Uh Oh. China’s New Set of Policymakers could be Harvard Trained Keynesians

Wonder why China’s economic policies have transitioned into boom bust cycles? Well that’s because China’s policymakers has increasingly been influenced by the Keynesianism

Now Harvard trained Chinese politicians are vying for power.

From Bloomberg,

Li Yuanchao serves the Chinese Communist Party as head of its organization department. For a few months in 2002 he had a different overseer: Larry Summers.

Li controls the patronage system of the 82 million-member party that this month is unveiling its next generation of leaders, overseeing an apparatus that names cadres to posts in state-owned companies including China Mobile Ltd. (941) and acting as career manager for thousands of rising officials. He took part in an executive training program at Harvard University when former U.S. Treasury Secretary Summers was the school’s president. Li reminded Summers of that when the two met in 2010 in Beijing.

Li is the most prominent graduate of a program that has brought rising Chinese leaders to Harvard’s Cambridge, Massachusetts campus for more than a decade. The initiative underscores the fact that even as the U.S. and China are at odds over issues ranging from the value of the yuan to Syria, top politicians in China are increasingly drawing on their U.S. experiences in setting policy for the world’s second-biggest economy, said Anthony Saich, a professor at Harvard’s Kennedy School of Government who oversees the program.

And further evidence suggests that the relationship of US-China leadership have been joined to hip through the Harvard channel.

This bolsters my postulation that territorial disputes in Southeast Asia seem more of a false flag to shield other political agenda:

Other graduates of the program at the Kennedy School’s Ash Center for Democratic Governance and Innovation include Commerce Minister Chen Deming and Zhao Zhengyong, the governor of Shaanxi province. They get face time with some of Harvard’s most famous professors. In one program, officials attend a series of seminars Saich calls “star turn.”

Want to learn about how a country uses soft power? Joseph Nye, the political scientist who coined the term, holds a seminar on that. What about the U.S. presidency? Roger Porter, who served in three U.S. administrations, including as assistant to the president for economic policy under George H.W. Bush, meets with the students. Economics? Summers will lecture on the U.S. or global economy “or whatever’s on Larry’s mind at any particular time,” Saich said.

Harvard’s Kennedy School has been expanding its offerings to Chinese officials and executives at state-owned enterprises since the first program -- for senior leaders at the vice- minister level -- began in 1998, sponsored by Hong Kong’s New World Development Co. About 150 officials have been through the program since its inception, with 20 each year at most, Saich said.

And one can also guess that cronyism and nepotism could have been part of the Harvard-China leadership program

Harvard also attracts other relatives of China’s top leaders. Chen Xiaodan, the granddaughter of top planning official Chen Yun and daughter of China Development Bank Corp. Chairman Chen Yuan, graduated from the business school with an MBA this year, school records show. Xi Mingze, Xi Jinping’s daughter, is an undergraduate at Harvard College…

And it has dawned on me from this report that Harvard has become the most influential policy think tank on China albeit masquerading as school.

There are 686 full-time students from China enrolled at Harvard for the 2012-2013 academic year, more than from any other foreign country, and almost half of them, 331, are in the Graduate School of Arts and Sciences, according to the Harvard International Office website. The Harvard Kennedy School of Government, where Li and Bo attended, has 32 Chinese students, according to the site.

Harvard’s links to China go back at least to 1879, when Ko Kun-Hua, a Chinese language teacher, was hired, according to the university website. Ko died of pneumonia less than three years after arriving and his books became part of the Harvard Yenching Library, which now has more than 1 million volumes.

The above simply reveals of the pivotal role played by the Harvard connection in shaping China’s domestic and geopolitical policies.

Importantly if Harvard trained policymakers captures the top echelon of China’s state hierarchy, then we should expect more macro "demand management" measures such as stimulus, welfare and military Keynesianism to dominate China's policies. This means boom bust cycles will also commonplace feature in China.

And this also implies that the same political economic formula that has been a drag to the US (debt based consumption system) will likewise be the strategy used on China: a seemingly crafty move by US politicians through the Harvard nexus.

I am reminded by the snarky remark made by the late conservative William F. Buckley Jr. on Harvard:

I am obliged to confess I should sooner live in a society governed by the first two thousand names in the Boston telephone directory than in a society governed by the two thousand faculty members of Harvard University.