For years, academics, competition lawyers, and politicians have claimed Facebook, Google, Apple and Amazon are similarly too big and powerful. Proposed remedies to that “problem,” under the veneer of boosting competition, have included enforcing platform openness, tougher pricing laws, breaking up firms and restrictions on data use.
Our existing laws and institutions have restricted the worst of these demands. But this populist narrative bred the Big Tech antitrust agenda in the United States and the formation of the UK’s digital markets unit. Unhindered by propriety, China has taken the logic further.
This example speaks to a broader pattern. For all the hand-wringing about the rise of a “repressive” China in politics, in policy area after policy area our climate of ideas is converging with theirs.
Historian Niall Ferguson has noted how Ronald Reagan and Margaret Thatcher approached the Soviet threat confident of the superiority of open economies, market-led innovation, and commitments to free expression. Left and right today might talk up China as a geostrategic and economic foe. The difference? They seem to believe replicating Chinese policy is needed for Western success.
Our leaders used to bemoan China’s practices of subsidising industries, trade protectionism, and government-granted business privileges. Yet now we copy them: Congress recently authorised direct subsidies for semiconductor fabrication plants, while Joe Biden has retained Donald Trump’s tariffs. Boris Johnson has promised a government-backed “green industrial revolution,” with state support for electric vehicles, renewables, and the greening of aviation. So much for the strength of markets over planning!
Chinese research and development efforts have been used as justification for huge increases in government science budgets on both sides of the Atlantic. The Integrated Review of Security, Defence, Development and Foreign Policy supported the UK becoming a “Science and Tech Superpower” in part by invoking growing Chinese capabilities.
On infrastructure, Western nations seem intent on aping China at home and abroad too. Joe Biden and Boris Johnson see transport mega-projects as key to “Build Back Better” and “level up.” The G7 even committed to a “Build Back Better for the World” initiative in July, as a “values-driven” counter to China’s cross-continent “Belt and Road Initiative.”
But the imitation extends beyond economic development policies. China is rolling out its electronic digital renminbi — a central bank digital currency designed to broaden government surveillance and usurp tech company-built payment systems. Now Rishi Sunak and the Bank of England are pondering their own “BritCoin”, urged on by commentators worried about the “wild west” of private currencies. Hear that echo?
Yes, few in the West advocate to go “full China” with a dystopian social credit system and widespread identity verification. And we’ve not given up on lifestyle freedoms to the extent of banning kids from playing online games outside of three hour-long time slots at weekends, as China recently has.
But paternalistic moralising is ascendent, with our government ever-willing to step in with bans and nudges for our own good. Where China calls gaming the “opium of the mind,” our politicians dub fixed-odds betting terminals the “crack cocaine of gambling.” Boris Johnson’s Government is banning “junk food” advertising before 9pm and implementing a code which, in the name of protecting children, will require websites to put age verification gateways on lots of benign content.
Epidemiologist Neil Ferguson even thinks Chinese footage facilitated Western COVID-19 lockdowns. “If China had not done it, the year would have been very different,” he said in December. True or not, a disdain for Chinese-style civil liberties is rising. The Government’s resolve to implement vaccine passports has strengthened even as breakthrough COVID-19 transmission weakens their case.
Not so long ago, the Western counterblast to Chinese economic planning and lifestyle controls would have been to herald the virtues of freedom.
We’d defend Western digital platforms that have slashed advertising costs, gifted users content free-of-charge, and facilitated new competitive marketplaces.
We’d worry about the slippery slope of “national security” exemptions to free trade and point out that a manufacturing-heavy Chinese-style industrial policy is doomed to fail, with overcapacity and malinvestment the inevitable consequence of state-led attempts to second-guess technologies and consumer demand.
A confident West would highlight how politician-led infrastructure produces Chinese ghost cities and bridges to nowhere. We’d observe that patents granted per investment units in R&D are three times higher for Chinese private companies than state‐owned enterprises, reminding us that public research crowds out more productive private efforts. And we’d deplore the chilling impacts on entrepreneurship of knee-jerk bans and dehumanising paternalism.
But, the truth is, intellectuals and politicians today are generally not confident in the principles that have left us with a GDP per capita four times higher than China. So the response to its rise is to advocate for capitalism with watered-down Chinese characteristics.
