Andy Stern, former head of the SEIU, had a remarkable piece in yesterday’s Wall Street Journal – remarkable for its naiveté, obtuseness and sheer gullability.  It was one of the worst things I have ever read in a serious newspaper.  The piece, entitled “China’s Superior Economic Model” is a paean to the Chinese state and its political leadership.  With its creation, Stern joins the list of left-leaning pundits (think Friedman) who see authoritarianism and central planning as a panacea for a messy world.  The errors are many and the truths are few, so where to begin?

How about with the fact that if China there are no free employee public unions, and Andy Stern’s very reason for existence wouldn’t be tolerated?  In Wisconsin, Scott Walker and the Republicans, through legal means, changed the law to prevent collective bargaining of public sector unions.  Andy Stern vehemently opposed Walker’s actions, as was his right.  Yet, here we find him supporting a regime that tolerates no dissent and no political organizations that do not toe the party line or are not controlled by the Communist party.  If Stern had tried to form the SEIU or a similar organization in China, he would have been thrown in jail and, perhaps, tortured or executed.

Stern proceeds in his piece to comment:

 “[f]or me, the tension resulting from the chorus of American criticism paled in significance compared to reading the emerging outline of China’s 12th five-year plan. The aims: a 7% annual economic growth rate; a $640 billion investment in renewable energy; construction of six million homes; and expanding next-generation IT, clean-energy vehicles, biotechnology, high-end manufacturing and environmental protection—all while promoting social equity and rural development.”

Road maps are great – they lay out exactly how one should proceed and show where one should end up.  Paul Ryan has a road map, but I doubt Andy Stern likes it.  Of course the road map looks good – it is a one-sided unverifiable analysis of what China would like to do.  Have you ever seen a plan that said “we are going to contract our economy by 3%, increase unemployment, install old technology and produce pollution?”  The problem here is that the road map which Stern likes is an illusion.  China cannot guarantee a 7% economic growth rate for five years, though it can try.  It may be able to build 6 million homes, but the question is does that make sense?  Why should China build the homes and where should they be put?  In a free market, individuals decide that question, in China, it is by government fiat.  That is what has led to an entire ghost city in China – lots of homes but nobody wants to live there.  Ditto for all the rest of it.  Everything sounds good, but then you realize China is building high-speed rail that costs billions and doesn’t work because it comes from a centrally planned vision.  Finally, there is that last gem “promoting social equity and rural development.”  If there is one thing that doesn’t exist in communist states, it is “social equity.”  There is clearly a dominant political class in China which controls everything, tells people how to live and demands obedience.  The idea that they care about equity is laughable, just look at what they do to people who speak up about poor conditions and bad government.

A little bit further down the page:

 “The current debates about China’s currency, the trade imbalance, our debt and China’s excessive use of pirated American intellectual property are evidence that the Global Revolution—coupled with Deng Xiaoping’s government-led, growth-oriented reforms—has created the planet’s second-largest economy. It’s on a clear trajectory to knock America off its perch by 2025.”

The jury’s definitely still out on this point.  Remember when Japan was going to take over the world?  Predicting fifteen years into the future is very difficult and with China’s hyper-economy it is possible the whole system could crash and burn.  This is a country experiencing massive upheaval on numerous fronts.  It is also a country of corruption and lawlessness with little to no respect for intellectual property or rule of law.  It is true, many have flocked to China with investments because it is a hot area, but who knows what will happen?  Russia and Venezuela looked like good places to invest, until the governments started confiscating assets.

There is much more to comment on regarding Stern’s piece, but the bottom line is that it is full of assumptions that are less than sound, admiration for a dictatorial regime with an atrocious regard with respect to human rights and rule of law and arguments for the centralization of power in the hands of a select few.  I assume Stern likes the China model because he believes the centralized control of the economy is an evolutionary step over free market capitalism (points made in his article).  He must then also assume that, like in the U.S., public labor unions can capture the centralized decision makers through political contributions and alliances that will thereby enable unions to extract more money and more benefits for their members.  All of this rests on the assumption that unions will be welcomed and embraced by the central authorities.  The irony, of course, is that in communist China, there is no place for public unions because there is no need of their money – when you are a corrupt central government you don’t have any political competition which means you don’t need those resources.  Of course, Stern isn’t concerned about the Chinese workforce.  What he really wants is to take what he sees as the “best” of the Chinese system (central control by politicians and bureaucrats) and marry it to the current U.S. system to wind up with centralized powers beholden to public employee unions that, as a result, give those unions wages and benefits in excess of what they would otherwise have.  It makes complete sense from Stern’s point of view, but it is an albatross for everyone else.