In contrast to the Soviet Union, China’s leaders recognize that strong economic performance is essential to political legitimacy. Like the Soviet Union, however, they are paying through the nose for a few friends, gaining only limited benefits while becoming increasingly entrenched in an unsustainable arms race with the US.When the Soviet Union imploded in 1991, the Communist Party of China (CPC) became obsessed with understanding why. The government think tanks entrusted with this task heaped plenty of blame on Mikhail Gorbachev, the reformist leader who was simply not ruthless enough to hold the Soviet Union together. But Chinese leaders also highlighted other important factors, not all of which China’s leaders seem to be heeding today... But overseeing a faltering economy was hardly the only mistake Soviet leaders made. They were also drawn into a costly and unwinnable arms race with the United States, and fell victim to imperial overreach, throwing money and resources at regimes with little strategic value and long track records of chronic economic mismanagement. As China enters a new “cold war” with the US, the CPC seems to be at risk of repeating the same catastrophic blunders... China spent some $228 billion on its military last year, roughly 150% of the official figure of $151 billion... the issue is not the amount of money China spends on guns per se, but rather the consistent rise in military expenditure, which implies that the country is prepared to engage in a long-term war of attrition with the US. Yet China’s economy is not equipped to generate sufficient resources to support the level of spending that victory on this front would require.If China had a sustainable growth model underpinning a highly efficient economy, it might be able to afford a moderate arms race with the US. But it has neither... China’s growth is likely to continue to decelerate, owing to rapid population aging, high debt levels, maturity mismatches, and the escalating trade war that the US has initiated. All of this will drain the CPC’s limited resources. For example, as the old-age dependency ratio rises, so will health-care and pension costs... while the Chinese economy may be far more efficient than the Soviet economy was, it is nowhere near as efficient as that of the US. The main reason for this is the enduring clout of China’s state-owned enterprises (SOEs), which consume half of the country’s total bank credit, but contribute only 20% of value-added and employment... the CPC is that SOEs play a vital role in sustaining one-party rule, as they are used both to reward loyalists and to facilitate government intervention on behalf of official macroeconomic targets... Dismantling these bloated and inefficient firms would thus amount to political suicide. Yet protecting them may merely delay the inevitable, because the longer they are allowed to suck scarce resources out of the economy, the more unaffordable an arms race with the US will become – and the greater the challenge to the CPC’s authority will become... The second lesson that China’s leaders have failed to appreciate adequately is the need to avoid imperial overreach. About a decade ago, with massive trade surpluses bringing in a surfeit of hard currency, the Chinese government began to take on costly overseas commitments and subsidize deadbeat “allies.”.. Exhibit A is the much-touted Belt and Road Initiative (BRI), a $1 trillion program focused on the debt-financed construction of infrastructure in developing countries... An even more egregious example of imperial overreach is China’s generous aid to countries – from Cambodia to Venezuela to Russia – that offer little in return... from 2000 to 2014, Cambodia, Cameroon, Côte d’Ivoire, Cuba, Ethiopia, and Zimbabwe together received $24.4 billion in Chinese grants or heavily subsidized loans. Over the same period, Angola, Laos, Pakistan, Russia, Turkmenistan, and Venezuela received $98.2 billion... Like the Soviet Union, China is paying through the nose for a few friends, gaining only limited benefits while becoming increasingly entrenched in an unsustainable arms race. The Sino-American Cold War has barely started, yet China is already on track to lose.
Political Divisions in 2016 and Beyond
Tensions Between and Within the Two Parties
One way to understand the 2016 election, then, is to note that by making questions of national identity more salient, Donald Trump succeeded in winning over “populists” (socially conservative, economically liberal voters) who had previously voted for Democrats.
.. Trump’s candidacy has brought more economic liberals into the Republican Party, moving the party’s center of gravity on these issues to the left. Trump has also moved the party to a much more nativist position on questions of national identity.
.. The View That Politics is a Rigged Game
- Elections today don’t matter; things stay the same no matter who we vote in.
- People like me don’t have any say in what the government does.
- Elites in this country don’t understand the problems I am facing.
.. The Importance of Social Security/Medicare
- How important is Social Security to the respondent?
- How important is Medicare to the respondent?
Attitudes on Foreign Trade A battery of questions on the costs/benefits of free trade.
Attitudes On Gender Roles A battery of questions on the role of women in society.
Pride in America
- How proud are you of America’s history?
- I would rather be a citizen of America than any other country in the world.
The Perception That “People Like Me” Are Losing Ground
- Life in America today for people like me is worse compared to 50 years ago.
- In America, the values and culture of people like me are becoming rarer and less accepted.
Attitudes Toward African-Americans A battery of racial resentment questions toward African-Americans.
Feelings Toward Muslims
- Favoring or opposing temporarily banning Muslims from other countries from entering
- the U.S.
- Feeling thermometer rating toward Muslims.
Attitudes on Immigration
- Whether illegal immigrants contribute to American society/are a drain.
- Favoring or opposing a legal way for illegal immigrants already in the United States to
- become U.S. citizens.
- Whether it should be easier/harder for foreigners to immigrate to the U.S. legally than it is
Attitudes on Moral Issues
- View on abortion.
- View on gay marriage.
- View on transgender bathrooms.
Attitudes on Economic Inequality
- Whether our economic system is biased in favor of the wealthiest Americans.
- Whether we should raise taxes on the wealthy.
- Whether distribution of money and wealth in this country is fair.
Attitudes Toward Government Intervention
- Whether we need a strong government to handle complex economic problems.
- Whether there is too much/too little regulation of business by the government.
.. Divides get much wider as we move toward questions of race and national identity. Trump voters have more negative attitudes than Clinton supporters about African-Americans, are much less supportive of immigration, and have much more negative feelings toward Muslims.
.. To summarize, supporters of Clinton and Trump are very polarized on identity and moral issues. Views on economic issues are more of a mix. Both candidates’ supporters are generally supportive of the social safety net, and somewhat concerned about trade. Yet they diverge very much on how concerned they are about inequality, and how actively they want to see government regulate business and intervene in the economy.
.. The data suggest that the main divide within the Democratic Party electorate is about attitudes toward the establishment and the existing order than it is about specific issue positions (with the exception of trade policy).
.. For the most part, Trump and Cruz supporters look fairly similar, though Cruz supporters are considerably more conservative on moral issues, and notably less concerned about inequality and the social safety net, and more pro-free trade. In other words, Cruz voters were more likely to fit the description of traditional
.. For the most part, Kasich supporters are the true moderates, caught in between the two parties on almost every issue, both economic and social. Kasich supporters come closest to Democrats on their feelings about immigration and about Muslims specifically.
.. Looking at the correlates of candidate favorability, we can more clearly see the potential divide in the Democratic Party. Again, it is more about disaffection than issue positions. The strongest predictor of Sanders support (holding all else constant) is a sense that the system is rigged. Clinton’s biggest boosters, by contrast, are more comfortable with the system as is, are less likely to see things getting worse, and are generally prouder about America. They are also more supportive of free trade. Interestingly, support for Muslims is noticeably more highly correlated with support for Clinton than for Sanders. This is somewhat surprising.
.. Still, to the extent that many of these divisions are establishment/antiestablishment divisions, they are somewhat muted by Democrats now being the opposition party. By contrast, had Hillary Clinton become president, these disagreements might have widened, since governing requires the kind of compromise and incrementalism that would be most likely to drive the Sanders wing of the party into rebellion.
.. we can see that Trump’s biggest enthusiasts within the party are Republicans who hold the most anti-immigration and anti-Muslim views, demonstrate the most racial resentment, and are most likely to view Social Security and Medicare as important.
.. By contrast, the strongest predictor of support for Ted Cruz is a set of strongly conservative views on moral issues, and somewhat pro-free trade views.
.. Notably, among Trump supporters, the age gap is nonexistent on resentment toward African-Americans, and very small on immigration. There is a wider gap on feeling toward Muslims, with old Trump voters being more anti-Muslim.
.. The widest within party variation by age cohort is within the Democratic Party on the indexes measuring pride in America and the perception that “people like me” are losing ground. Younger Democrats are both the most optimistic about their own future, but the least enthusiastic about America. To the extent that politics is increasingly organized around a conflict over ethnonationalism versus multicultural cosmopolitanism, the vanguard of this struggle is younger Clinton voters opposed to older Trump voters.
.. In both parties, this donor class is both more conservative on economic issues and more liberal on social issues, as compared to the rest of the party. However, there is a slight but notable asymmetry between the two parties on identity issues. Among Democrats, the donor class is notably to the left of the working class on these issues.
.. Already, we saw that in 2016, many of the party switchers appear to have been motivated by identity issues.
.. What Divides The Parties Now?
The parties are divided on both social/identity and economic issues, but more so on identity issues. The gaps between the Clinton and Trump voters on questions of racial resentment, immigration, attitudes toward Muslims, and moral issues are consistently wide. There is very little overlap between the two camps on these issues.
.. By contrast, although the parties are divided on economic issues, there is more overlap. Particularly in the Republican Party, there are a wide range of views on economic issues, now that the party has expanded to include more and more populists who were formerly Democrats.
.. Many of the Romney voters who supported Clinton did so because they were uncomfortable with Trump’s far-right positions on immigration and other identity issues.
.. Early indications suggest that Trump was serious about his ethnonationalist agenda, which will keep identity issues, especially immigration, at the center of our politics. If this happens, it may put pressure on the remaining pro-immigration Republicans and the remaining anti-immigration Democrats (some remain in both camps), further realigning the parties.
.. Democrats may also be pressured to move further left on these issues, given that both younger voters and the party’s donor class are quite far to the left on identity issues. If so, American politics would become further polarized along questions of culture and identity.
.. Since Republicans have picked up more economically liberal voters (and may continue to do so since there are still some populists who vote for Democrats), it may be harder for Republicans to continue to push a traditional conservative free-market agenda. If so, this would leave conservatives with little place to go. Democrats might move right a little bit on economic issues, but they are limited by where their voters are on the issue. In addition, a move rightward might activate more of the anti-establishment sentiment that could potentially cause a rift in the Democratic Party.