China
Arthur Kroeber: China Needs Proof of Democracy
China is ready for democracy, Arthur Kroeber argues. Instead of moving towards democracy at the behest of the rising middle class, however, the nation’s elite and middle class are fighting against such change.
“They are motivated partly by an understandable fear of instability but more by the self-interest of the elites who now hold power,” Kroeber writes in today’s Financial Times. Reading this reminds me of the enjoyable discussions with Arthur when we briefly shared an office in Hong Kong.
Some highlights:
Democracy is not making progress in China
There is also little evidence that the growing dynamism of China’s economy is creating space for the emergence of democratic institutions. Even as it reformed the economy, the Chinese Communist party skilfully strengthened its control over important economic actors – including virtually all of the nation’s big companies. It also ensured that responses to the country’s major social ills flow mainly through government channels.
China’s leadership has learned from the Soviet Union.
As China scholar David Shambaugh details in a new book, China’s Communist Party: Atrophy and Adaptation, the party carefully studied the collapse of the Soviet Union and concluded that to avoid the same fate it needed to run a dynamic economy, restrain corruption and ensure that government stayed responsive to changing social needs. The successful execution of this strategy has resulted in what another sinologist Andrew Nathan has aptly dubbed “Resilient Authoritarianism”: an autocratic system responsive enough to societal demands to keep itself in power for a long time.
China’s middle class sees no advantage in rocking the boat
They know that if democracy were introduced tomorrow they would be outvoted and they have little interest in changing the system.
Kroeber’s conclusion:
The task for democracy advocates is therefore not to lecture the Chinese on the inherent superiority of democracy, but to prove it by marshalling the evidence that it promotes stability and better satisfies social needs.
Discussion
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What would be ideal, in my opinion, would be a federalisation of independent Chinese provinces into autonomous economic entities able to decide local political decisions. It’s very Mao in the sense local power was a major differentialisation of Maoist communism and Leninist communism.
For example, the current inflation problem: Poorer provinces are getting hit by higher food costs. Poorer provinces tend to be more agricultural. If each province has it’s own floating currency a free-market method would exist for richer provinces to buy from poorer at a higher rate (the poorer provinces’ exchange rate is lower).
A market based direct redistribution of wealth without having to go through taxation-fiscal redistributions which are slow, inaccurate and subject to extreme levels of corruption.