisis — having a financial system. The consequences for this defect are well-known — in lieu of sharp cyclical ups and downs, these countries produced long-term economic stagnations. A venture capitalist would not fare well in that system.

Li claims that he has studied the ability of democracies to deliver performance. At least in his talk, the evidence that he has done so is not compelling. There is no evidence that countries pay an economic price for being democratic. (It is also important to note that there is no compelling global evidence that democracies necessarily outperform autocracies in economic growth either. Some do and some do not. The conclusion is case by case.) But in the areas of public services, the evidence is in favor of democracies. Two academics, David Lake and Matthew Baum, show that democracies are superior to authoritarian countries in providing public services, such as health and education. Not just established democracies do a better job; countries that transitioned to democracies experienced an immediate improvement in the provision of these public services, and countries that reverted back to authoritarianism typically suffered a setback.

Li blames low growth in Europe and in the United States on democracy. I can understand why he has this view, because this is a common mistake often made by casual observers — China is growing at 8 or 9 percent and the US is growing at 1 or 2 percent . He is mistaking a mathematical effect of lower growth due to high base with a political effect of democracies suppressing growth. Because democratic countries are typically richer and have much higher per-capita GDP, it is much harder for them to grow at the same rate as poor — and authoritarian — countries with a lower level of per-capita GDP. Let me provide an analogy. A 15-year-old boy is probably more likely to go to see a movie or hang out with his friends on his own than a 10-year-old because he is older and more mature. It is also likely that he will not grow as fast as a 10-year-old because he is nearer to the plateau of human height. It would be foolish to claim, as Li’s logic basically did, that the 15-year-old is growing more slowly because he is going to movies on his own.

Li is very clear that he dislikes democracy, more than about the reasons why he dislikes democracy. Li rejects democracy on cultural grounds. In his speech, he asserts that democracy is an alien concept for Chinese culture. This view is almost amusing if not for its consequential implications. Last time I checked, venture capital is a foreign concept but that apparently has not stopped Li from practicing and prospering from it. (And I presume “Eric” to be foreign in origin? I may be wrong on this.) Conversely, would Li insist on adhering to every and each precept of Chinese culture and tradition? Would Li object to abolishing the practice of bound feet of Chinese women?

The simple fact is that the Chinese have accepted many foreign concepts and practices already. (Just a reminder: Marxism to the Chinese is as Western as Adam Smith.) It is a perfectly legitimate debate about which foreign ideas and practices China ought to accept, adopt or adapt, but this debate is about which ideas China should adopt, not whether China should adopt any foreign ideas and practices at all.

If the issue is about which ideas or which practices to adopt or reject, then, unlike Li, I do not feel confident enough to know exactly which foreign ideas and practices 1.3 billion Chinese people want to embrace or want to reject. A cultural argument against democracy does not logically lead to making democracy unavailable to the Chinese but to a course of actions for the Chinese people themselves to decide on the merits or the demerits of democracy. Furthermore, if the Chinese themselves reject democracy on their own, isn’t it redundant to expend massive resources to fight and suppress democracy? Aren’t there better ways to spend this money?

So far this debate has not occurred in China, because having this debate in the first place requires some democracy. But it has occurred in other Chinese environments, and the outcome of those debates is that there is nothing fundamentally incompatible between Chinese culture and democracy. Hong Kong, although without an electoral democratic system, has press freedom and rule of law, and there is no evidence that the place has fallen into chaos and anarchy. Taiwan today has a vibrant democracy, and many mainland travelers to Taiwan often marvel that Taiwanese society is not only democratic but also far more adherent to Chinese traditions than mainland China. (I have always felt that those who believe that democracy and Chinese culture are incompatible are closet supporters of Taiwanese independence. They exclude Taiwanese as Chinese.)

Indeed Li himself has accepted quite a few political reforms that are normally considered as “Western.” NGOs are okay and even some press freedom is okay. He also endorses some intra-party democracy. These are all sensible steps toward making the Chinese system more democratic than the Maoist system, and I am all for them. The difference is that I see freedom to vote and multi-party competition as natural and logical extensions of these initial reforms, whereas Li draws a sharp line in the sand between the political reforms that have already occurred and the potential political reforms that some of us have advocated. As much as I tried, I fail to see any differences in principle between these partial reforms and the more complete reforms encompassing democracy.

There is a very curious way Li objects to democracy: He objects to many of the mechanics of democracy. In particular, he has a thing against voting. But the problem is that voting is simply a way to implement the practice of democracy, and even Li endorses some democracy. For example, he favors intra-party democracy. Fine, I do too; but how do you implement intra-party democracy without voting? This is a bit like praising tennis as a sport but condemning the use of a racket to play it.

Li has not provided a coherent and logical argument for his positions on democracy. I suspect, although I do not have any direct evidence, that there is a simple modus operandi — endorsing reforms the CCP has endorsed and opposing reforms that CCP has opposed. This is fine as far as posturing goes but it is not a principled argument of anything.

That said, I believe it is perfectly healthy and indeed essential to have a rigorous debate on democracy — but that debate ought to be based on data, facts, logic and reasoning. By this criterion, Li’s talk does not start that debate.

In this aspect, however, democracy and autocracy are not symmetrical. In a democracy, we can debate and challenge democracy and autocracy alike, as Li did when he put down George W. Bush (which I greatly enjoyed) and as I do here. But those in an autocracy can challenge democracy only. (Brezhnev, upon being informed that there were protesters shouting “Down with Reagan” in front of the White House and that the US government could not do anything to them, reportedly told Reagan, “There are people shouting ‘Down with Reagan’ on Red Square and I am not doing anything to them.”) I have no troubles with people challenging people in power and being skeptical about democracy. In fact, the ability to do so in a democracy is the very strength of democracy, and a vital source of human progress. Copernicus was Copernicus because he overturned, not because he re-created, Ptolemaic astronomy. But by the same criterion, I do have troubles with people who do not see the merit of extending the same freedom they have to those who currently do not have it.

Like Li, I do not like the messianic tone some have invoked to support democracy. I support democracy on pragmatic grounds. The single most important benefit of democracy is its ability to tame violence. In The Better Angels of Our Nature, Pinker provided these startling statistics: During the 20th century, totalitarian regimes were responsible for 138 million deaths, of which 110 million occurred in communist countries. Authoritarian regimes caused another 28 million deaths. Democracies killed 2 million, mainly in their colonies as well as with food blockades and civilian bombings during the wars. Democracies, as Pinker pointed out, have trouble even bringing themselves to execute serial murderers. Democracies, Pinker argued, have “a tangle of institutional restraints, so a leader can’t just mobilize armies and militias on a whim to fan out over the country and start killing massive numbers of citizens.”

Contrary to what he was apparently told when he was a Berkeley hippie, the idea of democracy is not that it leads to a nirvana but that it can help prevent a living hell. Democracy has many, many problems. This insurance function of democracy — of mitigating against disasters — is often forgotten or taken for granted, but it is the single most important reason why democracy is superior to every other political system so far invented by human beings. Maybe one day there will be a better system than democracy, but the Chinese political system, in Li’s rendition, is not one of them.

The Origins of New US-Turkish Relations

For several years, there has been a significant shift underway in U.S. strategy toward the Middle East, where Washington has consistently sought to avoid combat. The United States is now compelled to seek accommodation with Turkey, a regional power in its own right, based on terms that are geopolitically necessary for both. Their relationship has been turbulent, and while it may continue to be so for a while, it will decline. Their accommodation has nothing to do with mutual affection but rather with mutual necessity. The Turkish incursion into Syria and the U.S. response are part of this adjustment, one that has global origins and regional consequences.

Similarly, the U.S. decision to step aside as Turkey undertook an incursion in northeastern Syria has a geopolitical and strategic origin. The strategic origin is a clash between elements of the Defense Department and the president. The defense community has been shaped by a war that has been underway since 2001. During what is called the Long War, the U.S. has created an alliance structure of various national and subnational groups. Yet the region is still on uneven footing. The Iranians have extended a sphere of influence westward. Iraq is in chaos. The Yemeni civil war still rages, and the original Syrian war has ended, in a very Middle Eastern fashion, indecisively.

A generation of military and defense thinkers have matured fighting wars in the Middle East. The Long War has been their career. Several generations spent their careers expecting Soviet tanks to surge into the Fulda Gap. Cold Warriors believed a world without the Cold War was unthinkable. The same can be said for those shaped by Middle Eastern wars. For the Cold War generation, the NATO alliance was the foundation of their thinking. So too for the Sandbox generation, those whose careers were spent rotating into Iraq or Afghanistan or some other place, the alliances formed and the enemies fought seemed eternal. The idea that the world had moved on, and that Fulda and NATO were less important, was emotionally inconceivable. Any shift in focus and alliance structure was seen as a betrayal.

After the Cold War ended, George H.W. Bush made the decision to stand down the 24-hour B-52 air deployments in the north that were waiting for a Soviet attack. The reality had changed, and Bush made the decision a year after the Eastern European collapse began. He made it early on Sept. 21, 1991, after the Wall came down but before the Soviet Union collapsed. It was a controversial decision. I knew some serious people who thought that we should be open to the possibility that the collapse in Eastern Europe was merely a cover for a Soviet attack and were extremely agitated over the B-52 stand-down.

It is difficult to accept that an era has passed into history. Those who were shaped by that era, cling, through a combination of alarm and nostalgia, to the things that reverberate through their minds. Some (though not Europeans) spoke of a betrayal of Europe, and others deeply regretted that the weapons they had worked so hard to perfect and the strategy and tactics that had emerged over decades would never be tried.

The same has happened in different ways in the Middle East. The almost 20-year deployment has forged patterns of behavior, expectations and obligations not only among individuals but more institutionally throughout the armed forces. But the mission has changed. For now, the Islamic State is vastly diminished, as is al-Qaida. The Sunni rising in Iraq has ended, and even the Syrian civil war is not what it once was. A war against Iran has not begun, may not happen at all, and would not resemble the wars that have been fought in the region hitherto.

This inevitably generates a strategic re-evaluation, which begins by accepting that the prior era is gone. It was wrenching to shift from World War II to the Cold War and from the Cold War to a world that many believed had transcended war, and then to discover that war was suspended and has now resumed. War and strategy pretend to be coolly disengaged, but they are passionate undertakings that don’t readily take to fundamental change. But after the 18 years of war, two things have become clear. The first is that

  1. the modest objective of disrupting terrorism has been achieved, and the second is that
  2. the ultimate goal of creating something approaching liberal democracies was never really possible.

Consistency

The world has changed greatly since 2001. China has emerged as a major power, and Russia has become more active. Iran, not Sunni jihadists, has become the main challenge in the Middle East and the structure of alliances needed to deal with this has changed radically since Desert Storm and Iraqi Freedom. In addition, the alliances have changed in terms of capability. The massive deployments in the Middle East have ended, but some troops remain there, and to a section of the American military, the jihadist war remains at the center of their thinking. To them, the alliances created over the past 18 years remain as critical as Belgium’s air force had been during the Cold War.

There is another, increasingly powerful faction in the United States that sees the Middle East as a secondary interest. In many instances, they include Iran in this. This faction sees China or Russia (or both) as the fundamental challenger to the U.S. Its members see the Middle East as a pointless diversion and a drain of American resources.

For them, bringing the conflict to a conclusion was critical. Those who made their careers in this war and in its alliances were appalled. The view of President Donald Trump has been consistent. In general, he thought that the use of military force anywhere must be the exception rather than the rule. He declined to begin combat in North Korea. He did not attack Iran after it shot down an American drone or after it seized oil tankers in the Strait of Hormuz. After the attack on the Saudi oil facility, he increased Saudi air defenses but refused offensive actions against the Iranians.

Given the shift in American strategy, three missions emerge. The first is the

  1. containment of China. The second is the
  2. containment of Russia. The third is the
  3. containment of Iran. In the case of China, the alliance structure required by the United States is primarily the archipelago stretching from Japan to Indonesia and Singapore – and including South Korea. In dealing with Russia, there are two interests. One is the North European Plain; the other is the Black Sea. Poland is the American ally in the north, Romania in the south. But the inclusion of Turkey in this framework would strengthen the anti-Russia framework. In addition, it would provide a significant counter to Iranian expansion.

Turkey’s importance is clear. It is courted by both Russia and Iran. Turkey is not the country it was a decade ago. Its economy surged and then went into crisis. It has passed through an attempted coup, and internal stress has been massive. But such crises are common in emerging powers. The U.S. had a civil war in the 1860s but by 1900 was producing half of the manufactured goods in the world while boasting a navy second only to the British. Internal crises do not necessarily mean national decline. They can mean strategic emergence.

Turkey’s alignment with Iran and Russia is always tense. Iran and Russia have at various times waged war with Turkey and have consistently seen Iraq as a threat. For the moment, both have other interests and Turkey is prepared to work with them. But Turkey is well aware of history. It is also aware that the U.S. guaranteed Turkish sovereignty in the face of Soviet threats in the Cold War, and that the U.S., unlike Russia and Iran, has no territorial ambitions or needs in Turkey. Already allied through NATO and historical bilateral ties, a relationship with Turkey is in the American interest because it creates a structure that threatens Iran’s line to the Mediterranean and compliments the Romanian-U.S. Black Sea alliance. The U.S. and Turkey are also hostile to the Syrian government. For Turkey, in the long term, Russia and Iran are unpredictable, and they can threaten Turkey when they work together. The American interest in an independent Turkey that blocks Russia and Iran coincides with long-term Turkish interests.

Enter the Kurds

This is where the Kurds come into the equation. Eastern Turkey is Kurdish, and maintaining stability there is a geopolitical imperative for Ankara. Elements of Turkey’s Kurds, grouped around the Kurdistan Workers’ Party, or PKK, have carried out militant attacks. Therefore it is in Turkey’s interest to clear its immediate frontiers from a Kurdish threat. The United States has no overriding interest in doing so and, indeed, has worked together with the Kurds in Iraq and Syria. But for the Turks, having Kurds on their border is an unpredictable threat. American dependency on the Kurds declines as U.S. involvement in the Middle East declines. Turkey becomes much more important to the United States in relation to Iran than the Kurds.

Trump clearly feels that the wars in the Middle East must be wound down and that a relationship with Turkey is critical. The faction that is still focused on the Middle East sees this as a fundamental betrayal of the Kurds. Foreign policy is a ruthless and unsentimental process. The Kurds want to establish a Kurdish nation. The U.S. can’t and doesn’t back that. On occasion, the U.S. will join in a mutually advantageous alliance with the Kurds to achieve certain common goals. But feelings aside, the U.S. has geopolitical interests that sometimes include the Kurds and sometimes don’t – and the same can be said of the Kurds.

At the moment, the issue is not al-Qaida but China and Russia, and Turkey is critical to the U.S. for Russia. The U.S. is critical for Turkey as well, but it cannot simply fall into American arms. It has grown too powerful in the region for that, and it has time to do it right. So Trump’s actions on the Syrian border will result in President Recep Tayyip Erdogan’s visit to Washington and, in due course, a realignment in the region between the global power and the regional power.