Why China’s Riches Won’t Bring It Freedom

Why China’s Riches Won’t Bring It Freedom

Modern history is the story of how liberal democracy, originating in the U.K. and America, spread around the world. This may sound like an absurd fantasy. In actuality, this Whiggish narrative of progress underpins most newspaper editorials, political commentary and speeches in the West, and frames larger views of political developments in the non-West.

It accounts for the gloomy undertone to Freedom House’s latest report, which records the shrinking of liberal democracy worldwide. Even countries with regular elections, such as India, are far from upholding the notion of liberalism, which advocates the maximizing of individual rights for the fullest realization of human potential.

Perhaps we should discard the ideological prejudice that assumes the universalization of liberal democracy. We might then be able to see dispassionately the true multiplicity of political forms, how they came into being and what they portend.

The specific socioeconomic conditions that enabled both liberalism and democracy, such as the Reformation’s stress on individual responsibility or industrial capitalism, were particular to Western Europe and America.Catch-Up States

They couldn’t be recreated elsewhere easily, especially among countries trying to catch up to the West. Japan, the first non-Western country to try to become modern, became an economic and military power without enshrining liberal concerns for individual rights.

Before Japan, there was Germany, another society that embarked on industrialization relatively late compared with the rest of Western Europe, and was modernized by a strong centralized state.

Neither Germany nor Japan embraced the traditions of Anglo-American liberalism, which encouraged individualism, laissez-faire economics and a fundamental distrust of state power. Individual rights were subordinated to the economic and military imperatives of countries lurching late into the modern world.

Few Japanese wished to criticize the slogan “fukoku kyohei” (meaning “enrich the country and strengthen the military”), as their country rapidly modernized in the late 19th century under the not-so-benign gaze of the U.K., Russia and the U.S.

Even during the politically favorable conditions of Taisho Japan or Weimar Germany, liberals wanted the state to devise and implement social-welfare policies for the benefit of the working poor. Reacting against modern capitalism’s built-in inequalities, they trusted in bureaucratic management of the economy (prefiguring in some ways the liberal New Dealers of the U.S.).

Many Indian liberals, too, stressed state initiative in many areas of public life. India’s first prime minister, Jawaharlal Nehru, implanted representative democracy by ensuring that individual consent, periodically sought through elections, legitimized the great power of the Indian state.

Yet his liberalism had a communitarian and paternalistic bent. The state was to hold great prescriptive powers in the realm of the economy. The Indian constitution held that free speech, too, could be circumscribed in favor of the public good.

Alas, a straight line runs from this pragmatic acknowledgement of a diverse society to the present, when just about anyone — a small town mullah as well as a thuggish politician — can claim to be attacking artists and writers on behalf of the public good. Liberal democracy in India has never seemed more feeble.

China’s Challenge

But it is China that poses the bigger challenge to the Anglo-American faith in the onward march of liberalism and democracy.

It has achieved spectacular growth without embracing electoral democracy. Moreover, the state controls the commanding heights of the globalized economy. This will not change anytime soon.

China’s experience as a late developer is crucial to understanding its peculiar trajectory. Liberals, always a minority among the country’s leaders and thinkers, had little chance of flourishing against a backdrop of civil war and foreign invasions. China’s biggest challenge, for much of the 20th century, was survival and self-strengthening.

Chinese leaders first had to establish, in double-quick time, a centralized national state, a center of security and stability in a dog-eat-dog world of international relations. Unlike the Japanese, who developed an indigenous family conception of the state, Chinese leaders had to systematically overhaul the body politic in order to command loyalty from China’s citizens.

Having disavowed their imperial system, Chinese leaders — Chiang Kai-shek as well as Mao Zedong — had to inculcate a sense of nationalism and national identity from scratch through mass education and propaganda.

Individual challenges to the state’s arbitrary power were ruthlessly crushed. The heirs of Mao finally recognized the blunders of investing too much economic initiative with the state. But even Deng Xiaoping, while liberalizing the economy, did not break with older imperatives: of mobilizing China’s resources to make it truly autonomous and secure, and postponing the expansion of individual freedoms.

“Development is the only hard truth,” Deng claimed. “If we do not develop, then we will be bullied.” Speaking of the “China Dream,” the new Chinese leader, Xi Jinping, upholds the same imperatives of national unity, strength and pride against the need for broad democratic reforms.

And he may be right to think he has a receptive audience. Soothsayers have been predicting the collapse of the Chinese regime for decades. In recent years, they have transferred their hopes onto the main beneficiaries of China’s economic growth: the middle classes. Last year’s leadership transition generated much wild talk about imminent revolution.

Remote Apparatchiks

But China’s middle classes seem too fragmented to mount an effective political movement, let alone spark a revolution. And to many Chinese left behind by economic growth, the remote apparatchiks in Beijing may appear more committed to their welfare than an affluent minority devoted to further self-enrichment.

With its rhetoric of social welfare, the Communist Party still monopolizes the ideological sources of mass political legitimacy in a poor country. It now also draws on an indigenous discourse, such as neo-Confucianism, in championing the values of discipline, hierarchy and harmony.

The party also remains capable of diverting political ferment among the middle classes into nationalism. In any case, the growing availability in China of some private freedoms — primarily to consume and travel — has defused at least some of the urge for political change.

It is why Chinese liberals insisting on the sanctity of individual rights seem as powerless and isolated as their counterparts in 1920s and ’30s Japan.

Ignoring their plight, many commentators view China’s ability to survive and adapt as proof of an alternative model: a developmental state that, presided over by a technocratic elite, is stronger than society and places the national community above the individual.

But these inverted Sinophiles, or Asianized Whigs, make the same mistake as the ideologues of liberal democracy: China’s “model” is not for universal export, either. It is, instead, an unreplicable product of China’s peculiar history.

Here is the question before us: Is the model sustainable, and what implications would its failure have for China and the larger world?

The late modernization of Japan and Germany, though largely successful, did not lead to peace in Europe and Asia. Rather, economic crises and growing social unrest led to greater authoritarianism at home and jingoistic expansionism abroad.

Certainly, China’s assertive posture with its neighbors and increasing severity against internal dissidents do not bode well. China may turn out to be another cautionary lesson in the dangers of a country arriving too late in the modern world, with its elites determined to regard liberal democracy as an unaffordable luxury.

(Pankaj Mishra is the author of “From the Ruins of Empire: The Revolt Against the West and the Remaking of Asia,” and a Bloomberg View columnist, based in London and Mashobra, India. The opinions expressed are his own.)

To contact the writer of this article: Pankaj Mishra at pmashobra@gmail.com

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: