Be careful, America!

A few days ago Israel and China signed their first trade agreement at governmental level. What might result from this in due course intrigues me enormously because, simultaneously, their cultures share one feature in common and are poles apart in another. How will these have a bearing?

The feature they share in common is that, traditionally, they have both placed the status of the scholar above that of any other calling. In older times, parents with daughters of marriageable age in both cultures would seek scholarly young men rather than those who were merchants. In this they are both distinctly different from most of the other predominant cultures around the world such as the American, the West European, the Latin American, the Islamic, etc.

The feature in which they differ enormously is that the Chinese are highly deferential to authority. Unless oppressed too harshly over too long a period, they will generally obey whatever their government decides. In school, children and students learn in highly disciplined teacher-led contexts and seldom raise questions. Indeed, even though China produces many thousands of graduate engineers and scientists every year, the Chinese government is very worried about their young people’s lack of creativity compared with those in the West. Senior officials say so quite frequently. At family level, parents who can afford it are increasingly sending their teenagers abroad for further education. In contrast, Jews are notoriously individualistic and, in particular, are highly creative in the arts and sciences.

Ah! the sciences. If Chinese and Israeli firms are going to have a growing relationship in future years then the sciences will be important. What pattern might this take? The number of Nobel prizes in science can give us a guide. Both countries began to industrialize and carry out scientific research seriously about 60 years ago (the Communist Revolution occurred in 1949; the State of Israel was founded in 1947). Since then, Chinese scientists have won 9 Nobel prizes and Israel 3. Considering that China has a population of about 1,200 million and Israel 6 million then, proportionately, it would seem that Jewish researchers have been almost 70 times more innovative than Chinese.

The ratio is even more lopsided if we include Nobel science prizes won by Jewish-Americans (with a population of about 9 million out of 300 million Americans). My conservative estimate based on surnames on a Wiki list gave them 30 prizes out of a total of 250 won by Americans as a whole. Interestingly, the number of science Nobels won by the Chinese-American population (of about 4 million) is 8 — almost as much as mainland China and twice as productive than non-Chinese American scientists! This is eloquent evidence that it’s not so much Chinese brains that lack something but that the freer more liberal culture of America is immensely more conducive to creativity than China.

If we assume that the authoritarian culture of China is not going to change very much in the coming years (it’s hardly done so far) and that the American scientific culture took at least three or four decades to become so prolific, then it is reasonably safe to assume that, for some considerable time to come, Israel is going to be the predominantly creative pole of the Chinese-Israel trade relationship. The Chinese are likely to continue concentrating on what they are already so very good at — copying and mass producing of what has been designed elsewhere.

In terms of annual gross production of consumer goods China is already destined to overtake America by 2020/30 according to the usual think-tanks. So far, America is still way ahead of China in making highly sophisticated producer goods — hot out of research labs — and could, in theory, still retain a reasonable body of export trade. But what if China responds with swish producer goods of its own — hot out of Israeli research labs? — and competes both in America domestically but also in America’s present export markets? As Israeli researchers are already well up with America in several research areas (biology, communications, nanotechnology, drones, etc) this is something for America’s long term planners to think about beyond the massive currency adjustments that can’t be far off now.

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