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in the world ’ s most populist country is that it ’ s transforming into a normal economy and country much like those everywhere around the world. This is a system that for many years was closed off to the rest of world, and didn ’ t want to have anything to do with people outside. China called itself the middle kingdom and saw itself as the center; there was no reason to leave. Two hundred, three hundred, four hundred years ago, when Westerners started arriving on Chinese shores, they found many of the kind of opportunities that people are sensing today, but China never really opened up to those.

China, since 1949, went through economic calamity, political upset, was secretive, and was closed down to the rest of the world for many years. Only in the early 1980s did China start to recognize how the world was changing, and it wanted to be part of the world. It really did open up, it really was allowing itself to interconnect with the world in every way.

Clearly the biggest impact has been economically. You can see people who years ago not only didn ’ t have any access to material goods, whether it ’ s a bicycle or a television, but they didn ’ t even have money to buy those things. If those existed, they were given by the state. (People obtained coupons from their companies to have a new bicycle.) As money started to fl ow into the economy, as people started to have money, there was a shortage of goods.

In more recent years, China has started to make lots of things, so much so that it is exporting them.

It is a highly competitive environment here because people sense a new opportunity and the government has stepped back.

Now the Chinese are able to do what they want — they can start businesses, buy what they want, and increasingly, go where they want. Chinese are traveling abroad in record numbers; there ’ s a fl ood into many, many countries. They are coming back with ideas, and at the same time foreigners are being allowed to come to China and set up in a way that the world really hasn ’ t seen on c15.indd 198

8/26/08 7:02:39 PM

James

Areddy 199

such a scale for really a long time. Japan is very often used as a comparison, but Japan retained a lot of the closed - naturedness of historic China, whereas China is allowing foreign companies to come in and start factories and start selling products to its people.

Q: Although China is still a Communist state, it ’ s not Communism like what the history books tell you. How would you describe the way this new economic model and the old political model have come together? Is this a new Communism?

James Areddy: Right. What ’ s going on in China is very much defi ned by the government stepping back from society. The government ’ s fi ngers are everywhere. It ’ s in people ’ s homes; everyone has a neighborhood committee. There ’ s a little old lady who watches what ’ s going on in every neighborhood, and that ’ s certainly defi ned people ’ s lives for years. It ’ s made them a lot more reluctant to do lots of things, because there were always reports about them.

More and more, what ’ s happening is that no one ’ s paying attention, and that ’ s probably the biggest change. Of course the question is, is China a Communist state or is it not? A lot of people would argue that economically it ’ s not at all and that it ’ s one of the most competitive economies in the world. But the truth of the matter is that the government is still party to much of what happens in the economy, and less in terms of what happens with someone ’ s average life — who they decide to get married to, where they want to travel, what they want to buy, things like that.

Q: Can you get a handle on how big the Chinese government is and talk about it in relationship to the American government?

Our government seems to be ever - growing, and the Chinese government, as you just said, seems to be becoming smaller or at least stepping back. Do you have a hunch that their government is stepping back, maybe becoming smaller? Could you compare the sizes of our government and our involvement?

James Areddy: