Keyu Jin - China: Beyond Socialism and Capitalism

e okay all right oh this is so exciting hi everybody uh welcome I'm trying to find the right the best place to say it welcome everybody to the Westminster Town Hall Forum my name is tame danger I'm director of The Forum very excited to have you all here we have a wonderful presentation today by world-renowned economist kug Jin uh which is going to start in a little bit but we are going to open with some music um gaw Hong who has been at the Forum before we're very excited to have her back yes she she has performed all over the world in Solo concerts with symphony orchestras with artists from many different musical genres she has won a soral medallion in recording a Sally award six gold medals from the Global Music Awards and new numerous commissions with various musical organizations uh she studied at Beijing Central conservatory and now teaches at Carlton college and that I bring that up because she brought several of her students with her here her today her here today and I actually wanted to just have each of them introduce themselves and what they're playing today so hi hello hello my Emma and I play the hul which is this instrument very cool thank you very much and you are hi my name is Amy and I play the D or the Bamboo Flute very cool and oh great you got a mic perfect hi my name is Eden and I played the Chinese also known as Chinese ether all right well this is fantastic we're going to learn more about these different instruments and the pieces that we'll here but for now one more time please a round of applause uh for this amazing ensemble good morning everyone thank you so so much for having us and it's such a great honor to be here uh to share with amazing uh Professor Jing's lecture so we're very honored to be here the first piece we're going to play is called uh uh Y which means fisherman song it's um Emma is going to play Hulu is made of a gourd is from a this music is from a yunan pince is a very sooning music I hope you like it [Music] [Applause] [Music] [Applause] [Music] [Applause] [Music] for [Music] [Music] n for [Music] [Music] m [Music] [Applause] [Music] e e [Music] [Applause] [Music] [Applause] [Music] [Applause] [Music] [Applause] [Music] [Applause] [Music] [Applause] [Music] [Applause] beautiful job Emma the next one is going to play the Guang Guang is a 21 string uh Chinese zisser um she's going to play called Jas FL our enjoy [Music] [Music] oh [Music] [Applause] [Music] for [Music] [Applause] thank you Yen was beautiful thank you so now yeah give her a big PR so now we're going to introduce the Chinese bamboo flute this a a flute made of bamboo and in is going to play a piece called yin which mean the bird singing in the woods you can hear all kindful birds now let's enjoy [Music] a [Music] [Music] [Music] n [Music] [Laughter] [Music] [Applause] [Music] [Applause] [Music] [Applause] [Music] [Music] [Applause] [Music] the I [Music] [Applause] [Music] [Applause] [Music] [Applause] [Music] [Applause] [Music] f the [Applause] [Applause] [Laughter] a [Music] [Music] [Applause] beautiful job Amy so beautiful isn't that what sounds like a birds there right many birds there good job so the next one I will introduces the Chinese PE I think I see some my good friends here old friends many Chinese friends has been knowing for 30 years being here I've been here for 30 years okay raise your hand you haven't seen the people before in person wow I'm very proud of a Minesota usually when I ask people how many people like 100% everybody never see that but I I'm so um honored to be here to represent the people if you already know and be with me um because I have this uh story 30 years ago I came to this country I had tour in 10 cities including New York City Cleveland Pittsburgh why was in Denver then they were announcing please come to see the Chinese woman play the peip after five minutes somebody called the presenter how could this Chinese woman play the peep pod they saw I was a play the vegetable I wish I could that way I could have I would be a very rich I can know how to play it um since then I have been doesn't matter where I go I go to elementary kid elementary school or I go play with the symphony orchestra I always first introduce what pea is so now I will show you the PE is very different from the guitar so since I don't have the mic with stand I will just yell hope everybody can hear me so the PE is pluged not like the guitar when you play guitar you plug the inside like this right so I will show you that's how you play the [Music] [Applause] guitar thank you okay that's our uh University Min the China Center Director my good friend she knows that so when you see that when you play the guitar you do like this but the Chinese people play Upside away you plug towards outside can we everybody try how to play the PE start the index finger you flip out index finger middle finger ring finger Pinky and thumb like this 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 [Music] 5 that's how you play the PE thank you then uh Chinese music always tell you story I can imited the sound like a flowing water [Music] [Applause] [Music] or I can make sounds like a bubly water or I can make sounds like a Chinese gum Chinese simple I mean chaa cha drum all sounds together like a percussion band did you hear or I can make a fireworks fire clock or Canon shot or blow wind or horse trotting listen carefully I will play the horse trotting and the melody at the same time [Music] did you hear the horse sh yeah thank you at this time we hear so many geese in our backyard so Chinese people always like imited nature now I will try to the geese trying to talk to each [Laughter] [Applause] [Music] other or I can imitate the Chinese people talking how are you nice to meet [Music] you then I just heard your laughing ha listen I can imitate The Laughing okay thank you so much thank you so much give a big appuse for John thank you so now I'm going to play a piece how the Chinese music combining with the sound and the uh uh sound fact so this piece called the dragon B because I always introduce this piece for the people who never hear the piece because in the beginning you can hear the drum sounds like [Laughter] this see you can hear that and you can hear fire cck then you can hear the Water behind the boat sounds like this right then you can hear percussion band because on the boats not just who can get there first they also competing um to keep the feet together so they have a percussion band then you can hear two medes three medes or four Med each from different vage one from some one from Minneapolis one from Northville so you can hear the melody is the people singing in the middle part you can hear people cheering in Chinese cheering let's go s PA Go Minneapolis here sounds like one person solo then they follow everybody start screaming listen [Music] this right and they that everybody squammy so in the end they're very happy go home here is Dragon Ball Long TR [Applause] [Laughter] [Applause] [Laughter] [Applause] [Laughter] [Applause] [Laughter] [Applause] [Music] [Laughter] [Music] [Applause] [Applause] [Music] [Laughter] [Applause] [Applause] [Music] [Applause] [Applause] [Music] [Applause] [Laughter] [Music] [Applause] [Music] [Applause] [Laughter] [Music] [Applause] [Music] [Applause] [Music] [Applause] [Music] [Applause] [Music] [Applause] [Music] [Applause] C so I um I'm so I'm sincerely thanks everyone to be here and invited us for uh Professor Jean's amazing talk thank you so much for having us including us so I wanted to uh um uh introduce um not last the time to say and Emma and Amy and Eden to uh join me so the last piece we'll go play is so it means uh from Southern China when they celebrate they just dance so it's very short it's kind of like our goodbye and have a wonderful lecture have a wonderful day here is the [Music] oh [Music] [Applause] [Music] [Applause] [Music] [Applause] wonderful thank you to these incredible musicians for offering your gifts with us today hello and welcome I am Megan Gage fin I serve here at Westminster as senior associate pastor and it is good to be together with you today welcome to Westminster Presbyterian Church especially if you are newer or visiting or newer to The Forum where West the Westminster Town Hall Forum has had its home here in the church since 1980 we're grateful that you're here please take the time to enjoy the program a after the program to enjoy our spaces including the gallery where you'll find all sorts of beautiful art to enliven your spirit there's a brand new exhibit that is just open featuring The Art and sculpture of Paul T grandland and of course please meet in Westminster Hall after the program for Breads and spreads and uh further conversation thank you now and would you please join me in welcoming the forum's director T danger okay hi hello everyone um again my name is Tain danger I am director of The Forum that ring is a good reminder that now is a good time to silence your cell phones for this program that we are about to have um I'm so glad that you all are here the Westminster forums mission is to invite voices of conscience to address the issues of the day from an ethical perspective and today we have someone who is absolutely fantastic to help us do that one of the world's foremost economists and uh experts on China Dr KU Jin we're very glad today's program like all Town Hall forums are entirely free and open to all if you've never been here before as uh Megan Gage Finn said we've been doing this since 1980 and we do do about 8 to 10 programs a year they're all like this where you can just come and enjoy and learn uh entirely free here in person via live stream and that is all made possible by individual donors and supporters so if you haven't or you are considering it please uh think about supporting the town hall Forum I am not exaggerating when I say it is literally the only way that we can do programs like this 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The Forum started a program called The Ark towards Justice where we invited a national voice on racial Justice to come and speak about where we have come in that time and where we still need to go and we are continuing that this year for our fourth annual Arc towards Justice program May 23rd Thursday May 23rd and our speaker this year is Wesley Lowry a poit Sur prise winning journalist and the auth author of the book American whitelash a changing nation and the cost of progress that book tells the story of how the election of the nation's first black president ignited a new and frightening phase in a historical cycle of racial progress followed by backlash uh it has been called one of the best books of the Year by national public radio it was a New York Times bestseller and ibram X kendi talked about it as being an indis ible reading so we really hope you will join us for our fourth annual Arc towards Justice with Wesley Lowry Thursday May 23rd all right our thanks today to ma mortensson companies for co-sponsoring our entire spring season here at the Forum uh we are very grateful for their generous support of what we do thanks as well to our media co-sponsors and we have several of them and you saw a lot of them if you're here in the in the hall they're great so our longtime Partners at Minnesota Public Radio who record and broadcast all of the Westminster Town Hall forums uh in fact all of this Spring's Westminster forums are going to be broadcast uh on Minnesota Public Radio over the noon hour one each day the last week of May so if you missed any of our programs want to hear them again invite someone else to listen Mark that last week in May as you'll be able to hear those broadcasts Statewide and anywhere in the world uh on MPR thanks as well to mpost a nonprofit community supported Newsroom you can see their coverage of critical issues challenges and opportunities facing Minnesota at mpost decom they are also outside so go say hello to them uh after the program and to Sahan Journal whose mission is to provide reliable highquality journalism for immigrants and communities of color in Minnesota you can learn more about them at Sahan journal.com and again visit them out in the lobby okay uh one other uh short note we uh we have a program right after we're done here today if you are inspired you are thinking a lot as I am guessing you will be because our speaker is amazing uh we are going to have an opportunity for you to continue this conversation immediately following the program so our friends from Global Minnesota are here and they are actually going to facilitate a post Forum small group discussions in the misel room you don't need to sign up ahead of time you don't need to register you can just uh go out to the misel room which is sort of straight back this way uh there'll be signs pointing you in the right direction and join some of the other attendees in discussing what we've heard for today also following the program copies uh of Dr jyn's book uh are going to be for sale from next chapter books right outside and so again grab a copy of the book and she's going to be signing those uh right afterwards so uh last thing if you're here there are cards in your program and those are what we use for you to ask questions so if you want to ask a question if you're inspired at any point write it down on the card in front of you and during the sort of halfway point our ushers will come around and pick those up and the second half of the program is all your questions for Dr jyn so with that I am going to introduce our speaker so one more time this is the Westminster Town Hall Forum my name is taine danger and our speaker today is Dr KU Jinn she is a tenured professor of Economics at the London School of economics and political science she was born and raised in Beijing and attended high school and college in the United States she holds a ba an Ma and a PhD in economics all from Harvard University her most recent book is the new China Playbook Beyond socialism and capitalism which is going to inform much of what we'll hear from her about today Dr jyn is an academic member of the China Finance 40 group and has worked with the World Bank the IMF the China banking Regulatory Commission and more she's a non-executive board member of the conglomerate richmont and she resides with her family for part of the year in London and part of the year in Beijing we are so glad to have her here and I hope you will join me in doing a big warm welcome to the Westminster forum for Dr KU Jin thank you thank you thank you thank you so much I am so happy and so thrilled to be to be here in 1997 I moved to America I was 14 I Was Alone um I arrived at the doorsteps of an American Family who actually took me in they thought I was only staying for a week during an exchange program and I stayed for three years um just months before I arrived I was a proud member of the party youth league in China I was studying Marxist economic and political thought in school and it never occurred to me nor to my friends that there was something called fun plans on a Friday night and of course that all changed when I got here to this country I was genuinely mesmerized by the openness um by the freeth thinking and I was a little shocked to be encouraged by my history teacher to question authority textbooks teacher and even facts woo what a foreign concept um and I was surprised to learn that in school life there was something actually more important than grades and the China I knew from back home exuberant Dynamic ever changing so fast was so different from the China that uh Americans had in mind when they asked me questions when I got there as if it was kind of a dark place of Terror and that contrast in perspective really stuck with me ever since now thinking back this little story of mine I think really embodies a lot of the differences um the misunderstandings potentially the cultural gaps that we have between the two countries us and China and that's why I wanted to share it with you today now I wrote this book that was published last year the New China Playbook and trying to explain how China actually works how it has come come to foster a really unique model uh that goes beyond conventional Socialism or capitalism and also how China has a new generation of Chinese radically different from the older generations and they're going to change the face of China so my goal was to hopefully give a perspective from the inside Based on data facts and a huge amount of wonderful serious scholarly works that has been done on the Chinese economy by International scholar over the years and most of all rise above the emotions and sensationalism and the News cycle and so I wanted to tell a different side of the story and there is always a different side of the story and given how tense things have become between the two countries us and China I think it is important to tell that story uh so allow me to offer you a different perspective and lens to look through uh in the next hour so people ask me often what are the biggest misunderstandings about China now one of it is actually how the model works now 30 million private companies sprung out from nowhere like mushrooms spring up from a desert in so little time 20 years uh in the beginning stages and beginning ages of 1980s it was China was a thoroughly anti- capitalistic uh economy and suddenly 30 million out of nowhere we tend to think of China's system as being extremely centralized as if everything is decisions are made on the top by a few people maybe even one person but that's not quite accurate politically it's very centralized but economically it's extremely decentralized decisions implementation um uh are all made on the ground decided by local officials who actually go about helping private entrepreneurs to succeed in my book I call this the mayor economy local provincial leaders I mean they could be Mayors they could be party uh uh secretaries in charge of turning backward fishing villages into global technology hubs like Shenzhen and that's what they did I don't know what we expect our Mayors to do for us in this country but in China that was their mandate it was to help growth it was to implement these radical reforms it was to help protect the environment to to Really encourage the private entrepreneurs to build um uh something uh new and So currently even fast for many years today they're running around all over country uh all over the country building Min silicon valleys helping private entrepreneurs find Talent coordinate financing build a whole industrial clutter around key companies like EVS or semiconductors the shanghainese government actually gave money and cheap land to Tesla hoping that they would build factories and sell um cars there Chinese local governments giving subsidizing American companies in China people were fine with that they liked it they bought Tesla cars they're all over the streets of China today and so a lot of people don't understand what what are the incentives Behind These Mayors you know the decentralized economy that they would want to do this uh for the private entrepreneurs and help the economy well that comes back to some pretty unique institutional features in China so to be promoted to the higher runs of the political hierarchy and everybody wanted to be promoted um you needed to do a good job for the local economy and on top of that by doing that you got more jobs filled your fiscal coffers um and the land you own which the local governments own are actually worth more and most of all you needed the private Entre to help you right we usually think about China as if the state kind of suppresses the private or surprises no actually it's quite the opposite they need the private entrepreneurs because they're the most productive and they're the most Innovative so there were huge incentives and on top of that there was a lot of competition across the regions in China it was like a beauty contest you know contesting for the best and promising entrepreneurs and you had to be friendly to them you had to be nice to them you had to be helpful so in the data we see that the clean friendliest uh local governments saw the fastest growth and the rise of the largest companies and those that were more corrupt more extractive they lost out so there's an incentive to behave to actually lend a helping hand rather than a grabbing hand which some might expect in a country with a poor rule of law or too much political power concentrated in the hands of too few would have been uh very difficult but that was uh what the Mayors did and you didn't need every mayor to be like that you know China's a big country there are tens of thousands of local governments and many of them were corrupt and money went into their pockets but the majority were incentivized and that was enough to lead to this seesmic change at Breakneck uh Pace now leaving aside what we think about China and their problems they challenges their challenges were the model we're seeing the economy slow down at a significant Pace today uh it is still a fact that it is the country that has been growing the fastest for the longest period of time in all of human history and that is a fact so something has must have gone right now this comes to a broader point and a more contested point which is what do we actually think about the role of the state now I'm a western trained Economist I can tell you in our models in our intellectual thinking framework there's very little room for the state except for maybe regulations maybe stepping in when there are market failures but I can also understand culturally and historically why we feel so uneasy about State interventions and we've also seen the state overreaching and being too heavy-handed of course and these are problems but sitting around many of these meetings with politicians leaders experts talking about development and developing countries a perennial thing that comes up is not enough State capacity Emerging Markets need to double their infrastructure in the next few years not enough State coordination not enough uh investment that's a fact as well and China didn't have that problem China actually had the opposite problem too much infrastructure which was also wasteful it was inefficient but it was still a better problem to have than to not have enough connectivity to unleash people's productivity on balance now for all of its expedience the model has serious challenges it's being tested it's much less effective Now growth is slowing down huge amounts of debt 140 million vacant homes to be filled and who knows how many years there's too much capacity too much Supply not enough demand the financial system is really a living dinosaur too little credit for the small mediumsized Enterprises and that's the other side of this high growth high cost model it was costly there were waste but to the Chinese on net the benefits still outweighed the cost because a billion people were lifted out of poverty and even today it's the first time that you have a developing country being able to do things like Cutting Edge technology and Des despite the problems and I'm sure there'll be many questions about Chinese economies today and I'll share with you my muse I still think it's too early to write China off this country this very country the us we've had 12 recessions in the last century it took more than 10 years to recover from the Great Recession of 2009 China is currently experiencing its first serious economic IC recession uh in the last 40 years the potential is still there there's a vast majority of people underemployed undereducated in the rural areas and even just between China where China is today and its potential whether it's in terms of urban urbanization tertiary education the service sector productivity there's a big gap still yet to be filled and again even in this country we've seen over time that poor states converged to the Richer States it's in the data and it's also going to happen to China so there's still room for growth now the second misunderstanding is about Chinese aspirations some in this country may think that China's sole goal is to overtake the US gez that's a lot of responsibilities in the world no thank you um and no not feasible the daily preoccupation of the vast majority of Chinese today is still about putting food on their table and keeping their kids in school not really having a dangerous Obsession about America really it doesn't believe that worrying about America is actually going to solve its own problems and the government needs to keep its own house in order there's a lot of domestic challenges and by the way talking about aspiration and we have an ethical theme in this uh series of talks we're going to have to accept that there will be similar aspirations from India Indonesia Vietnam the entire African continent they are rising they have huge aspirations to Pedal their way to prosperity and we'll have to need to deal with that too they're going to start selling cheap Goods to China use its technology ology and by the way some of that is already happening as factories are moving to Southeast Asia on mass the Chinese don't really have much time to talk about the Vietnamese stealing their jobs we don't really hear about it in the newspapers instead what they hear about is they should invest more in smart Manufacturing in up tooling upskilling uh their workers climbing up the value chain so they're not forever stuck and condemned to produce ing cheap Goods climbing up the global value chain is what they're focused on and maybe it's also another cultural thing to do and again culture and history is something it's a theme in my book I like to talk about it a little bit because I do think we kind of sometimes underestimate how important uh they are and that contributes to some of the misunderstandings um but it's a cultural thing to do in China to turn a crisis into motivation now speaking of President Biden's export controls on uh semiconductors or you know kind of asking companies to break off ties with China to stop selling to them well initially it didn't go down that well uh in in China um but then they kind of just turned it into a positive attitude it totally mobilized everybody they whipped companies into shape for the longest time they were actually comfortably importing American uh chips and now all of a sudden they have to start buying Chinese Chips and not because the Chinese government forced them to but rather it's because of um these policies from America so and in fact they said well thank you thank you for keeping us on our toes there were huge accelerations in these domestic Industries and there was almost a national Euphoria when they made breakthroughs in the chip industry small victories but still small triumphs and the Chinese people were pretty happy they turned this around and said oh this is pretty positive and by the way President Biden would you mind also sanctioning our national men's soccer team too but thank you jokes aside um to look at to the rise of African India does China want to see that as a threat or opportunity I actually really think they see it as an opportunity and that rest of the world is is coming 90% of the people in the world still live in the developing countries and they too have that kind of aspirations um and third finally the Chinese people the misunderstandings and the new generation that's actually what I enjoy talking about the most uh it's what gives me the most hope that we are going to do much better with a new generation and that we're not actually headed on a collision course the new generation born after the one child policy in the 1980s I was among the first generation I have lots of thought thought about I've done lots of research about it um it's a fascinating topic uh they are radically different from my parents age you know going through huge vicissitudes economic psychological hardships in China during these turbulent times um the new generation they love Leisure consuming spending money on clothes uh traveling entertainment all of that they even like to borrow to spend we used to think about China as a Big saver you know SA saing so much and then flooding the world with capital and products well this generation is different they borrow they spend 85% of the consumer credit is actually accounted for by people under 35 one click on alibaba's you know e-commerce website you can borrow to buy a lipstick that's what college students do I don't know who who pays them back maybe their parents but anyway they they still love to to borrow that the mentality uh has totally shifted and despite what we think about the one child child policy the dark sides there were also some unintended consequences for one it seriously raised the status of Chinese women why because you used to educate your sons first before your daughters and everybody now with a daughter pour all the resource into her the modern Mulan of every family right and we see in the data that the gender gap completely closed in in my generation for uh attainment in higher education and in the data Among The Business Leaders those born in the 1990s 45% of the Business Leaders are women compared to only 6% of those born in the 1970s 60s sorry or 10% for those born in the 1970s so it really accelerated the closing of the gender gap for China and this for very traditional Confucian Society way above what economic growth would have predicted uh in uh uh in in other countries and moreover this is a really open-minded generation I've looked at lots of international surveys about them uh they care about things like diversity animal rights um social inequity they feel more confident uh you know the the kind of factory workers that opted for three uh shifts and night back in those days that's not in that generation they're more relaxed more chill you know it's not a bad thing um they're not going to be working as hard as tenacious but they have a broader you know perspective about life uh in general and also they communicate better many of them have been educated in this country a third of international students in this country are Chinese students and 5 million visitors before the pandemic come to this country they are are fluent with the Western culture the language uh and they would be great ambassadors uh for uh China and they connect much better with the Zen genzies around the world and they are that bridge um and they're also very Innovative now this is again a fact despite what's happening between the two countries I don't know if you noticed but four out of the five the most downloaded apps today are actually Chinese I don't know if it will stay stay stay this way but you know the new generation they have much more they have much less of a cultureal divide and GAP and so let me leave with this thought our great leader D Xing who really pushed the country for reforms and opening up and really was um the forefather of this miracle success used to say about intractable problems and we had many back in those days as well let's leave it to the smarter younger generation to figure it out they're going to they're going to sort it out but at the same time we still need to hold the world together for them to actually give them that chance um I don't think that on top of all the debt that we're going to throw at them or the dirtier planet that we really want to add a more dangerous World on the cusp of uh collapse uh to the mix so it's where places like this forms like this to offer for this exchange uh to get to know each better each other better to uh reduce these misgivings that I think is so so important and it's really in this kind of country that such curiosity and openness for different views can actually take place so I really thank you uh for listening thank you for giving me this uh opportunity and thank you for giving me and so many other students from China from India from Africa to learn from this country and we can also expect that when the next Global financial crisis comes around the corner and I'm certainly it sure it will the two central banks in us and China they're going to have to call each other up right that if there's ever a hope of realizing the green transition we are going to need the cheapest cleanest energy and technology and a whole lot of investment and collaboration uh to make it happen and everybody here is here to stay nobody's really going anywhere uh we're here so let's keep the People to People connection keep the dialogues open have some Goodwill and maybe even just start from small victories and I believe over time even more can be achieved thank [Applause] you thank you so much Dr oh thank you so much this is the Westminster Town Hall Forum coming to you from Westminster Presbyterian Church in Downtown Minneapolis Minnesota my name is t danger Our Guest this afternoon is Economist Dr KU Jinn she is the author of The New China Playbook Beyond socialism and capitalism this is the part of the program a lot of enthusiasm for the book uh this is the part of the program where we open it up for you all to ask questions uh if you're here in the room you've got uh cards in your you've got a card in your program to write your question down and hand it Forward uh and you can hold it up and ushers will come around and grab your cards and we will uh bring those to our table over here and we'll bring as many of them as we can uh while folks are starting to do that write your questions and we'll collect them uh I'm going to take a minute to say thank you uh to some of our sponsors who made this program and many of our happen thanks as I said at the top to Mortenson companies for sponsoring our entire spring season thanks to our longtime Media Partners Minnesota Public Radio for recording and broadcasting all Westminster Town Hall forums thanks as well to mpost a nonprofit community supported Newsroom you can see their coverage of critical issues and challenges and opportunities facing Minnesota at mp.com thanks as well to Sahan Journal their mission is to provide reliable highquality journalism for immigrants and communities of color in Minnesota learn more about them at Sahan journal.com now as I promised at the top Dr jyn will be signing copies of the new China Playbook immediately after the program those are for sale from next chapter books in the lobby so please uh join us back out there we will also have our traditional Breads and Reds over in Westminster Hall which you're invited to and if you want to continue the conversation there is a moderated program uh with global Minnesota in the misel room and you can join other attendees and having a small group where you talk more about what we've heard today and uh reflect and Converse about that so with that I see people waving cards we're already starting to collect some cards up here so I am going to welcome back to the podium uh Dr JY and start bringing the questions from the audience oh thank you perfect all right so so you kind you started to allude to this a little bit in your remarks but the book came out last year A lot has happened in the last year in uh the world and in the Chinese economy in particular we have a real estate sort of uh crisis I think it's fair to say in China that's been happening uh there's been a lot of questions about the Slowdown in growth and there have been some numbers that came out this week that suggest that some of that maybe is coming back but I guess maybe just a way to frame this is if you were to write one more chapter of the book today reflecting on sort of what's been happening over the last year or so since the book came out uh what would you say about the model and how it is holding up now and maybe how it has to change going forward thank you Tay and that's that's a really excellent question important question the model is being tested I in my book I really argue that state coordination State mobilization was really important for a certain stage of development China has reached the stage of development where there needs to be a lot more markets and a lot less State and so that has to change but there's some signs that things are uh changing uh over time but you know we also have to wonder as I alluded to this as well the ups and downs are part of the features of you know economic cycles and one big difference is that this country had something like a $5 trillion stimulus package over the pandemic Chinese households had nothing and there is you know a serious uh loss of confidence and also loss of opportunities so it's going to take time for the economy to recover and by the way China's already massive it's already big so to keep on growing that fast is going to be very difficult India everybody talks about India and India is definitely an exciting place but even if India grows let's say four to five percentage points faster than China until 2030 China is still going to contribute $130 trillion dollar more of GDP to the world uh than India so it's has to have slowed down anyways but look you know I think a broader question is can we have more expertise in the system can the people's preferences be uh uh reflect more in the leadership's decisions that all requires a huge amount of reforms I'm worried what I'm worried about most is when countries get to a certain uh income level and they drop the progrowth agenda and that would be really really sad for China and for the rest of the world too um there's a question here about uh China potentially trying to a strategy to uh take the place uh or at least compete with the us as the world's Monetary Exchange uh and this this could probably get very technical but I'm wondering if you can help kind of Orient us around what that space is in that conversation um China has among its other Ambitions or aspirations um wants to internationalize the R&B you know dollar is very powerful dollar is very very dominant uh and so I think it has the plans but realistically it is still very very far from coming close to that goal of being even really an international currency why very very simply and very briefly you need a financial system like the US breath liquidity size just look at the US treasuries it's not just trade denominated in dollars but the lending is also denominated in dollars and it's very very hard to um replace that but that said again we cannot forget the other part of the world the massive emerging developing World they have a desire for a parallel movement of maybe a common currency maybe an alternative to Dollar I'll be it being very difficult that is a desire in the financial system but it's also very difficult to achieve uh there there's a couple of different questions about uh Hong Kong and about uh Hong Kong's ability to to self-determine but also uh at least one about uh Hong Kong as a Global Financial Center and whether that uh changes as uh it is sort of it's in a different world now where it's become part of mainland China in this way so I'm wondering if you can talk about both of those both uh sort of uh the relationship that we've seen over the last years with China and Hong Kong and then also the financial sort of Center implications of that the fate of Hong Kong and Mainland China are inextricably linked uh if Hong Kong does well it makes China look good and if China's economy does well it would make it would be good for Hong Kong's economy because Hong Kong is the financial center the conduit through which a lot of the capital investment flows and so I recently went to Hong Kong last week uh two weeks ago and they were still pretty optimistic because even though a lot of people left some new people are coming back and they're Reinventing themselves I I'm not an expert on Hong Kong but I do just want to mention one thing and in the spirit of just giving you another side of the story because we're all familiar with one one side of the story um the the Hong Kong people told me that in 2003 SARS arrived in Hong Kong and the Hong Kong economy was completely you know going under at that time Hong Kong asked mainland China can you lift the restrictions so that you can help us with our economy they actually took the initiative uh so that there could be more economic integration between the the two countries many of you have been to Hong Kong most people from most countries will never need a visa to go to Hong Kong guess who needs a Visa Chinese Mainland Chinese need to go get a visa and um just in the spirit of a broader audience the cultural aspects I they they've cut they put up two beautiful museums and gez the artist politically opposite to Chinese government are all hanging there I was very very surprised so I think the the complexity of the issue is not something I have the expertise or the time to talk about but anyways they are kind of really linked together and I still believe the Hong Kong people um have some hope that they'll be able to kind of reinvigorate their economy and their livelihoods uh there's a question here that uh ties together two so you talked about the younger generation uh and this person is wondering what this younger generation thinks of the belt and Road uh initiatives uh and that will probably require a little bit of explanation as to the belt and Road initiatives thank you China also had a vision or you know can say the leadership had a vision in China of building infrastructure around the world and as we mentioned Emerging Markets need infrastructure there's a 1 trillion doll infrastructure Gap every year in the world and you know I just came from the World Bank they were talking about we need infrastructure investment but so China came up with this belt and Road initiative China wanted to put in money they wanted to send construction workers they wanted to do these development projects um that was a good idea in design it was probably not well implemented huge amount of problems uh Emerging Market debt but there's also a lot of misunderstanding and that is also changing by the way just one statistic 90% of the developing Count's debt is held by Western financial institutions and that's just the data it's not really just the Chinese um infrastructure that has uh uh uh kind of cast them in into debt so I have issues I have issues with with the plan and implementation but it was um an idea I don't know what the younger generation uh thinks about it the younger generation obviously Uber connected they think about Innovation they don't think about hard power as much That's the older generation you know the infrastructure the money and all this hard politics they think about softer links and softer power and that's also why I I'm more hopeful for them I mean I think it's fair to say that there is a growing skepticism or or in certain parts in certain sectors of this country in the United States of uh going out into the globe and trying to uh set terms for other countries right like and and we have a long history of doing that but you hear a lot more of people saying is that really our role and I guess maybe that's part of the question do you hear those kinds of debates right now in China about like what is our role not just in how we take care of ourselves but what values do we potentially like impose or ask of other countries that we work with that is a really really great question thank you tame for that I it is it reminds me to say that people in China talk about really different issues and they they worry about different issues partly because is you know they're still they have you developing country have different set of challenges um they want to stay engaged I think it would be a mistake to think about China as wanting to kind of recede from the globe they want to be you know it's all about openness and sending their kids to school internationally and if they can merging the businesses and by the way Starbucks everywhere you know I Le said yes McDonald's that was my gift when I did well in school a Happy Meal um uh uh that was luxury luxury and um you know Estee Lauder that I think American Business have or potentially can do really well in China and they they like that they like to be internationally integrated now just to be serious for a little bit and to be completely honest I do think that Chinese government feels somewhat of an existential threat um of not being able to control their core components like chips or um uh uh core competencies and in that sense they're trying to strive for greater Independence as by the way Japan is spending $500 million on indigenous uh uh Innovation we haven't talked about the chips act science act inflation reduction act Europe is doing the same UK is feeling it's you know falling behind and spending a lot more on compute so we're we're getting that kind of you know a return of you know more needs to be done and I'm not sure it's all that bad because if it does mean Lots more cleaner energy and a faster transition um it has to be managed it's a complex relationship that has to be managed but it's not inconsistent with globalization maybe protection on some areas but more open uh on other areas these are not irreconcilable paradoxes uh there's a question here can you say more about China and intellectual property and particularly the use of potentially of us intellectual property yeah intellectual property protection was very weak for a longest period of time um and the government has really tried uh to at least start the process of cutting down you know theft and putting in a very comprehensive system why it's not just with American companies or German companies Chinese companies are stealing from each other and in order to get Innovation you need to have intellectual property uh protection and now there are many many things that are going into the courts I I've also met with um with lots of you know uh as I mentioned Mayors and they were talking about German multinationals in their city and when there was an inter IP leak how much they you know really try to uh uh change things and and manage things so I think it is also um in the process of becoming more uh uh more uh more serious by the way um maybe this is part of confusion culture but apparently to Chinese stealing books is not a crime um but so they they started teaching people in middle school and Elementary School the importance of respecting other people's intellectual property so I think they're serious but it's going to take some some time uh to make it really happen but it's also actually good for China too uh I we have several questions uh here about uh Taiwan and I I I understand you're an economist this is an Ethics based form so I guess I don't know maybe one way to frame this is trying to take a summary of a bunch of these is there an ethical Way To Think about frame China and Taiwan and the rest of the world that that I think is a critical critical question that concerns China that concerns uh people in this part of the world um as well uh for all the things that we read about in headline news about this assertiveness towards Taiwan I think there's not been enough reporting about let's say the premier Chinese Premier in Davos uh in the world you know facing uh International um that International audience announcing that China will not tolerate conflict and Chaos in the region and I think it's as much of a signal as the Chinese government potentially uh can give I really wouldn't underestimate how peace you know how much peace means to this generation of of Chinese again the one child policy you know everybody has only one child uh think about what that would mean if there was really a conflict um on a more practical level first of all I believe that dialogue exchange you know president she recently said there's nothing we can't talk over you know between the mainland and Taiwan talk things over on a practical level I think that would you know conflict is really the very very bottom of a long list of other options uh to deal with this and I can appreciate and understand uh some of the uncertainties and certainly for me as well for everybody um it is on our mind but I think that you know again just taking a dat a point this is T Taiwanese University lot citations many different surveys among the T Taiwanese 90% of the people prefer status quo 5% prefer Independence and 5% prefer sighting with China and so I think that you know what I'm a little bit also worried about is a lot of these tensions misunderstandings miscalculations could also you know push things in a little bit in the wrong direction but let's hope not well isn't even though then you have to Define what the status quo is which seems like kind of part of the debate that we're having like China has one notion of what the status quo is that in certain ways the Us and other parts of the world disagree with whether Taiwan is part of mainland China or not I think the status quo is just kind of what's going on now implicit understanding that let's just keep us separate and but not not really too separate and uh and not much changing I think that's the yeah so there's a related uh question here about the the geopolitics um and I promise we'll get back to some economics questions but there there is a there is a question here about how we account for China's support of Russia and North Korea and what China's goals would be in those relationships again a you know a very difficult question to to engage with and answer um again let me just give you a different perspective not necessarily something I personally agree or not agree but just give you uh kind of an an angle from from China first of all China shares a border with Russia any country that shares a border with Russia you know needs to manage the relationship um China also doesn't see that a substantially weakened China uh sorry a substantially weaken Russia is good for China from a real politique point of view you know because of the rising tensions between us and China that triangular relationship Russia China America you know for years for history throughout history has always been short-term based I don't believe there's a long-term commitment or real friendship but it is very much about you know a multi-polar world a different different coalitions and whether right or wrong some Chinese believe that of St substantially weaken China would mean that all the attention and focus would be uh on China but at the same time it is very clear and it's part of this five principles that foreign invasion is not something they support and so um I think on the other hand uh you know the Ukrainian issue is something that they also openly acknowledge as being very difficult but um uh uh so I think it's that that thing that they have to Grapple with that I know obviously Al also confuses uh other parts of the world okay I promise an economics question uh give it this is a good question I think so given your description of China as a market-driven economy in what ways is it still communist thank you for that question I don't really know if there is any uh communist part of aspect of it but you know when I say Beyond socialism and capitalism conventionally defined I'm talking about a pretty unique balance between um industry and state state coordination and Market mechanisms individualism and communalism and so China has decided that it's going to be on one part of that Spectrum now America might be totally you know on the one end of free markets China be might be some somewhere in between but there's not just one model and so I don't think it's necessarily communism but you know how much of State coordination State role State uh uh uh intervention is allowed and as I mentioned to you before personally I think that China has come to an age where it needs a lot more markets and a lot less uh State [Music] um there's a there's a couple question questions here about G uh president xiin ping uh about his extended presidential terms about some of his uh work in the world and I would love for you to comment on those and I might also ask with that should we think about xiin Ping's uh economic like understanding of the world what he's trying to do as something new and different is he trying to do something different as the leader of China than previous leaders have done are we in a different chapter under xiin ping um certainly things feel like they have changed uh and if you ask uh you know the younger generation do we want a Freer and more open Society I'm I'm sure their answer would be yes I'm sure the people would want that but you know they look at Western democracies and what's been happening around the world democracies that's been introduced to some of the native soil you know in honesty I don't think they're that convinced that that is actually the answer to some of their own problems as well in other words they're not also seeing um that much inspiration in some of these things but certainly the society has has become more controlled and um yes the leadership has a somewhat different agenda now again not all of this is new we we had the same arguments here in this country in in Europe about big Tech about monopolies about you know consumer production of data um um I think that the leaderships in China uh they they are skeptical of this deeply entrenched link between politics and capital they don't think that c politics should be sing to the tunes of capital they think Capital should be sing to the tunes of of politics and so invariably there is a somewhat different agenda uh and you know while some of it is is is it's it's understandable you know we talked about the one child policy generation the parents are so anxious about the education system the competition and uh all these tutorial companies and so the leadership did something and it wasn't great it didn't do good for the stock market and investment um but it's it's not that uh it's not that difficult to understand that there are things to be concerned but my own view you know China can't give up the progrowth agenda it's way too early these are things to be considered but to think about but you need experts you need to rely on experts to give you the sound counsel and advice on how to do things how to bring about more growth and more inclusive growth it's not just by going after companies or regulations that are erratic that's going to deliver that but I think the broader agenda of more Equity is not uniquely a Chinese thing uh switching to leaders in this country uh just this week President Biden has uh recommended that if he were reelected he would increase Steel tariffs on steel coming from China uh former president Trump has offered to raise tariffs on almost everything uh this is almost like an economics 101 can you just sort of talk about tariff policy and like if those came to pass what would happen in this country what would happen in China what would that actually mean um there's been a lot of studies in America serious studies that show that the last round of tariffs were paid by Americans and that was a fact and that increased the prices that's going to add to inflationary pressure but still leaving those studies aside and there's a really broad consensus among the economists that's been uh the case you know we're going to see this because of a political uh issue you know I think about Chinese roads German cars Japanese cars American cars the predominantly foreign cars running uh on the streets of China and China can now do EVS it can't do its own combustion uh vehicles but it can do pretty good EVS pretty cheap pretty high quality but they're going to meet with a lot of resistance if they try to go into Europe and certainly I highly doubt they will be able to come here so then I think about okay what happens if Chinese start to say Well if you know you're going to slap on tariffs on EVS shouldn't we slap on even more tariffs on German cars and American cars and I think this is not we're not heading the right direction it's a lot of protectionism under the guise of National Security but this is you know not the really the the good direction that we we we should all head so it's going to raise some retaliatory efforts but the Chinese thinking is look you know we're expecting this anyways it doesn't matter if it's trump it doesn't matter if it's Biden it's kind of all just going to be like that so um they're just going to have to keep going it maybe they'll work with more uh Global uh partners and by the way in the data what do we see about trade yes there's less direct trade between China and the us but they're all going through Mexico and Vietnam it's is taking longer and it's more expensive uh and Chinese money you know guess who's funding the factories in Vietnam Chinese Capital Chinese investment in Mexico has risen eight times it's just taking a longer route why because ultimately the ultimate supply and demand are still coming from the two largest countries L largest economies in the world and even if they try to you know kind of break up in direct terms they're still deeply embedded indirectly through these links through other countries uh one more audience question here at least it says could you discuss the potential effects of uh the Chinese demographic transition and how that might affect the Chinese economy uh and political development over the next Generation thank you and that's that's a really excellent question because people are really worried about China's aging and it's because the one child policy people don't really want to have kids anymore and that is seen to be be a serious challenge uh for for the Chinese government my own view is there's something actually even more urgent than that and that is the big deep skill and education mismatch and by the way this is not an uniquely Chinese uh problem as well there have been a 100 million additional college graduates in the last 10 to 15 years there's massive youth unemployment right now but in manufacturing there's 25 million vacant Jobs still needing to be filled there's like 300,000 Talent Gap in semiconductors and so many more it's not just being educated that's important right we're pouring so much into education but it's about the right kind of education giving them the right kind of skills the tools to adapt to this new age where Ai and you know supercomputing and all that new tech crop of Technology you need technical workers you need vacational vocational workers and so that is a much more urgent problem than the potential reduction in labor force in so many years and by the way China is one of the biggest exports of industrial robots they uh if they wanted to substitute robots for the labor force uh that is something they can do so I think before the Aging problem they need to take care of their young people uh actually as long as we're talking about young people there's another question here about uh the educational system uh and this is sort of just can you talk a little bit about how it works how much of it is state funded how much of it is individual families uh is higher education available to all excellent um so education used to be free uh or at least uh come at a very very low cost and uh but that all changed after the one child policy why because you have only one child dragon or Phoenix you really wanted to invest in that one one child that you have and so they started paying huge exorbitant sums for tutorials outside tutorials and I can't say thanks to the capitalist system um not a lot of a lot of these companies actually exploited that angst from parents and so uh it was really exorbitant uh on average in the data people spent a quarter of their income on educating one child so that was really causing all that anxiety uh in in the country and hence our leaders came in to step in and again you know maybe potentially wreaking havoc in the economy but it was it was for social reasons that uh that it happened the education system I believe is a challenge it's a challenge for China's goal of becoming a real innovator a real kind of um doing groundbreak in Innovation because uh we have we are judged based on standardized testing but I've been thinking well with a country with that many people you can't have an American System you know applications think about how much corruption there will be uh and you know this is actually the standard test testing is really the only way that the very bottom run of society those in the poor areas actually had a chance uh uh for a better life and that's all and it's not perfect um so I think um it is a big problem it is very hard to change our last speaker who is here Caris swisser is a tech journalist and she's talked a little bit about a Tik Tock band that's in front of Congress and about some of these social media pieces uh I am just curi if you were you know called to testify and talk about what the whether the US should be concerned about something like Tik Tok or social media ownership by a Chinese company or whether that's overblown just what would you say wow jez tough questions by the way I wasn't I got a really warm welcome yesterday so I I need to answer some of glad you're here these questions I guess um you know data is becoming a national security concern all around the world and and so I I understand that but at the same time from what I know and I don't know that much Tik Tok has done everything it can in terms of having Oracle manage some of its data and putting the data and keeping in the US I don't know if there's more uh that can be done um but look you know this is America right it's not China why does America want to look more and more like China and so you know the kind of principles we uphold in this economy the free markets I understand they're National Security issues but uh it's also really difficult to compare what would happen uh between the two two countries you know Tesla also so some people are saying EVS are of National Security concerns because the data right I don't think we should not we should ban Tesla that would be a huge you know disappointment for Chinese people and I don't think we're going to do that um so I I do think though that more and more countries are going to use this National Security as an excuse to do lots of protectionist things we just got to keep it really pretty narrow otherwise it's going to spread out throughout um all kinds of goods and then this can kind of get go out of hand so we've talked about a lot of things uh geopolitics a lot of big economics things uh things that are in front of Congress and different governments around the world and I can imagine people being like this is all very interesting but like what do I do with this and so I am curious maybe just as a a way to end if if you would have anything that you would want people to take home or an invitation for what sort of folks were just watching today listening uh or on the radio later uh that you would want them to sort of take from what you're talking about in the book or talked about here today that you think would move us in a positive direction thank you well I think you know let's keep our Communications Channel open um People to People connection business to business but also at the leadership level the military level how important is that right leader not talking twice a year I mean maybe once a month would would help and um I don't know keeping you know there are lots of Chinese students who really still want to come here and lots of universities that want to work together lots of scientists data scientists AI scientists that still want to see the collaboration so I think that to the extent that we can to keep those exchanges uh uh open that would be great and recently uh Anthony blinkin mentioned about I remember you know sitting in this meeting and pretty surprised to say that he said something positive about China and said uh talked about the fetanyl fetanyl crisis in this country and how China really did the Chinese government really took action and seriously implemented all these you know um uh uh uh uh restrictions or or cutting down in China and that is an instance of collaboration and so that might be a small victory that might be a small victory but I think it would help build trust over time little by little so on that note can you all please help me do a big warm thank you Dr KU Jin for speaking here at the Westminster Town Hall Forum again the book is the new China Playbook Beyond socialism and capitalism thank you so much Dr kin she will be outside signing books after this thank you all so much for being here at the Westminster Town Hall Forum uh please join us for our reception join us for our post Forum discussion uh get a copy of the book it's really good uh and we will see you again at the Westminster Town Hall Forum thank you so much I hope I wasn't too hard on you you

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Length: 96min 45sec (5805 seconds)

Published: Fri Apr 19 2024