Nightmare scenario if China tries to live the American Dream


INNOVATION TALK:ON NOVEMBER 8th, China is set to hold the 18th National Congress of the Communist Party.

We already know who will be the next party leader: vice president Xi Jinping. What we don’t know is what matters: does Xi have a “Chinese Dream” that is different from the “American Dream?” Because if Xi’s dream for China’s emerging middle class – 300 million people expected to grow to 800 million by 2025 – is just like the American Dream (a big car, a big house and Big Macs for all) then we need another planet.

Spend a week in China and you’ll see why. Here’s a Shanghai Daily headline from September 7th: “City Warned of Water Resource Shortage”. The article said: “Shanghai may face a shortage of water resources if the population continues to soar

. . . The current capacity of the city’s water supply is about 16 million tons per day, which is able to cover the demand of 26 million people. However, once the population reaches 30 million, the demand would rise to 18 million tons per day, exceeding the current capacity.” Shanghai will hit 30 million in about seven years!

“Success in the ‘American Dream’,” notes Peggy Liu, the founder of the Joint US-China Collaboration on Clean Energy, or Juccce, “used to just mean a house, a family of four and two cars, but now it’s escalated to conspicuous consumption as epitomised by Kim Kardashian. China simply cannot follow that path – or the planet will be stripped bare of natural resources to make all that the Chinese consumers want to consume.”

Liu, an MIT graduate and former McKinsey consultant, argues that Chinese today are yearning to create a new national identity, one that merges traditional Chinese values, such as balance, respect and flow, with its modern urban reality. She believes that the creation of a sustainable “Chinese Dream” that breaks the historic link between income growth and rising resource consumption could be a part of that new identity.

So Juccce has been working with Chinese mayors and social networks, sustainability experts and western advertising agencies to catalyse sustainable habits in the emergent consuming class by redefining personal prosperity – which so many more Chinese are gaining access to for the first time – as “more access to better products and services, not necessarily by owning them, but also by sharing – so everyone gets a piece of a better pie.”

That means better public transportation, better public spaces and better housing that encourages dense vertical buildings, which are more energy efficient and make shared services easier to deliver, and more e-learning opportunities that reduce commuting.

Emphasising access versus ownership isn’t just more sustainable, it helps ease friction from the differences between rich and poor. Indeed, Juccce translates Chinese Dream as “Harmonious and Happy Dream” in Mandarin. (“Green” doesn’t sell in China.)

The Chinese are more open to this than ever. A decade ago, the prevailing attitude was, “Hey, you Americans got to grow dirty for 150 years. Now it is our turn.” A couple of weeks ago, though, I took part in the opening day of Tongji University’s Urban Planning and Design Institute in Shanghai and asked students whether they still felt that way. I got a very different answer. Zhou Lin, a graduate student studying energy systems, declared, with classmates nodding: “You can politicise this issue as much as you want, but, in the end, it doesn’t do us any good.” It is not about fairness anymore, he said. It is in China’s best interest to find a “cleaner” growth path.

To say China needs its own dream in no way excuses Americans or Europeans from redefining theirs. We all need to be rethinking how we sustain rising middle classes with rising incomes in a warming world, otherwise the convergence of warming, consuming and crowding will mean we grow ourselves to death.

China’s latest five-year plan – 2011-15 – has set impressive sustainability goals for cutting energy and water intensity per unit of GDP. All of these goals are critical to the greening of China, but they are not sufficient, argues Liu. With retail sales growing 17 per cent a year since 2005 and urban incomes up 150 per cent in the last decade, “the government must also have a plan to steer consumer behaviour toward a sustainable path,” adds Liu. “But it doesn’t yet.”

So Xi Jinping has two very different challenges from his predecessor. He needs to ensure that the Communist Party continues to rule – despite awakened citizen pressure for reform – and that requires more high growth to keep the population satisfied with party control. But he also needs to manage all the downsides of that growth – from widening income gaps to massive rural-urban migration to choking pollution and environmental destruction.

The only way to square all that is with a new Chinese Dream that marries people’s expectations of prosperity with a more sustainable China. Does Xi know that, and, if he does, can he move the system fast enough? So much is riding on the answers to those questions. – (New York Times)

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