Tuesday, June 10, 2014

China: Wealth and Democracy

Will Western levels of income mean that China adopts Western models of democracy?

In a recent article, I discussed a report tabled by the IMF on China’s economic future. In it, IMF economists Malhar Nabar and Papa N’Diaye argued that if Chinese authorities are able to complete the necessary economic reforms, then China will become a high-income economy by 2030. In nominal terms, high-income economies have a Gross National Income (GNI) of more than $12,616 per capita. This effectively demarcates those nations that are rich and those that are not. Of course, while China will enter the rich nations club, with its current GNI of $5,720, the dragon economy will have a long way to go in order to match the sheer wealth of the United States (which has a GNI of $52,340). Nevertheless, given its relative size, China is set to overtake the United States as the world’s largest economy by 2030.

This will have tremendous implications in terms of the future balance of power in world politics. Equally, high-income status will also have tremendous implications for the Chinese Communist Party (CCP) and the current domestic political arrangements in China. As it stands, China’s great socialist revolution has already morphed into a devolved variant of high capitalism. The free market-based reforms that Deng Xiaoping inaugurated in the 1980s has created a scarcely concealed capitalist culture in China over the top of the communist facade.

At the first hint of reform, outside commentators were quick to hail the death of communism and the eventual triumph of democracy. It seems the reoccurring theme of the CCP’s future demise acts as a comforting aside for commentators who berate (rightly) the oppressive nature of the communist system. Yet much of it is done out of a generalized fear of a non-Western nation on the rise. As Alex Lo of the South China Morning Post notes of critics of the Communist regime, they “project their own democratic belief and criticism of the Chinese system of government to assume the central government has no real legitimacy and that, once growth slows, social unrest will follow and the regime will eventually collapse.” Moralization on China’s clearly poor human rights track record is one thing, but the reality of the CCP’s paramountcy in China is quite another.

Without a doubt, China’s communist party is moving into unchartered territory. Already, economic development has created a society that is better educated, better paid, and more material. Already, Chinese have been afforded a degree of personal freedom hitherto unheard of in Chinese society. While, these freedoms are hardly comparable to those of liberal democracies, Chinese citizens are developing much politicized voices and are getting better at expressing their opinions. Recent demonstrations against local government initiatives for one emphasizes the ability of people to mobilize against authorities. The Chinese of today have witnessed phenomenal rates of economic progress and as a result, they expect better and aspire for more. This brings into question just what the citizenry of China will demand from their leaders once the endless horizon of economic development comes to a close.

The question is timely in the wake of the twenty-fifth anniversary of the Tiananmen Square massacre, an event that still hangs over the CCP. If communism failed to die at Tiananmen, many observers are confident that it will at the very least collapse once the middle class of China begin demanding political reform. The thinking of many observers is based on the antecedent of the progressive Western narrative in which those with a newfound economic stake in society went on to demand a new political settlement. This is a linear conception of the past: from the artisan’s workshop to the capitalist’s factory; from mercantilism to free markets; from monarchy to nation states; from elitist societies to mass democracies. All paths have a satisfactory conclusion with the endgame being liberal democracy.

However, during the industrial age, the diffusion of wealth into an educated middle class in the West forced elites to renegotiate the terms of political control. With industrialization, spreading affluence, and mass media, people mattered. As such, even conservatives such as British Prime Minister Benjamin Disraeli found themselves showing unheard of degrees of benevolence, creating a universal male suffrage in a bid to undercut the more radical demands of the people. Even German Chancellor Count von Bismarck initiated pioneering social welfare reform as a concession to the sentiment of revolutionary workers. Old regimes accommodated the changing status quo and those that failed to do so faced the even worse prospect of the mob.

In the contemporary context of our globalized world, the master narrative of democratization has stalled. In the United States, there is stalemate and polarization in the political system. In Europe, there is skepticism and malaise. And then there was the myth of the Arab Spring. Rather than inaugurating a new era of democracy in North African countries such as Egypt, onlookers seemed genuinely shocked when the revolution gave way to a modern-day Thermidorian Reaction as the military reverted to old authoritarian habits.

The idea that the Communist Party will collapse and democracy will eventually triumph in China is a grave misreading of the situation. The party stands as a harmonizing and unifying force in Chinese society – a far more important consideration for the middle class given the painful legacy of China’s historical fragmentation in the nineteenth and early twentieth century. Indeed, it stands to reason that if the CCP succeeds in elevating China into the echelons of the high income bracket, then conversely it will act as a powerful legitimating device for the regime.

If anything, Chinese nationalism serves as a far more popular discourse in mainstream society; whether it is populist anger at Japan or the huge crowds that flock daily to watch the flag raising ceremony in Tiananmen Square. In terms of maintaining harmony, nationalism can be a double-edged sword for the CCP. Displays of patriotism can help to maintain unity and assist in diverting the population’s attention from pressing domestic issues. Yet at the same time, zealous nationalism can be harmful to China’s international image and threaten to undercut its peaceful rise narrative. Nationalism, like all things in China, needs to be carefully stage managed in order to prevent it from causing social instability.

Stage management and social stability are the keywords in the CCP’s lexicon of governance. Beijing is learning to account for its actions to its people. For instance, recent worries about the capital city’s rising levels of air pollution have made the authorities more aware of environmental matters. Policy changes aimed at dealing with the issue of air pollution demonstrate the ability of the government to shift resources in order to troubleshoot popular issues. Thus, given the government’s sensitivity towards public opinion, considered political change over the coming years or decades, depending on the boldness of party leadership, is quite likely. Whether this will take the form of an empowered National People’s Congress, more inclusive decision-making at the party level, or greater democracy at the local level only time will tell. The CCP, though, is no house of cards; as Eric X. Li writes in Foreign Affairs, Beijing is more than “able to meet the country’s ills with dynamism and resilience, thanks to the CCP’s adaptability, system of meritocracy, and legitimacy with the Chinese people.”

That in no way assures the CCP’s future survivability – as in any political system, changing socio-economic contexts invariably influences political regimes. But even if the regime loses its communist fa├žade in place of a more democratic model, there is no suggestion that the elites or the “red nobility” that act as the invisible state will be displaced from positions of authority. Indeed, very few revolutions or changes to the status quo are quite as radical as people tend to think. Pragmatic elites invariably negotiate with the changing times so that it appears that the political arrangement has changed. Reform is easy, elitism and dynasty are much harder commodities to flush out of the system. The fact that China has a huge income inequality gap already shows that in the event of a post-communist meltdown there will be elites ready to step into the breach – just like the oligarchs in Russia. Thus, the West should watch China’s political stability with a high degree of caution. While liberal political reforms are desperately needed to improve the human rights situation in China, a radical rupture in the political system could signal an uncertain future for China and the world.

Christopher Ernest Barber is a doctoral candidate at the University of Auckland, specializing in the history of  international arbitration and the development of globalization, commerce, and trade.


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