Is China better at capitalism than America?

Conventional wisdom holds that Uncle Sam's free-market model is the best in the world. But China's growing clout is causing economists to think twice

The 1991 collapse of the Soviet Union seemingly put to rest any doubts about the supremacy of America's capitalist system. Guided by the magic hand of the market, the U.S. had created more prosperity than any other country in history, while the Soviet system crumbled under the weight of its creaky, bureaucratic machine. But the subsequent rise of China, whose economy combines aspects of capitalism and central planning, has thrust the U.S. model under new scrutiny. While Uncle Sam continues to limp his way out of the Great Recession, China has hardly broken its stride. Is China's brand of capitalism simply better than America's?

Yes. China is winning the future: China is smoking us, says Zachary Karabell at The Daily Beast. Both the U.S. and China engage in a lot of government spending, but China puts its money into infrastructure, transportation, alternate energy, and housing, all of which "will yield long-term benefits for the Chinese economy." The U.S., on the other hand, spends on "consumption, safety nets, and the military," which comprise a shakier foundation for economic growth. The "sclerotic inability" of the U.S. government to "productively invest for the common future" is the reason why its "form of capitalism has ceased to fulfill hopes, dreams, and needs of far too many people."
"China's not the big trade cheat harming America's domestic economy"

Nonsense. China's system is a pale imitation of ours: It's fashionable to proclaim that China "is eating our lunch," says Ian Bremmer at Reuters, but it's all "baloney." Just look at the way Chinese manufacturers "copycat everything foreign, from cars to watches to iPhones to social networks." The Chinese system will never "foster the entrepreneurial spirit" that makes these innovations possible, because the drearily unimaginative state is the "majority owner" of the economy. China has been able to "shoehorn a crude version of a beautiful financial system into its state-controlled economy and get some good results." But it will never be able to replicate the breakthroughs that are the hallmarks of a true free-market system.
"Chinese capitalism is just another knockoff"

Either way, the U.S. can learn from China: At every turn, America sees "ideological hang-ups standing in the way of what everyone realizes must get done" in investment and education, says Michael Schuman at TIME. In that sense, we could learn a lot from China, which dispassionately puts "pragmatism and problem solving over ideology." That's the Chinese model America should adopt: "Dropping the political bickering and ideological grandstanding and doing whatever is necessary to create prosperity."

Who is spying on Pakistan's spies?

Rob Crilly is Pakistan correspondent of The Daily Telegraph. He blogs excerpts from recently released Wikileaks files. The story of Kamran Bokhari's visit inside the ISI HQ in Islamabad and his brief meeting with agency’s chief Lt. Gen. Shuja Pasha.
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It is not often we are allowed a glimpse inside the shadowy world of Pakistan's Inter-Services Intelligence (ISI) agency. So amid all the humdrum dross, poorly sourced rumours and conspiracy theories in the Stratfor emails obtained by Wikileaks, it was a delight to discover an account of a meeting in April last year with Lieutenant-General Ahmad Shuja Pasha, who retired as its director general at the weekend. Analyst Kamran Bokhari describes the tight security at the ISI's lair in Islamabad and its smart premises:

Once after the main barrier, which is an iron gate you enter the courtyard of the new main building adjacent to the old ones. A really fine structure recently completed when the current army chief was heading the ISI and Musharraf was in charge – from the inside it resembles a 5-star hotel in terms of the quality of the interior finishing.

There's an interesting discussion about Afghan policy, Libya (apparently Gaddafi asked for help – no surprise given the two countries' close relationship) and the Raymond Davis debacle. Then it's time to leave…

At this point I asked him if there was any change to his email address and Pasha says I am sorry I have not been in regular touch over email because these people were reading my messages and I had to have my pc cleaned but I am still using the old email address. I asked who was reading his emails and he replied there is only one entity in Pakistan who can do that. (I take it he meant people from within the directorate were doing so).

So even the head of Pakistan's all-powerful ISI is apparently being spied upon. Perhaps by people within his own directorate. Or maybe he's simply trying to implant the idea that there are rogue elements at work, allowing him, his agency and Pakistan to play a double game with their allies in the West.

That's the thing about spies. Nothing is ever quite as it seems.

What ex-newspaper editors would have done differently

Veteran Tribune Co. and Chicago News Cooperative editor James O’Shea tells Nieman Reports:

Journalists of my era often responded to the challenges posed by the industry’s shifting business model with the retort: “That’s a business side problem.” More often than not, though, the business side’s answer was budget cuts that diminished journalism. Tomorrow’s newsroom leaders must take responsibility for the success of the enterprise by convincing themselves, readers and owners alike of something that has always been true: Good journalism is good business.

American Journalism Review asked editors the same question in 2002. Here’s what they said then.

India’s Crumbling Cities

Just give it a try…! Type “India’s dying city” on Google, and perhaps, I was not surprised to see the search engine leading me to pages on Kolkata, once the city of joy. Mahatma Gandhi described Calcutta as a dying city and the Indian-Caribbean writer V.S. Naipaul describes Calcutta as a city without future with the words: "All of its suffering are sufferings of death. I know not of any other city whose plight is more hopeless". But, Shreyasi Singh feels, Kolkata is just a symptomatic of a larger malaise affecting our cities.

One of the best things about Kahaani – the Hindi thriller that’s doing spectacularly well at the box office these days – is the way the bustling metropolis of Kolkata (once Calcutta) has been captured.

Cinematographer Setu has filmed the city in all its manic glory – people-filled streets, the grime of a city that has seen better days, and the sudden and unexpected beauty of a well-lit Howrah Bridge, an iconic Kolkata landmark, in the evening. That the movie is set over the span of a week or so during the Durga Puja festivals, the biggest festival of the Bengalis, just amplifies the sights and sounds in the movie.

Yet, while watching the movie – transfixed as I was by the smart storytelling and tight plot – I couldn’t help but think that the while the cinematographer deserves praise for his excellent work, India has generally failed when it comes to the look of our cities today.

Beyond romanticizing the “soulfulness” of a crumbling, but spirited city, the failure in administration of our urban areas is almost criminal. Kolkata isn’t alone. Barring Delhi and Hyderabad, where there have been tangible infrastructure enhancements, our other big cities – especially Bengaluru and Mumbai – are falling apart before our eyes.

In December 2005, India launched the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), the largest national urban initiative to encourage reforms, and it fast tracked plans for the development of 63 identified cities. As the JNNURM report stated, according to the 2001 census, India had a population of 1.03 billion, with approximately 28 percent of those people living in urban areas. By 2011, an estimated 65 percent of India’s gross domestic product was coming from urban areas, and by 2021, more than 40 percent of the total population of the country is expected to reside in urban centers.

As that happens, our cities need to be braced and prepared to handle this influx. If Kahaani’s realistic portrayal of Kolkata is a snapshot of what one of our biggest cities looks like, our preparedness seems less than satisfactory.

Dilli Dur Ast

Why Third Front is an idea with very little practicality, and most often no production viability

It’s a chair everyone wants to sit and fit in. So, it was not surprising when India Today magazine got the issue on its cover page. The story titled, “Will UPA survive this summer?” ponders upon various permutations & combinations around the new government formation. The issue has come to the forefront after drabbing performance by the incumbent UPA (read Congress) government in the recently held state polls. Despite prime minister brushing aside possibility of mid-term election, the political circle is abuzz with possibility of snap polls. Congress at this juncture definitely doesn’t wants to jump into poll fray, same for the BJP. With two of the biggest national parties unwilling to test their mandate at this juncture, regional forces have started indulging in the fantasy of a third alternative in the prevailing mood of the nation.

Indulging in fantasy of Third Front is not new in country’s politics. We saw it just before the 2009 general elections, when political pundits almost made UPA sit in the opposition. Several compromising candidates for the Prime Ministerial job were popped-up, ranging from Dalit leaders Ram Vilas Paswan and Mayawati to OBC stalwart Sharad Yadav. Later UPA without support from left and with help from other regional allies including DMK and TMC came to power. The dream died in its bud.

Almost all the regional satraps foresaw the results of assembly elections. No surprising, much in advance, they declined to toe Congress’ line on various issues including Lokpal Bill, the provisions of NCTC, the FDI and others. Regional cards were played with full acumen; issues of federalism vs. centre’s control were popped up. Naveen Patnaik was seen drafting letter on Mamata’s behalf over NCTC issue and Nitish Kumar and Jayalalitha joining the axis under West Bengal CM’s leadership. Taking Mamata on-board gave some definite edge to the possibility of what was in the store. And the possible die was cast on 6^th of March, when results stated pouring in from various states. Congress, except Uttarakhand and Manipur, was the clear loser. Party’s expectations were dashed, the party was on back foot. Decimated Congress boosted this desperate group of would be PMs, sticking together just to be in the power. Return of Mulayam Singh Yadav in UP, who earlier served as Defence Minister, in HD Deve Gowda led similar front, boosted their confidence. And after the return of the Akali Dal-BJP combine in Punjab, talk of a new federal front has only intensified.

Third Front is not an alien concept to Indian politics. The Janta Party was the first non-Congress party which came to power in Delhi and since then India has seen five experiments on the line. None of these experiments were based on majority by the coalition partners. If we look at the numbers garnered by these parties in the current Lok Sabha, their combined strength adds up to 222, minus the BJP, which falls short of the 50% mark. It is also obvious that many of these parties, such as DMK and the AIADMK or the SP and BSP can’t see eye to eye. So the rational figure goes further down to less than 100 seats, impossible to offer a viable alternative.

There is a bigger inherent weakness which is glossed over when the going is good (i.e., when the romance is at an early stage) and which rears up in an ugly fashion when the honeymoon is over. Each of these regional chieftains is ambitious, i.e., they would all like to be prime minister. Their logic is—if someone like Deve Gowda, a complete outsider to national politics can make it as a compromise candidate (ditto for I.K. Gujral) why not me, who runs a state government and can deliver a handful of Lok Sabha seats? In this too many chiefs, not enough Indians situation, the ambitions of these regional bosses will cancel each other out.

Also the contention that regional parties are losing is not supported by outcome of recent polls. Both in UP and Punjab, the Congress’ vote share went up.

This will not stop the Third Front idea from gaining traction, because that is propelled by an antipathy towards the Congress and suspicion of the BJP. And given the peculiarities of our system, a minority government could, with some informal help from outside, come to power, even if its durability would remain suspect. But the cheerleaders of yet another front would do well not to get overexcited; Delhi is still far away.