Month: December 2015

CHINA – A DEVELOPMENTAL STATE?

Political scientists are fond of ‘typologies’. Political systems are of this or that kind, and one way to explain individual systems is to determine which type they belong to.

One such category is ‘the developmental state’. This is a type of state that has been seen to evolve in East Asia in the latter part of the last century when the ‘tigers’ displayed remarkable development. It has been suggested that the reformed China is the most recent developmental state. But is that a good way of understanding the Chinese system?

The arch-typical developmental state was South Korea in its authoritarian transition. The characteristics of this state were:

  • a strong authoritarian state
  • a dedication of that state to the modernisation of the country
  • rapid economic growth the main engine of modernisation
  • a state-led economy of crony capitalism, steeped in two-way corruption.

The Korean state, although with economic development always the no. 1 priority, was also activist in other areas of public policy, including social protection. For example, the first autocratic leader/dictator, General Park, immediately after the military coup in 1961, started to build a welfare state in Korea, with the same energy he put into creating the Korean CIA, his secret police.

The Chinese state has many of these characteristics but the similarities with previous East Asian developmental states are only on the surface. Compared to authoritarian South Korea, for example, the current Chinese regime is

  • not just a state, it’s a party-state
  • not just authoritarian but dictatorial, including with the military as the armed wing of the party
  • not dedicated to modernisation but to the perpetuation of the regime, with modernisation a means towards that goal
  • not a case of crony capitalism but of a corrupt socialist market economy.

The Chinese state is activist in what it needs to be activist in, mainly the control of its population, but not where it does not need to be activist in the interest of perpetuation. In social protection, for example, it does only what is productive in the interest of ‘stability’, and no more. Another difference is that, even in the authoritarian period, public administration in Korea was in the hands of a civil service which retained some element of autonomy. In China, the public sector is a party service, not a civil service.

The difference between these state systems came on display in the late 1980s. Both regimes were challenged by uprisings in their populations, in Korea in 1987 and in China in 1989, but reacted differently. In Korea, the authoritarian regime tried to survive through the crisis of popular revolt but was unable to hold on to power and stepped aside to allow democratic reform. In China, the regime did not give in but reached for its ultimate power resource, the military, and crushed the revolt with weaponry. In Korea, there being no party-state, the leaders could not react similarly. They did not have a similar resource of ultimate power at their disposal and did not have the justification for the use of force that is contained in the ideological and organisational structure of a party-state. Presiding over a country that was not monolithic but built on vibrant civil society institutions which had evolved during the period of modernisation, including in business and voluntarism, the authoritarian leaders could relinquish control without fearing that their project of modernisation would collapse, indeed had to give in since an attempt to hold on to power with force would have destroyed the project that was their raison d’être and their only claim to legitimacy. In China, the leaders could not compromise because that would have meant the demise of the party-state and because there was no civil society for China to fall back on, wherefore compromise would lead to chaos. Nor did they have to compromise because they had the physical and ideological means to hold on in their hands.

Typologies are sometimes useful in political analysis, but sometimes also misleading. In the Chinese case, it is almost always misleading to suggest that the system can be understood by how it conforms to any general category. The Chinese system is entirely of its own kind and needs to be understood on its own terms. That is true whether we look to the political system, the party-state, or the economic system, the socialist market economy. The way this system works is like nothing elsewhere or previously known to man.

For my own case, when I started my research on the Chinese system I expected to see a similar story to the South Korean one (on which I had co-authored a previous book), only writ large. As I worked on, however, a completely different and unique story emerged.

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IS CHINA A DEVELOPING COUNTRY?

At the ongoing global climate conference in Paris, China is claiming to be a ‘developing country’. That is a way for it to reduce the obligations it will have to take on in a global pact, and to shift responsibilities on to others.

But is China a developing country? It is often opportune for the leaders to be able to put their country into that category, but this is a case of modesty that others should reject.

First, it is false. A developing country is one in which governance is severely restricted by inadequate fiscal and administrative capacity. That is not the case for China.

The state is fiscally solid. It was near to being bankrupt after Mao’s disasters. The first purpose of economic opening up was to rebuild the fiscal basis of the state. That has been successful and the Chinese state now has ample resources for public policy. When Mao left the stage, state revenues were at about 10 percent of (the then small) GDP, now they are at about 40 percent of (the now big) GDP.

It is also administratively solid. There has never been a bureaucratic state like the Chinese one. About 75 million officials are in the pay of the state. The Internet is controlled by an army of about 2 million ‘internet opinion analysts’. The birth control bureaucracy is about 500 000 strong. This is a state that has adequate administrative capacity for such policies as it wishes to pursue.

Second, it is always wrong to try to understand the Chinese regime as belonging to any general category. It is a dictatorship, but not like any other. There is much capitalism in the economy, but the economy is not a capitalist one. There is also much socialism, but not a socialist economy. The regime is totalitarian, but with a brand of totalitarianism of its own making. And there is much underdevelopment, but China is not a poor, helpless and backwards developing country.

Always, we need to understand China on its own terms, not as a system of this or that kind, but as one of its own kind.

THE LOVE AFFAIR WITH CHINA IS OVER

You may not have noticed, but 2015 was the year the shine went off China.

The last two or three decades, businesses from around the world and foreign governments have been falling over each other to get in on the China act. They have for comfort wanted to see a state that is worthy – authoritarian, yes, but delivering good governance for the benefit of the people. Academics, like Henry Kissinger and others, have helped by praising China as a ‘civilization state.’

But slowly, we are seeing that the regime is being reshaped by Xi Jinping and his team, into a less attractive one than had been hoped for.

An early signal went out immediately on the new leadership taking up office. Their position in the East and South China Seas was classified as one of ‘core interest,’ a message that China will do as it wants in these areas and that there will be no settlements by mediation, a policy, according to the defense minister, of ‘no compromise, no concession, no treaty.’ Since then, China has done what it wants, unilaterally setting up an ‘air defense zone’ between Taiwan and Japan and establishing bases on islands of its own creation in other countries’ areas. China is now an aggressive and expansionist state, certainly in its own neighborhood. And not only towards its smaller neighbors. During Xi Jinping’s official visit to India in September 2014, Chinese troops moved briefly into the contested border territory they call South Tibet, repeating a larger incursion a year earlier.

A second change has been in domestic policy. The leader the world hoped would be a modernizer, has instead tightened all the screws of dictatorship. Censorship is harder. Maoist mass-line and rectification campaigns are back in use. Internet control is ever more uncompromising. Non-official NGOs have steadily less space of action. Activism is increasingly dangerous and activists more severely persecuted, including for causes such as women’s rights. In the most recent campaign, hundreds of human rights lawyers across the country have been detained or had their practices shut down.

Here, too, there is an aggressive edge to the new policy. Principles we in the democratic world hold high, are virulently denounced in the party press as ‘western’ and purged from school and university teaching and textbooks. Their promotion is said to be the work of foreign agents.

While the tightening of controls has been clear to see, less noticed has been a rejection of Deng Xiaoping’s pragmatism in policy. Collective leadership is gone and one-man rule back, complete with a veneer of person cult. Also back is a cultivation of ideology, now in the form of a narrative of nationalistic greatness and glory. In this ideology – Xi Jinping’s ‘China Dream’ – nation comes first, greatness is the purpose, and ‘each person’s future and destiny is closely linked with the future and destiny of the country and nation.’ A big and powerful country, a strong state, an ambitious and shrewd leader, a commanding ideology – that adds up to a force to be feared.

As policy has turned to aggression abroad and dictatorship at home, the economic ground is shifting under the feet of the state. Growth is slowing. It is becoming recognized that China’s self-promotion has been based in part on bogus statistics. More importantly, the state’s reputation for steady management is crumbling. Last year, it opened its stock market and encouraged households to put their savings into equity. This year, the stock market crashed and millions of savers lost their money. The government then wasted billions in a failed attempt to stabilize prices, only to reveal that they did not understand what they had unleashed.

A regime that has pinned its reputation on effective governance turns out not to be in control. The most recent evidence is in the trumped-up abolition of the one-child policy. It is more than twenty years since Chinese and other demographers started to sound serious warnings of the detrimental economic and social effects of the birth control policy. But the new policy amounts to no more than a twigging of the rules, universally received as too little too late. The government has built up a birth control bureaucracy more than half a million strong and is unable to do more for fear of retribution from vested interests.

The world is taking stock of the new China, but with confusion. When Xi Jinping came to Washington in September, he was received with all the honors due to a great leader and could show the folks back home that he had been given respect. But there was a conspicuous lack of substance to the visit. One reason is that China looks after itself, ruthlessly so, as in cyber espionage, but takes little interest in collaborating on the solution of world problems, such as in the Middle East. It has nothing of positive interest to offer the other great power.

When he came to London a month later he was received with open arms and the British government offered itself up as China’s best friend in Europe. There was much criticism of Britain humiliating itself in order the obtain Chinese investments, but the real humiliation was the other way around. It will not have escaped the Chinese leaders that they were received not for the brilliance of their civilization but for, and only for, the weight of their gold.

If America is apprehensive and Britain a case study in folly, how should the world deal with a China that is more aggressive and dictatorial than is comfortable?

First, we should engage with China on all levels. That is in our own interest. But also, by engagement China binds itself to international rules and commitments. A China that feels snubbed is a more dangerous country. For every bond, China is less dangerous.

Second, we 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 with reference to the many relevant international commitments that China has signed up to.

Third, we should speak out in clear language against China’s policies of aggression, in particular against neighbors. That should always be done with reference to international law. We should know from history that if aggressors are not stood up to early but instead met with appeasement, there will be a higher price to pay later.

For now China has the upper hand since others are divided and hesitant. Above all, neighboring countries need to collaborate more and better. Others should support that collaboration and speak with one voice. Have no doubt: speaking out is effective if it is consistent. The Chinese leaders are desperate for respect. They should know that the way to get it is to respect their own people and other countries.