Brian Greenspun on the role of Macau in a developing China and of the country’s challenges for the future

Tuesday, Nov. 21, 2006 | 7:14 a.m.

Editor's note: Brian Greenspun spent more than two weeks in China in October, traveling the country as part of a study tour conducted by the Brookings Institution. In a series of columns, he is offering his thoughts on what he has learned about one of the world's most intriguing and powerful countries.

Why will Macau work?

For the same reason its mother, China, cannot help but succeed.

Next door to the tiny gambling-heavy island of Macau, a one-time Portuguese controlled enclave that is now very much a part of China, resides the largest population on one of the largest land masses on the planet.

Throughout our three-week Brookings Institution study tour of China, we were constantly reminded that there were 1.3 billion people. That is a lot of folks, a lot of mouths to feed, bodies to keep healthy and people to assure that their futures and that of their families will be bright.

As my friend New York Times columnist Tom Friedman wrote recently about the tremendous, country-threatening environmental challenges that China faces, what it chooses to do from this day forward will determine whether that country enters the next part of the 21st century as a world leader or a world destroyer.

For a number of very good reasons, not the least of which is that it has no choice, I believe we are at the beginning of China's emergence as the next world economic and military power.

To an American who looks at the world through American eyes, what we saw in China might give pause and call into question her ability to meet substantial, almost overwhelming, economic, environmental and social challenges.

But to a person who can take a bit of a longer view, it is easy to see how China can emerge as a leader in the next half of the 21st century.

To do so it has to overcome the kind of problems that would doom other, less prepared and less committed countries. The question is simply whether or not China has what it takes.

Macau tells a significant part of the story.

For more than 50 years, those of us who have been fortunate to see it, have watched Las Vegas grow year after year into what has become the fastest growing and most "American" of cities. When others experienced 1 percent or 2 percent growth, we have enjoyed 6 percent and 8 percent growth. I say enjoyed, but if you were a city or county planner or an elected official dealing with revenue and infrastructure issues, the last half century has been many things, but probably not enjoyable.

All that growth, all that excitement and all that hyperactivity are but child's play compared to what is happening in Macau. That tiny island will achieve in 10 years most of what it has taken Las Vegas over half a century to accomplish.

We think we have building cranes here? Not even close. And where we have tens of millions of people to draw from within a two- or three-hour plane ride, China has hundreds of millions. And that number is growing almost at percentages that even we cannot fathom.

If our market in Las Vegas is the vast middle class, China has a middle class almost as large as ours and it is just getting started. And, unlike some in our society, as best I can tell, the Asian mind and the gambling mind-set are in harmony.

All this is to say that the Las Vegas-based gaming companies appear to me, at least, to have made the right investments at the right time and in the right place. I have lived through an entertainment and gambling-based growth spurt for the past half-century in Las Vegas. I know what success in this world looks like. To me, tomorrow's success looks a lot like Macau.

So, assuming Macau will be a winner, what about China?

China is a much grander story. We can understand Macau because we can view it in terms of Las Vegas' success, which gives us an apples to apples comparison.

Trying to fathom the future of a country that is 5,000 years old, that is patience personified, that looks at progress in terms of decades and centuries and not quarters and years, and which must govern and advance 1.3 billion people, well, that's a good bit more difficult.

China's future will not happen in the relative vacuum of economic freedom, which exemplifies Macau. With her, we are dealing with not only an emerging economic superpower but a military one as well, with all that implies.

Still, when we ask the question, "What about China?" I think the answer is very simple. Had you been with us for two weeks in that amazing country, your declaratory statement would say it all. What about China!