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The Limits of Stephen Schwarzman's Scholarship Diplomacy

A billionaire private equity investor wants to create a Rhodes Scholarship for the 21st century -- in China. But will it meet its goals?
schwarzman.jpgStephen Schwarzman, chairman and CEO of the Blackstone Group, gives a speech at a news conference for the launch of the Schwarzman Scholars at the Great Hall of the People in Beijing, April 21, 2013 (China Daily/Reuters)

The world's most important bilateral relationship is between the United States and China. But how much do American leaders actually know about the country? Few politicians (former Utah governor Jon Huntsman being a notable exception) have ever lived in China, speak Chinese, or have an advanced degree in Chinese Studies. As a result, many view China as a strange, foreign land, one whose planned eclipse of the United States appears to be an ominous development.

Stephen Schwarzman wants to change this. The billionaire private equity investor, whose company Blackstone once invested in China's largest sovereign wealth fund, has announced the formation of a $300 million scholarship that will bring 200 students -- of whom an estimated 40 percent are to be U.S. citizens -- each year for a one-year Masters program at Beijing's prestigious Tsinghua University, beginning in 2016. In addition to their coursework, the students will meet with key Chinese leaders, travel throughout the country, and immerse themselves in the country's language and culture. The hoped-for result is ambitious: "To build a culture of greater trust and understanding between China, America, and the rest of the world," according to Schwarzman. His aim is no less than creating a Rhodes Scholarship for the 21st century, located in the country which many expect to dominate it.

But will just a year in Beijing be sufficient? After all, many students require much more time than that just to get their bearings in a foreign country. Schwarzman is aware of this limitation, but thinks it'll be fine. "Getting top-level students to derail their lives for several years in a foreign country is difficult," he told me. "So there's a practical element to what we can achieve." The rigorous course-load, travel, and interaction with top leaders, he hopes, will help compensate.

Tsinghua, known as "China's MIT" due to the strength of its engineering program, is widely considered one of the country's best universities. Both President Xi Jinping and his predecessor, Hu Jintao, are alums. But in China, education remains firmly under the watchful eye of the government, and certain subjects -- Taiwan, Tiananmen Square, and Tibet being the big three -- are not considered open to inquiry. Schwarzman claims that there will be "no interference in the academic focus of the program," but there's no way he can guarantee that -- ultimately any educational activity on Chinese soil is under the jurisdiction of the Communist Party. It isn't difficult to imagine Schwarzman Scholars eventually wondering if, perhaps, a Chinese Studies program in the United States might provide a more open academic environment.

Then again, it's hard to be too critical of a philanthropist endowing 200 students a year with the opportunity to live and study in a foreign capital, all expenses paid. In addition, simply being inside China is not without value. It's much easier to perceive the extent of Beijing's pollution issues, for instance, when you're breathing the city's air. And it doesn't take more than a couple of trips to rural Chinese towns to understand how many people still live in poverty, a point lost on many pundits whose view of China doesn't go much further than their Shanghai hotel room. Schwartzman, to his credit, is aware of these misperceptions and wants to correct them, and thinks that his scholarship will help.

But the Schwarzman Scholarship is intended for more than just familiarizing students with China -- it wants to affect international relations. Schwartzman told me he developed the idea for the fellowship by noting that a rising China presents a lot of complications that, if left unaddressed, will create "friction". This is certainly true, and is already beginning to happen in areas of trade, foreign policy, currency, and environment. But the problem is this -- conflicts in international affairs derive from more than just a gap in understanding. China's rise presents problems for the United States not because Washington doesn't understand what Beijing is doing, but precisely because it does. President Obama could have spent part of his childhood in China rather than Indonesia, and it still wouldn't make a difference in shaping American foreign policy.

Does this mean Stephen Schwarzman shouldn't go ahead with his Scholarship? Of course not -- I wish more people in his income bracket would follow his lead. But it's worth remembering that it'll take a lot more than mutual understanding to ensure a smooth Sino-American relationship going forward.


Matt Schiavenza is a contributing writer for The Atlantic. He is a former global-affairs writer for the International Business Times and Atlantic senior associate editor.

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