McGregor’s “No Ancient Wisdom” – The Monster Under the Bed is Real

No Ancient Wisdom, No Followers scared me, but I don’t know whether to be afraid of China or afraid for China.  Maybe both.


McGregor’s China is like a fading Olympic boxer who is now addicted to the worst excesses of the good life. Still powerful and

No Ancient Wisdom, No Followers by James McGregor
The “Old Hand’s Handbook of Winning Bar-room Debates”

dangerous – but lurching towards self-destruction.   The China in No Ancient Wisdom is corrupt and conniving – expert at nothing but amassing and maintaining the ruling elite’s power.  The author effectively describes the relationship between the CCP (Chinese Communist Party)  the SOEs (State Owned Enterprises ) and the government of the PRC – and yes, the news is bad and the scenario is dark.

The power of McGregor’s work is that he backs up and quantifies every suspicion of the orthodox China-watcher.  It could be subtitled, “The Old Hand’s Handbook for Wining Bar room Debates.”  Our favorite monster under the bed is real, and now we know his family tree and physical description.

No Ancient Wisdom’s strength, however, is also its weakness.  McGregor confirms our darkest fears, but he doesn’t bring anything new to the table.  The numbers he uses are huge (“nine SOEs accounted for 69 percent of the central SOEs’ aggregate profit… The total profits of China Mobile and Sinopec alone in 2009 surpassed the combined profits of China’s 500 largest private enterprises”) and the spider-web of connections is insidious and unnerving (his endnotes include five pages of acronyms).  Our worst suspicions are confirmed – 21st Century China is indeed a network of sinister Party functionaries plotting to safeguard their personal fiefdoms at the expense of not only the Chinese people, but the world itself.  But we already knew that, didn’t we?    McGregor is at his most effective when he is shining light on less reported plots, like the way China has subverted the WTO or neutralized the ability of international audit firms to objectively report on the financial activities of Chinese firms – even when they are listed on US exchanges.McGregor doesn’t pretend to be able to predict the future of China or to speculate about its relationship with the rest of the world, and maybe that is a good thing.  No Ancient Wisdom is one of those horror stories where the beast is neither slain nor reformed – he continues to roam the countryside and terrorize the villagers.  Those are the scariest stories, but the least satisfying.   No Ancient Wisdom is an important resource – but it is supporting material.


My question – and it’s one that McGregor doesn’t help with – is how do individual westerners best approach the hot, lumbering mess that is 21st Century China.

3 Approaches for small & medium firms dealing with the “No Ancient Wisdom” China:

  1.  Ignore it
  2. Wait.  It may go away, or it may come to you.  Or both.
  3. Engage carefully.
  1. Ignore   Many American businesses still want to ignore China.  On the way to a trade conference in NYC last week, and I was concerned that there would be a dozen other firms selling business entry consulting or China-oriented training services.  Instead, there was a single booth representing the Confucius Institute’s  usiness arm  tucked away in “resources” section along
    Fragile Bridge - Managing Chinese Business Conflict
    Fragile Bridge – Negotiate to Win in China

    with the chambers of commerce and trade associations.    Once you dip below Fortune 500, America’s approach to China is the ostrich defense – bury your head and hope the threat goes away.  Reading McGregor, I have a new understanding  (or at least sympathy) for this approach.

  2. Wait it out.  China is looking like South Dakota after the gold rush.  There’s still money to be made, but there’s no point in rushing in now.  For many small and medium sized Western enterprises, it’s probably best to wait for the big boy MNCs to build inroads and test the waters.  The way capital has been flowing out of the PRC, simply waiting for China to come to a town near you may be the most viable strategy of all.

  3. Engage carefully.  The big MNCs have learned this the hard way.  Now is a good time to start figuring out a plan because in China Americans are looking good for the first time in a long time.  Have a goal.  Don’t try exporting your business model without knowing how to alter it for China.  More and more you’ll be negotiating with people who want a US presence – so make sure that is leverage for you and not vulnerability.



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