China's 1989 Choice: the Paradox of Seeking Wealth and Democracy
wilsonquarterly.com
wilsonquarterly.com
> What Is the Chinese Economic Model?
1. Steal Intellectual Property. IP represents the crown jewels of the global economy; they are the peak achievement of Western civilization, and of all of China's competitors. China steals IP daily, in every possible way: through force, through simple copying, through reverse engineering, through industrial and government espionage, through common theft. China also has a national policy which prevents non-Chinese firms from selling in China unless companies transfer their most valuable IP to China as the price of market access. The clueless ones obey; just ask Boeing.
4. Industrial Policy: Subsidize Key Industries. Japan also started this idea, but China takes it much further. Originally, the government (or the People’s Liberation Army) owned virtually all large enterprises, but even today, it retains strong interests in most key export companies, which makes government assistance less transparent. Many outsiders assume they are dealing with “real†companies, when they are actually dealing indirectly with the Chinese government. Examples of subsidization and export dumping would include tires and, more recently, steel exports (sound like Japanese history?), now being tariffed by the E.U. and the U.S.
7. Price for Export, Suppress Domestic Consumption, and use domestic savings to drive the above policies. While everyone is talking about how wealthy the new Chinese coastal middle class has become, they forget that there are another 800MM+ Chinese still waiting inland on the farm for anything good to happen to them. Despite the latest boom, the Chinese people are still among the top global savers. China seems to be allowing faster wage growth, and is encouraging domestic consumption, more than Japan has.
This is the single most different aspect of the Chinese system. Banks operate as partially privatized central planning. The government prints its own money and hands it out to the banks whenever they lend badly to favored government entities. Corruption in banking is dealt with severely to prevent the bad behavior that the moral hazard would entail. There is such deep denial of the corrupt nature of private money creation in banks in the west that most analysts overlook this as a key advantage of the Chinese system. How many years have we had predictions that the Chinese economy was going to bust any day now?
> There is such deep denial of the corrupt nature of private money creation in banks in the west that most analysts overlook this as a key advantage of the Chinese system.
Can you maybe explain it? Are banks more corrupted in the West or in China? Is <something, I'm not sure what> an advantage or a disadvantage of the Chinese system as compared to the west?
Looks like banks in China can only do that with their government authorization.
Of course, the government is incredibly multilayered and not cohesive, so usually this simply means local government vs. central government.
As of 2012, more than 52% of China's population was urban. Granted, at the time that still meant something like 640 million outside the cities, but not by far all of those are "waiting on the farm" either.
I believe that government is a reflection of culture, and as China's culture becomes more globalized its government may become more open.
In other words, the vast majority of Chinese are still fine with this type of censorship, because they truly believe the government is protecting them and creating a better life for them. Surely an American can understand this, too (post-9/11 National Security brainwashing).
Until most Chinese start believing their government is evil, and that there is a much better, more free way to live, not much will change.
Is their government evil? It seems to me that their government has been hugely successful in bringing about economic growth and spreading that wealth effectively. There is corruption within the government and the equivalent of a dynasty going on at the leadership level, but evil seems an incorrect assessment.
Also is there an example of a much better more free way to live (that continues to work at China's scale)?
http://en.wikipedia.org/wiki/Tiananmen_Square_protests_of_19...
I suppose people can argue about how things are different now compared to the past, but I once worked with a man who was the sole survivor in his village. The rest of his family and village were starved to death. The cleanup crew found that he was still barely alive and nursed him back to health. He eventually smuggles himself to the U.S. It is one thing to hear about abstract atrocities in far-away lands, that happened a long time ago, but it is quite another thing to look someone in the face who has suffered from them.
http://en.wikipedia.org/wiki/Great_Chinese_Famine
http://www.theguardian.com/world/2013/jan/01/china-great-fam...
you might argue something along the lines of "well what does it matter? look at china", to which my response would be, so what? economics, businesses, money, etc. are all just abstract complicated notions run and managed by paper-clip maximisers. there are people who are suffering, and.. how can that be ignored?
Today in China this suffering is reduced more and more, despite a growing population. That in itself is a good thing. However, the Chinese don't have the amount of freedom we are enjoying. But how do you compare non-freedom versus material suffering?
I believe that eventually China will have to establish these freedoms to keep improving their economy. And we are already seeing signs of the limitations: Innovation in China is hard to come by, and corruption on any level is uncontrollable with citizens afraid to speak up.
This was a big problem for revolutionaries of the 19th and 20th centuries that were eager to overthrow various regimes in relatively undeveloped countries, yet who looked to socialist ideas for inspiration: They wanted to agitate for socialism. Marx explicitly had said they'd fail.
Lenin attempted to solve that after the Russian civil war by instituting NEP - New Economic Policy: semi-free markets, private ownership on the small scale, coupled with tight regulation. The intent was to shepherd the country through capitalist development as quickly as possible, and bring about the advanced capitalist stage that Marx had claimed would be necessary for a successful socialist revolution, without giving up the political control, and while trying to counter the worst excesses.
Lenin hinted he believed the SSSR would need NEP for decades before it would be ready for an actually socialist system, but Stalin undid most of the reforms shortly after he took charge. The stratification that the Bolsheviks oversaw, coupled with the ultimate failure of the Soviet system was a fairly solid demonstration of what Marx had warned about.
While Mao seemed to believe China could take another path, and leapfrog all of the capitalist development entirely, China has gradually taken a similar approach to that of Lenin ever since Deng Xiaoping gained the upper hand: Loosen the economic reigns slowly, but try to retain the political control, with the ultimate goal at least on paper still ultimately being to develop society enough to make socialism possible. As long as they manage to keep the material growth, this creates a way of pacifying the population fairly effectively whether or not they actually have any intent of ever softening up their political control:
There's an "end game" that is appealing, and as long as it seems like things are going in the right way, and people generally feel their lives keep getting better, there's little reason for most people to want to rock the boat.
The danger with that, of course, is that the moment they fail to keep up the forward momentum in material wealth, people will increasingly start to question their policies, and want a greater say, and start caring about all kinds of other problems, and then their options becomes to yield, and lose control, or apply more and more violence to keep on top.
I think this is a false dilemma. Taiwan, Singapore and Hong Kong all managed to develop into wealthy nations (PPP GDPs per capita of around 35k, 60k and 40k respectively compared to 12k in the mainland), in spite of having far greater degrees of freedom than Mainland China.
>most Chinese were suffering a lot more from poverty than from individual rights
The poverty was to a degree due to the lack of individual rights. In Maoist China, you literally didn't even have the right to the grain you farmed in your field; you had to give it to the Party and then wait in line for whatever they decided you deserved. There was no opportunity to save up and improve your lot; starting a business, privately buying and selling things, was literally grounds for execution.
Hong Kong also had very limited democratic control until the 80's (being a British Crown Dependency until then) and was in an extremely special situation by acting as a place that received a massive inflow of people and capital fleeing from the PRC when CPC took control, and that was able to capitalise massively on trade with the rapidly growing Shenzhen.
It is in any case moot, as the point is not that it isn't possible, but that if faced with the choice - whether or not the choice is a false dilemma or a total fabrication - it is not at all clear, nor even likely, that people will pick freedom over material wealth.
It is not an excuse for dictatorship, but an explanation for peoples willingness to put up for them in certain situations.
> The poverty was to a degree due to the lack of individual rights. In Maoist China, you literally didn't even have the right to the grain you farmed in your field; you had to give it to the Party and then wait in line for whatever they decided you deserved. There was no opportunity to save up and improve your lot; starting a business, privately buying and selling things, was literally grounds for execution.
The poverty didn't start when Mao gained control. This was a response to widespread poverty previously.
One can certainly make the argument that they could have developed faster with a different system.
But that is not the point that was being made. The point being made was that when your population is poor - to the point of starvation - their priority is material improvements, not freedom of speech - and this largely explains why a dictatorial government that manages to feed their population and produce growth gets so little opposition. It's not that there might not be better alternatives, but that if most people feel they're doing better than last year, they will not rebel.
It's worth noting that the effect of steady improvement on people's overall happiness is quantifiable, and there are theories that claim that major societal upheaval in general can be tied back not to high degrees of poverty or oppression, but to "backsliding". That is, people will for the most part put up with bad situations, but not put up with things getting steadily worse for long periods. Conversely, societies are at their most stable not when they are wealthiest, but when they see slow, steady growth.
(Jonathan Haidt's "The Happiness Hypothesis" covers this in more detail and with some references to related research)
The Legislative Council had half its members from the current government officials including the governor and half its members appointed by the governor. How democratic that was.
I think if I were a member of the Chinese ruling class I'd probably answer your question by comparing Indian and Chinese life expectancy and literacy since 1949, and their respective GDPs per capita since 1980. Democracy has been much, much less effective at reducing suffering in India than communism has been at the same goal in China. Democracy in China would probably have been more effective, faster but your question and phrasing are emotion, not argument.
In the hierarchy of needs, a full stomach for you and your family comes before individual freedoms, free press etc. The vast majority of those 1.3b people still struggle with this. Those in power know it. They've seen the British Opiumpire, Maoism and the Cultural Revolution, anything after that was a step forward.
The idea of corporatocracy is that a country is run by, and for the good of, corporations as a whole rather than individual citizens. People who believe this view will point to things like the huge lobbying power of corporate interests, the level of influence of the corporate media, the fact that an awful lot of lawmakers have very close links with companies in industries that they are drafting regulations about, or the the bailout of banks etc.
You may or may not agree with whether this is really happening in the US or elsewhere, or the level to which it undermines democracy, but it helps to talk about what the word actually means rather than a straw-man argument.
Turns out, lots of antidemocratic systems have elections, I would even argue a modern dictatorship should have as many elections and referendums as humanly possible.
One democratic and one antidemocratic nation might have very similar constitutions, and institutions.
Is it then about human rights and freedoms? Human rights are impossible to implement perfectly. There are always compromises. For example, if you want people not to hurt, kill and steal from each other, you better tax them to finance some kind of justice system. But taxation is a violation of the right to property, and policing restricts all sorts of freedoms. What we call "democratic countries" just have a "better" compromise than antidemocratic ones.
Democracy being an emergent property solves all sorts of conundrums. Freedoms, and the protection thereof are essential to enable free and fair elections. These free elections are necessary to maintain control of the state aparatus which is necessary to guarantee these freedoms.
An emergent property is hard to construct. We've seen how difficult it can be to establish a democratic system from the outside (Afghanistan), and how easy (Germany).
The necessary parts of a working democracy (and what are these, anyway?) seem to depend on the other parts to work.
But the general attitude is "Let's just have open elections, and everything is peachy!" And in a more subtle manner, in Europe people start to view "number of referendums" as the only measure to compare "democracticness".
That's true only if you are 'liberal' (to the extreme). Taxation is what gets you public health, schools, streets in places where you go once a year. It's what keeps remote villages connected to the mainland.
In a sense, it's what society is all about. Otherwise we would be still living in the jungle like monkeys.
So since your view is open to interpretation, better be cautious using strong terms like if you're talking about maths IMHO e.g. "[...]taxation is a violation of the right to property [..]"
If a government takes away people's money, then their right to property is violated, in my (not that liberal) view. But I just require very good reasoning and solid participatory control over that "taking away".
Russia for example regularly expropriates some citizens, and always with an outwardly reasonable and legal justification. But in Russia there is no participatory control over the instutions doing this...
No, it's quite literally true. Taxation is armed men taking your money by force. We've just agreed that it's worth it to violate property rights to some degree for the greater good.
10,000 years ago you were completely welcome to live outside of the city-state if you wished where everything is taken and kept by force; you'd just have a shorter/harder life at it.
Get rid of the government and you could take my house just by showing up with a bigger gun than me.
Only thing I could do is get together with my friends and neighbours to form an armed gang for mutual property rights enforcement, AKA a government.
Human society exists to grant those privileges so that it allows more people to live - an evolutionary advantage. People have been brainwashed, or deluded into thinking that those "rights" they enjoy is somehow divine and inalienable.
But even Psychology and Neuroscience has picked up on a tendency of humans to not like other humans suffering. In a sense, hurting someone else hurts us also. In that way, a society which respects individual's rights is not acting on a whim, but rather on a biological predisposition - even if it is weak.