China Syndrome

John writes:

In the December 07, 2010 edition of The New York Times, the Grey Lady ran an article about superb standardized test scores from Shanghai, China, outperforming American students by a wide margin. Right on cue, the reaction from many Americans was a mixture of awe and fear, with a healthy dollop of disdain towards America’s educational system. While the Chinese performance was impressive, and there are indeed many flaws in the American educational system, I am afraid most Americans, whether conservative or progressive, will take the wrong lessons from this story.

First, it is largely incorrect to attribute China’s recent economic growth to educational excellence. As Michael Lind has noted, China’s recent economic success has largely been due to the deliberate mercantilist policies of the Chinese government. Currency manipulation, cheap labor, anti-union policies, lack of environmental regulations, and deals with multinational corporations have all driven Chinese economic growth much more than educational prowess. Improvements in education often accompany development, but it is usually other factors like industrial policy that actually spearhead development in the first place.

Second, success in education does not always translate into guaranteed economic success. The Japanese had a famously intense educational system, but that did not prevent the Japanese economy from entering into a recession in the early 1990s after the Japanese asset price bubble burst, followed by a “Lost Decade” of disappointing economic performance. The Soviet Union is a much more dramatic example. Despite having achieved near universal literacy and impressive successes in math and science, these accomplishments could not resolve the underlying systemic problems of the communist system which eventually helped cause the fall of the Soviet Union. Furthermore, as Steven Hill wrote back in September, 2010, there are already many reasons to doubt the current narrative of China itself as an unstoppable economic juggernaut.

Third, the impressive educational systems of China and other East Asian countries have not come without a price. China’s young adults are plagued by depression and other mental health problems and intense competition has increased stress, especially among China’s student population. The situation seems to be similar in other rapidly developing or newly developed East Asian countries, such as South Korea, which has seen a huge increase in its suicide rate since the early 1990s. For those of us who think economics must ultimately serve human ends and not just material ones, this is troubling information.

Finally, and perhaps most importantly, the fetishizing of education among America’s elite, especially its progressive elite, has led to a situation where more and more people are pushed into going to college when they might be better served by choosing a different path. Again, Michael Lind is perhaps the best critic of this brand of technocratic/meritocratic progressivism. In an August 03, 2010 article, Lind argued that the old American Left was a populist one, anchored on labor unions and other populist organizations. Today, the American Left is largely defined by the tastes and opinions of affluent professionals and others who have succeeded within America’s educational system. Their preferred policy is to make the United States a meritocratic state with education as the key to upward mobility. Lind does a good job tackling this ideology and why it has been so disastrous for millions of young Americans who are either deemed to be hopeless cases because they did not go to college, or who do go on to obtain a higher education and find themselves underemployed and deep in debt. Instead of the meritocratic state, Lind proposes a return to the New Deal system of high wages and robust social insurance.

It is important to note that much like the current swooning over Germany, the swooning over China is displayed as a morality play, with disciplined Germans and Chinese pitted against their lazy counterparts in the United States and the Mediterranean nations. These kinds of cultural arguments are important weapons in the arsenal of neoliberals who desperately want to defend the current economic orthodoxies from any real critique. But as Cambridge economist Ha-Joon Chang notes in his excellent book Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism, the cultural arguments for why some economies do well while others do poorly offer a way to avoid asking bothersome questions involving policy or systemic structure. Chang discusses this tendency in the context of development economics and shows how some cultural traditions, like Confucianism, for example, have gone from being considered bad for an economy to now being considered a source of success for Asian states. The same thinking applies to supposed "national characteristics." Chang notes that the Japanese and Germans were once considered lazy by observers from countries such as Great Britain and France which had already begun to industrialize. Indeed, the modern work ethic is really a product of the Industrial Revolution. Pre-industrial work was often characterized by a great deal of self-direction on the part of peasants and artisans. In order to get the now landless peasants or ruined craftsmen to accept the toil of the factory, capitalists had to institute systems of discipline unknown to most free workers in traditional societies, complete with long hours and military-like regimentation.

While I don’t want to discount the great importance of culture, I think it is important that populists are able to see through certain kinds of arguments that are designed to avoid a more thorough discussion of economic systems as a whole. While I do think there are significant problems with the American system of education, I don’t think the Chinese system embodies the answers we need.