The Google China Disconnect

Another analysis of a precarious negotiation

Most of you must have read about Google’s problems with the Chinese “system”. This post uses that event as an example to illustrate what is wrong with the Chinese and indeed the Asian way of doing things. I am not suggesting that western ways are better, just less screwed up. Let me first define what I mean by the Asian way. The ‘Asian way’ refers to cultural attitudes, behaviors and mindsets seen in east Asian people. So I would consider Chinese, Japanese, Korean, Taiwanese people and even some SE Asians to have a shared way of looking at the world. Other groups in Asia, such as Indians, Arabs, non-Arab middle easterners, Turks etc have their own issues. But back to the problem at hand..

I define the Asian ‘way’ as:

1. Civilizations with a lot of traditions and homogeneity, but lacking any social conscience and altruism. (compared to some European countries). 2. Societies that use rigid rules, hierarchies and not personal profit (gain) as a motive to support order. It is about scaring people with the specter of loss than encouraging them with the reasonable hope of gain. (It works in the short-term, then it breaks down). 3. Societies that do not often promote or listen to people based on competence, but rather prefer the advice of ‘wise’ old idiots or connected people. (Not unlike the english class or american wasp/ ivy-league system). 4. Discourage true innovation, but encourage specialization into repetitive mindless work. (Toyota makes great cars but they could not have invented the concept, and not because they were dumb). 5. Place excessive attention on your precise place in the hierarchy, combined with hereditary hierarchies and the tendency to hoard money- a truly nasty combination (Why would people work for the common good, if they have poor social mobility and everyone is trying to snuff out everyone else). 6. Do not like dissent, and believe it can be controlled, with hilarious and lethal results when stuff finally flies.(Read Chinese History) 7. Often incapable of adapting to new thinking, but can readily adapt name/ dress etc. (Japanese culture and custom versus dress and lifestyle, same for China and similar countries).

While each of these flaws is also present in other groups, it is their combination and expression in a people who believe three more ideas that seals their fate.

Those three ideas are:

1. Belief in their cleverness and unwillingness to cooperate with others for any extended period. 2. A worldview shaped almost exclusively by zero sum thinking, manifesting itself as mercantilism. Also believe in an unchanging world. 3. An unwillingness to think through their actions. Ironically many of these civilizations boast they can do that, when they only have 2000+ years of stagnation to show for it.

While these civilizations can become prosperous they can only do so if they have a host, that is willing to play their mercantile games. Once the host dies or breaks the parasitic feeding, the components of the parasite start fighting each other and reduce themselves to poverty or stasis.

Consider Google and China.. It’s experience in that country is hardly uncommon, infact it is the norm. However most western companies tolerate that because they believe that the chinese will change and they want to stay in that market. However short of multiple tungaska like events, they will not. It took carpet firebombing of Japanese cities + 2 nukes to partially westernize them.

You see, the Chinese believe that somebody else will buy their stuff in increasing amounts forever.

They seem to ignore that the money and debts they accept are and will be uncollectable.

Most asian cultures save a lot of money because they mistrust each other and will not support a working social welfare system. But saved or hoarded money does not create jobs or innovation. While saving money might have a place in societies before the industrial era, post-industrial societies can only function with almost zero savings or indeed a deficit. Most people in post-industrial societies do not have jobs that are productive or essential, they merely circulate money to maintain social stability and channel money into innovative endeavours. Ever wonder why japan has been in recession since the early 1990s?

However the Asian psyche cannot wrap itself around this concept. I will post another one in this series soon.

As for China becoming a superpower.. Not in this Incarnation.