Our most recent series has focused on China. I selected China because it presents the best examples of concepts I identified in World Leadership. In China, we see two important concepts at work.
The first concept is the four leadership power sources. Leadership power for a society ultimately boils down to four things: population, wealth, military strength, and foreign reach. Historically, a society only needed two of these to dominate its rivals and become a leader. Today, China has all four. Moreover, it is actively building them. It develops strategic plans to increase them. It seems to know that becoming the dominant world power in the future requires that it grow them: China takes a far more active and disciplined approach to growing its power sources than nearly any country in the world. Even more importantly: it grows them in balance. Many societies have grown one power source at the expense of another—only to their demise. (A large, starving population doesn’t help anyone.) Growing the four power sources in balance is the key to reaching one’s full potential.
The second concept is governance basis. What may ultimately hold China back is its insistence on a centralized governance structure, which harkens back to an antiquated governance basis. All decision-making is funneled up to a single entity—one person even. This will ultimately hold it back because this structure will become a bottleneck—with too much decision-making forced through too few decision-makers. This will limit China’s capacity to manage its resources. Arguably, we are already seeing signs of this limitation. If China is going to pursue a position of world leadership, it will someday have to open-up its governance architecture to allow more decisions to be made at lower levels.
So, what’s the verdict? Will China grow into the next great power? Or will it strangle itself by insisting on what it thinks is its greatest strength—centralized rule? The decision is theirs to make. However, intuitively enough, it’s not theirs alone. It really depends on what everyone else does. But that’s another series.
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