Former World Bank economist critiques Western protectionism amid China’s industrial ascent, urging systemic industrial policy reform over ‘Eastern wisdom’ rhetoric
Original framing: “Economist Justin Lin urges West to adopt ‘Eastern wisdom’ as China moves up value chain” — South China Morning Post
The U.S. and Germany both pursued aggressive industrial policies in their developmental stages, from Hamilton’s Report on Manufactures (1791) to Germany’s post-war ‘Wirtschaftswunder’ under Erhard. China’s industrial ascent mirrors Japan’s post-1945 strategy, where state-directed credit and protectionism enabled rapid catch-up. The ‘overcapacity’ narrative echoes 19th-century British complaints about German and American industrial competition, revealing a pattern of hegemonic resistance to rising powers.
Justin Lin’s framing reflects a broader geoeconomic struggle where rising powers challenge the West’s post-1980s free-market consensus, which itself was built on state intervention.
The ‘Eastern wisdom’ rhetoric obscures the structural reality: China’s industrial ascent is not an anomaly but a return to the historical norm of state-led development, as seen in Germany’s post-war miracle or the U.S.’s 19th-century industrialization. The omission of labor and environmental costs in both Chinese and Western models reveals a shared blind spot—industrial policy is framed as a race to the top, not a process requiring democratic oversight. Meanwhile, marginalized communities in extractive hubs and deindustrialized regions bear the brunt of this competition, their voices silenced by a debate framed in terms of national competitiveness rather than human dignity. The path forward requires institutionalizing transparency, decoupling strategic sectors from protectionist cycles, and centering justice in industrial transitions—lessons that demand a reckoning with the West’s own industrial past.