Tiananmen 20 Years After

Tomorrow marks the 20th anniversary of the Tiananmen massacre. Who would have guessed the regime responsible for that slaughter would not only still be running China, but also would be more powerful than ever?

British historian Niall Ferguson has a look at Chinese power today. He’s writing not because of Tiananmen (Ferguson doesn’t mention it), but because his book The Ascent of Money: A Financial History of the World is out in paperback, and he wants you to read it. That Ferguson can publish a commentary devoted to China’s power two days before the massacre’s anniversary and leave it unmentioned heavily underlines how Tiananmen memories have faded, to the Communist regime’s benefit.

Ferguson wants us to understand how the current financial crisis, as with several in the past, is producing a tectonic power shift—this one with China supplanting the U.S. as the world’s leading economic power. His facts:

➢ the U.S. economy will contract by 2.8% this year—while China's is forecast to grow by 6%.

➢ The $787 billion U.S. stimulus package has had little impact, with housing prices falling around 20%, year over year. China's $585 billion stimulus is delivering far more, with April fixed investment surging by nearly 34%, net imports of iron ore up by a third, and oil imports rising almost 14%.

➢ In 2006, the U.S. had seven banks in the top 20, including the top two; today it has three, and the biggest, JP Morgan Chase, is 5th. In 2006, China did not have a single bank in the top 20, but today the top three are all Chinese.

Though Ferguson leaves Tiananmen unmentioned, he offers a reason why Chinese might be passive about the Tiananmen massacre, just as they are about China's current economic downturn:

China is imbued with a remarkable sense of patriotism that is not just a product of Communist Party propaganda. People are proud of their country's economic miracle over the past 30 years. After two wretched centuries, they believe China is on the way back. People whose grandparents survived the Great Leap Forward and whose parents endured the Cultural Revolution can surely cope with a decline in the growth rate from 11% to 6%.

China as #1.