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Sat May 19, 2012
China's New Plan: A Great Leap Into The Air
Originally published on Sat May 19, 2012 5:55 pm
Right at this moment, more than two-thirds of all airport construction in the world is happening in China.
The country is in the first full year of a five-year plan to eventually make China the center of global aviation, and the Chinese government is pumping a quarter-trillion dollars into the project.
"From the American perspective, the whole idea of five-year plans is preposterous," says James Fallows, author of a new book about China's aviation boom, called China Airborne. "If you think five-year plan, you think Soviet Union, you think economic failure."
The new plan is hugely ambitious and not at all certain to succeed, he tells NPR's Guy Raz, but it's a window into whether China's overall economic strategy is actually the model for the 21st century or a cautionary tale.
"Part of the genius of the Chinese economic boom over the last couple of decades," Fallows says, "is they have combined this large-scale government direction, which actually is important there, with this whole infinity of private, uncontrolled, very entrepreneurial activity."
He says China's leaders feel that if the country is ever to attain real prosperity, it needs to succeed in areas like pharmaceuticals, information technology and aerospace. "And that's what this next push is all about," he says.
Fallows adds that the new five-year plan is directly aimed at raising the profile of Chinese companies abroad. While corporations like GE, Sony and Hyundai have massive international brand awareness, Chinese companies are generally unknown outside their own borders, even though they contribute to the success of the multinationals.
The people behind the current plan — the 12th such five-year plan in China's history — recognize that they face a different set of challenges now than they have in the past.
"The last 30 years have been a miracle for China in alleviating poverty; in getting people off some of these very, very difficult farms, where their cash income might be a hundred dollars a year, to an urban factory life where there are many other signs of material progress," Fallows says. "But taking the next step may be significantly harder."
So why the focus on aerospace, rather than something like roads or infrastructure? Fallows says it's actually not an either-or question in China, as its massive aerospace projects are accompanied by equally massive road and rail-building efforts.
"It's all ahead on all fronts, because they have both the needs and the resources," he says.
But, he says, the Chinese are specifically focusing on aviation in order to meet a growing domestic demand for travel. "And also, because they think that if the country can become not just a consumer and purchaser of Boeing airplanes and Airbus airplanes, and Gulfstreams, and Cessna business jets and all the rest, but if they can take part of the international business of providing those things, then that will signify a real level of maturity for the economy."
Fallows points out that aerospace is the U.S.'s biggest export sector, something the Chinese have taken note of. "They're buying lots of things now," he says, "but they're hoping this is an area where they could succeed."
And if they are to succeed, Fallows says. there's a hard transition ahead for China. "If you're going to have advanced research centers, if you're going to have sort of high-end coordinated international engineering, you need to have the sort of soft attributes of a successful liberal society that will draw first-rate talent from around the world," he warns.
That means China may have to give up some of its internal controls in exchange for full-fledged sophistication and wealth, he says. China's aviation history is entirely military, as opposed to the mix of military, commercial and hobbyist activity in the U.S.
"Everything about flying within China is subject to military control and whim," Fallows says. Military controllers often hold up departures, routes are indirect in order to dodge military airspace, and cruising altitude is sometimes restricted to a fuel-inefficient 10,000 feet.
"It's equivalent to having to drive on a freeway in first gear. It just is a terrible way to run airliners," he says.
Chinese business interests are fully in favor of a more efficient, businesslike system, but Fallows says the military continues to stand in the way.
"The reason this matters is it's a little distillation of the struggle for China in general. Almost everything about China's next step of the economic and cultural and technological ladder requires some relaxation of government control, some military control, he says. "The question is, how that balance will be struck."
"That's the difficulty," he continues. "If China succeeds in this, it will in a way be more threatening to American competitors, but it will be better. There'll be a different kind of more modern China, in the fullest sense."
GUY RAZ, HOST:
And if you're just joining us, this is WEEKENDS on ALL THINGS CONSIDERED from NPR News. I'm Guy Raz.
Right at this moment, more than two-thirds of all airport construction in the world is happening in China. The government there is pumping a quarter of a trillion dollars into this hugely ambitious project. It's part of a five-year plan to turn China into the center of global aviation, and it's a window into that country's overall economic strategy.
James Fallows has written a new book about the plan. It's called "China Airborne." And regular listeners to this program know Jim as a familiar voice most Saturdays. We caught up with him yesterday during a visit to the West Coast.
JAMES FALLOWS: I am in Seattle and delighted to talk to you from here.
RAZ: Well, it's great to have you. Let's talk about the five-year plans first because this aviation plan is part of the 12th five-year plan in modern Chinese history. Basically, every five years, the government takes a big idea and throws everything it's got at that idea.
FALLOWS: Yes. And from the American perspective, the whole idea of five-year plans sounds preposterous and was associated...
RAZ: Stalinist almost, right?
FALLOWS: Yeah. And if you think five-year plan, you think Soviet Union, you think economic failure. And part of the genius of the Chinese economic boom over the last couple of decades is that they have combined this large-scale government direction, which actually is important there, with this whole infinity of private, uncontrolled very entrepreneurial activity. And in the one they're starting right now, I think the sense of the leadership is they've gone about as far as they can with this low-wage factory construction-infrastructure model.
And if China is ever to become a richer country as opposed to just a bigger version of a poor country, they need to succeed in industries like pharmaceuticals and info tech and aerospace. And that's what this next push is all about.
RAZ: You said something interesting in the conversation that we had on the program a couple of weeks ago, which was you asked me to name a famous Chinese company, which I couldn't. And the point you were making was that it's almost impossible to do that because famous companies build things in China, but China doesn't actually have many well-known companies. How much of this latest five-year plan is really about changing that?
FALLOWS: I think it is directly about changing that. The reason that it matters that we've heard of GE, Sony, Apple, Microsoft - you name any corporate brand from Europe, Japan, the United States or Korea - is that their brandedness is a huge economic advantage. They get an outside share of the profits. We haven't heard of any of the little companies in China that do the assembly and the actual work because they are the equivalent of sort of day labor in a sense. They have very little bidding rights.
And so I think, again, the people behind the creation of the current 12th five-year plan and the 13th and 14th that will come after that recognize that a different kind of challenge is ahead of China the next 10 or 15 years, compared with the huge success of its past 30-plus years. Now, the last 30 years have been a miracle for China in alleviating poverty in getting people off some of these very, very difficult farms where their cash income might be $100 a year to an urban factory life, which has a lot of other signs of material progress for the country. But taking the next step may be significantly harder.
RAZ: Our guest is James Fallows. His new book is called "China Airborne." It's about China's five-year plan to eventually make the country a center of global aviation. Why the focus on air travel in this plan rather than, say, you know, making great roads all across China or creating a great rail infrastructure?
FALLOWS: Part of the amusing answer to that question is that it's almost never an either/or decision about anything in China. And so just as most of the aerospace activity and infrastructure construction for airplanes is under way in China, so, too, they have a mammoth road-building program, a mammoth railroad-building program. And so it's all ahead on all fronts because they have both the needs and the resources to do that.
I think the reason why there's been concentration on these couple of very high-end industries, notably including aerospace and aviation for the Chinese, is both they feel this will help address a need of making connections within their country and satisfying a still very quickly rising demand for people to be able to go back and forth for family reasons, for travel reasons, for even touring reasons.
And also because they think that if the country can become not just a consumer and a purchaser of Boeing airplanes and Airbus airplanes and Gulf Streams and Cessna business jets and all the rest, but if they can take part of the international business of providing those things, then that will signify a real level of maturity for the economy.
It's worth remembering for Americans that Boeing is, year in and year out, the largest net exporter of all American companies. And the aerospace sector is overall the leading export sector for the United States. So the Chinese recognize that. They're buying lots of things now, but they hope that this is an area where they could succeed too.
RAZ: Let me ask you about flying in China because so much of the airspace - or practically all the airspace - is controlled by the military, which is precisely the opposite in the U.S. A vast majority is civilian-controlled in the U.S. Many flights in China take place at 10,000 feet. I mean, that requires a lot of fuel. It's certainly not comfortable for passengers.
Is that changing, and how much more will that have to change for China to reach this ambitious goal of becoming an aviation powerhouse?
FALLOWS: That is a central question, probably the central question, about how this one aspect of China's high-tech ambitions is going to be realized. Because, as you say, China's aviation history is entirely military, where America's has a combination of military and commercial and individual hobbyist background. And so everything about flying within China is subject to military control and whim.
The reason that departures from big airports in Shanghai or Beijing are so often delayed is because the military controllers, for some reason, are not giving permission for the traffic to leave. The routes for even big Chinese airliners are quite indirect by international standards because the military has only these narrow corridors. And as you mentioned, for security reasons, sometimes the airliners are kept to an altitude of 10 or 12,000 feet, which is grossly inefficient for big airliners. They can use twice as much fuel per mile, twice as many carbon emissions per mile when they're doing that. It's equivalent having to drive on a freeway in first gear.
The reason this matters is it's a little distillation of the struggle for China in general. Almost everything about China's next step up the economic and cultural and technological ladder requires relaxation of some government control, some military control. Question is how that balance will be struck.
RAZ: James Fallows' new book is called "China Airborne." Jim is a regular on this program and a national correspondent for The Atlantic. Jim, thanks so much.
FALLOWS: My pleasure. Thank you very much, Guy.
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RAZ: You're listening to ALL THINGS CONSIDERED from NPR News. Transcript provided by NPR, Copyright National Public Radio.