HOW NOT TO UNDERSTAND CHINA

On the 15th of April 2015, the Financial Times ran a remarkable full-page interview with the Chinese premier Li Keqiang (his “first interview with a western media organisation,” by the paper’s editor Lionel Barber and his colleagues David Pilling and Jamil Anderlini). That interview was emblematic of one version of the western misunderstanding of the People’s Republic.

This is the misunderstanding that overstates the regime’s economic achievements, resulting in uncritical admiration. The absence of critical antennae was on display at the beginning of the interview, where China was presented (needlessly for the logic of the interview) as “the world’s largest economy.” Observers of China know very well that its economic statistics are unreliable, yet the financial world tends to operate as if they are truthful. Why?

It is elementary: China is good for business; comforting then to see a big and expanding market there. But the misunderstanding sticks deeper. Twinned with an overstatement of economic prowess is an understatement of the regime’s political dictatorship. Neither financial journalists nor business operators are naïve: they know that the Chinese regime is oppressive and that many suffer for it. But they tend to see the oppression as no more than might be expected to maintain order in so big and complex a country as China and to give the regime’s dark side little weight in their overall assessment. That assessment is that with reform and opening up the People’s Republic has evolved into a more or less benevolent, or at least tolerable, autocracy that has delivered stability, economic growth and progress for most Chinese people.

China is of course now a very big economy, but economic growth, although dramatic, has been nowhere near what official statistics will have it. If you subtract exaggeration from the official numbers and take into consideration the weight of unproductive investments propped up by unsustainable debt, the best guesstimate is that the Chinese economy is about a third smaller than officially measured. Furthermore, the progress that has followed is not for most Chinese people but, in China’s extremes of inequality, for a minority.

Nor is the oppression mild and restrained. China is a society in which people of independent opinion cannot sleep at ease at night out of fear that someone will come knocking and take them away, and bring retribution down upon family, friends and contacts. Under Xi Jinping, all the screws of dictatorship have been relentlessly tightened.

While the financial world is bedazzled, the academic world is mostly be critical. This criticism is manifold and deep, but often revolves around some idea that China’s political economy is riven by internal “contradictions” and, mostly, that it is just a matter of time before it falls into decline, possibly collapse. The main contradiction, it is thought, is between capitalism in the economy and Leninism in the polity, resulting in, for example, inadequate economic reform, out-of-control local government debt, extractive corruption, capital flight and so on.

This, however, is another misunderstanding, resulting from a failure to see the Chinese regime as entirely unique and of its own kind, and of seeking to squeeze it into preconceived theoretical models of state logic. Those models tells us that with economic opening up must come political opening up and that the partnership of capitalism and Leninism cannot hold. That was “inevitable,” said then President Clinton, “just as inevitably the Berlin Wall fell.”

But this has not been the Chinese reality. On reform and opening up, Deng Xiaoping from the start said in clear language that it was to be economic but not political. In 1989, that was confirmed and consolidated. In The Perfect Dictatorship I have reviewed the socialist market economy, state-economy relations, and the matrix of power made up of the party, the military, the executive, the legislature, the police, the security services and the judiciary. I find many problems in the workings of this bureaucratic monster, but not in the nature of contradictions. Rather I find a system that on its own terms is logical and works extremely well. The economy is not miraculous, certainly by East Asian standards, but good enough. The state is fiscally solid, with adequate administrative capacity and awesome control capacity. Collapse is not in the making.

The reason Bill Clinton thought economic opening up was inevitable, was that he thought the emerging middle class would make itself a force for liberalisation. But in China, the middle class has instead aligned itself with the Communist Party. Many have though that hard dictatorship could not survive the internet, but in China the internet has been turned into another instrument of control from above. This may not fit with our models but that’s because our models do not fit China.

A dispassionate analysis of the Chinese system today is necessarily despondent. The regime’s priority is to preserve itself. It can rely steadily less on economic growth for legitimacy. It is steadily more dependent on repressive control. “Benevolence” and “contradictions” are flights of fancy. Dictatorship is the natural form of rule in this system, and the art of dictatorship has been perfected. At least for the duration of Xi Jinping’s tenure, hard dictatorship is what we’ll have. Those who observe and deal with China better get used to it.

HOW THE WEST GOT CHINA WRONG

The western misunderstanding of Communist China has been called “the liberal myth.” With our mindset and experience, it is almost impossible to grasp that a country can fail to open up politically when it opens up economically. “The more we bring China into the world,” said then President Bill Clinton, “the more the world will bring freedom to China.” We have thought that the new middle class would make itself a force for liberalization. But in the socialist market economy, it has instead aligned itself with the Communist Party. We have thought that the internet would forge opening up from below. But behind the Great Firewall, it has instead become another instrument of control from above. Liberalisation has not happened, but we cling to the belief that it will. When Xi Jinping came to power in 2012, it was thought, with no evidence whatsoever, that the time had come for a new leadership of reform. What has followed is ever tighter dictatorship.

The Chinese model is entirely unique, like nothing the world has ever known. We simply get it wrong if we try to squeeze it into our own models. It needs to be understood on its own terms.

For those who deal with China from outside, there is a huge temptation to see it in a good light. It is a big power and economy with which we must get along. It is an ancient oriental culture which attracts interest and fascination. The west is bedazzled by China’s mysticism and bigness. Henry Kissinger, for example (in On China), pays Beijing tribute with his romantic notion of the “civilization state.” The academic literature on China is generally critical, but even much of that criticism conforms in its way with the liberal myth. We observe the absence of rule of law, but take that to be a pathology in a regime that could do better. We observe the censorship, the propaganda, the “thought-work,” and the thuggish “stability maintenance” and criticize the regime for its excesses.

The abuse of the law and the courts and the brutal clampdown on any form of active opposition are, however, not “mistakes” on the part of a confused regime. These practices are logical and necessary, given the regime as it is.

In the Chinese party-state, there is a single supreme determination that trumps all others: stability, meaning the regime’s perpetuation of itself. The post-Mao rulers have had two strategies of self-preservation: the purchase of legitimacy and the exercise of control. During the last decades of rapid economic growth, they could rely on being rewarded for economic betterment. But mega-growth is now over and people’s expectations are outrunning government delivery. The leaders are therefore shifting to relying more on controls. Behind Xi Jinping’s tightening of dictatorship lies a steely analysis of what is needed to avoid the disintegration that has befallen previous Leninist systems, primarily the Soviet Union.

A dispassionate analysis of today’s Chinese system is unavoidably despondent. Not much, if anything, can be expected of reform for the better from within. Dictatorship is here to stay.

However, the model is still, to some degree, in the balance, if only between harder and softer dictatorship. That difference matters enormously for the Chinese people and for the world.

The current leader is flirting with a new ideology of nationalism and chauvinism under his slogan of the “China Dream.” Ideologies are always dangerous and their force should never be underestimated. If the new ideology were to take hold, Xi could abandon all of the pragmatic legacy after Deng Xiaoping and embrace all-out totalitarianism, now of nationalistic rather than Marxist inspiration.

Our misunderstanding of China leads us to confusion in our dealing with the new superpower, as recently for example in Britain’s failed attempt to make itself China’s best friend in Europe. The truth is that we must continue to do business with a regime that is and will remain repugnant. It is safer to do that with open eyes than by pretending that hard dictatorship is benevolent autocracy. It is more productive to be straight with a Chinese leadership that does not believe flattery.

The outside world has very little sway over developments in China. But we do have one lever that could give us some influence to possibly hold China to at least pragmatic dictatorship. The leaders are not content with power but desperate for respect. It is in our gift to award or withhold respect. That influence cannot change China for the better, but it might do something to prevent it from getting worse.

To use this lever to effect we should stand firm on our own values and principles and claim democracy’s moral high ground. We should then engage with China on all levels, economically and politically as well as in science and culture and in other ways. By engagement, China binds itself to international rules and commitments.

We, our leaders that is, should speak out in clear language against China’s breach of human rights and rule of law. That should always be done with reference to China’s own constitution and laws, which are in these respects sound (if ineffective). And we should speak out in clear language against China’s policies of aggression. That should always be done with reference to international law.

The Chinese leaders want respect because they need respect abroad for legitimacy at home. We should let them know that if they want our respect, they must respect their own people and other nations.

WHO’S AFRAID OF THE CHINESE STATE?

There are two main competing schools of thought on the Chinese state:

  1. The benevolence school. Here it is thought that the reformed People’s Republic, with and after Deng, has evolved into a more or less benevolent autocracy that has delivered stability, economic growth and progress for most Chinese people. The proponents of this school are not naïve: they know that the Chinese regime is oppressive and that many suffer for it. But they tend to see the oppression as no more than might be expected to maintain order in so big and complex a country as China and to give the regime’s dark side little weight in their overall assessment. This is the narrative you will see in, for example, the Financial Times, the Economist and in most business commentary. A recent book in this school is, for example, Hank Paulson’s Dealing With China.
  2. The contradiction school. Here it is thought that China’s contemporary political economy is riven by internal contradictions and, mostly, that it is just a matter of time before it somehow implodes or explodes or otherwise falls into decline. The main contradiction, it is thought, is between capitalism in the economy and Leninism in the polity, resulting in, for example, inadequate economic reform, extreme inequality, out-of-control local government debt, extractive corruption, capital flight and so on. This is the story you will typically find in, for example, commentary in the Wall Street Journal. A recent book in this school is, for example, David Shambaugh’s China’s Future.

There are many variations within these schools but by and large the thinking on political China, with a few exceptions, falls into these two categories. The pro-China voices are in the benevolence school and the China-critical voices in the contradiction school.

For my part, I disagree with both. The benevolence school is not empirically tenable. It exaggerates the regime’s delivery. Even economic growth has been nowhere near what inflated statistics will have it. The best guesstimate is that the Chinese economy is about a third smaller than official statistics will have it. The progress that has followed is not for most Chinese people but, in China’s extremes of inequality, for a minority. Nor is it morally tenable. It depends on an understatement of the regime’s repressiveness. After 1989, it has been made clear to the Chinese people that they, or some of them, may have economic progress but that liberty is not available. China is a society in which people of independent mind cannot sleep at ease at night out of fear that someone will come knocking and take them away, and bring retribution down upon family, friends and contacts. Under Xi Jinping, all the screws of dictatorship have been relentlessly tightened.

The contradiction school depends on what has been called ‘the liberal myth.’ In Western mindsets and experiences, it is almost impossible to grasp that political Leninism and economic capitalism (after a fashion) can co-exist. It is thought that with economic opening up must come political opening up. That was ‘inevitable,’ said then President Clinton, ‘just as inevitable as the Berlin Wall fell.’ But this is to squeeze China into a model of our own making in which it does not belong. On reform and opening up, Deng from the start said in clear language that it was to be economic but not political. In 1989, that was confirmed and consolidated. In The Perfect Dictatorship I have reviewed state-economy relations and the matrix of power made up of the party, the military, the executive, the legislature, the police and the judiciary. I find many problems in the workings of this bureaucratic monster, but not in the nature of ‘contradictions.’ Rather I find a system in which the state is fiscally solid, with adequate administrative capacity and awesome control capacity.

The reformed People’s Republic is a regime the likes of which the world has never seen. Neither the benevolence school not the contradictions school grasp its true nature. It is not a kind state – that’s self-deception by friends of China – nor a state threatened by internal contradictions – that’s wishful thinking by foes of China.

The best we can hope for in Beijing now, at least during Xi Jinping’s tenure, is a hard dictatorship that is nevertheless tempered by an element of pragmatism. If that is unpalatable, bear in mind that the alternatives are even worse: either all-out totalitarianism or chaos.

CHINA – A MODERN STATE?

Britain has a new female prime minister, Theresa May. She is the second woman to hold that post, after Margaret Thatcher, who was prime minister from 1979 to 1990. But there is a difference. Under Margaret Thatcher, there were hardly any female government ministers. Now, there are many women in other top government posts. It was remarkable when Margaret Thatcher was the boss. Now women bosses are becoming the norm.

And not only in Britain. One of the presidential candidates in the US will be a woman. Throughout Latin America, Africa and Asia, we see many women in many top jobs in many countries.

And not only in politics. There are movements in many countries to get more women into top posts and boards in business organisations.

Underlying these advances for women is a new culture of equality. It is becoming accepted that women have an equal stake in society to that of men and that they should be equal in position, privilege and responsibility. There is still a long way to go, many women will insist, but there has nevertheless been a massive shift in attitudes. It is still being remarked upon that Theresa May is a women in the top job, but it is not remarkable in the way it was in Margaret Thatcher’s time. The new culture of equality is central to our understanding of modernity.

This shift in attitudes and practices is visible on China’s borders. In both South Korea and Taiwan, the presidents are now women. Although that has been remarked upon, it has generally been accepted as relatively obvious and normal.

What then in China itself? Here, this understanding of modernity is conspicuously absent. China has in this respect not entered the modern world. Not only are there no women in the political leadership, it is wholly exceptional to find women in leading posts anywhere else, be it in public administration or in business (except for the All China Women’s Federation). There is no new culture of equality. Where it is trying to get a foothold, it is seen as dangerous and repressed. When young women about a year ago organised manifestations to draw awareness to sexual harassment on public transport, they were rounded up and detained. By all accounts, the elementary matter of gender equity in family and household responsibilities, elsewhere a battlefield of modernity, is a non-issue. China is a rigidly gendered society that is holding on to an elsewhere outdated culture of gender inequality. It is a matter the national leadership takes no interest in.

The rest of the world is in movement on women and equality. In China, the wall of dictatorship is shutting the modern world out.

CHINA – THE LOGIC OF REPRESSION

Many of us who have been able to visit China, for example (as in my case) to lecture at Chinese universities, have been struck by the openness of debate. It seems that almost anything can be discussed. From this it might seem that the repression of opinions is mild or near to non-existent.

It also seems that Chinese people are often pretty free to express almost any opinions they wish, including critical ones of the government and regime. Some are able to write against the Communist Party in the international press.

However, at the same time there are cases of harsh repression of even activity that is in no way seriously subversive. For example, in early 2015 there was a burst of clamp-down on feminist activists in Beijing and other cities. Many were arrested in different parts of the country while planning awareness campaigns about sexual harassment in public transport. That is not an anti-regime issue. The official All-China Women’s Federation is campaigning on the same matter. In another case, In the early morning of the 29th of April 2015, in the eastern city of Suzhou, ahead of a ceremony to mark the anniversary of the execution of Lin Zhao, a young Christian woman and critic of Maoism who was executed in prison in 1968 and who rests in a cemetery in the city, a huge police force busted homes and guesthouses and detained dozens of people who had gathered in the city for a mourning at her graveside.

So what’s going on. Why are seriously subversive opinions (sometimes) tolerated and non-subversive actions (sometimes) clamped down upon?

There are two answers:

  1. As in all dictatorships, there is much arbitrariness. What “should be” stopped is sometimes left alone. Of course, it is in the nature of arbitrariness that those who are left alone today may be crushed tomorrow.
  2. But there is also a logic. The regime has little to fear from isolated expressions of opinion and actions. There are about 500 “mass incidents” a day throughout the territory – protests, strikes etc. – which are no more than easily manageable annoyances. However, what the regime does fear is anything that takes the form of organised action, even of loose networks. The reason the feminists and the mourners were detained and stopped was not that their causes were dangerous but that they were forming networks of co-ordinated action.

From the outlook of the Chinese regime, opinions are less dangerous that action, and collective action always dangerous, even for non-dangerous causes.

CHINA – POVERTY AND DELIVERY

The Chinese leaders boast that they are delivering for the benefit of the people. This is their main claim to fame. Recently, the foreign minister Wang Yi, clashed with a Canadian journalist who asked about human rights. His line of questioning was “irresponsible” said Wang, and went on: “Do you know that China has lifted more than 600 million people out of poverty?”

Has it? Is the Chinese government delivering the way it boasts?

On poverty, we don’t know. There are no precise official poverty statistics. Numbers such as the 600 million are based on rough estimates of how many people live on an income below a very low threshold, such as the equivalent of 1 or 2 dollars a day. When the economy grows, the numbers below that threshold go down, but when the threshold is an income that does not provide for anything near a minimally decent life, this is not an informative statistic.

On poverty in China, we can say three things with certainty:

  • In the growth period, the extent of poverty has been reduced, probably a great deal. Compared to the Maoist period, there are many fewer people in poverty.
  • Even so, the 600 million boast being false, China is still a country of massive and oppressive poverty.
  • All the reduction in poverty in the growth period, has come as a direct result of economic growth, with none of it resulting from redistribution thanks to social protections. On the contrary, since economic inequality has increased massively, there has been an increase in the extent of relative poverty.

Chinese governance has in fact not delivered anywhere near what the leaders claim. Even their basic boast of having delivered economic growth is false. It is without doubt true that there has been strong growth in the last two or three decades, but

  • Not as strong as has been boasted; the official statistics are bogus and have exaggerated the pace of growth.
  • No more than standard for the region; careful comparisons of the best growth periods in Japan, South Korea, Taiwan and China show all to be about equal but with growth in China slightly behind the three other countries.

The same foreign minister Wang Yi has called “the Chinese story the greatest success story of our time” (at the World Economic Forum in 2014). False boasting again. In the Maoist period, the Chinese story was the greatest horror story of our time. In the post-Mao period, the Chinese story has been no more than a standard East Asian story.

CHINA – THE BEATINGS

If you follow the doings of the Chinese security services in the interest of “stability maintenance”, you will discover a disturbing regularity: people get beaten up. Physical beatings are a regular method of retribution. At home, on the streets, in confinement, in prison, women and men alike, are beaten up. Sometimes severely, causing serious injury, ultimately death. The use of beatings is not the work of a few “bad apples” but systemic.

Security officials are often civilians, often with unknown authority. They may be police officials in civilian dress or hired thugs without formal police authority. These are the prolific beaters who rough up “troublemakers” with different degrees of severity.

The Chinese state is the most sophisticated dictatorship ever, so smooth in its operation that it often does not even look dictatorial to many Chinese. It is so smooth that it is possible for many outside observers to pretend that the regime is only mildly authoritarian with some unfortunate blemishes. But it is still a dictatorship, and like all dictatorships an ugly form of rule. Beneath the surface of sophisticated control, this like other dictatorships depends on brute violence and on instilling fear into the souls of its people. If you oppose the dictatorship, you are in danger not only of being thrown into jail but also of suffering physical damage. If you think of opposing the dictatorship, you need to recon with the risk that you will be beaten up.