No nation has as many people as China, which is closing in on a population of 1.5 billion.
This huge population is a major asset for China. Yet Beijing also faces numerous challenges to maintain economic growth, strengthen supply chains, develop strategic STEM sectors, and secure a modern military edge by properly developing, training, employing and retaining its human capital, according to a recent panel.
A discussion on the topic was held May 16 to coincide with the release of a report jointly produced by the Center for Strategic and International Studies and the Brookings Institution. “How China’s Human Capital Affects Its National Competitiveness” is part of a larger project led by Jude Blanchette, Freeman Chair in China Studies at the Center for Strategic and International Studies, and Ryan Hass, senior fellow and the Michael H. Armacost Chair in the foreign policy program at Brookings.
Ryan Hass of the Brookings Institution.
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Blanchette and Hass were hosts for the event. The discussion included Emily Weinstein, a research fellow at Georgetown’s Center for Security and Emerging Technology, and Leta Hong Fincher, the author of “Leftover Women: The Resurgence of Gender Inequality in China.”
“The project itself is really driven by a simple thesis, that in order to understand the nature and future of U.S.-China competition, it’s really important to have an awareness of the role that human capital or the ability to develop talent will play in that competition,” Hass said.
“And often in Washington, we hear discussions about military issues, strategic issues, economic issues," he added. "But at its core all these issues trace back to how well, or poorly, each country will be able to develop capital, human capital, in order to achieve their objectives. And this is a point that China’s leaders seem to understand.”
He said Chinese President Xi Jinping, Premier Li Keqiang and others talk about their national goals and ambitions for lifting up the talents of their people. Hass said since China has four times the population of the United States, it doesn’t need to be on par with U.S. workers in a productivity basis in order to catch up or surpass the U.S.
But there are problems.
“Their demographic profile is going to get worse with time," Hass said. "By some measures they are probably already post-peak in terms of their ability to harness a growing population to advance their economy. And as time goes by, they will have a profile that more closely resembles Japan’s today.
“They also face real challenges with their urban-rural divide and the inequality of allocation of resources and opportunities for those who live in the cities and those who live in the countryside," he added. "This divide is exacerbated by the fact that they have a pretty restrictive system for allowing domestic registration for people to move about the country.”
That limits the ability to place top talent in places where they can maximize their talents and achieve their potential. Other challenges include ethnic, gender and minority issues, he said.
Blanchette said while Jinping appears focused on military modernization, he should be thinking more about comprehensive education reform, especially in China’s rural areas where most of the population growth will occur.
“This is a wave that we’ve seen coming for the better part of 30 years,” he said. “And it’s now very much cresting. And it is impacting the structure of China’s workforce, where you have a net negative growth in workforce. You’ve got this emerging retirement wave, which is going to put significant pressure on China’s pension system, health care system and its overall fiscal outlook. It seems to me Xi Jinping would be better focused on a sort of ‘build back better’ with Chinese characteristics right now than where a lot of his attention seems to be.”
Weinstein said the sheer number of people to draw from gives China an edge, as does its ability to look ahead when making plans.
“China has big, lofty goals that they lay out in five-year plans, 10-year plans, 15-year plans," she said. "Those big plans and the ability to really think strategically is a really big piece of China’s strengths, particularly in science and technology."
The Chinese approach to education is often impressive as well, Weinstein said.
She said her colleague Diana Gehlhaus, a research fellow at Georgetown’s Center for Security and Emerging Technology, has analyzed how China has improved its artificial intelligence education system at all educational levels.
“They’ve made significant strides in trying to implement AI education majors at universities and things like that,” Weinstein said. “I would say, for better or for worse, the education system is a big strength for China because it is so top-down, it is so centralized. And, obviously, in the United States, education is very much a state-by-state policy. China has really been able to kind of blunt force push their universities into the 21st century.”
She also credited Jack Corrigan, a CSET research analyst, for producing a report explaining how Chinese universities have moved over the past 15 years into the top world rankings.
The Chinese government has poured massive amounts of money into luring people to the universities, Weinstein said.
“And this fits hand-in-hand with their policies to improve education because, obviously, if you want very prominent researchers to come to your universities, you have to have a relatively high-ranking university,” she said.
Weinstein said these talent programs are under much scrutiny in the United States and are starting to receive more scrutiny elsewhere now as well, “partly for very legitimate reasons.”
China’s technology transfer activities fit into three categories, she said: legal activities, illegal and extralegal.
"And talent programs fit in that extralegal bucket if you’re a U.S. professor working in biotech and you want to sign on to a talent program with Shanghai University, it's not illegal,” Weinstein said.
“But one of the issues is that these talent programs kind of push you to do things that your home university or your home country might not necessarily be comfortable with," she added. "And we’ve seen with the now-defunct China initiatives, what some of these talent programs have pushed people to do, including not listing that you are participating in that talent program on your resume or trying to kind of obfuscate more of that information.”
But as changes are made, one constant remains and that is China still needs overseas talent. That is being helped by policy and political issues in the U.S. that pushes people out of the United States and back to China, she said.
Weinstein said the Chinese are remarkably open about the problems they face, and are honest about both their strengths and weaknesses.
A report coming out soon will look at what China believes are their chokepoints in technologies, she noted. They are aware what they need and where innovation is happening across the planet, such as the semiconductor supply chain in the Netherlands, and where aviation-grade steel is being produced.
China has initiatives worth studying and learning from, Weinstein said. CSET Director Dewey Murdick testified before the Senate Select Committee on Intelligence on May 11 and made that point.
“He brought up this idea that there are things in the Chinese system that we can’t learn in the United States,” Weinstein said. “I feel like there is such an adverse reaction when you tell a policymaker now that, ‘Oh, you know, our 'quote unquote' adversary or competitor country is doing something that we should try to do,’ and some people double down on the communist side and say, ‘Oh, well, we’re a capitalist democracy. We shouldn’t be doing anything like that.’
“But just one example of something that we could potentially learn from China. So there’s this recent research that looked at China's open source intelligence and intelligence collection, intelligence strategy,” she said. “And one of the things that was found was that they have about 60,000 personnel that are tasked with studying science and technology gains, achievements, advancements globally, and reporting back on that. We have nothing like that."
She said American and Chinese scientists and researchers must continue to communicate.
“I get the question a lot about in biotechnology, is there anything that, you know, is it worth collaborating with China because of, you know, biometric data being collected, the issues with minorities in Xinjiang,” Weinstein said. “I would be scared if all medical, biomedical biotechnology researchers between the U.S. and China stopped talking. Because if the Chinese are coming up with the cure to cancer, I don’t think we want to, you know, stop talking to them just because it’s China who finds the cure.”
A male-dominated society
The discussion shifted toward China’s internal problems, including demographic challenges and the fact that the Communist Party of China is male-dominated political institution.
“I’ve written a lot about how China’s authoritarian system is very patriarchal. It's a patriarchal authoritarianism that really, I argue, relies on the systematic subjugation of women,” Hong Fincher said.
“The Communist Party in the past, of course, is really believed in gender equality," Hong Fincher said. "It’s enshrined in [their] constitution. But I’ve written a lot about how in the reform era, gender inequality has really surged in many, many ways and continues to rise. So you would think that with economic growth slowing, that one of the things that the party would want to do is to enable more talented women to work. But it’s doing the complete opposite. You look at the labor force, participation rates for women continues to decline. It’s really plummeted over the last couple of decades."
And then, of course, politically, there has never been a woman on the standing committee. There is currently only one woman on the Politburo, and the percentage of women at the Central Committee level has actually fallen and is dismally low.”
She said after years of study and contemplation, she is convinced that China’s leaders, particularly Jinping, believe that Communist Party survival actually depends on keeping women down, on pushing women back to very traditional roles of wife and mother.
“You see that as well with population planning policies,'' she said. “Clearly this is a political decision. It’s that the leaders have decided, the male leaders, that it is essential for political stability in China, that women all return to the home and be docile wives and mothers.”
Blanchette said Chinese census numbers the last two years, from a national planning perspective, have been “pretty dismal.” That is affecting family planning policies and the role of women.
“I call them population planning because family planning is a little too benign for what’s happening in China,” Hong Fincher said. “Population planning has always been very coercive and draconian in China. Now, after decades of the so-called one child policy, they’ve completely reversed course. Starting in 2016, they implemented a two-child policy, which was supposedly projected to lead to a bump in births, which only there was a tiny little bump at the beginning. But we’ve seen a decline in births in the number of newborns for five consecutive years. And this is extremely alarming to the Communist Party leadership.
“And so last year in the summer, they came out with a three-child policy," she added. "And along with that is, you know, corresponding propaganda saying, ‘Oh, it's really glorious, patriotic to have more children.’”
This could lead to other drastic measures, in her view.
“So what I’ve begun to notice is, I had long expected that we might end up seeing abortion restrictions in China," Hong Fischer said. "I think this is incredibly politically sensitive, given that just the long history of forcing women to be sterilized or enforced mass insertion of IUDs,” she said. “And so the government can’t just announce outright overnight that they’re going to have an abortion ban. But I believe that we are certainly seeing more and more language referring to the need to reduce what they call medically unnecessary abortions."
She said there has been an “enormous crackdowns on feminist activism in China,” which she wrote about in her book, “Betraying Big Brother.” But people are pushing back.
“It’s really amazing to me that in spite of these incredibly rigid crackdowns, that there are still emerging, always emerging, these grassroots feminist responses and new forms of political activism,” Hong Fincher said. “There’s also their own version of the MeToo movement, where individual women, largely women, come out about it and they’re determined to tell their stories about sexual assault.”
She discussed Chinese tennis champion, Peng Shuai, who wrote about being sexually assaulted by Zhang Gaoli, the former vice premier.
“And we still don’t know what’s going on with her,” Hong Fincher said. “She’s very likely under house arrest. And they trotted her out briefly during the [Tokyo] Olympics to say, ‘Claim that everything was OK.’”
She said there is a lack of reliable media coverage on Shuai.
Other stories are spreading across China despite government efforts to censor them, including rape victims or the “chained woman” in rural China who was trafficked and forced to give birth.
“That sparked an enormous amount of outrage across China, actually, on social media, even though it was very heavily censored,” Hong Fincher said. “And so I don’t think that the case of Peng Shuai will ever be completely over."
Hong Fincher said it’s often pointed out that there are women who are CEOs and CFOs in China.
“Certainly there are fewer barriers for advancement of women in the corporate sector in China than in the government sector. But that’s really not saying very much,” she said. “Moreover, the very senior female executives in China, they got there in spite of massive gender discrimination. And they never criticize the government publicly. They never talk very concretely about the barriers that they themselves have encountered because they realize that their situation is very precarious. So it’s still very bad for women and in the private sector as well as in government.”
Blanchette asked about the possibility that China will see a major exodus of talent as its political system continues to close.
“There’s been a lot of reporting now about what’s going on in Russia, where you’re seeing this wave of young, talented individuals leave the country as they look at the prospects for development there,” he said.
Weinstein said it is a definite consideration.
“I think part of what we’re seeing at this point in time is China trying to kind of trying to play both sides," she said. "There’s a lot of rhetoric now about this big tech crackdown may be ending. I wouldn’t say it’s ending. That’s kind of the messaging that's coming out of China.”
Challenges to retaining talented people
But there is another element unique to China.
Entrepreneurship in China is “such a weird concept,” Weinstein said, because entrepreneurship and innovation inherently assumes ability to take risks. China does not welcome risk.
Unlike Silicon Valley, where companies grew on their own, Chinese companies are usually tied to the government, Weinstein said. That could change if China senses a need to retain ambitious and talented people.
Jinping also might talk about patriotism linked to staying in China and helping the country and its people grow and prosper.
Another factor is racist actions and rhetoric in the United States, she said. That will push Chinese students and scholars back to their nation, Weinstein said.
“I think if the United States really wants to be a place where folks in China or in Russia and other countries are not comfortable where they are, where they currently live, if we want to become a place that people want to go to, I think we have a lot we need to do,” she said.
"Chinese media outlets often paint the USA as a violent, dangerous place that does not welcome people from other countries, Weinstein said. It’s almost funny, considering the source, but the points they make are serious."
Weinstein said in the past, the United States was for many people overseas their first option for a new place to live, learn and work. Instead, the U.S. may need to adjust to working in concert with people in other countries, an example of the Chinese “win-win” philosophy.
Hass said one of America’s longstanding asymmetric advantages has been its ability to attract top talent from around the world who want to come live and work here and contribute to American society.
Weinstein noted that said the United States must make it clear to Chinese citizens living in the U.S. that if they feel endangered or threatened, they can turn to our government for assistance.
Hass called the one-hour discussion a “really rich conversation” that helped unfold the complex nature of dealing with China and understanding its culture, people and government.