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The Engineering State and the Lawyerly Society: Dan Wang on his new book “Breakneck”

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Welcome to the Sinica Podcast, a weekly discussion of current affairs in China.

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Dan Wang has been on the Sinica Podcast a couple of times before, and I am delighted to have him back today.

He is one of the sharpest and most original observers of China’s technology sector and manufacturing landscape, having won a certain level of fame for his annual letters and other essays — writings that somehow managed to combine on-the-ground insights with big picture perspectives.

Dan has worked for Gavekal Dragonomics in Beijing since 2017. After a stint with the Paul Tsai China Law Center at Yale, he’s now at the Hoover Institute at Stanford.

If you’ve seen the PBS Nova documentary “Inside China’s Tech Boom,” which I had the pleasure of narrating — it’s a film by David Borenstein — you’ve already encountered Dan. He was a featured voice helping to explain the deeper drivers behind China’s technological rise and talked eloquently, I thought, about the importance of process knowledge, of what the Greeks called metis, which is an important idea that’s really stayed with me and has become quite foundational to my understanding of China and the importance of manufacturing.

Today, we’re going to be talking about his new book, which comes out just about the time you’ll be listening to this. It’s called:
“Breakneck: China’s Quest to Engineer the Future.”

It’s a book that posits — and here I’m greatly oversimplifying — that China is ruled by engineers and they do what engineers like to do: they build. America, on the other hand, is ruled by lawyers. It’s an engineering state on the one hand and a lawyerly society on the other.

Dan’s book is full of memorable witticisms and pithy, trenchant observations. Perhaps most importantly, it explores what each side might ideally learn from the other. They obviously each have their strengths and their weaknesses, so I’m really anxious to ask Dan about whether he thinks Americans are actually learning the right lessons or just burying their heads in the sand and inhaling big plumes of copium.

Before we jump in, I want to point out that this book was especially interesting for me as somebody whose abortive doctoral dissertation was specifically about the rise of this engineering state, about the… The emergence of technocrats in post-Mao China. So things might get a little in the weeds. I ask your forgiveness in advance and will do my best to keep it reasonably accessible.

Dan Wang, welcome back to Sinica and happy birthday, man.
Dan Wang: Thank you very much, Kaiser. And what better birthday present than to speak to old friends like this?
Dan Wang: Yeah, it’s great to have you.

We have to start with what, for me, was clearly the most important part of your entire book, which is that magical and totally improbable guitar-making hub in Guizhou that you stumbled upon as you and Christian Shepard from the Washington Post and another friend rode your bikes through that mountainous province toward Chongqing.

As a card-carrying guitar nerd, this totally blew my mind. I got to find this place. How does a little inland town end up just cranking out guitars for the whole world? I mean, is this just one of those serendipitous quirks of China’s industrial sprawl? Or is there something systematic in how the state, local governments, and entrepreneurial networks operate so that these clusters take root in the unlikeliest places?

And I guess more importantly, were there any of you guys who were guitar players? And if so, did you guys try out some of the local handiwork while you were there?

Kaiser, you’re much cooler than me. You are a guitar player. I am a clarinet player. And I think by coolness, that just really outranks me.

How indeed did kind of a third or fourth tier city in Guizhou become one of the great hubs of guitar making?

Well, in 2021, when I was stuck in China during the summer due to the success of the zero COVID strategy at the time, I asked two friends of mine,

“Hey, why don’t we go on a really long bike ride somewhere in the southwest, which I find the most beautiful part of China?”

Oh, for sure.

And so over five days, we cycled from Guiyang to Chongqing. It was four days in Guizhou, the province of Guizhou, and then until the fifth day when we reached Chongqing.

It was on our second or third day when we came across these giant guitar cymbals on the side of the road. So there were these guitars that were hanging off streetlights. There’s this giant guitar that was on a hill that was kind of this ornamental thing. And off in the distance, there was another big guitar that you could see on the town square.

And so we were very puzzled by this. We unfortunately didn’t stop to try out the handicraft. I’m pretty sure that neither Chris, Zheng, Tung, nor I are anything of real guitar players ourselves.

And afterwards, I went to find that Zhengan County in Guizhou is indeed the largest guitar-making hub in the world. I think it’s something like 30% of guitars in China is produced there. I have to get the exact figure right in my book.

And that happened due to a great accident in which a lot of folks in Guizhou were moving to Guangdong. In the 90s, Guangdong was making absolutely everything and anything. Some people were making guitars for export. And so a lot of people from Guizhou just happened to move to a particular guitar factory.

One of the things that we really found on our bike ride was when you’re going through China’s countryside, Tristan made this very astute observation that there are hardly any middle-aged or people in their 20s or 30s that you could find in Guizhou. It’s a lot of children being led with the grandparents. And that’s because anyone who is able to work has been moving over to the coastal areas where you could have a much better job producing guitars or whatever it is for export.

And something that the local government in Zhengan did was that it found that, well, there’s a lot of people making guitars here. Guitars are not really endemic to the local culture of people playing guitar. That’s not really a Guizhou thing. That’s not really necessarily a Chinese thing.

I’m working to change that, but yeah.

Well, you’re a big force, Kaiser. Maybe we can change that. But it just attracted a lot of people to try to say,

“Hey, why don’t you move back home to Guizhou? You can make a lot of guitars here.”

And somehow that strategy worked. And so a lot of people moved back to Guizhou from Guangdong, and now they’re producing guitars mostly on the lower end.

So this is not the sort of things that will be sold in, I think, the high-end guitar shops that you would probably frequent, Kaiser. But there is some innovation here, and I expect that they will get better and better.

Yeah. I mean, it’s amazing how good quality the Chinese guitars have. I mean, it’s astonishing. And all of the major brands are actually making a lot of their guitars in China now.

• Indonesia is coming up in the world, but it used to be Japan and then South Korea.
• It’s migrated to China, from China off to Indonesia, I imagine.
• But there’s still quite a bit happening there. The guitar ecosystem, all the electronics, the effects pedals and all that, it’s huge. I hope to one day make a pilgrimage to the guitar mecca and maybe even spend some time there and get some free stuff. I’ll show you my cycling route for Kaiser.

Yeah. No, that’d be great. You can pedal there. Right. Yeah. No, I’m not going to do that.

But yeah, was the enticements just the usual package of tax incentives, of steeply discounted infrastructure promises of raw materials? What do they do to entice people to a place like that? What do they typically do?

I think the typical enticement is:

• We will give you the infrastructure
• We will give you the taxes
• We will also let you be close to the hometown where a lot of people want to be.

A lot of folks in Guizhou, folks in the Southwest can’t necessarily love the Southeast and Guangdong where they were working. It’s too humid. They might say, “we don’t love the Cantonese food. Where’s all the spices? Where’s all the pickles? Where is the really pungent flavors that folks in Guizhou are used to?”

And so this coincided with sort of this rural revitalization program that Beijing has emphasized for quite a while now. And so I think it is just this big happy accident that I would say a pretty random place in Guizhou is just making so many guitars now.

Awesome. Dan, I know you’re going to end up on every major podcast talking about this book, so I want to avoid just asking you about the main themes or going through chapter by chapter. Instead, I was hoping that we could use the main themes of the book as kind of a jumping-off point to explore a lot of the questions that popped into my head as I read it, questions I’m sure you’ve thought about as well. Not necessarily things that made their way into the pages of the book itself, but let me start here.

I mean, we can all rattle off the obvious differences between an engineering state and a lawyerly society. You got speed versus procedure, certain social orderliness versus the chaos of pure market forces. But what are some of the more subtle trade-offs, the ones that most people don’t even know that they’re making that maybe shape daily life in each system? I’m thinking predictability, dignity, moral legitimacy. I mean, which of these things matters to people who live inside each system?

Yeah. Well, I want to push you a little bit on this, Kaiser. I wonder which is the system that delivers legitimacy. I could posit that the lawyerly society has some degree of legitimacy because there are some procedures in place that people expect that rules have to be followed, and maybe the lawyers are better at following the rules.

On the other hand, the Communist Party, I think, would say, well, we have much greater legitimacy. We have this, what is that term, whole process, substantive democracy, in which we are delivering much better things for the people. So I think legitimacy is a concept here that we can play around a little bit with.

What I’ll say is that the engineering state, I think I came onto this framework in part due to these excellent articles I found in 2001, I believe, that was written by an interesting analyst at the time called Kaiser Kuo, who pointed out that there were quite a lot of engineers that were being promoted into the Central Committee and the Politburo.

And I think there has been quite a lot of discussion since 2002, which is the really striking year when every member of the Standing Committee of the Politburo, notably Hu Jintao, as well as Wen Jiabao, had degrees in engineering.

• Hu Jintao was a hydraulic engineer
• Wen Jiabao was a geologist

Of course this was a really striking fact for a lot of people.

I think there has also been this kind of view and understanding that America is very lawyerly and that the government is of the lawyers, by the lawyers, and for the lawyers.

And so what I wanted to add onto this kind of general understanding that was in the air, so to speak, was that I felt like I really experienced the merits and the madness of the engineering state by living there from 2017 to 2023.

I was in China at a time when a lot of things were getting a lot better. The high-speed rail system had really come into fruition at that time. People were no longer shoving each other around to get in line. The system felt quite rational and well-organized.

Shanghai is a marvelously functional city where one is never really more than 15 or 20 minutes away from a subway stop. Shanghai was building all sorts of parks. It built about 500 parks by the year 2020. By the end of this year, the city targets that it will have a thousand parks. Shanghai is just this remarkably well-functional, livable place.

And so that was something that I really experienced by living there. But Shanghai is also infamously the city that suffered perhaps the worst lockdown ever. In the history of humanity, in which 25 million people were unable to leave their apartment compounds for about eight to ten weeks over the course of the spring in 2022. And so that was something that I felt very ethically myself.

When I moved to the Yale Law School’s Paul Tsai China Center, really being embedded in one of these most elite, elite-making institutions in the United States, really seeing that the US is run by lawyers, seeing how the Biden administration at that time had been really, really lawyerly. About 11 out of 15 cabinet members in Joe Biden’s administration had gone to law school. Many prominent folks went to Yale Law in particular.

That was sort of what I wanted to add, that this was something I lived and felt in both places.

Yeah, absolutely. We’ll talk a little bit about this idea of performance legitimacy down the road here. But so I want to dig into sort of maybe philosophical underpinnings of this contrast that you highlight.

In the West, we often reach for the trolley problem as a kind of shorthand for thinking about moral tradeoffs.

I mean, do you pull that lever to sacrifice one life in order to save five? I’ve often wondered how this dilemma looks different through the lens, you know, like the one that you’ve drawn, whether it looks different between an engineering state and a lawyerly society.

I would imagine an engineering-oriented society be more inclined to treat this as kind of a technical optimization problem. You just kind of minimize total loss, while a maybe more lawyerly society would insist on:

• Rules
• Rights
• Procedures that, you know, can’t be violated even for a greater good

Kind of, you know, a utilitarian versus a deontological philosophical orientation.

Maybe that points to a deeper distinction. I mean, do these orientations that you’ve described, do they line up with the classic contrast between communitarian or group-oriented values on the one hand and on individualistic ones on the other?

Yeah. I think that’s actually a pretty fascinating question. I wonder if there is a systematically different way that Chinese tackle the trolley problem in a way that is pretty distinct from the way that Westerners think about the trolley problem.

I think the level that I was thinking a little bit more about was that I think part of the reason I wanted to come up with this framework of engineers and lawyers is that I think we’ve been reasoning about the US-China conflict in these 20th century terms like:

• Socialist or capitalist
• Autocratic
• Neoliberal
• Democratic

And all of these terms have some use, but I’m not really sure that they still really apply in very nice ways now.

You know, are we going to say that something like, is China fundamentally left-wing or right-wing? Well, I can make arguments on both sides. Is the US fundamentally more left-wing or right-wing? Again, this is something that we can debate and I’m not sure how far exactly we get up to these sort of frameworks.

And so the framework that I came up with of the engineering state and the lawyerly society, I would submit is just no worse than trying to figure out exactly to what extent China is Marxist today.

You know, I don’t think that Marxism is quite the right lens to try to understand the people’s republic. Maybe it is, but I think this is what we need to do is to have a plurality of frameworks here.

Maybe we should have something like the discussion of:

• How socialist China is
• How engineering it is
• How communitarian it is

We just need to have more than one framework really to think about the great conflict of the moment.

Yeah, no, I completely agree. And that’s what I really like about this particular framework is it takes us beyond these sort of binaries of ideology, you know, China being just such an incredibly syncretic society that blends so many aspects.

But the one thing that I think it all circles around is this technocratic policy, and I think it feels like, to me, a very, very good explanatory lens. So I applaud that.

I’ve often used a concept I kind of borrow from economics when I think about what a society values. And that’s, you know, the concept of elasticity.

You know, I imagine that in every society, individuals have kind of an intuitive sense. I don’t think they have it mapped out really explicitly, but, you know, how much of one thing that they value, they’d be willing to give up to gain some amount of something else that they value.

You can, you know, kind of almost put numbers to it.

I'll trade you three points of administrative efficiency to get one point of procedural fairness, right?  
Or I'll trade you two points of transparency for one point of speed.

I mean, it seems to me like for decades, Americans’ coefficient of elasticity has been really, really rigid. They’ve been very unwilling to trade down in civil and political rights for even for, you know, pretty markedly… Improved economic outcomes. But I mean, it’s my sense, Dan, I’m wondering if you agree that lately, because of China’s example in manufacturing strength, in infrastructure, in its energy build-out, in the energy transition, in education, in STEM education especially, I feel like there’s a shift happening and this is happening. And I think you note this, it’s both on the right and the left, in America, like within MAGA and among also, say the abundance bros, right? You know, Derek Thompson and Ezra Klein and those guys, more Americans seem willing to accept some erosion in rights or process in exchange for what they believe are better material outcomes.

Do you think that that coefficient is changing? And if it is, does it change the way that you think about the lawyerly versus engineering states, especially if we start seeing each side borrowing from the other’s value hierarchy?

Well, there’s certainly a lot of borrowing between the U.S. and China at the moment. But I’m not sure that they’re borrowing all the right things.

Yeah. That’s the big issue. Are they?

Well, I think what we are seeing with the Trump administration is a lot of authoritarianism without the good stuff—good stuff like functional subways, better transport infrastructure, and better infrastructure generally. I think you’re very right to point out that there is a sense of deep dissatisfaction in the U.S. I mean, that is always true everywhere at all times, but I think there is an especially big sense at the moment that the U.S. has not been very functional for quite a long while.

The U.S. has not been very functional because especially in the bigger cities, where things are just far too expensive. If we’re thinking about cities like New York, Boston, or San Francisco, housing prices are really unaffordable for too many people. These are cities that try to build new infrastructure—mass transit—and basically don’t do a very good job of it.

You know, I was really struck that it’s not just that New York is unable to build new subway stations and new subway lines with any sort of efficiency; it costs about $2 billion per mile to build a new mile of subway in New York City. They’re not even doing simpler stuff very well.

• The Port Authority bus terminal is getting an upgrade and it will be completed, I think, something like six years from now at the cost of about $5 billion to upgrade a bus station.

And so this is the sort of thing that looks kind of ridiculous. Why does it take several years to upgrade a bus station? I realize that’s kind of a complex structure. There are all sorts of intricacies with the tunnels, but still this is fundamentally a bus station that shouldn’t take more than five years to build out.

So, you know, we have broken mass transit. We have unaffordable housing. The pandemic revealed that the U.S. isn’t able to manufacture a lot of pretty basic goods. There were shortages of masks and cotton swabs. There were shortages of furniture, all sorts of simple consumer goods that weren’t easily exportable from China at the time.

And so there is a pretty big sense that nothing is working when we have to face this critical transition to decarbonize the economy and to build a lot more solar, wind, transmission lines, which all demand quite a lot of land.

And so I think I wonder if there is the case that the U.S. has even made a conscious decision to try to erode some of the elasticity of the proceduralism. Because I think one of my arguments in the book is that the proceduralism has encrusted itself throughout a long period of time without anyone’s real intention to create a lot of processes everywhere throughout the American government.

This is sort of a force that kind of took a life of its own. And this was something that a lot of homeowners and especially the NIMBY set exploited, I would say, to block new housing in Berkeley for students, to block a solar or a wind project as well as their transmission grids. This became something that richer people were able to access and exploit to block projects that they didn’t like.

And that isn’t even really a majoritarian demand for greater proceduralism. This was kind of an independent life force that grew upon itself and has a very vested interest of minoritarians that are really vested in trying to keep that system so they are able to block a new apartment building if it takes them with their light away, for example.

You know, you work to be very fair in the book and that’s something I really like about it. I mean, you don’t just heap praise though on the engineering state. You make a point of calling out the downsides. And they’re very real. Can we talk about some of those? What the problems are of the engineering state? What does it get wrong? You sort of channel the James Scott scene like a state thing and a lot of the excesses of that thinking.

There’s two chapters in particular of your book that really dwell on this. And they are about, of course, the one-child policy, which is a conspicuous failure of the engineering state mentality and also the zero COVID policy, which starts off as sort of a triumph, not right away, right? It, I guess, displays some of the pathologies of it, but by the spring of 2020 you see this V-shaped recovery. You see China really use its state capacity to wrangle the COVID epidemic.

But then of course, you talk quite a bit about the lockdown. So, talk a little bit about what some of the major downsides are. I think the engineering state has major upsides.

Um, so to be clear, I really want to articulate that the speed of construction of new housing in China, new roads, tall bridges, subway systems, nuclear, all sorts of construction in China, I would say is net positive. You could go to Guizhou as I did, look at these really tall bridges. It is pretty easy to say, well, this is a bridge to nowhere, but I think it is also true that a bridge to nowhere quickly turns nowhere into two somewheres at the ends of these bridges.

If you take a look at China’s major infrastructure, I would say that on net, it’s been extremely positive, that the benefits have way, way, way exceeded the costs.

Now, I would say that there have certainly been some costs:

• There is the waste that has been presented to the environment. These hulking concrete and steel structures are very carbon-intensive. I think that is often a waste of resources.
• It has involved a lot of displacement of people. Many of the big construction projects of the nineties and throughout much of the two thousands, like the Three Gorges Dam, really displaced hundreds of thousands of people who didn’t want to have their villages flooded in this giant lake.
• There have been giant financial costs. Guizhou has now 11 airports. Many of them don’t have more than a dozen flights per day. Maybe that will change, but for now, a lot of that seems like misallocation of investment.

But in spite of these costs — human, environmental, financial — I would still say that the benefits of infrastructure way exceeded the downsides of so much frenetic construction.

When I say that you talk about downsides, I don’t mean to suggest that you present a kind of moral equivalence between the systems. It’s pretty clear that you believe one side needs to learn more from the other right now.

It’s pretty clear where you think the osmotic gradient should flow.

The problem, I think, is that the Chinese leadership is not only physical engineers. They’re also fundamentally social engineers, and they cannot stop themselves from treating the population as just another building material to be remolded or torn down as the circumstances demand.

And so I think we can point to a lot of social engineering projects in China and we can point to the repression of ethno-religious minorities in Tibet as well as Xinjiang. Even with the Han majority, people have lived for a long while with the hukou system, which is not even fully abolished yet, in which it becomes really difficult for a migrant worker to move to Beijing or Shanghai and access educational facilities for her child.

What I really decided to focus on were these two big projects that you mentioned:

• The one-child policy, which took place mostly throughout the 1980s and persisted all the way until 2015.
• The zero COVID policy, which I lived through.

And I think you’re really right to point out that zero COVID follows an arc that isn’t very straightforward.

I think the first act of this big dramatic arc of zero COVID was the spring of 2020, or even earlier in the winter of 2020, when I was living in Beijing and we heard about this new pneumonia that was spreading through Wuhan.

And when we saw the Wuhan lockdown, which was in January, I believe January 23rd, you have these sort of dates that are emblazoned in your mind if you lived through the pandemic in China.

Wuhan lockdown, hearing the stories of the ophthalmologist, Dr. Li Wenliang, who raised valid concerns and was disciplined by the state for raising these sort of concerns, created a lot of anger among pretty much everyone I knew that there was yet another respiratory virus that was spreading from China.

This is the second one after 20 years with the first SARS crisis.

There had been some political suppression of bad news up until the state really tried to react and try to tamp it down. A big way. And so that was the great first act when a lot of commentators from the U.S. and parts of the West were sometimes even gleefully saying that this might be China’s Chernobyl moment in which a disaster triggers the political downfall of the entire regime. And so that was the first act.

And then the second act proved a lot of that wrong. So the second act of China’s COVID experience was the much longer time period when Beijing, Shanghai, central government, local governments proved that China was able to control the virus much more effectively than the U.S. can or much of the West could. And so the second act was people in China feeling relatively glad that they were living in China and able to be free of transmissions, able to carry on life relatively normally.

There were some costs. I wasn’t able to see my parents who were in Pennsylvania. My parents were telling me this very un-Chinese thing, which is to say,

“Stay there. Don’t come to visit us. Trump’s America in 2020 is a terrible mess. So, you should just stay in China where life is a lot better.”

They weren’t wrong. They weren’t wrong at the time.

But then there was the third act of China’s COVID experience. That third act was triggered by the much more transmissible Omicron variant of the virus, which overcame a lot of vaccines and was just extraordinarily transmissible. That was really the variant of the virus that forced Shanghai to go into lockdown for about eight weeks in the spring of 2022 when people could only go downstairs to their apartment compounds to have their noses and their throats swabbed. Otherwise, you couldn’t really go outside even for any sort of fresh air.

And so this was a time that drove a lot of people crazy. This was a time when a lot of families were suffering some degree of food insecurity because the Shanghai government had no logistical capacity to really try to deliver food to a lot of families. I knew a lot of families where the parents really tried to reduce their food intake so that they could save some food for their kids.

The food shortages resolved after, I believe, something like the second week of April. But, you know, this was something that was pretty extraordinary—that people were feeling food insecure in China’s largest city in the year 2022. That was really surprising.

And then the great denouement of the great dramatic act of China’s COVID experience was when in 2022’s December, Beijing decided to drop all COVID restrictions in the coldest month of the year, when people had very few fever reducers in stock to meet this great ending of the pandemic when zero COVID kind of became total COVID.

And so in Shanghai, I caught COVID around December 22nd, when I think everybody else was catching COVID at around the same time. So luckily, I had quite a fine experience with all of these things. But there were a lot of folks in Shanghai who didn’t have a very good time getting COVID at that point.

And so, you know, this is where the engineering state is pretty ambiguous, I think, in terms of its effect. So sometimes it looks pretty good that it was able to follow WHO recommendations and control the virus until it then collapsed under its own weight.

So the evidence here is pretty ambiguous, I would say.

Yeah, absolutely. But, you know, at the same time, I worry that there’s a certain type of American copium smoker who is taking these failures of the engineering state, assuming them to be inevitable consequences of adopting the sorts of things that you would like them to say. And, you know, they’re telling themselves these sort of self-soothing daily affirmations, like:

• “Don’t worry.”
• “Sure, China’s got prestige rail lines, but they go to nowhere.”
• “There are empty malls the size of Rhode Island.”
• “There are all these cemented-over rivers.”
• “And, yeah, the occasional citywide lockdown of 25 million people.”

So, you know, actually, America is doing great. Thank you very much.

Yeah, I wonder.

I think I absolutely agree with you that the mood in the U.S. especially fluctuates way too wildly for what the situation actually is.

I remember at the end of 2022, there was just excessive triumphalism in the U.S. because China ended its zero COVID program in this horrible collapse in which a lot of people died and the state suppressed all of this data.

Russia then wasn’t doing very well in its fight against Ukraine. And so it looked like Ukraine was also winning against autocracy.

And the end of 2022 was also the years when it seemed like the U.S. had these great technological breakthroughs,

• artificial intelligence on the one hand,
• and mRNA vaccines on the other hand,

and the autocracies simply didn’t have these technologies in place.

And so the views have shifted quite a lot. And these views go up and down, I think, a little bit too wildly given the state of… The evidence. And one of the things that I’m always trying to say, you know, when I was at China, now when I’m at the Hoover Institution is always that this is going to be a really long struggle between the U.S. and China. This conflict, these tensions will go on for a very long time. I don’t think that it is anything like a static picture in which one country is winning and they will have any sort of a decisive advantage. I think that the struggle will take place over a very long time.

And there’s not going to be any scenario in which one country simply disappears off the face of the earth. That is a fantasy. And I think it is also a fantasy to imagine that either country will collapse and never get back on its feet. I think that both countries are going to be winning and losing. And when they’re winning, they’re going to be making a lot of mistakes. When they’re losing, they’re going to try to catch up. And that’s just going to be a dynamic process over the next few decades.

Do you agree?

I do agree. I think the language of existential threat and the framing of zero sum is foolish when you see it on either side. Let me get to the things that we ought to be, we as Americans ought to be learning from China. One of the things that you really emphasize is process knowledge. I mentioned that in the introduction. For you, is that primarily a cultural asset? That is the status of engineers, the kind of tolerance for iteration. Is it a firm level capability, having long patient capital, kind of shop floor autonomy? Or for you, is it kind of a policy environment with permitting and procurement and standards at the fore?

Where would you intervene first, in other words, to sort of rebuild process knowledge in the United States where it’s so sorely lacking?

I think it is all of the above, Kaiser, that it is cultural, it is policy driven, it is a matter of economics. So I think the most important thing to grasp about technology is not the actual physical instruments or tools that we can see, anything like a robotic arm. It’s also not a recipe or a blueprint or a patent, any sort of knowledge that’s really easy to write down.

I think the most important part of technology has to be the process knowledge, which is all of this meta and tacit knowledge that exists more on a population level. And so this is something that various hubs of knowledge production have been able to recreate in the past.

You know, at the start of the industrial revolution in the UK, there was just a lot of knowledge about how to build textiles in order and how to build engines.

Right.

When that moved from Britain to Germany, Germany had a lot of process knowledge about how to do interesting new fields like electrical engineering, as well as chemistry. And that has moved from country to country. The US has been a major industrial leader on something like automotives, on something like semiconductors in the past.

And right now, a lot of process knowledge with manufacturing is being built and activated and grown in China, where you could be a worker in Shenzhen, making iPhones in the first year, being poached to make Huawei phones the second year, then making a DJI drone the third year, and then making a CATL electric vehicle battery the fourth year.

And so there’s just so much knowledge that can’t be written down with technology that is necessary for the production of a lot of different goods.

So I think this is one of these things that the US didn’t sufficiently appreciate when a lot of corporates did offshore a lot of jobs to China. I want to be clear that a lot of the manufacturing job losses in the US have been triggered by automation and technological change, not so much by offshoring, but something like 10% of the manufacturing change is created by offshoring.

And one of these things that I wonder about is if Apple didn’t build all of its iPhones in Shenzhen, and rather built it in, let’s say:

• Cleveland, Ohio
• Detroit, Michigan
• Anywhere in Wisconsin

What if all of that knowledge involved in building hardware was actually in the industrial Midwest in the US as well? Could it be that Wisconsin or Michigan or Ohio are actually major producers of:

• Consumer drones today
• Electric vehicle batteries today
• All sorts of electronics

that is present in Shenzhen as well?

And so this is one of these things that I think has been critically understated in the US that has been driven by an excessively financial profit-driven model that didn’t account for all of the most important things with process knowledge.

Right. I mean, this possibility, this hypothetical that you float of an Apple producing in Cleveland, that seems to place a little too much of the onus on Apple. It’s not as though that decision could have been undertaken in a vacuum. There were other factors that it had to consider rather than just simply the cost of labor. It was, as you say, you know, there was a policy… Environment. You know, there are other reasons they chose not to do that. And surely you would agree that it’s not just on Apple.

Absolutely. I think that the infrastructure wasn’t in place. The costs were much, much lower in the past. And so these are all real.

Yeah. Yeah. I mean, when you, when you talk about, when I asked you about process knowledge and, you know, whether it’s a cultural asset or a firm-level capability or policy environment thing, you said all of the above. I mean, that reminds you of something that you wrote recently. You just published in Foreign Affairs with your former boss, Arthur Kroeber, who is, by the way, one of the people in the China space who I just admire the most.

You guys wrote that, you know, China has taken in all of the above technology strategy. What would you include as the pieces of that strategy that perhaps people are less aware of?

I think that people know, you know, big pieces of it, but some of it, I think there is still a gap in our understanding of how China did this. What would you identify?

Arthur and I wrote that piece in Foreign Affairs called The Real China Model, in part to try to rebut the sense that China has succeeded technologically simply because it has stolen all the IP from the US. And so, you know, I, one of my favorite boogeymen is this tweet by Senator Tom Cotton, which he tweeted on World IP Day,

“China doesn’t innovate, it only steals.”

I think that is a flagrantly wrong presumption that I think we just need to discard because it is not helping us understand China any better.

There’s also this view out there that China succeeded simply by subsidizing its way into technological leadership. I think that’s not wrong, but I think it is woefully incomplete to say that the Chinese have been able to make central planning work and been able to select winners. I think they haven’t had a terrific track record on that.

What we point out in this piece is that China has actually built a lot of what we call deep infrastructure to be able to have its success.

Now, deep infrastructure goes beyond traditional infrastructure where China is superb — of trains and ports and highways to move goods around. What we point out are three big things:

• Electricity production. China is just able to produce a lot more power. A lot of it is produced by coal, and a growing share of it is being produced by solar as well as wind. China is now producing a much greater share of electricity than any other large country, save Japan, and it will overtake Japan soon enough.

Yeah, you noted, I mean, I think just to throw one stat, that China’s total electricity output is greater than the United States and the EU combined, and every year it adds another Britain’s worth of electrical production.

• Another piece of deep infrastructure here is just the data connectivity that the Communist Party really tried to pursue. In the 90s, we were saying that data is going to corrode authoritarian regimes because they can’t handle the free flow of information. Now, Bill Clinton introduced this really bizarre image of trying to nail cello to the wall. I think it’s just too weird. I never really quite understood this image. And then the Communist Party has very successfully nailed all that cello to the wall.

That’s right. Chinese people are on smartphones constantly, maybe even a little bit too much. And the Communist Party is very much in charge.

• And then the third bit of deep infrastructure that China built is the process knowledge that we talked about. It is this highly robust, flexible workforce that is able to jump and build a lot of different things.

And so when you marry these three pieces of deep infrastructure —

- power
- connectivity
- process knowledge

— to the fierce dynamism among Chinese entrepreneurs who are really competitive in trying to build interesting new projects, build more cheaply than the other guy, not necessarily achieving a lot of profit, but creating new and worthwhile products, when you marry all of these things together, I think it is no surprise that China has become the technological superpower that it is today.

There are some elements of technology theft from the West. There is an obvious element of the state trying to pick winners, subsidizing all of these things.

What we can acknowledge is that China has both a strong state as well as strong entrepreneurs that have built a lot of these technological achievements.

Dan, I’ve often remarked on how China in the 21st century is a much less technophobic or techno-pessimistic society than America is today. You can see it in survey research on attitudes toward things like AI. But I mean, anyone who’s lived in China and the US, as both you and I have, we know this intuitively, right? Just in the posture that people have toward technology.

I mean, so years ago, I interviewed a philosopher named Anna Greenspan about a book that she wrote. Called Shanghai Future, one I highly recommend.
Me too.
You’ve read this?
Yes, I’m a big admirer of Anna’s work.
Yeah, she’s great. So you remember, she talked about this big difference in attitudes toward futurity in the US and China. I’ve come to use kind of shorthand that I like. China is still in its Star Trek phase and the US is in its Black Mirror phase, right?

So the question I have for you is, what is the causal direction, if indeed you see any causality at work here, between China’s technocratic engineer-dominated polity and its technophilic society? Does the technocracy create the technophilia or does the technophilia create the technocracy?

I think that the technocracy creates the technophilia. I’m willing to change my mind on this, but I think it is definitely the case that China’s leadership uses mega projects, big prestige projects, really to try to rally the population into doing something better. And I think there are some ways in which this could be a little bit insidious.

One theory that I’ve come across is that one of the reasons that Li Peng, the premier throughout the 1990s, was so heavily invested in the Three Gorges Dam was in part to try to distract from his own image as what the Western media labeled as “the butcher of Beijing” for having ordered the Tiananmen crackdowns.

And so the Chinese government decided that it is going to try to build its way out of this political crisis of 1989 and to really invest in a lot of technology here. There should be a forthcoming book about this. And so once that book is out, maybe we can point to it.

I think it is definitely the case that the Chinese government loves pointing at pictures of great infrastructure. You can’t open an issue of Tioshe, which I was fervently reading when I was living in China, without coming across some amazing new bridge that the government has built, some great new port, which always looks very telegenic, or some speeding high-speed rail going through the countryside.

And so they definitely love to create these sort of images. There is a sense, I think, in which the Chinese government really likes to promote these big novels like Wandering Earth, which has been adapted into a film, and Three-Body Problem, in which there is kind of this emphasis on a world government that is entirely run by engineers working together to overcome a great threat to humanity.

That is, I think, a common theme to Liu Cixin. I think he is one of these progenitors of the engineering state’s mindset.

Right. Of the so-called Industrial Party, the Gongyedang.
That’s right. It’s sort of the Ur text of the Gongyedang.

And I spent a lot of time talking about the Gongyedang in my chapter on tech power.
Right.

And I think the contrast is with the United States, which has had a pretty major tech clash. I think we saw a lot of skepticism of social media, especially after 2017. There right now is still a lot of worries about what smartphones are doing to young people, what social media is doing to young people, what AI might be doing to all of us.

That is all real. And that strain is less present in China, I think, in part because the state loves to create new engineering projects, and in part because I think the Chinese have naturally been more optimistic over the last 40 years than Americans have because they’ve seen their lives improve in such obvious ways.

In lockstep with the improvement of technology. So yeah, it’s reinforcing, right?

And I wonder to what extent the Chinese government might actually be actively censoring some of these views. There has been extensive censorship of opposition to the Three Gorges Dam. And there may even now be some censorship to the big new dam that is being built in Tibet as well.

And so I think there is, on the one hand, the leadership itself is technophilic and trying to engineer their way out of every problem. On the other hand, they may also be censoring some of the perhaps merited, humanistic, critical backlash against what technologies are doing to us.

I want to get into how maybe the technophilia has enabled the technocracy in just a little bit, but because I do think there’s a little bit of bidirectional causality here.

But I want to first ask you whether you think that things like the fact that so many of the leaders are themselves engineers, it sets up a ladder of success, right? I mean, where high status and access to resources and power are kind of enabled by technical, technological prowess, right? So it sets up an incentive system.

So if you are a parent, you’re raising children, you’re going to want to push your children into STEM education. And that itself kind of reinforces that technophilia in society, you know, to your point.

I feel like that’s a big piece of it. Have you given much thought to that as well, to the sort of social forces that work in reinforcing technocratic politics? I think there is definitely a sense that Chinese parents prefer that their kids study STEM degrees. And that is definitely much more obvious that many more Chinese kids are studying math relative to American kids, which I think is a shame. Many more Americans need to be much, much better than the pathetic math capabilities that they presently possess through a lackluster education focused on STEM. I think that should definitely be the case.

So Vivek Ramaswamy was right. Maybe Vivek was right. The issue, I think, is that the slight wrinkle that I would present to you, Kaiser, is I wonder if it is the case that though parents encourage kids to study STEM, they’re not necessarily encouraging the kids to become engineers.

I think the allure of working in tech and consumer internet, especially for one of these big, prestigious firms like

• Baidu
• ByteDance
• Tencent
• Alibaba

is still much more alluring than working as an engineer. Maybe it is so much more alluring to work in the financial sector rather than in some sort of a technical engineering field, in part because they pay so much better. And so I think the kids are still facing the same tug of incentives that smart kids in the U.S. also feel in being drawn to Silicon Valley as well as Wall Street.

And something else I wonder about, I’m really curious for your take on this, Kaiser. You’ve been spending a little bit more time in China than I have over the last few years. But I was in China in December of 2024. And one of these things that I become really cranky and annoyed by is just how much people are on their phones all the time.

So people are texting other folks over the middle of a dinner. You know, you can see over a hot pot and a hot pot restaurant, many people are just on their phones instead of speaking to their dinner companions. Every trendy cafe shop is better photographed rather than a place to sit and have coffee with other people.

Maybe I’m just getting too old and cranky here, Kaiser. Maybe you can talk me into, you know, being a little bit more sympathetic.

No, you’re only going to hear the same crankiness from me. I mean, it’s something I freaking hate. And I’m also probably guilty of it. I mean, I find myself just having that tug. I mean, I can’t even conceive of taking a subway ride without having my headphones. I’ll walk three blocks back to my apartment if I’ve forgotten my headphones. Yeah, I’m terrible about it. But yeah, this is like the plight of modern homo sapiens. It’s not just a China or America thing. I see it in the States almost just as bad.

But yeah, I mean, I’ve remarked on this before. I used to, you know, you’re standing on the sidelines of a soccer game and you turned another parent of one of your kids’ classmates and you say,

“What are you doing about juniors’ screen time?”

And they’re too busy on their own damn phone to even hear your question. And yeah, it’s a problem.

It’s a problem. I wonder if it might be slightly worse in China because everything has to be turned into a Wang Hong spot and everything has to be photographed as well.

Oh, Christ. Yeah. I mean, I was in Shaxi in Yunnan and it’s becoming that way, you know, because Li Weifei shot a television show called

“Chiou Fung Le Di Phang”

and everyone has to, you know, like have their picture taken where she was and where that scene was shot. Christ.

Maybe let’s check our crankiness and get back to some techno-optimism.

Yeah. You know, actually, I want to dig into history here. I mean, you don’t explore this so much in the book, but I’m sure you’ve given us a lot of thought, which is, you know, the question of what gave rise to the engineering state in China?

I mean, when do we start to see it emerge? Was it a deliberate policy choice or something that just sort of happened? I mean, because this is something I explored quite a bit in my own work as a graduate student I mentioned in the intro and that you so kindly name-checked. I was really inspired to write on this question because by the early nineties, when I was doing this work, it was already, you know, China was already so thoroughly technocratic.

It was already so dominated by engineers. It hadn’t even peaked yet, but already you could see it. I mean, there were already books about this, but like Lee Chung, who’s now at HKU, Lynn White of Princeton, they did a lot of work on, on technocracy. But what struck me was that it had become so technocratic, but somehow it had gone unremarked upon in China itself.

There were foreigners who were looking at this fact and marveling at it, but it was in China itself. It was like, “yeah, of course.”

I wonder if there’s something deeper in China’s history, maybe the imperial civil service examination system, or this, you know, oriental despotism idea of Karl Wittfogel in his hydraulic theory of civilization. You know, he posits that… The technical demands of water management in China created both the opportunity and the necessity for centralized political control. So you have engineers sort of running the state. These were the things that I was exploring and I was wondering what you think about this. What are the historical and maybe cultural roots of the engineering state?

Yeah, I think there are definitely deeper roots in both the engineering state as well as the lawyerly society. That was my next question.

The part of America being very lawyerly, you can read the Declaration of Independence as almost a legal document. So many of the founding fathers were lawyers: first 16 U.S. presidents from Washington to Lincoln—13 of them have been lawyers at some point. And so in the U.S. there is definitely this very obvious legal tradition.

And I think that you can say the same about China as well. I don’t want to take this too literally. I think the work of Karl Wittfogel on oriental hydraulic despotism was a product of the time. He was this strange cold warrior that was trying to discredit the Soviet Union. I don’t refer to Wittfogel at all in my book. But I am definitely a big fan of the work on the clergy system. In particular, Professor Huang Yashun’s book, The Rise and Fall of the East. What is it? Examination.

The Rise and Fall of the East. Examination, autocracy, science and technology. That might be right. We have to fact-check that one. But I think the examination system is very real.

And so I do want to trace a lineage of the engineering state to imperial times. Without being too literal about this, but one might be able to say that imperial China was a proto-engineering state in part because the emperors ordered so many people to build Great Walls or Grand Canals.

• Great Walls was a big fortification system.
• The Grand Canal was also a water management system.

So many people died trying to build this canal. The historical records here may be exaggerating some things, but so many people were supposed to have fallen in the course of building this Grand Canal. One might be able to say that the emperors rarely hesitated to almost completely reorder a peasant’s relationship to her land. So there was some social engineering here as well.

Again, I don’t want to be too literal to say that the emperors were straightforwardly engineers, but I think one can trace the sort of lineage because of the state’s management of the imperial exam or the Keji system.

And I think one of these differences I want to trace between the West and China is that I think the Chinese were practicing a source of a sense of absolutism starting from the first Qin dynasty with Qin Shi Huang, in which the state really tried to control quite a lot of things.

This is someone that we label today in China as a despot who buried the scholars and standardized the weights. And so there’s this sense of autocracy stretching back for about 2,000 years now. The Chinese had been practicing absolutism way before the European monarchs ever whiffed this idea in the 17th and 18th centuries.

And so one of my ideas here is that one of the reasons, perhaps, that China did not develop a liberal tradition was that the court administered the exams, which was how one became an intellectual in the first place. And so it becomes really difficult for an intellectual to become a court intellectual by advocating for constraints on the power of the emperor. So mostly all of the mandarins were encouraged to just say,

“How do we govern better? How do we increase the discretion of the sovereign?”

You don’t really get very far by saying,

“Well, what we need is some sort of property rights. What we need is to protect the business people.”

You never really quite had that. And so you didn’t have as vibrant a sense of a liberal intellectual tradition emerging out of China. Rather, that was much more of an absolute sense of trying to increase the power of the sovereign.

Yeah, absolutely. I think that you’ve put your finger on it right there. This cooptation of the entire literati class just by making their advancement contingent on their support for a state orthodoxy.

Right. And I think we see parallels to that today in the Communist Party. I actually think that, I mean, I could spend a lot of time talking about this, but that there’s always been this sort of privileging of knowledge elites. And that assumes, of course, that there’s some objective knowledge in the universe against which you can be tested.

So I mean, at all points, there is this sort of a paradigm of what is true. And there is some canonical set of texts. They could be the Confucian classics or they could be, you know, engineering texts. And if you have demonstrable knowledge of that, somehow that qualifies you for office. I mean, that seems to be sort of the common… Thread. Yeah. So something that I, so, you know, the U.S. obsession with process, in its best form, protects the weak, which is really good. But, as we’ve discussed, it can impede the provision of public goods, the building of infrastructure that can really hurt the weak.

So China’s obsession with outcomes often lifts the many, but can screw the few or occasionally, as in the case of the one-child policy and zero COVID, which you talked about, it can screw the many as well.

So I guess the big question is, how do you build or design institutions that kind of somehow bind outcomes to rights? That is, build fast without trampling people. And what are the kinds of small practical reforms that can move either system in that direction?

Maybe we can start with China. What are some ways where these institutions can be bound up more in rights? And then we can move to the U.S. because you’re very hard on U.S. proceduralism. You’re very generous about its civic function, but maybe we could talk a little bit about the reforms that lawyers could champion that would improve build speed without betraying that kind of ethical core.

Yeah. Well, here is where I would give a plug to my friend, Nick Bagley’s work. He is a law professor at the University of Michigan. He has a book that will be coming out that I think is a perfect encapsulation of the problems of the lawyerly society. He doesn’t quite call it that. And he proposes these tangible legal reforms such that:

• We are able to build dormitories for students in UC Berkeley
• We can build mass transit for all of us

So that is one of these books that will be coming out sometime next year.

You know, I think there is actually a kind of a simple answer to a lot of construction. It’s not that the U.S. and China are the only countries that are unable to hit the right balance. I think actually a lot of countries have hit the sweet spot in terms of constructing mass transit while protecting the public interest. And so this is most of Europe. This is Japan. And we can just take a look at what these other countries do.

You know, I was just back to the U.S. after spending much of the summer in Europe. My wife and I spent a month in Denmark. Denmark is really highly functional in terms of public transit. You can go down to the subway systems that are completely spotless. They’re cleaner than anything in Shanghai. They’re fully automated and they just work really well. And you don’t even have to buy any tickets or go in any turnstiles. It’s such a high trust society that people know that you will have bought your tickets beforehand.

And so, countries like Denmark, countries like Japan, which has built a lot of high-speed rail, these are not shining exemplars of human rights abuses.

I would say that, you know, we can just take a look at:

• Germany
• Japan
• Denmark
• France

They are able to build trains and subways and all sorts of infrastructure at really reasonable costs without having violated a lot of rights. And so it is mostly the Chinese and the Americans that have gotten the balance wrong.

Yeah, that’s a good point. And do you see efforts now on either side to try to learn from these better examples?

I wonder to what extent China is learning better examples of public interest. I think there have been some ways in which China is learning good lessons. I think it is not the case that environmental reviews for high-speed rail, for example, are entirely perfunctory. I think that the builders are actually trying to do their best to mitigate a lot of environmental issues.

What’s just not available in China is endless lawsuits that can delay absolutely everything on purely procedural bases.

And I think the Chinese have also had some examples of protests that achieved the delay or the cancellation of projects. Remember, I think it was in 2020, when folks in some bigger city—may have even been in Shanghai—went onto the streets to protest the construction of a new trash processing site near their home.

Now, maybe that’s nimbyism. Maybe that is misbegotten. But, you know, we do see that there have been some protests of people trying to maintain their neighborhoods and tell what they like. Maybe that’s positive. Maybe that’s negative.

And I think there is definitely this big sense in the U.S., as we mentioned before, that the U.S. has been dysfunctional for the many, and we need to get much better at building housing, mass transit, all sorts of infrastructure to get the country moving again.

Now, for the most part, I would say that the U.S. government now isn’t learning the right lessons from China. Rather, it’s learning most of the bad lessons from China.

Yeah, as you said. So on the topic of learning lessons, you know, the COVID lockdowns… showed the extreme downsides of the engineering state. I mean, a good engineer, a good scientist, presumably learns from mistakes. I think it’s widely accepted that there were a lot of mistakes made during that time.

What lessons do you think China’s leaders themselves drew from the experience?

That’s a great question. And I haven’t given that too much thought. And I wonder whether there is a lot of studies here. Now, how did enforcing these lockdowns really change the leadership’s mind? Now, I wonder whether they have also learned some of the wrong lessons with COVID.

I mean, one of the things that really struck me was that the Shanghai lockdown, locking down 25 million people in 2022 for eight weeks was accomplished through just the normal police systems. You know, you just had the regular police actually enforce COVID lockdowns.

As best as I can tell, no officers of the People’s Armed Police, which is the paramilitary force that wear what looked like army uniforms, were really deployed to try to enforce a lockdown of that magnitude. And they certainly didn’t have to bring out the People’s Liberation Army to try to suppress the desire to be free.

And so I wonder whether the leadership has learned a lesson that actually the coercive internal security apparatus doesn’t have to be so large in order for the people to be pretty obedient about what are really extraordinary controls that no one had expected at that time. That could be a potential lesson there.

Perhaps other lessons have been that the Chinese surveillance state grew very extensively, that people were tracked on their phones all the time for contact tracing purposes. And there were some issues about privacy concerns. But for the most part, people went along with all sorts of these projects.

And I wonder if the Chinese state has just learned that autocracy is actually much more possible. It’s even more possible than they thought. And I’m hopeful that they learn some good lessons out of this as well. Off the top of my head, I’m not sure I can name any, but I’m wondering, what do you think?

Yeah, no, I mean, I think that you touched on something that I wanted to ask you about, because you know, a lot of people who believe that, you know, the COVID era biosecurity state that was coming into being — you know, the controls that the health code apps and the checkpoints created — that this was just never going to be set aside once the pandemic passed, that this was going to be a regular feature of life.

They thought that the leadership was going to get so addicted to this level of control that they just never let go of it. But it seems like they have. I mean, the app is gone. The checkpoints, the screenings, they’re all, you know, a thing of the past.

Indeed.

I think that’s a pretty good example of maybe a lesson, if not a lesson learned, at least that they exercise a little bit of restraint. Touch wood.

Right. The question is whether they have very long memories and built up this muscle such that if they ever need to exercise these muscles again, they’re going to be able to roll these things out.

It doesn’t surprise me that a lot of the checkpoints, a lot of these apps, and a lot of these COVID testing facilities have been torn down because they became these hated symbols of enforcement. So it could be the case that they took away these highly visible symbols of enforcement, but they have the memory and the muscles to try to bring them back really quickly if necessary.

Yeah, that’s a very good point. I think they certainly have that muscle memory now.

Dan, you write about fortress capabilities, the kind of redundancy, the overcapacity that Western analysts often dismiss or disparage as wasteful. But you actually make the argument in your book, I thought that was a really interesting one, how inefficiency can actually be kind of a source of resilience in China’s system.

How should we be thinking about the trade-off between resilience and efficiency when comparing China’s fortress model with America’s maybe leaner, but possibly more fragile system?

I think one of the things that the pandemic revealed was exactly how fragile a lot of America’s supply chains really were. They were poised for perfection, and it didn’t take much for everything to be ruined.

And there has been this…

Depending on just-in-time delivery and…

Exactly. Just-in-time delivery is something that creates a lot of profitability because you’re reducing your flow of inventory. I think this is also really attributed to Tim Cook of Apple that created these hyper-optimized supply chains. Things were moving around all the time, and so they built very little inventory in order to prepare for shocks.

And I think one of the benefits, mostly a benefit of the engineering state, is that they do build a lot of redundancy. It creates a lot of inefficiency. You can find… There is extreme inefficiency in the Chinese state with the state-owned enterprise sector. There’s just so many redundant jobs. You would just have too many people doing the same things. You have dragging down profitability in all sorts of ways. But that turns out to be really useful in a crisis, that you have the capacity to retool your manufacturing lines in order to build not electronics, but cotton masks, as was the case with JD, Jindong, as well as Foxconn as well.

And so China has a lot of redundancy. China is trying to build up its own oil and gas sector, even though it’s much more costly to tap Chinese gas and oil relative to Russian or American gas or oil because Xi Jinping really treasures energy sovereignty. They’re building a lot more farmland in less than optimal places. I think it is also very striking that as soon as you take the high-speed train out of Beijing or Shanghai, you run into farmland really quickly. And that is because they want to set aside a lot of land for provinces and major municipalities to be food self-sufficient.

And so all of the redundancy involved with manufacturing, all of this overcapacity, there’s also a way to maintain process knowledge that they are constantly training their workers to make sure that their skills don’t go rusty. And I think, again, this is where I think for the most part, China’s engineering state in a lot of economics, you can point to a lot of flaws with debt, with environmental destruction, with all sorts of profitability costs. But there are also some benefits, and these are really revealed during a crisis which you can never predict could emerge.

So Dan, I mean, shame on me. I have not yet finished reading Derek Thompson and Ezra Klein’s Abundance, but I think I get the gist of their argument. It’s interesting to me how little they actually talk about China. But where do your ideas sit in relation to their ideas?

I would want to be a card-carrying member of the Abundance movement. I am slated to speak at the Abundance Conference in Washington, D.C. in the first week of September. So I think I am proximate enough to that.

Now, I think my challenge to Ezra and Derek are to speak a little bit more about China. I think the first parts of the Abundance book, there’s a lot of discussion of how the U.S. isn’t building enough mass transit and infrastructure.

And then the second part of Abundance is talking a little bit more about the scientific failings of the U.S., in which they’re not really taking advantage of being able to scale up and commercialize a lot of American scientific innovations. So China is a good operating model for Abundance. It’s not the best. It is not the most amazing, shining example for the U.S. to follow.

I would love people to ask them whether that was a tactical choice on their part to avoid making the China comparison just to, you know, I mean, because the optics of it aren’t necessarily good. It no longer looks like rah-rah, go America. It erodes some of the, I think, the patriotic oomph that the book otherwise has.

I suspect that what is the case is that, I mean, it’s not only, I mean, it’s not the case that China is avoided entirely. Both Abundance as well as Breakneck talk about California high-speed rail and its awful failings relative to the Beijing-Shanghai line. I suspect what is the case is that Ezra and Derek believe, as I do, that America doesn’t need to become like China in order to build infrastructure. It would be good enough to be like France, Denmark, or Japan.

And so I think we really don’t need to reach the China model. There’s just much better models for the U.S. to reach. And so this is why I say that China is a good operating model of abundance, not the best.

It is good because China has demonstrated that there are virtues to overcapacity, that it is really good to have a hyper-competitive solar sector that is driving prices down, not making a lot of money for investors, but, you know, creating a lot of consumer surplus and building a lot of mass transit for a country that desperately needed it.

There were a lot of costs, but, you know, again, we don’t have to fully copy the Chinese model wholesale in order to get to a better mode of abundance.

You know, you close your book down by emphasizing lived experience, what ordinary citizens feel day to day in terms of dignity, of fairness, of security. I mean, I’ve argued for a long time that Chinese people, like all people, most people at least, anchor their feelings about a given government and its legitimacy, not just in performance, however important that is, but also in whether the state feels to them intuitively morally upright or whether it feels just.

States that emphasize procedural legitimacy obviously tend to foreground this. You know, in China, when you have local corruption, You have arbitrary crackdowns, you have unequal treatment. It can definitely undermine legitimacy, legitimacy on the ground. And when people see the state standing up to bullies or ensuring national dignity, it can bolster this type of legitimacy, which I would love together. You know, it’s this sort of sense of moral uprightness or justice, and that can be domestic or foreign.

How much do you think legitimacy in China actually rests on what I would call the moral dimension, the state, you know, being just or upright and defending dignity? In other words, when you have corruption or arbitrary crackdowns and this stuff eats away at moral standing versus when the state asserts itself against bullies or delivers on fairness, how decisive is that in shaping how people experience the party’s legitimacy day to day?

I ask this because so often there’s this idea that China’s only about performance legitimacy and that somehow an economic downturn or slowdown could deliver a death blow to performance legitimacy. I feel like that’s only a part of the story.

I certainly agree that it has been a persistent fantasy in the U.S. and some parts of the West that China’s political legitimacy depends entirely on economic growth. You’ve seen this narrative come again and again:

• If only we tariff them and deprive them of the American market, the Chinese people will rise up and revolt to maintain their export markets.

I think that is just a silly argument that we see even in 2025. I think that China’s legitimacy is more broadly based than that. I wonder to what extent moral legitimacy, the sort of Confucian virtue, is very much present in China.

I think certainly there is a view that the leadership would try to act as if they are very good Confucians in China. And I wonder to what extent that is actually very effective. Because I think one of the issues I have with China, and it was Professor Huang Yasheng who laid this out very well, is that the state tries to increase a lot of legitimacy in the virtue of the rulers, but they’re not thinking in terms of incentives and constraints and systems that really try to police behavior and induce better governance.

When they reduce things into a matter of morality and virtue, it becomes more about the person rather than about the system. And I think Huang Yasheng has been really good at pointing out how virtue has been a distraction to better governance. What do you think?

Yeah, no, I think that he’s not wrong, that that is a problem. It’s not systematized; that it’s still subject to a lot of kind of patrimonialization. And I think that he’s absolutely right, that if you look at patterns of protest in Chinese history, the way that it is voiced often is in terms of moral failings of leaders rather than particular policies. That is not always a helpful framing when it comes from above or from below. So I tend to agree with him there.

I want to move on though and talk about legitimacy itself. I think there’s this inability among many Americans, and I think you just hinted at it just now, to see beyond procedural legitimacy as the only possible foundation for proper political authority.

I have long believed that this fundamental refusal—it’s not always articulated, but it’s often really present in the American habitus, just in the language that we use—is a big part of the problem when it comes to forming a good understanding of China. It produces a very unhelpful moral framing, and it makes us interpret everything that Beijing does in the most negative possible light.

I think it fuels escalation. It’s not like Beijing is unaware also that there is this kind of assumption of illegitimacy on the American part. I mean, it’s pretty obvious from China’s point of view, and it makes them very defensive. It makes them very anxious. It makes them also assume the worst: that they assume America’s real goal is to destabilize China, which, yeah, they’re not necessarily wrong.

Maybe you’re not.

So my question is, does this appear to you to be changing? Do you think that there is now an appeal to the American public of this idea of performance legitimacy, especially since procedural legitimacy no longer appears in America to deliver the goods when it seems to be so badly eroded? Is there kind of an uptick in appreciation for performance legitimacy?

Because I mean, just to put my cards on the table, I mean, I’ve noticed since January of this year a vibe shift, especially among younger people, in their attitudes toward China. And often it seems to be on the grounds that, hey, look, they deliver the goods.

I think there absolutely is a sense even within the American elite to say, well, we design all of these… Procedures in place in order to ensure some sort of fairness and making sure that the public interest is consulted. And I think there has been a sense even within the Democratic Party that, you know, we take a look at these blue states and blue cities, big cities, which are almost unanimously governed by Democrats. And they don’t seem to be working all that well.

You know, there’s tremendous public disorder in a lot of cities. Mass transit isn’t functioning very well. A lot of politicians are much more interested to govern on social issues rather than delivering economic issues that many families, working-class families care the most about. And I think there is a sense that we can’t just rely on processes in order to deliver the sort of legitimacy that we’re talking about.

I think that that is a very vibrant debate within the left now, that we can’t simply be the lawyerly society anymore. How do we actually deliver the goods? And so this is where, to put my own cards on the table, I am in favor of abundance. I am in favor of Ezra and Derek’s program to create much better cities, show that California and New York are not deeply broken things.

That when voters point to the track record of Democratic mayors as well as governors, there is something real here to be able to say that they’re actually meeting the needs of the people rather than just making sort of statements and performative gestures that don’t actually deliver the goods for anyone.

So in the end, and here, I mean, we’ll kind of wrap up with this, but you know, the engineering mindset can be way too literal, right? And the lawyerly mindset can be way too formal. I guess what I want is some kind of conceptual pluralism. I want like this set of institutional practices that somehow are able to switch frames, you know, to use the right frame in the right moment.

I guess what I’d like to see is somehow that we build the muscle inside China, its one-party state, to build that muscle inside polarized democracies like the one we live in right now, to be able to do that, to be able to be, you know, conceptually plural in that way. And I feel like that’s what your book gets at.

Is that a fair characterization? And what are the ways we can build toward that kind of, you know, conceptual pluralism?

You’re absolutely right, Kaiser. And I’m glad that you picked up on this point, that one of the things I really craved after spending six years in China was some degree of pluralism, that, you know, it wasn’t just one official register speaking above all the rest. That was really eagerly censoring all of these different viewpoints.

And I think I’ve said so many cancelable remarks on this podcast, Kaiser, but let me offer a yet more cancelable remark. I think there is a better profession rather than engineers and lawyers to govern the population, and that is dentists. No, I joke.

I think that the right profession to govern the population, if we had to choose but one, would be something like economists. I think that economists have a sense of procedure, they have a sense of getting things done, and they have a sense of social science, not to engage in really stupid things.

Unfortunately, I think economists are the most reviled academic profession on the planet. They certainly have gotten into a sticky wicket for themselves. But I think one thing that I will always be glad for for economists is that they were the people most actively pushing back against things like policies like the one-child policy.

That was the case in China, in which it was the economist who was the head of Peking University that really pushed back against the one-child policy in earlier formulations in the 1950s. And it was mostly the economic profession in the West that pushed back against the population bomb by Ehrlich.

And so I think that economists are the happy go-between. But I think that economists certainly need to be supplemented by degrees of pluralism on themselves. There should be lawyers in government. Absolutely. There should also be engineers in government rather than the U.S. Senate, which has 47 people who went to law school and one person trained in engineering.

I think there should be some sort of a balance with all of these things. I certainly don’t want to be entirely ruled by humanists. Mao Zedong was many things. He was, I think, primarily a poet. And if you take a look at earlier iterations of the Soviet Union, you had all these fantastic writers around Joseph Stalin. They were such good writers. They were such good literary critics.

And look at what a mess they made. So I don’t want to be governed by poets and literary critics. That sounds like an absolutely terrible paradigm. I think what we need are people who understand social science. And so my nomination is to be ruled by economists.

I’m going to put my vote in for historians. I think they have that sort of… Perspicacity and then that broader frame. And they’re not as paralyzed as economists are. And if we have to go with economists, I’m going to go with the Arthur Krobers over the Michael Pettises to rule us. That’s a better economist, perhaps. I think I, as someone who belongs to an institution called the Hoover History Lab, think that historians would not be so bad either.

Yeah, not so bad at all. Well, Dan, what a fantastically fun and wide-ranging conversation I’ve had. I cannot recommend the book more highly. Make sure that you get out and buy it right away. It comes out on the 26th, on August 26th. I encourage you all to pick up a copy. Above all, it’s a really fun read. It’s full, like I said, of really great turns of phrase. I had a long list of memorable quotes from it that I put together as I was reading it.

Let’s move on now, though, down to the segment I call “Paying It Forward,” where I ask you to name-check a younger colleague, maybe somebody at Hoover. I mean, Hoover was full of villains as far as I can tell, but there’s got to be one person worth name-checking there before we move on to recommendations. So who do you offer “Paying It Forward”?

I will offer two names:

• One is Afra Wong, who writes a sub-stack called Concurrent. I think she is a great new thing that is sharing some interesting Chinese perspectives. She hosts a podcast called “Cyberpink,” and I think that is just a nice thing—creating more voices that are building some sort of liberal society among the diaspora.
• The other person really doing this is He Liu, who is of the Hoover Institution. He Liu works with Liz Economy, and he has a podcast series interviewing people who have built US-China relations starting in the 1970s. So there’s an oral history project that He Liu is involved in.

So those are my two names, Afra Wong as well as He Liu. He Liu and I have crossed swords a little bit on Substack. He’s extremely committed to the liberal project when it comes to China, and nothing wrong with that. But like I said, we’ve crossed swords a bit. But great recommendations both. Afra, I’ve seen some of her work as well, and it’s excellent.

What about recommendations, Dan? Do you have a book you’ve read recently that you would like to recommend or anything, film, music, anything at all?

Well, I think over the course of book writing, I really got myself back into the classics, the things that I have really enjoyed. And so I guess I will recommend two sets of things.

The first set are the Mozart’s Italian operas written with Lorenzo da Ponte. These are:

• The Marriage of Figaro
• Don Giovanni
• Cosi Fan Tutte

I found myself, over the course of book writing, listening to these highly pleasurable, fun, and inventive operas that I think will stay with me for the rest of my life. So these are the Italian operas by Mozart.

Yeah.

And I think what I will do is also recommend my quartet of favorite novels. I have four novels that I’ve been rereading recently. And so the first one is The Red and the Black by Stendhal, which has these incredible depictions of the mistakes and stupidities that one commits in the act of love. This is a French novel that was published in 1830.

I will also throw in another French novel, the Proust. And so these are really wonderful, intoxicating tales of love that Marcel Proust has created for us. The entire series of In Search of Lost Time.

That’s right. And the Penguin translations are all quite good in English.

A third novel is that everybody is reading Moby Dick this summer.

Yeah. Why is that? Why is everyone reading Moby Dick? I mean, I know that Joe Weisenthal from the Bloomberg Odd Lots podcast seems to be leading the charge on this. But I reread Moby Dick about, well, maybe six or seven years ago. Yeah, fantastic novel. But what do you think explains it being such a zeitgeist thing this summer?

It is just like a strange and bizarre marvelous white whale. You never know at which corners of the four seas that Moby Dick will shoot his spout up. And so I think that’s a little bit of a mystery to me. But I am I am a dickhead. And I love the depictions of mesmerizing whale lore.

And my favorite final novel is Bleak House by Charles Dickens. It is just this very fun, inventive, clever book that is a miracle of construction. So I commend it to your listeners.

Operas by Mozart, as well as this quartet of novels. Fantastic. Great, great, great, great.

I have a couple of recommendations. One is by Yun Sun from the Stimson Center. She heads their China practice. It’s in Foreign Affairs. It’s called China is Enjoying Trump 2.0, which I thought did a really good job of sort of channeling Beijing’s perspective on what’s happened in the time since Trump took office now. It’s like seven months now.

It’s really good. She’s always solid. And this is a particularly, I think, Excellent view into the Chinese mind on this. I also want to plug a book I’m reading right now. It’s called Revolutionary Spring by Christopher Clarke, who is one of my favorite historians. It’s just an amazing work of history.

Hopefully, you’ve read his earlier book, The Sleepwalkers, which is about the run-up to the First World War, which I also highly recommend. I’ve actually recommended it before on Seneca.

I’m hard-pressed to think of a working historian who has all the things that Clarke brings to the table, which is just an obvious facility in so many languages and this ability to just zoom in. Because the revolutions of 1848, which is what Revolutionary Spring is about, these happen all over Europe and at the same time.

So if you’ve got to write a book on this, you need to be able to:

• Zoom into a very specific country and its context
• Then zoom out to see how its experience fits into this bigger European and, really, frankly, global tapestry.

And the other thing, of course, is that Clarke is just a brilliant, brilliant writer. His prose is just delicious.

I think it’s such a good book. It’s a really hardcore history. I mean, it’s not for the faint of heart. There’s more detail than I think a lot of people are used to, and it’s just great. So that and Sleepwalkers—my recommendations.

Dan, once again, thank you so much for taking so much time to talk to me. And happy birthday.

“Thank you.”

What is it? Happy birthday.

“It is my 33rd birthday.”

What is three? Is that an auspicious number?

“I’m not sure.”

Well, it’s half of 66, which is an auspicious number.

“Okay, that’s good.”

Yeah. Thank you so much for taking the time. And congrats on the book, which is, again, just so terrific. It’s been a total delight.

“Thank you again, Kaiser.”

Looking forward to seeing you again.

You’ve been listening to The Seneca Podcast. The show is produced, recorded, engineered, edited, and mastered by me, Kaiser Kuo. Support the show through Substack at www.sinecapodcast.com, where there is a terrific offering of original China-related writing and audio.

Email me at [email protected] if you’ve got ideas on how you can help out with the show. Don’t forget to leave a review on Apple Podcasts.

Enormous gratitude to the University of Wisconsin-Madison Center for East Asian Studies for supporting the show. Huge thanks to my guest, Dan Wong.

Thanks for listening, and we’ll see you again next week. Take care.

Bye.