lunes, 17 de septiembre de 2018

APSA conference roundup: Research on political polarization on social media and the U.S. Congress



The ways that social media shape political attitudes and the intricacies of lawmaking in the U.S. Congress were two of the many topics at the American Political Science Association Annual Conference in Boston earlier this month. Here are brief summaries of some highlights from the conference across sessions on those topics, which represent a small portion of the full agenda. Several of these papers relate to Pew Research Center work on congressional rhetoric, news on social media and political discussion on social media. As is true of many academic conferences, some of these results may be preliminary and could later be revised; several of the papers we mention are not yet published in peer-reviewed journals. The full conference program is available here.

On social media, exposure to the other side can increase political polarization. In a paper that was published by the Proceedings of the National Academy of Sciences in late August, researchers recruited a nonprobability sample of U.S. adults to test whether seeing tweets from those on the other side of the ideological spectrum makes political attitudes more or less polarized. They found that Republicans who hold ideologically conservative views often become even more likely to hold strong views when they follow a bot on Twitter that tweets views that run counter to their own.

Online organizing can be a potent political force – even when it’s not done publicly. During the 2016 election, Hillary Clinton supporters around the country met in private Facebook groups to organize, share experiences and find community. A researcher at the University of Texas, Austin, surveyed members of one of these groups and analyzed their posts using a novel method that took care to ensure group members’ privacy. She found that people’s most common reason for joining these groups was to find solidarity or to express political opinions in a safe space.

Some of the most divisive political ads on Facebook during the 2016 election were from groups that did not disclose their funding sources. Using data from people’s Facebook feeds across the U.S., researchers found that many of the very divisive political ads that people received did not come from any campaigns or known issue groups. Instead, they were paid for by groups that were not registered or whose information could not be determined. This research was published in the journal Political Communication.

Incivility from political leaders is relatively rare, but it gains a lot of attention when it does appear. An analysis of Twitter data from researchers at the University of Texas, San Antonio, found that only a very small portion of tweets from members of Congress contain uncivil language. But the uncivil tweets that did exist got more engagement, regardless of gender, partisanship, number of followers or frequency of tweeting. In another study, a researcher from Tufts University found that political leaders who are female or nonwhite are more likely to face incivility and hostility on social media, regardless of what they tweet. Overall, women in politics, and especially nonwhite women, face more negative reactions online than their male peers.

Legislative staff experience level matters for lawmaking. Researchers from three universities examined the backgrounds of congressional staffers to assess how much having a more experienced legislative staff benefits lawmakers. They found that having individual legislative staffers with high levels of experience was more important than having large staffs when it came to legislative productivity. However, committee chairs were the group most likely to have experienced staff, and thus were especially likely to benefit from them.

For corporations, connections with Congress are important. A University of Oxford researcher found that of 685 financial corporations, those that spent on lobbying, campaigns, or that had personal connections with politicians received larger bailouts during the 2009 Troubled Asset Relief Program. On average, corporations with these political connections received a higher share of bailout funds after the financial crisis by 2.4 percentage points.

sábado, 15 de septiembre de 2018

Swedish election highlights decline of center-left parties across Western Europe


A woman passes campaign posters for Swedish Prime Minister Stefan Löfven, Finance Minister Magdalena Andersson and Foreign Minister Margot Wallström, all of the center-left Social Democrats, in Stockholm on Sept. 1. General elections were held Sept. 9.

Sunday’s general election in Sweden extended two trends that are now prominent across Western Europe: the rise of right-wing populist parties and the decline of center-left parties.

The far-right Sweden Democrats entered parliament for the first time in 2010, winning 6% of the vote. On Sunday, they finished in third place with 18% of the vote. And while the center-left Social Democrats finished ahead of the Sweden Democrats, they registered their worst electoral performance in more than 100 years.



Sweden’s Social Democratic Party is not an anomaly. In legislative elections held over the past two years, the French Socialist Party, German Social Democratic Party and Dutch Labor Party – three other major left-of-center parties – recorded their worst-ever results in the postwar era. Once-strong center-left parties in Austria, Denmark, Finland, Norway and Spain are also near historic lows in terms of their most recent legislative election results.

Not all social democratic parties are suffering historic defeats. The UK Labour Party won 40% of the vote in the country’s 2017 general election, roughly matching the performances the party turned in under Prime Minister Tony Blair (a member of the party) in 1997 and 2001. But most center-left parties in Western Europe are in a weaker position than they were two decades ago.

Related interactive: How traditional and populist party support differs across Western Europe

Observers have suggested a variety of reasons for the decline, some of which are specific to individual countries. In France, for instance, many pin the collapse of the Socialist Party on the party’s onetime standard bearer, former President François Hollande. His term was marred by unpopular economic reforms, deadly terrorist attacks and personal scandal; his approval dropped as low as 4% in the final months of his term, according to one poll. The fall of France’s Socialist Party disrupted the two-party system and cleared the way for new challengers across the ideological spectrum, including current President Emmanuel Macron.

In contrast, the German Social Democratic Party has trended downward for decades. Its vote share declined in 2005 after then-Chancellor Gerhard Schröeder (a member of the party) made cuts to the social safety net. The declines continued through the financial and refugee crises and two coalition governments with Chancellor Angela Merkel’s center-right Christian Democratic Union (CDU). The coalitions left voters without a clear center-left alternative to the CDU, and many defected to parties across the political spectrum.

Center-right parties in Western Europe have generally not experienced similar declines. Sweden’s Moderate Party, for example, won 23% of the vote in 1998 and 20% this year. The Finnish National Coalition Party has also held relatively steady, dropping only slightly from 21% of the vote in 1999 to 18% in 2015. Moreover, it has won a larger share of the vote than the Finnish Social Democratic Party in each of the country’s last three elections, something it had never done before.

Due to the decline of the center-left across much of Western Europe and the comparative steadiness of the center-right, most Western European countries are led by center-right parties, as measured by the party of the prime minister or other head of government.

Two countries, Italy and France, are governed by relatively new parties that eschew traditional left-right characterization, though both have pursued agendas that experts generally place right of center. Only two countries are governed by the center-left: Spain, led by the Spanish Socialist Workers’ Party, and Portugal, led by the Socialist Party.

lunes, 10 de septiembre de 2018

News Use Across Social Media Platforms 2018


Most Americans continue to get news on social media, even though many have concerns about its accuracy

About two-thirds of American adults (68%) say they at least occasionally get news on social media, about the same share as at this time in 2017, according to a new Pew Research Center survey. Many of these consumers, however, are skeptical of the information they see there: A majority (57%) say they expect the news they see on social media to be largely inaccurate. Still, most social media news consumers say getting news this way has made little difference in their understanding of current events, and more say it has helped than confused them (36% compared with 15%).

Republicans are more negative about the news they see on social media than Democrats. Among Republican social media news consumers, 72% say they expect the news they see there to be inaccurate, compared with 46% of Democrats and 52% of independents. And while 42% of those Democrats who get news on social media say it has helped their understanding of current events, fewer Republicans (24%) say the same.1 Even among those Americans who say they prefer to get news on social media over other platforms (such as print, TV or radio), a substantial portion (42%) express this skepticism.

Asked what they like about the news experience on social media, more Americans mention ease of use than content. “Convenience” is by far the most commonly mentioned benefit, (21%), while 8% say they most enjoy the interactions with other people. Fewer social media news consumers say they most like the diversity of the sources available (3%), or the ability to tailor the content they see (2%).

This study is based on a survey conducted July 30-Aug. 12, 2018, among 4,581 U.S. adults who are members of Pew Research Center’s nationally representative American Trends Panel.
Growth in social media news consumption slows down

About two-thirds of U.S. adults (68%) get news on social media sites, about the same as the portion that did so in 2017 (67%). One-in-five get news there often.

Facebook is still far and away the site Americans most commonly use for news, with little change since 2017. About four-in-ten Americans (43%) get news on Facebook. The next most commonly used site for news is YouTube, with 21% getting news there, followed by Twitter at 12%. Smaller portions of Americans (8% or fewer) get news from other social networks like Instagram, LinkedIn or Snapchat.

The prominence of each social media site in the news ecosystem depends on two factors: its overall popularity and the extent to which people see news on the site.

Reddit, Twitter and Facebook stand out as the sites where the highest portion of users are exposed to news – 67% of Facebook’s users get news there, as do 71% of Twitter’s users and 73% of Reddit users. However, because Facebook’s overall user base is much larger than those of Twitter or Reddit, far more Americans overall get news on Facebook than on the other two sites.

The other sites studied – including YouTube, Tumblr, Instagram, LinkedIn, Snapchat and WhatsApp – have less of a news focus among their user base. Fewer than half of each site’s users get news on each platform. Still both YouTube and LinkedIn saw these portions rise over the past year.

Nearly four-in-ten YouTube users (38%) say they get news on YouTube, slightly higher than the 32% of users who did so last year. And 30% of LinkedIn users get news there, up from 23% in 2017.

The percentage of U.S. adults who get news on two or more social media sites is 28%, little changed from 2017 (26%).
Demographics of social media news consumers

Social media sites’ news consumers can look vastly different in terms of their demographic makeup. For example, the majority of news consumers on Instagram are nonwhite. Three-quarters of Snapchat’s news consumers are ages 18 to 29, more than any other site. And LinkedIn, Twitter and Reddit’s news consumers are more likely to have bachelor’s degrees – 61% of LinkedIn’s news consumers do, as do 46% of Reddit’s news consumers and 41% of Twitter’s news consumers.
Most social media news consumers are concerned about inaccuracy, but many still see benefits

Even though a substantial portion of U.S. adults at least occasionally get news on social media, over half (57%) of these news consumers say they expect the news they see on social media to be largely inaccurate. This is consistent with the low trust in news from social media seen in past surveys. About four-in-ten (42%) expect the news they see on social media to be largely accurate.

Republicans are more likely than Democrats and independents to be concerned with the inaccuracy of the news they see on social media. Among social media news consumers, about three-quarters of Republicans say this (72%), compared with 46% of Democrats and about half of independents (52%). And, while there are some age differences in expectations of the accuracy of social media news, this party divide persists regardless of age.

Concerns about the inaccuracies in news on social media are prevalent even among those who say they prefer to get their news there – among this group, 42% say that they expect the news they see to largely be inaccurate. Still, those social media news consumers who prefer other platforms such as print or television for news are even more likely to say they expect the news on social media to be largely inaccurate.

Not only do social media news consumers expect the news they see there to be inaccurate, but inaccuracy is the top concern they bring up about information on social media. When asked an open-ended question about what they dislike most about getting news on social media, concerns about inaccuracy top the list, outstripping concerns about political bias and the bad behavior of others.2 Specifically, about three-in-ten (31%) social media news consumers say that inaccuracy is what they dislike most about the experience. Included in the responses about inaccuracy were concerns about unreliable sources, lack of fact checking, and “fake news.”

Politics surface as another negative aspect of social media, though at a lower rate – 11% who at least occasionally get news there say there is too much bias or political opinion, either on the part of the news organizations or the people on the platform. About the same share of social media news consumers (10%) say they dislike the low quality of news – such as lack of in-depth coverage, or clickbait-style headlines.
Convenience and ease seen as most enjoyable part of getting news on social media

Even though social media news consumers have concerns about the accuracy of the information there, they also cite some benefits of getting news on social media, which may help explain why getting news on the platform is still so common.

The most commonly named positive thing about getting news on social media is convenience – 21% say this is what they liked most, with responses such as “It’s very accessible,” “It’s available at the touch of a button” and “I don’t have to go looking for it.”

Respondents also say they like the interpersonal element: 8% of social media news consumers say they enjoy interacting with others – whether through discussing the news, sharing news with friends and family, or seeing what others’ opinions are. Speed and timeliness are also mentioned as positive aspects of getting news on social media – 7% say they like how quick it is to get news on social media, and 6% say they like that news there is up to date, with descriptions like “up to the minute” or “the most current.”

A fair share of respondents (12%) say they do not like anything about getting news on social media. This is higher than the percentage who volunteered that they do not dislike anything about news on social media in the previous question (only 4% say this).
About a third say social media positively affects their understanding of current events

About a third (36%) of the people who get news on social media say it has helped them better understand current events. Nearly half (48%) say it doesn’t have much of an effect on their understanding, and 15% say that news on social media has made them more confused about current events.

Among those who get news on social media, Republicans are less positive than Democrats and independents about how news there influences their understanding of the world around them: About a quarter (24%) say that social media news helps them better understand current events, compared with 42% of Democrats and 40% of independents.

Age is also a factor in the way people view the role of social media. Younger social media news consumers are more likely to say it has impacted their learning for the better. About half of social media news consumers ages 18 to 29 (48%) say news on social media makes them better informed, compared with 37% of those 30 to 49, 28% of those 50 to 64, and 27% of those 65 and older.

domingo, 9 de septiembre de 2018

Trump’s Disruptive Foreign Policy Could Be Working


Beneath the crazy talk, there’s reason to think some of Trump’s “unpredictable” policies could work.


After months of hugging dictators and dissing democrats, Donald Trump is now seen around the world as a deranged toddler—symbolized by the Trump “blimp baby” that flew over Britain this summer and is now embarking on its own world tour. But beneath all the crazy talk that comes out of the president’s mouth (and Twitter feed), there may be reason to think that some of the “unpredictable” policies he so relishes could work.

Last fall, noting that 25 years of sanctions haven’t worked against North Korea, Trump decided to shake things up, threatening to “totally destroy” that regime if it didn’t dismantle its nuclear threat. And lo, Kim Jong Un began talking—and reportedly dismantling a missile site (though he appears to be continuing work on new missiles, and the two sides are currently stalemated over further moves).


As for Russia, yes, Trump said unpardonable and decidedly unpresidential things at the Helsinki summit in July. And there is little doubt Russia meddled criminally in the 2016 U.S. election. But Trump also might have had a point when he said, “I hold both countries responsible” for current tensions, though the comment provoked howls of outrage on both sides of the aisle. Washington has been meddling in other countries’ democracies for a long time, and it might be useful to drop our self-righteousness and acknowledge, at least to ourselves, that one country’s “democracy promotion” is another’s DCLeaks and Guccifer 2.0. Vladimir Putin might be a thug and an autocrat, but that’s just the point: To him, there is probably no difference between what he did so nefariously in 2016 and what America did a few years earlier in Russia’s elections—openly supporting, for example, anti-Putin protests—and in Ukraine.

Moreover, Putin remains popular in Russia, while Western-style democracy does not, and there’s really nothing Washington can do to change this. What Trump appears to be pushing for, then, is a return to realpolitik, a truce on trying to change each other’s political systems, and reaching agreement where we can—for example, on Syria, Iran, North Korea and nuclear proliferation. There’s a long way to go, and Trump still might be vulnerable on the issue of collusion with the Russians. The president also needs to understand that one summit does not a foreign-policy success make. But many Americans who voted for Trump, even if they didn’t particularly like him, said they supported him because he pledged to toss out a lot of policies that weren’t working in Washington, and that he has done, if often recklessly. If he can induce Putin to cooperate more on critical issues—and if Kim does end up taking down his nuclear and missile programs—then Trump could appear to be something more of a grown-up in the years ahead.

The American middle class is stable in size, but losing ground financially to upper-income families






About half (52%) of American adults lived in middle-class households in 2016. This is virtually unchanged from the 51% who were middle class in 2011. But while the size of the nation’s middle class remained relatively stable, financial gains for middle-income Americans during this period were modest compared with those of higher-income households, causing the income disparity between the groups to grow.

The recent stability in the share of adults living in middle-income households marks a shift from a decades-long downward trend. From 1971 to 2011, the share of adults in the middle class fell by 10 percentage points. But that shift was not all down the economic ladder. Indeed, the increase in the share of adults who are upper income was greater than the increase in the share who are lower income over that period, a sign of economic progress overall.

 
Our newly updated calculator lets you find out which group you fit in, first compared with other adults in your metro area and among American adults overall, and then compared with other adults in the U.S. similar to you in education, age, race or ethnicity, and marital status.

Financially, middle-class households in the U.S. were better off in 2016 than in 2010. The median income of middle-class households increased from $74,015 in 2010 to $78,442 in 2016, by 6%. Upper-income households (where 19% of American adults live) fared better than the middle class, as their median income increased from $172,152 to $187,872, a gain of 9% over this period. Lower-income households (29% of adults) experienced an income gain of 5%, about the same as the middle class. (Incomes are adjusted for household size, scaled to reflect three-person households, and expressed in 2016 dollars.)

But, recent gains notwithstanding, the median income of middle-class households in 2016 was about the same as in 2000, a reflection of the lingering effects of the Great Recession and an earlier recession in 2001. The median income of lower-income households in 2016 ($25,624) was less than in 2000 ($26,923). Only the incomes of upper-income households increased from 2000 to 2016, from $183,680 to $187,872.

The widening income gap between upper-income households and middle- and lower-income households this century is the continuation of a decades-long trend. In 1970, the first year covered by earlier Pew Research Center analyses, the median income of upper-income households was 2.2 times the income of middle-income households and 6.3 times the income of lower-income households. These income ratios increased to 2.4 and 7.3 in 2016, respectively.

A recent Pew Research Center analysis also found that the wealth gaps between upper-income families and lower- and middle-income families in 2016 were at the highest levels recorded. Although the wealth of upper-income families has more than recovered from the losses experienced during the Great Recession, the wealth of lower- and middle-income families in 2016 was comparable to 1989 levels. Thus, even as the American middle class appears not to be shrinking (for now), it continues to fall further behind upper-income households financially, mirroring the long-running rise in income inequality in the U.S. overall.

The period from 2011 to 2016 encompasses much of the economic expansion following the Great Recession of 2007-09. But the recovery has been slow (the slowest in modern times) and that may help explain the lack of movement of adults into upper-income households during this period. The nation’s gross domestic product (GDP) per capita did not return to its pre-recession peak (near the end of 2007) until the latter half of 2013. Likewise, the median income of U.S. households took until 2016 to return to where it stood prior to the start of the Great Recession in December 2007.

Download our tables on the middle class in U.S. metropolitan areas and states.

The share of adults who are middle class varies widely across U.S. metropolitan areas. The estimated share was highest in Sheboygan, WI, where 65% of adults lived in middle-income households in 2016, and it was the lowest in Laredo, TX, where 39% of adults were in middle-income households. The 10 areas with the highest concentrations of middle class adults are located in the Midwest or the Northeast, with the exception of Ogden-Clearfield, UT. These areas are also more reliant on manufacturing than the nation overall. (See our earlier analysis of U.S. metropolitan areas for more detail on the characteristics of these areas.)

The metropolitan areas with the largest shares of adults in upper-income households are mostly in the coastal areas of the Northeast and California. They tend to be in high-tech corridors, such as Boston-Cambridge-Newton, MA-NH, or in financial and commercial centers, such as Hartford-West Hartford-East Hartford, CT. San Jose-Sunnyvale-Santa Clara, CA, where 32% of adults were upper-income, led among all areas in 2016. The area with the smallest share who are upper income is Lewiston-Auburn, ME (8%).

The metropolitan areas with the largest shares of lower-income adults are located primarily in the Southwest, with several on the southern border, such as McAllen-Edinburg-Mission, TX, and include farming communities in central California, such as Fresno, CA. In Laredo, TX, about half of adults (49%) lived in lower-income households in 2016, the highest share in the country. Ogden-Clearfield, UT, among the largest middle-class communities, also had the lowest share of lower-income adults (19%) in 2016.

In our analysis, “middle-income” Americans are adults whose annual household income is two-thirds to double the national median, after incomes have been adjusted for household size. In 2016, the national middle-income range was about $45,200 to $135,600 annually for a household of three. Lower-income households had incomes less than $45,200 and upper-income households had incomes greater than $135,600 (incomes in 2016 dollars).

Our interactive calculator lets you find out which group you are in based on your income, your household size, where you live and the cost of living in your area.

About this analysis

This analysis encompasses 260 of some 380 metropolitan areas in the United States, as defined by the Office of Management and Budget. The 260 metropolitan areas included are the maximum number of areas that could be identified in the Census Bureau data used for the analysis (the Integrated Public Use Microdata Series, or IPUMS). Together, these areas accounted for 79% of the nation’s population in 2016.

A metropolitan area consists of at least one urbanized area with a population of 50,000 or more people, plus neighboring areas that are socially and economically integrated with the core. Metropolitan areas may cross state boundaries, such as the Washington-Arlington-Alexandria, DC-VA-MD-WV, area.

“Middle-income” Americans are adults whose annual household income is two-thirds to double the national median, after incomes have been adjusted for household size. In 2016, the national middle-income range was about $45,200 to $135,600 annually for a household of three (incomes in 2016 dollars). The same standard is used to determine the status of households in all metropolitan areas after their incomes have been adjusted for the cost of living in the area.

The cost-of-living adjustment for an area was calculated as follows: Jackson, Tennessee, is a relatively inexpensive area, with a price level that is 17.9% less than the national average. The Hawaii metropolitan area known as Urban Honolulu is one of the most expensive areas, with a price level that is 24.4% higher than the national average. Thus, to step over the national middle-class threshold of $45,200, a household in Jackson needs an income of only about $37,150, or 17.9% less than the national standard. But a household in Urban Honolulu needs a reported income of about $56,250, or 24.4% more than the U.S. norm, to join the middle class.

The metropolitan area cost-of-living adjustment is based on price indexes published by the U.S. Bureau of Economic Analysis. These indexes, known as Regional Price Parities, compare the prices of goods and services in a metropolitan area with the national average prices for the same goods and services.

The national estimates presented in the analysis encompass the U.S. adult population, including people outside of the sample of 260 metropolitan areas.

The Census Bureau’s 2016 American Community Survey was conducted from January 2016 to December 2016. Respondents were asked to report their income received in the 12 months before the survey date. In principle, the 2016 ACS includes income data from a total of 24 months, from January 2015 to December 2016. Estimates for earlier years are from the Current Population Survey, Annual Social and Economic Supplements. The income data in these surveys pertain to the preceding calendar year. Thus, the assignment of adults to an income tier in, say, 2011 is based on their household income in 2010.

Differences between numbers or percentages are computed before the underlying estimates are rounded. Estimates may not sum to 100% due to rounding. Additional details on the methodology are available in our earlier analyses.

miércoles, 5 de septiembre de 2018

Americans are changing their relationship with Facebook


Significant shares of Facebook users have taken steps in the past year to reframe their relationship with the social media platform.

Just over half of Facebook users ages 18 and older (54%) say they have adjusted their privacy settings in the past 12 months, according to a new Pew Research Center survey. Around four-in-ten (42%) say they have taken a break from checking the platform for a period of several weeks or more, while around a quarter (26%) say they have deleted the Facebook app from their cellphone. All told, some 74% of Facebook users say they have taken at least one of these three actions in the past year.

The findings come from a survey of U.S. adults conducted May 29-June 11, following revelations that the former consulting firm Cambridge Analytica had collected data on tens of millions of Facebook users without their knowledge.



Related: Many Facebook users don’t understand how the site’s news feed works

Facebook has separately faced scrutiny from conservative lawmakers and pundits over allegations that it suppresses conservative voices. The Center found that the vast majority of Republicans think that social platforms in general censor political speech they find objectionable. Despite these concerns, the poll found that nearly identical shares of Democrats and Republicans (including political independents who lean toward either party) use Facebook. Republicans are no more likely than Democrats to have taken a break from Facebook or deleted the app from their phone in the past year.

There are, however, age differences in the share of Facebook users who have recently taken some of these actions. Most notably, 44% of younger users (those ages 18 to 29) say they have deleted the Facebook app from their phone in the past year, nearly four times the share of users ages 65 and older (12%) who have done so. Similarly, older users are much less likely to say they have adjusted their Facebook privacy settings in the past 12 months: Only a third of Facebook users 65 and older have done this, compared with 64% of younger users. In earlier research, Pew Research Center has found that a larger share of younger than older adults use Facebook. Still, similar shares of older and younger users have taken a break from Facebook for a period of several weeks or more.

In the wake of the revelations about Cambridge Analytica, Facebook updated its privacy settings to make it easier for users to download the data the site had collected about them. The new survey finds that around one-in-ten Facebook users (9%) have downloaded the personal data about them available on Facebook. But despite their relatively small size as a share of the Facebook population, these users are highly privacy-conscious. Roughly half of the users who have downloaded their personal data from Facebook (47%) have deleted the app from their cellphone, while 79% have elected to adjust their privacy settings.

lunes, 3 de septiembre de 2018

Xi's Weltpolitik




The Big Picture


Since US President Donald Trump's inauguration, China has increasingly come to be regarded as a new pole of global power and leadership. The question, then, is what China’s leaders have in mind for their country's enhanced role on the world stage.

In this Big Picture, Barry Eichengreen predicts that China will gradually replace existing multilateral economic institutions with more Sinocentric arrangements. And as Elizabeth Sidiropoulus points out, this is already evident within the BRICS bloc, where China is now primus inter pares.

Likewise, Kevin Rudd expects China to step up its "international activism" substantially in the coming years, in accordance with Xi's Marxist interpretation of the current historical moment. By contrast, Minxin Pei points to mounting domestic troubles that could derail Xi's agenda.

Globalization with Chinese Characteristics

The Trump administration’s “America First” policies have done more than disqualify the United States from global leadership. They have also created space for other countries to re-shape the international system to their liking.

 US President Donald Trump’s erratic unilateralism represents nothing less than abdication of global economic and political leadership. Trump’s withdrawal from the Paris climate agreement, his rejection of the Iran nuclear deal, his tariff war, and his frequent attacks on allies and embrace of adversaries have rapidly turned the United States into an unreliable partner in upholding the international order.

But the administration’s “America First” policies have done more than disqualify the US from global leadership. They have also created space for other countries to re-shape the international system to their liking. The influence of China, in particular, is likely to be enhanced.

Consider, for example, that if the European Union perceives the US as an unreliable trade partner, it will have a correspondingly stronger incentive to negotiate a trade deal with China on terms acceptable to President Xi Jinping’s government. More generally, if the US turns its back on the global order, China will be well positioned to take the lead on reforming the rules of international trade and investment.

So the key question facing the world is this: what does China want? What kind of international economic order do its leaders have in mind?

To start, China is likely to remain a proponent of export-led growth. As Xi put it at Davos in 2017, China is committed “to growing an open global economy.” Xi and his circle obviously will not want to dismantle the global trading system.

But in other respects, globalization with Chinese characteristics will differ from globalization as we know it. Compared to standard post-World War II practice, China relies more on bilateral and regional trade agreements and less on multilateral negotiating rounds.

In 2002, China signed the Framework Agreement on Comprehensive Economic Cooperation with the Association of Southeast Asian Nations. It has subsequently negotiated bilateral free-trade agreements with 12 additional countries. Insofar as China continues to emphasize bilateral agreements over multilateral negotiations, its approach implies a diminished role for the World Trade Organization (WTO).

The Chinese State Council has called for a trade strategy that is “based in China’s periphery, radiates along the Belt and Road, and faces the world.” This suggests that Chinese leaders have in mind a hub-and-spoke system, with China the hub and countries on its periphery the spokes. Others foreseethe emergence of hub-and-spoke trading systems centered on China and also possibly on Europe and the United States – a scenario that becomes more likely as China begins to re-shape the global trading system.

The government may then elaborate other China-centered institutional arrangements to complement its trade strategy. That process has already begun. The authorities have established the Asian Infrastructure Investment Bank, headed by Jin Liqun, as a regional alternative to the World Bank. The People’s Bank of China has made $500 billion of swap lines available to more than 30 central banks, challenging the role of the International Monetary Fund. Illustrating China’s leverage, in 2016 the state-run China Development Bank and Industrial and Commercial Bank of China provided $900 million of emergency assistance to Pakistan, helping its government avoid, or at least delay, recourse to the IMF.

A China-shaped international system will also attach less weight to intellectual property rights. While one can imagine the Chinese government’s attitude changing as the country becomes a developer of new technology, the sanctity of private property has always been limited in China’s state socialist system. Hence intellectual property protections are likely to be weaker than in a US-led international regime.

China’s government seeks to shape its economy through subsidies and directives to state-owned enterprises and others. Its Made in China 2025plan to promote the country’s high-tech capabilities is only the latest incarnation of this approach. The WTO has rules intended to limit subsidies. A China-shaped trading system would, at a minimum, loosen such constraints.

A China-led international regime would also be less open to inflows of foreign direct investment. In 2017, China ranked behind only the Philippines, Saudi Arabia, and Indonesia among the 60-plus countries rated by the OECD according to the restrictiveness of their inward FDI regimes.

These restrictions are yet another device designed to give Chinese companies space to develop their technological capabilities. The government would presumably favor a system that authorizes other countries to use such policies. In this world, US multinationals seeking to operate abroad would face new hurdles.

Finally, China continues to exercise tight control over its financial system, as well as maintaining restrictions on capital inflows and outflows. While the IMF has recently evinced more sympathy for such controls, a China-led international regime would be even more accommodating of their use. The result would be additional barriers to US financial institutions seeking to do business internationally.

In sum, while a China-led global economy will remain open to trade, it will be less respectful of US intellectual property, less receptive to US foreign investment, and less accommodating of US exporters and multinationals seeking a level playing field. This is the opposite of what the Trump administration says it wants. But it is the system that the administration’s own policies are likely to beget.