The Greenfield Report with Henry R. Greenfield
Welcome to "The Greenfield Reportwith Henry R. Greenfield," where 50+ years of world travels across 10 countries shape insightful takes on current geopolitical events. Join Robert for eye-opening global reports with practical local solutions, and enjoy guest appearances offering fresh perspectives. Embark on a journey of understanding and lively discussion.
The Greenfield Report with Henry R. Greenfield
Episode 13- China's Grand Strategy: Past, Present, and Future. Part 1 with Dr. Eric Hendriks
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Few geopolitical relationships will shape our future more profoundly than the complex dance between China and the West. In this eye-opening episode, we're joined by Dr. Eric Hendricks, a Dutch sociologist who brings extraordinary credentials to our conversation about China's past, present, and future trajectory.
In this, the first part of a two-part conversation with host Henry R. Greenfield, drawing from his six years living in Beijing and extensive research at institutions from Peking University to the University of Chicago, Dr. Hendricks takes us on a fascinating journey through China's evolving self-perception. He explains how the country has transformed from viewing itself as the "central kingdom" of civilization to experiencing what Chinese historians call the "century of humiliation," and now to Xi Jinping's vision of a "new era" where China reclaims global leadership.
We explore China's unprecedented surveillance capabilities—a system Dr. Hendricks describes as "nothing like this has ever been created before in human history"—capable of identifying any citizen within seconds through facial recognition. This technological control makes organizing even small-scale opposition virtually impossible, challenging Western assumptions about potential internal destabilization of the Communist Party's rule.
The conversation takes a particularly illuminating turn when addressing the ongoing economic tensions between China and the United States. Dr. Hendricks offers a compelling analysis suggesting America could potentially lose the current trade war, pointing to China's strategic control of rare earth refineries as just one example of its growing leverage. He breaks down the structural imbalances in the global economy, where America has evolved into a consumption-oriented society running deficits while China has become export-focused, creating dependencies and tensions that experts believe cannot continue indefinitely.
Whether you're concerned about global economic stability, fascinated by China's technological advancement, or simply trying to understand the shifting balance of world power, this conversation provides crucial context for navigating our complex geopolitical future. Listen now and gain insights rarely found in mainstream coverage of US-China relations.
Introduction to the Greenfield Report
Speaker 1Welcome to the Greenfield Report with Henry R Greenfield, your gateway to understanding today's geopolitical landscape. With 50 years of experience across 10 countries, henry shares expert insights on world affairs, offering practical solutions and engaging guest perspectives. Dive into the Greenfield Report for lively discussions on the issues that matter.
Dr. Eric Hendricks: China Expert
Speaker 2This is Henry R Greenfield for the Greenfield Report. Today we are once again in Budapest, hungary, a crossroads between the East and the West. We are fortunate to have a very special guest, an expert in several areas of East and West relations, and in this case we mean all the way to China. With us is Dr Eric Hendricks. Dr Hendricks, isa Dutch sociologist and critical theorist, currently a fellow at the Danube Institute and director of the China Initiative of the Tilos Paul Picon Institute. His research focuses on China's integration into the global order, with a particular emphasis on the ideological tensions involved. Dr Hendricks has studied at Utrecht and Berkeley in the United States, göttingen and the University of Chicago, as well, as he earned his PhD from the University of Mannheim. He has held research positions at the University of Bonn and Peking University and spent six years living and conducting research in Beijing. As a public intellectual, he has authored around 100 essays and op-eds for Dutch, german and English language media, including NRC, frankfurt Allgemein Zeitung sorry about that, eric Quillette Quadrant Times, higher Education and Cato. His most recent significant publication, which is available in the US journal Telos, is China's Counter-Cosmopolitanism. Welcome, dr Hendricks, and would you mind if I called you Eric? Oh, please do Well. Welcome to the Greenfield Report.
Speaker 2To give some context to our listeners, I first met Eric when he was giving a lecture at the Danube Institute a few years ago. We found that, while I came more from the business world and Eric came from the academic, we had a mutual connection as both of us had lived and worked in China for many years. We both have a strong belief in the Chinese and the future of China. While I believe Eric's fluency in Mandarin far exceeds mine, we both learned the language to add to our understanding of the people, the culture, the politics and the business in China. Thus, the subject of A Common Ground is critical to our mutual approach to understanding and working with China and the Chinese people.
Speaker 2As there are a vast array of questions facing China and the world, especially the United States and the Trump tariffs and the Chinese response, there are a wide variety of issues that we could cover Today. However, we would like to focus on just a few of the areas of expertise that Eric has, and we would like to begin with the European-Chinese diplomacy and how Chinese perceptions of this issue, which, in my view, is being underreported, with all the ups and downs of the Trump maneuvers. Also, we will cover another subject which is at the forefront and on everyone's minds Taiwan and the People's Republic of China and their stability. Eric, on the Greenfield Report, our method is to give you a question and let you take over and explore it as you wish, much like you do at the Danube Institute. So let us begin with China and your view on its past, present and future.
Speaker 3Thanks, robert. That's a great question. To start with, china past, present and future. China is a curious thing because it has a now, on its level of its official politics, has a clear notion of a new era, an impending new era, the Xin Zhe Dai. And this new era is going to be an era in which China takes greater leadership in the world and China will stay under the leadership of the Chinese Communist Party. The party will centrally guide Chinese society and the world as a whole will become a harmonious coexistence of different states, cultures and nations. So this is the ideal laid out by the Chinese Communist Party leadership, deal, laid out by the Chinese Communist Party leadership. And there are a lot of there's a, there's a. There's a lot going on in terms of political ideology and and intellectual reimagining, because China had to reimagine itself, is now currently in the process of reimagining itself and its place in the world, but has been doing so, I mean, for one and a half centuries. So let's go back. So this past, present, future what is China's past?
Speaker 3China's past is a long and complex series of dynasties which saw themselves as the central part of the world. Which saw themselves as the central part of the world. So China was not in itself conception before the modern era. It stayed alongside other states. It was the world as such or it was the world-carrying part of the world. So Chonghua means central kingdom or central terrain. So that was the original, traditional self-conception of China. There are no states, there is just a world in which there is a central part and there are less central parts, and the less central parts need to be symbolically connected to the center via attributes. Parts need to be symbolically connected to the center via attributes. These are symbolic ties, largely symbolic ties to the Chinese court, and at the center of the Chinese courts stands the emperor, the son of heaven, which connects humanity to the cosmic order.
Speaker 3Now, as modernity kicked in and China was rudely awakened by the technological and organizational dominance of the Western powers, it needed to reconceptualize itself. So now China woke up and it saw that it was not the central part of the world, but it was a state in a world of states, worse, in a world of states. Worse, it was a weaker state in a world in which other states had military, technological and organizational superiority. Now, this was a long, you know. A lot of things happened. A lot of wars happened, opium wars, uprisings, boxer rebellion, civil war, second World War we have a whole series of wars.
Speaker 3Then the Maoist era is a sort of is a sort of a continuous civil war in China, in Chinese society. So now, but now, but there was always this sense that China has a special mission still, even if it's not the world, maybe it is it's the country that's going to bring the socialist world revolution. So China will still be a country with a special connection to the category of world. But then in the 90s, when China was liberalizing under the influence of the Dunguists, there was a new sense, a very radical sense, in which China was not. It was not just that China was not the world, but a state in the world. And it's not just that China doesn't even have a special world historical mission anymore. China has fallen behind the most developed countries.
Speaker 3So that was a new, more liberal you could say notion in the 90s, and this was really the most diminished Chinese self-conception, and this was really the most diminished Chinese self-conception. And what you've seen recently is China reasserting a certain confidence, or at least they're trying to get a new sense of confidence. And as part of this they again Chinese intellectuals and Chinese politicians are again playing with the idea that there might be a special connection between China and the category world. So now Chinese intellectuals, like, let's say, xu Jilin in Shanghai, they will say that China has a world historical mission to bring the world into reality. But on the level of the Chinese political leadership, you will have the notion of the new era and the community of common destiny which China is going to usher in. So there is new intellectual ambition and there's political ambition. And while all of that is going on, there is of course in the international realm a rivalry with the United States.
The Century of Humiliation
Speaker 2So can I interject a little question here, because I don't think we're finished with that yet. Here's my question, eric there's a lot made about China's 100 years of shame, which you alluded to, and that this has a great impact on how the Chinese are viewing the rest of the world. Now we have a lot of other complications here to talk about today, but over and over, if you listen to the Chinese when they make their speeches, they have this allusion to how China was somewhat abused, especially by the foreigners, the Westerners. Is this real or is this just window dressing at this point?
Speaker 3Yes, there is the official concept of the century of humiliation, which runs from 1839 to 1949, the year in which the People's Republic of China was founded by Mao Zedong in Beijing. So the century of humiliation was originally a Kuomintang, a nationalist term, and the nationalists were the rivals of the Chinese Communist Party in the beginning and middle of the 20th century. In the Kuomintang version it's 1839, the first opium war, to 1945. So the end of the Second World War. But of course the People's Republic of China version puts it at 1949, not 1945, because that's when the PRC is founded.
Speaker 2So what is this? And remind our listeners where is the Kuomintang? Where did they go?
Speaker 3Oh, they went to Taiwan when they lost the Civil War. So there had been some, let's say, skirmishes between the Communist Party and the Kuomintang going back decades. But finally, after the Second World War, the Kuomintang lost the civil war on the Chinese mainland and migrated to, or fled to Taiwan, and this led to the current situation in which the People's Republic of China, run by the Communist Party, is on the mainland, the Chinese mainland, whereas the Republic of China is on Taiwan. So we have these two Chinas. America and most of the rest of the world originally recognized only the Republic of China as the representative of China, also in the United Nations, and then in the 70s came the big switch when America and many other countries in its wake officially recognized the People's Republic of China as the representative of the Chinese nation. But of course this thing is still going on because the Chinese may have.
Speaker 2We're going to save that for a little bit later, but let's just keep this thread going about how the Chinese see and I like what you were talking about here their view of the special importance of China in the whole entire world, and the name of the country reflects that, Chang'e being the center of the. I call it the center of the world. Okay, Other people interpret it slightly different, but it views themselves clearly as now their opportunity to become the most important country in the world. Now is that vision, in your opinion, still playing out? Are they getting close to that or where are they right now, before we talk about the current geopolitical yeah.
Speaker 3So in the official political rhetoric coming from the party leadership, the picture is quite modest.
Speaker 3China will just be a very important country alongside other countries and it will be in a sort of pluralized situation.
Speaker 3But in Chinese intellectual life and in the Chinese culture more generally, you can already see, you see the tendency to think of China as a very special country, and this will be in intellectual life, in political philosophy, will be expressed in various forms, but it has a much broader resonance.
Speaker 3Thomas Metzger of the Hoover Institute, who is this comparative sinologist and political philosopher who's written extensively on Chinese political thoughts, argues that the dominant assumption in Chinese intellectual life is that the natural condition is for China to be the leading country, which in some metrics it was at least it was before the modern era. In its self-perception it was the most important country, but of course also in terms of economic size it was the largest. However, china has never been the leader of something like a world economic system, because when the world economic system emerged and it was run by the dutch, the british and then the americans, it was, um, it was china that was on the periphery of that system. So china was, china was the largest economy at a time, uh, before, before it entered a world, world economic system.
Speaker 2And when it entered the world economic system, it's always been on the periphery so there isn't there isn't necessarily much objective history to this, but it's a kind of intuition that's very widespread in China that China has this natural centrality glad that you brought it up that, while China was the world's largest economy, arguably, the Indians talk about, you know, the Mughal area being also a very large economy, but much larger, of course, than the Europeans at the time.
Surveillance State and Party Control
Speaker 2In fact, actually, if you look at it as the way the world has evolved in industrialism now, in technology, those were very small numbers if you look at it in terms of where we are today as a global species. So I think that's something that we should all keep in mind, that, yes, it's kind of a historical legacy. Now, how does and I don't want to get too much into the weeds here, but does Xi Jinping thought play any part in that? Or is that again just a political thing? Sorry, what do you mean exactly when Xi Jinping is now talking about his philosophy? Is the guiding philosophy of China, so that China will become that dominant or special country in the world?
Speaker 3Oh yeah, so from the point of view of the Chinese Communist Party leadership, the party doctrines are crucial for China's success. Now, of course, if you look at it from a different perspective, you will not necessarily draw that conclusion, but in the official state doctrine which is, as you rightly point out, xi Jinping fought for socialism with Chinese characteristics for the new era. It's a very long, very long name. In this official state doctrine, it's, of course, stated that the Chinese society and all parts of Chinese society falling under the Communist Party leadership and the party being centered on the party leadership and the party leadership revolving around what they call the core, namely Xi Jinping himself, is crucial for China's success.
Speaker 2So just to rewrap that, and we're going to move now on to the next part, which is the Europe and the United States and the global geopolitical situation and how China fits in that, according to Dr Hendricks, in my view, listening and watching the Xi Jinping thought and also the surveillance that is going on. When I first went to China in 1981, there was a lot of surveillance, but that was all done by hand, block by block. There was a lot of surveillance, but that was all done by hand, block by block. Now it's facial recognition. Now those old social scores have been updated, as I'm sure you know, eric, recently they have now codified that into a national system, now not even allowing any local interpretation. So what I see in China, at least from my point of view perhaps you don't I see more of a centralization as opposed to any kind of local control. Do you see that?
Speaker 3Well, on the surveillance level, it would make sense to centralize, centralize. Of course there's other domains of society. You'll still see quite some importance of the local level, you know, in infrastructure projects, for example. But you know surveillance, yeah, you have an extremely advanced censorship and surveillance system in China. It's unprecedented Nothing In human history. It's unprecedented Nothing In human history, in human history. So nothing like this has ever been created before. Which is also why I kind of almost pity people who think that the Communist Party can easily be destabilized from the inside. If you try to organize in Chinese society anything that has any potential for being a political threat, even getting 10 people together in a room will be a logistical challenge, and meanwhile the Communist Party of China has 100 million members and the most advanced system of social control ever in world history.
Speaker 2Well, I remind our listeners that one of the most famous people in China is Jack Ma, who is the head of Alibaba and all of the things that go with that, and he's now a Chinese Communist Party member.
Trade War and Global Economic Imbalance
Speaker 2With that, and he's now a Chinese Communist Party member, so it proves to be that model which I think. Trump we talked about Trump, following the Orban playbook, you need to stay on side of the people that are in charge. I do want to make just a quick comment on the surveillance. Even when I left China in 2019, the end of that year just before COVID, the Chinese bragged that they could identify any person in the country using facial recognition within five seconds. In other words, there was no way that you could hide, as Eric said, and get together any kind of group that could ever threaten anybody in the Chinese Communist Party. Well, moving right along, how does China reflect upon the global geopolitical situation and economic turmoil that is already roiling the global markets and could do significant damage to the Chinese economy? And, secondly, do you agree with many people who feel that the Chinese will not blink and have been preparing for this for at least six years, when Trump put the first tariffs on in China in his first administration?
Speaker 3Oh yeah, the Chinese have been preparing not just on a strategic and economic level, but also intellectually. So they launched a concept of great changes unseen in a century, which explains how this glorious new era is still on the horizon, even though, in order to get there, china will need to struggle through some really tough challenges, and on the international level. Tough challenges and on the international level, the primary contradiction. So they have this Hegelian, marxian dialectics model, so the primary contradiction will be the United States targeting China. The latest phrase is economic bullying. So that's how the tariffs have been described by spokespersons and, I think, also by Xi Jinping himself.
Speaker 3Recently, I read a white paper that has just been published by the information departments on the World Trade Organization's principles on international law, on the principles of international trade.
Speaker 3They say that these tariffs completely disregard the system of trade and corporation that has been set up and built up in over decades, which is, of course, true. So they're scoring the, they're taking the moral high ground, but they're also responding with their own counter-terrorism. And at this point, arguably, the US is more vulnerable than China is because, part of the countermeasures that China has taken, it started to further restrict the access that the United States has to refined rare earths, and it gets a little bit technical, but it revolves around things such as special kinds of magnets, and it's not that these rare earths are themselves very rare in the sense that they wouldn't be anywhere else on earth, but it's the refineries, which are all in China, and so there are some depositories in the United States, but their experts have estimated that these will run out in six to 12 months. So it seems that this is going to sound a bit harsh, but it seems that America could actually lose this trade war against China.
Speaker 2Well, I think that it's important to say that. I mean, you have expertise there, and it was very interesting the way that you talked not just about rare earths but also about the refining of the rare earths, which is, of course, one of China's strengths, not just the rare earths, not just the refining, but also on all of the ways that they have been able to take various materials and turn them into products, turn them into systems, turn them into software, turn them into technology. So it's not just in fact. Maybe you might want to comment on this, I'm not sure, but it seems to me that China is the country that is hungry for resources. I mean, I lived in Australia for years. Australia basically lives on sending resources to China.
Speaker 3Yes, China has an enormous need for resources because it's the world's largest industrial producer. In recent years, the technological advancement has been spectacular. I remember in 2010, 2015,. People would say things such as well. China is producing cheaply, using cheap labor, but they're not high tech. They cannot make good combustion engine cars. They cannot make good laptops. They cannot make good combustion engine cars. They cannot make good laptops. They cannot make smartphones. And then, a few years later, they made excellent smartphones.
Speaker 2They somehow leaped over Crossing the chasm, they call it, from internal combustions. Well, let's not even do that, let's jump straight to EVs, Exactly.
Speaker 3So it's all been very spectacular and what has been revealed as a kind of ideological self-delusion on the Western side is this notion that Westerners have this inherent creativity or liberal society has this inherent creativity, which is nonsense, because I mean non-liberal societies and even very politically restrained societies can be very creative in economic domains, because technology is not such an ideological thing. So I mean you could just look at 20th century European history and you could see that the fact that Nazi Germany was a totalitarian state in which they did horrible things to people didn't stop them from building very advanced factories and innovating in weapon production, Right up to rockets.
Speaker 3Yeah, right up to rockets. And of course Werner von Braun was the big rockets man, came from Germany and was then joined to the United States after the war and was pivotal importance to the US Moon.
Speaker 2Project this mini wrap here on this section of asking you. So the Chinese economy has evolved. We all get that the Chinese economy now makes things and way beyond toys or any other things that most people don't need to have, but they in fact make things that people have to have. So is the Chinese economy, in your view, currently meeting expectations and, if not, why?
Speaker 3So the Chinese have structural problems in their economy which are actually tied up with the structural problems that America has. So they sort of form mirror images of each other. There's a microstructure to the world economy. There's a macro structure to the world economy, and I'm taking this from people such as Michael Pettis, who's an American macro economist who teaches at Peking University, and Ray Dalio, who's the great financial guru, but he's also a very advanced social theorist, in my opinion, and I'm taking these ideas and they are ideas and what I see is the following right, and what I see is the following the problems of the United States internally and the problems of China internally relate to the way the macroeconomic structure is structured.
Structural Economic Problems and Asymmetries
Speaker 3As a very financialized economy, you will see it running structural trade deficits. This is what financial systems do in modern capitalism. London in 1900 also ran a structural trade deficit with the rest of its empire In the Sterling Zone. London had to trade deficits, but the surpluses that were created elsewhere in the Empire were recycled via the London banking system. So people in other parts would sell things to London, london would consume these goods and then the money that was made was put on London banks. So America had some kind of surplus recycling mechanism like this. When it dropped the gold standard in the 70s, we went to a system where the United States was a structural deficit country and countries within its political sphere of influence created the surpluses.
Speaker 3So we're talking Japan, germany and then later also South Korea and then ultimately China joined that line of that series of exporters which were initially very much focused on exporting to the dominant consumption markets versus United States. So here was the game plan You're exporting in dollars from Germany, japan, south Korea, china. Your own currency doesn't appreciate much because you do the exports in dollars. The dollar is the dominant reserve currency and a dominant currency of trade. So the dollar becomes. There's a lot of demand for dollars because everything is done in dollars. So the United States becomes too expensive really for exports, but it has a lot of money to consume. What does it consume? The products which you produce cheaply because you're in this system In the empire.
Speaker 3We're sort of in the empire, but here comes the crux. Japan, south Korea and Germany were sort of in the empire and in China became a sort of big version of that. But outside in the empire and in China joint became a sort of big version of that, but outside of the empire. So that creates all these political tensions that we're seeing right now. That's the real fundamental level. That's what's going on. So what you have is that the manufacturing goes down. It's been continuously going down since the 70s, also before China joined the sea right as a large industrial exporter but it just went further and further and further this trend and it's kind of unstoppable. But it creates problems on both sides.
Speaker 2So do you believe that this is now in an imbalance, like Trump is saying? Yeah, it is.
Speaker 3So Michael Pettis and Ray Dalio think that this is a huge problem, right, and it cannot go on forever, and the asymmetries are only intensifying. And Ray Dalio think that this is a huge problem, right, and it cannot go on forever, and the asymmetries are only intensifying. Because what did Biden do, for example, when there was a little bit of a trouble in the American economy? He printed a lot of cash. He gave people cash or they would consume more. So that's how. That was the Biden response to the COVID crisis, which further intensified America as a consumption market.
Speaker 3What did the Chinese do? Well, they invest in infrastructure. What's the Chinese problem? Their return on the investment in infrastructure is declining because they have way too much infrastructure and their economy is way too focused on cheap exports and they need more consumption market. But they're kind of in their pattern. They're patternized, right, but on the same on the American. So the Americans just keep consuming, whereas they need to have more austerity and they need to rebalance and manufacture and the Chinese need more consumption. But both sides, when challenged, further intensify the asymmetry. So the asymmetry needs to blow up. But then the problem with the Trump is that they don't really have a clear sense of the macroeconomy. They have a kind of sense of other countries are just ripping us off and therefore they're not using the right tools.
Conclusion and Preview of Part Two
Speaker 2Well, you can see that, obviously, dr Hendricks has some very deep views on this and I think they're quite outstanding for our listeners. So we're going to end. This is the end of part one of this interview with Dr Eric Hendricks, and we will pick it up with part two in just a moment, where we're going to talk about what is that effect on the global economy global economy, again, as Dr Hendricks began to allude to, what did Biden do and how did that work? And what is Trump doing and how is that going to work. He's already mentioned that the US is not winning the trade war, but we'd like to go into some more depth and we have not yet covered the European response, which is, I believe, a key to the entire future of the global economy. So this is Henry R Greenfield signing off for the Greenfield Report and Dr Eric Hendricks, thank you very much, and we will be back with part two. Thank you.
Speaker 1Thank you for joining us on the Greenfield Report with Henry R Greenfield. We hope today's insights into the ever-shifting geopolitical landscape have sparked your curiosity and broadened your perspective. Stay connected with us for more in-depth discussions and expert solutions. Until next time, keep exploring the world beyond the headlines.