Posts Tagged ‘Communist Party’

By now, most China watchers have probably seen this piece by David Shambaugh cogently arguing that “the endgame of communist rule in China has begun.” If you want to see an equally cogent argument lead to a very different conclusion, you can see Arthur Kroeber’s piece from December about how Xi Jinping and his governing style are here to stay.

Both make for interesting reading, as do the countless other pundits who’ve made similar arguments on both sides of the CCP endurance question over the years. If they hadn’t wrapped all their interesting points together into a grand thesis predicting the future of the Communist Party, they would have been quite insightful. However, they did make rather firm conclusions, and that’s rather pointless. That’s because…

We really have no idea what’s going on in China right now

In November 2011, The Telegraph ran an exclusive report on a self-immolation that had happened in Tiananmen Square three weeks earlier. The paper only learned of it when they received a photo from a British tourist who’d been there and was surprised he hadn’t yet seen anything about it in the news. Despite the hundreds of people who’d been present snapping their own photos, no record of the incident could be found anywhere in Chinese media, Weibo, or anywhere else. It happened in perhaps the most trafficked and photographed place in China, it was during the heyday of Weibo, and it was walking distance from where hundreds of foreign correspondents were stationed. And yet, we just narrowly missed never hearing about it at all. It makes you wonder how many important things we are missing completely in China.

Hundreds of the best foreign correspondents in the world are stationed in China (the lion’s share based in Beijing, with most of the rest in Shanghai), but unfortunately they have no hope of collectively reporting more than a very small fraction of the important things happening in the country every day. They’re a few hundred covering 1.35 billion people living across 3.7 million square miles. There are of course Chinese journalists and netizens finding things out, but self-censorship and multiple levels of government censorship stop a lot of that from ever reaching the outside world’s comprehension. And a lot of the trends that could influence the CCP’s survival are simply unknowable.

How stable is the financial system? How significant are the hundreds of thousands of annual “mass incidents?” What exactly is going on behind closed doors at Zhongnanhai? How much is corruption affecting the military’s capability and loyalties? Is there any threat of some public grievance gaining collective appeal among different social groups? What questions are we not even thinking to ask? The Communist Party is in a better position than anyone to know these things, but even it’s probably clueless on a lot of these big questions. Things get garbled through five levels of government bureaucracy while hundreds of thousands of personal interests obscure things for their own purposes before they have any hope of being digested accurately. Despite the enormous strides in reporting and communication, we’re still very much in the dark. Which is why…

We have even less hope of possibly knowing what will happen in the future

After Bo Xilai’s sensational purge in 2012, many China-watchers (myself included) presumed that the incoming Politburo Standing Committee would take a turn toward the more liberal wing of the CCP. Then Ling Jihua’s son got in a Ferrari accident and New York Times exposed Wen Jiabao’s family wealth, making a mockery of any predictions on the PBSC’s composition. Totally unforeseen events (that we still don’t fully understand) changed everything, which should itself have been foreseeable.

That was just one small arena of Chinese politics. Imagine the present day stable of China pundits being transported back to 1986 and trying to predict what would happen over the next five years (then repeat that exercise with 1976, 1966, 1956 and 1946). Let’s even help them out a bit and presume they have access to all the information the CCP did. Does anyone honestly believe any of them could have predicted anything resembling what actually unfolded? If not, why should we think they’re any more capable today?

Political winds can shift on a dime in China, influenced by completely unforeseeable variables. The Tiananmen movement, for instance, was the result of dozens of different incidents and trends that came together in a perfect storm. Alter any one of those variables slightly, and things could have turned out very differently. You can conscientiously gather every bit of information available, every apparent trend and make a conclusion about where China is headed. Then something will almost certainly happen tomorrow that rips your thesis to shreds.

Perhaps either Shambaugh’s or Kroeber’s prediction will ultimately be proven “correct,” but that doesn’t mean it was a good prediction. If someone is tasked with predicting a coin toss, they could analyze the wind, the person tossing, the texture of the ground, and all sorts of other random variables. But whatever system of analysis they come up with will be utterly lacking. Perhaps someday a computer system will be able to meaningfully sort these variables, but it’s beyond any human’s capabilities. So even if the coin is tossed and their prediction is correct, that doesn’t make them a proficient coin toss analyst. Crass as the analogy may be, CCP soothsaying is similarly an exercise in futility that’s made fools of many “experts.”

But prediction sells. It’s harder to get media outlets to give you op-ed space or air time if you just say “things are complicated and we don’t really know what’s going to happen.” Making a bold prediction gets noticed and it has little downside (especially if you hedge, as Shambaugh did, without giving a deadline on it). Gordon Chang, perhaps the most extreme example, has set several firm deadlines on his CCP collapse theory that have turned out utterly wrong. And yet, he still enjoys “China expert” status along with regular columns and TV appearances.

Whether the Communist Party will survive or collapse in the short-term is THE question in China, so it’s not surprising that we see pieces arguing both sides. There’s nothing wrong with exploring the possibilities, and it’s certainly worth tracking events and trends that could influence this question. But when I see someone pulling an arbitrary set of indicators together to make a grand conclusion, I take it with an enormous grain of salt. You should too.

During the “Century of Humiliation” from 1839 to 1945 China was taken to its knees by foreign imperialists. The country was carved up, exploited, looted, raped and dethroned as the world’s greatest superpower. Only in 1949 when the communists triumphed over the Kuomintang in the civil war did China become whole again and begin the road back to its former greatness.

This is the Communist Party’s narrative of history. It’s the message that’s taught in textbooks and reinforced in the media, museums and movies every day throughout China. The elephant in the room that this narrative ignores of course is what happened for the first 30 years of communist China. And it also ignores the damage done by wholly domestic forces during the Century of Humiliation. The below charts show the relative death tolls inflicted on China by domestic and foreign forces over the past two centuries.

The first breaks down the major deadly events.

Getting an accurate count on these events is notoriously difficult*; especially when looking back to the 19th century. But even when we look at the range of estimates the picture is pretty obvious. The next chart shows when we combine these events into a simple Chinese vs. foreign-caused death comparison.

Here’s what it looks like when you just compare deaths caused by the Communist Party’s policies to the events of the Century of Humiliation (This graph doesn’t include the Communist Revolution).

In just 27 years the Communist Party managed to kill significantly more Chinese than all the foreign aggressors did in the previous 106 years combined.

Now in many ways these graphs miss the point. Killings were only one of the grievances over the Century of Humiliation. The damage done to the Chinese psyche was caused more by foreigners stealing territory, imposing unequal treaties, looting cultural relics, exploiting Chinese people, and of course, the heinousness of Japan’s war crimes. But making other considerations goes both ways. During the party’s first 30 years it took the personal property and land of millions, destroyed countless historical relics, denounced and humiliated people for the crime of being intellectual, and enabled violence often every bit as vile as what the Japanese committed. But these death tolls simply provide one objective measurement of the damage caused to China, and they have some important implications.

The nationalism derived from the Century of Humiliation legitimizes the party’s rule and unites the people against a common enemy. China’s education system emphasizes the greatness of China’s 5,000 year civilization and in many ways promotes the idea that Chinese are exceptional people by nature. Take this question from a college entrance exam:

25) Since reform and opening up, China has successfully embarked on improving national conditions and adapted to the road of peaceful development. Adhering to the path of peaceful development is in line with China’s historical and cultural traditions. This is because______

  • A. The Chinese nation is a peace-loving nation
  • B. Peace and development is the trend of the times
  • C. In foreign exchange the Chinese people have always stressed “loving neighbors” and “finding common interests among diversity “
  • D. Chinese culture is a culture of peace. Longing for peace has always been a spiritual characteristic of the Chinese people [A,C, & D are “correct”]

China was the greatest nation in the world and only lost its footing because of incompetent leadership and war-warmongering foreigners who don’t share China’s peaceful values. The party kicked out the imperialists for good (according to its version of history) and still takes an aggressive stance on any whiff of foreign insult or interference with China. Therefore, the Communist Party is “The inevitable choice in China’s social development.

However, to acknowledge that much of what derailed the country in the first place was home-grown violence would take a lot of wind from that idea’s sails. So would the implication that the rescuer (the CCP) did far greater damage to the country than those it needed rescuing from.

These numbers also matter for low-level foreign relations. Chinese businessmen have been known to invoke the Century of Humiliation as leverage with Western counterparts in getting a better deal. You’ll sometimes even hear common street vendors use historical grievances to justify overcharging foreigners. There remains a strong sense that China is still poor because foreigners set China’s progress back a century. So when there’s a chance to balance the scales a little bit, some try to seize their due compensation.

In the coming months as the party begins its difficult power transition (which just became even more complicated) and tries to grab whatever legitimacy it can, we can probably expect to see even more international events covered in China from an angle that harkens back to the humiliating century. And we might even see an uptick in coverage of scarcely-newsworthy events that portray foreigners in China as exploiters or aggressors. It would be a travesty to deny the damage that foreign powers did to China in the past two centuries, but when talking about setting back China’s development, these numbers suggest that foreigners’ role was slim next to certain other “parties.”

*The main sources for these charts are listed on necrometetrics.com here and here and were compared to a few other independent estimates to get a reasonable range. Some of the “various internal uprisings” have very scant data with only a single (likely unreliable) number though and should be taken accordingly. 
 

The party chief of one of China’s largest metropolises and member of the all-powerful 24-man Politburo went for a meeting in Beijing. Little did he know, he wasn’t to return home. He was sacked from his positions and awaits certain imprisonment. This is widely regarded as the result of factional party infighting ahead of a coming leadership shuffle and has been dubbed a “big bomb” for Chinese politics by one analyst.

But wait. This isn’t 2012 and we’re not talking about Bo Xilai. It’s 2006 and I’m describing former Shanghai Party Secretary Chen Liangyu, Jiang Zemin’s old “Shanghai Clique” brethren. He found himself on the wrong side of a politically-motivated corruption investigation launched by Hu Jintao’s Beijing clan while posturing for the following year’s 17th National Congress (China’s mid-term leadership shuffle). At the time, foreign media sank their teeth into the sensational political drama.

But wait. If we rewind further to 1995 we find that Beijing mayor and Politburo member Chen Xitong was taken down for corruption and embezzlement. He was in the Beijing faction and a rival of then paramount leader Jiang Zemin. Oh, and the scandal unraveled following the mysterious death of one of Chen’s close associates.

Are we noticing a pattern here?

Bo Xilai’s unfolding scandal is very similar to these past instances, but of course it’s different in one critical way: A lot of Chinese people know about it.

Yesterday morning it was the talk of the Beijing subway and a Chinese friend told me politics has replaced celebrity gossip around her office water cooler. This has forced the government to face the public with the scandal to a degree never before seen.

On April 10th, China’s official Xinhua news agency released a short, but explosive statement announcing that Bo had been officially stripped of his titles and his wife was suspected in the British businessman’s murder.

The embarrassing thing for Xinhua (and ergo the government) was that Reuters had broken this news hours earlier. And microbloggers on Weibo reported it (in one form or another) hours before that. In fact, the whole Bo saga unfolded on Weibo as the state media released only occasional terse statements.

When the Chen Liangyu scandal hit the light of day in 2006, there were about 130 million Chinese internet users and precisely zero of them were microbloggers. Today, over 500 million Chinese are online and half of them microblog. Imagine what those numbers will look like at the next leadership shuffle in 2017.

One can’t deny the sensational theatrics of late night foreign embassy runs, a dead (possibly ex-spy) foreigner, and a flamboyant neo-socialist. At its core though, Bo’s case is hardly unprecedented. But if we look back at the cases of Chen Xitong, Chen Liangyu and now Bo Xilai, we see that each incident has shaken the central party apparatus successively harder.

The party has been thrown off balance, but at the end of the year it will in all likelihood still be standing with its new leadership. But when China’s shadowy power politics inevitably spill out again into the increasingly connected and decreasingly trusting public, can things possibly remain as stable?

The unremarkable case of Bo Xilai: Part I

With the recent Bo Xilai saga, fault lines in the façade of Communist Party unity are emerging in a very public way. After the split between the Zhao Ziyang reformist camp and Li Peng’s hardliners in 1989 emboldened Tiananmen protestors, the Party now rightfully worries about the public sensing any weakness in the top leadership.

Even if the events around Bo hadn’t unfolded, the party would still be very much on edge. Later this year it will pass the torch to a new group of authoritarian leaders; and it’ll do so amid simmering social tension and unprecedented channels of mass communication. To protect itself, the party has recently taken measures demanding loyalty and respect for its relevance.

In January, President-in-waiting Xi Jinping called for more “thought control” over university students. This week, China ordered all lawyers to make a pledge of loyalty to the Communist Party. And yesterday, People’s Liberation Army (PLA) Daily ran a commentary opposing “indiscipline” in the army saying, “To resolutely do what the Party asks, and not to do what the Party asks not to do, is the most straightforward measure to oppose indiscipline.”

Army personnel, lawyers and students are real threats to the party. Student intellectuals were behind the Tiananmen Square uprising. Lawyers tend to have an affinity for the written law rather than the whims of leaders – which undermines authoritarian rule. And the military, well, they have guns.

The last group is especially worrisome.

The past few days have seen rumors of a Beijing coup circulating online. While these rumors are unfounded, the idea of a military coup is hardly far-fetched. Worry of this scenario within government ranks became apparent even before the rumors with a series of People’s Liberation Army (PLA) Daily articles calling for “opposition to the ‘erroneous views’ of military nationalization, military de-politicization, and non-party affiliation of the Army, and putting ideological and political construction first.”

The PLA, by law, is bound to protect the Communist Party first – not the country. Calling for the army to be loyal to the nation rather than a single political party was one of the things that landed Liu Xiaobo in jail.

When Deng Xiaoping started to hand power over to Jiang Zemin in the early 90’s, he reportedly had some sage advice for his successor: “Spend four out of five working days with the top [military] brass.”

For a party which then had neither socialist nor democratic-based legitimacy, the loyalty of the military was the only guarantor of continued rule. Jiang listened and did manage to stay in the good graces of the military throughout his tenure by consistently increasing military spending and taking a hard-line on Taiwan. When Hu Jintao came to power he continued the military buildup, but took a softer stance on the island. The Beijing-friendly Ma Ying-jeou was elected president in 2008, allowing Hu to engage Taiwan culturally and economically – which tacitly took a military takeover off the table for the foreseeable future. This wasn’t good news for PLA hawks anxious to use their toys.

Last year, the PLA gave a subtle indictment of Hu by launching an unannounced test of the new J-20 stealth fighter during a visit by US Defense Secretary Robert Gates. Xi Jinping will take control this year lacking even the degree of support from the military that Hu has. He’ll likely have to spend at least the first year consolidating power and PLA loyalty – assuming the leadership transition goes smoothly to begin with. But if the factional fractures become too deep, military hawks could decide to settle the matter themselves.

Whether the party’s rather pathetic demands for loyalty during this contentious period will be enough to maintain unchallenged authority remains to be seen. But whether they’re students, lawyers or soldiers, people aren’t getting any dumber. What they are getting is better connected and less patient with the political status quo. As one of the PLA Daily commentaries aptly points out, “Historical experience shows that, when the Party and the country are facing big issues, hostile forces at home and abroad always stir up trouble, noises in the society also increase, and the people’s thinking becomes more active.”

Translation: People are starting to think beyond what they’re told – and that’s bad news for the party.

This week we’ve looked Christianity’s potential in China to provide morality, work ethic, and possibly an opiate to keep people working through exploitation. The Chinese government has noticed these things and many within the party seem keen to enjoy the benefits of Christianity. So they’re doing what they know how to do best: Throw money at it.

The government is approving, funding, or outright building churches across the country. Party leaders are more than happy to let you worship…as long as it’s at one of their churches. Lest any religious organization go off the grid and pull a Falun Gong or Taiping, no church is allowed to operate without approval and constant oversight. So as a matter of logistics, official churches tend to be few in number and large in size.

Several months ago I went into one of these churches in Anhui. Sure enough it was magnificent. It was six stories high, capable of holding thousands of worshippers and the interior resembled a European cathedral. But I was less impressed once the service started. The sermon was boring, people went through the motions, sang a bit and left. And I’d guess about 90% of the churchgoers were over 60 years old. It’s the kind of place I’d go just to fulfill a religious obligation.

A few weeks later in Beijing, I met a Chinese girl in her late 20’s in an elevator. After some small talk, she pulled out a card with directions to her church and invited me to check it out. I asked if I was welcome given that I’m an atheist, and even worse, a journalist. She laughed and replied, “Then you should definitely come.”

Her church was in fact a little studio apartment in Beijing’s Zhongguancun district – a stone’s throw from where several Shouwang Church Evangelicals were arrested last year. And like the Shouwang church, this one was technically illegal.

About 25 people showed up, almost all in their 20’s or 30’s. They sat in rows before a pulpit where the preacher, Brother Xing, pounded on the podium and yelled throughout his sermon. He was a firebrand that would never get approval to preside over an official church. But for the young adults accustomed to hearing docile scripted speeches from school and government officials, he was an inspiration. They swayed back and forth as they sang hymns while some occasionally started tearing up.

At the end several people stood up to give testimonies about how faith was helping them through their lives. As they all stuck around for socializing afterwards, it became obvious why most choose this over official churches – where spontaneity is barred and sermons must be pre-approved.

The party sees the value in developing religion, but like it does with film, art, education, and just about everything else, it thinks money is a substitute for freedom. In its insistence on maintaining complete oversight and control, it neuters the institution and ensures the full benefits aren’t reaped.

There are of course risks with religion’s spread other than threatening the party’s rule. With religious freedom, there’s always the potential for cults to emerge. But current circumstances hardly protect against that. In fact, by forcing these churches underground the government just gives cult leaders the perfect excuse to keep congregations in the shadows.

Then there’s good old fashioned dogma. I once met some Chinese Christians who’d done Bible study with American missionaries. They spewed bile about the sin of homosexuality and the need to take evolution education out of schools. It yanked me right back to the worst of what I thought I’d left behind in Kansas. With the success of any religion comes the chance that its influence will lead to social and scientific regression.

But the government has more pressing issues.  An increasing eat-or-be-eaten mentality in an overall system of corruption undermines the country’s ability to sustain itself though development. The political risks of religious liberalization pale next to the potential. I’ve noticed (and the experts I’ve spoken with have agreed) that Chinese Christians seem mostly disinterested in politics with the exception of one issue: Religious freedom. They just want to worship how they want without being bothered. Then they’ll have peace of mind.

 

Christianity series Part 1: Can Lei Feng compete with Jesus?

Christianity series Part 2: The new Christians

Christianity series Part 3: Divine economics

Christianity series Part 4: What Marx may have gotten right

 

One of the great misconceptions from people who’ve never been to China is that Chinese long for western-style freedoms. More often than not, when I talk with Chinese friends about the enormous problems facing China and the desperate need for political reform, I get a similar response:

“Most Chinese people don’t care about things like freedom of speech. They just want stability and food in their stomach. Things have gotten so much better in the past 20 years, so these chaotic freedoms would be a stupid risk.”

To them, “freedoms” are totally abstract and irrelevant to their lives. I counter by saying, “You’ve never been totally screwed with absolutely no recourse.”

Imagine your town’s party secretary said your home would be demolished to make way for a public water park. You have the option of accepting cash worth far less than the market value of your home or taking a worse apartment several miles out in the boonies.

After demolition, it’s announced that the water park plan will be scrapped and expensive luxury apartments will be built instead. You and the residents cry foul and seek help from local courts and media only to find they’re under the thumb of the same person who took your home.

So some people try contacting Hong Kong’s Phoenix TV, where they’d seen corruption exposés before. Days later, Phoenix TV’s service is cut from the whole city. You consider going to the provincial capital or Beijing to petition. You seek advice from friends in other cities but they retell stories of people getting fired, harassed, detained or even killed for trying to do this. You decide giving up is probably the smartest choice.

For all the attention we foreigners call to instances like this, relatively few Chinese actually experience them. Most go on normally with steadily growing incomes, so it’s understandable that they don’t want a political shake up. I recently talked about this with my girlfriend’s father – an admitted laobaixing (commoner) – who agreed that freedoms and political reforms are luxuries too risky to trifle with.

This wouldn’t be surprising except that a few years ago he and his neighbors went through the exact situation I just described.

I asked how he of all people could still be averse to political reform. He replied that he had indeed been screwed, but if the kinds of freedoms I was talking about were allowed, the Communist Party would collapse and there would be chaos. If things ever do get really terrible, THEN the government can make reforms. But for now, it’d be a pointless risk.

This attitude is pretty common among laobaixing and, it seems, the government too. I’d compare it to saying global warming isn’t worth addressing until there’s some sort of major environmental catastrophe. It’s already hurting a small minority, but most are living the best quality lives anyone ever has. So why slow down this rocket ship before its engine blows? That’s exactly what’s happening right now in China economically and politically. Let’s look at some ways how:

The Stability Bicycle

 

Scenario 1: Local party cadre takes bribes, levies illegal taxes and uses his power to favor businessmen he has guanxi with. Everyone below him knows this but he doesn’t care. He’s elected from above and has control over the town’s police, courts and media. He knows that less than 3% of corrupt officials go to jail, because even if his superiors catch wind of his transgressions, they’d just assume not dirty their hands unless they’re backed against a wall. Indicting him could be an indictment on themselves and the system that feeds them.

Other government workers see this cadre getting rich and it makes them envious. The local factory inspector decides he too will take bribes. Now those who aren’t getting rich are losing face and opportunities to attract good wives. So everyone starts seeking out and abusing any kind of authority so they don’t get left behind. Those at the very bottom bear the heaviest burden of all this corruption and become increasingly resentful. Eventually, even honest business owners have to cut serious corners just to stay afloat. This leads to…

Scenario 2: Local factory poisons a river. Local party secretary (who has perhaps been bribed by the factory) prevents local media from reporting it in order to keep his job and city stability. Stability is indeed maintained and, operating on the precedent of impunity, the factory continues to pollute the river. Commoners are getting sick and some are dying. Perhaps they connect the dots and take to the streets. Perhaps they don’t.

True story

Very plausible ending to the story: The national government lets some egregious cases get reported, but they bury most small scale incidents like this (if they even find out) in order maintain public confidence and stability. People therefore see very few examples that might help them connect the dots in their own local situations.

This happens repeatedly up and down the river and many others for several years to the point that the water is now unsafe to even touch; much less drink. China’s Ministry of Environmental Protection has acknowledged this is already the case with HALF China’s lakes and rivers. Similar circumstances unfold with medicine, food, infrastructure safety, air pollution, and deforestation. Try as they might to stop it with their “iron fist,” the central government’s internal policing is about as effective as fighting a cornfield mouse infestation with a baseball bat.

Cases like Sanlu that are patently obvious to the whole country get wide attention, but most situations fester slowly out of the public view until they’re well beyond the point of no return. Eventually these things compound and millions get screwed, thirsty, hungry or poisoned. As people often do when they’re screwed, thirsty, hungry or poisoned, they revolt and the government’s attempt to keep social stability has backfired tremendously.

Scenario 3: In the wake of the 2008 financial crisis, the national government wanted to ensure social stability by keeping high investment and GDP growth, so it pushed down interest rates and engineered a lending boom that expanded the country’s money supply by two-thirds. Keeping money in the bank became pointless for the rich since interest rates are below inflation rates. Many people (especially those who’ve come into their money illegally) stash their money by buying multiple apartments. Thus there is huge demand for high-value real estate.

So we return to local party secretary who needs some quick money; maybe for himself, but maybe just to achieve the kind of raw economic growth demanded of him by national leaders who see 8% annual growth – no matter what – as the key to keeping stability. So he does this the easiest way he knows how: tearing down old cheap apartments and selling the land to developers to build luxury apartments nobody will ever actually live in.

Very plausible ending to the story: local party bosses across the country do the same thing until there are more luxury apartments than people can possibly buy. Prices crash and people who’ve already bought these homes lose their massive investments. Developers who haven’t yet sold their new buildings default on their loans en masse. This has a domino effect which causes much of the other $2.7 trillion in recent loans to go bad.

Rumors spread on the internet that banks are running out of money. Official channels deny this but people have long since stopped believing the stability-maintaining cheery propaganda. So commoners swarm to withdraw their savings and start hording goods. This causes even greater inflation and regular Chinese suffer worse than at any point during the 2008 financial crisis. The government’s attempt to keep social stability has backfired tremendously.

Scenario 4: In order to keep social stability and firm support, the government bases its education system on making students obedient. It teaches them to accept the material without challenging it. This material often includes subjective nonsense, so students are trained to think in a way to find the safe answer rather than the true or innovative answer. This begins with politics and history classes but spills over into other subjects. Students are afraid to express ideas beyond the status quo and teachers are afraid to teach them.

Meanwhile, international collaborative platforms like Twitter are blocked or heavily censored (in order to preserve social stability), so Chinese researchers are kept in a virtual cocoon. Manufacturing wages are starting to rise, so China’s economy needs to move up the value chain like Japan’s, Taiwan’s and Korea’s did before it. But because of the education deficit and lack of intellectual freedom, China isn’t equipped to do this.

Very plausible ending to this story: As this decade nears an end, demographic shifts put huge pressure on the young working generation as they must support aging parents. China’s best and brightest see the writing on the wall so they go overseas to get educated – where they mostly stay after graduation.

China’s “Indigenous Innovation” initiative relied more on protectionism and siphoning last year’s IP from foreign companies than it did on creating the right conditions to innovate at home. Under the standard policy of throwing money at a problem, several of the most brilliant Chinese minds manage impressive accomplishments in spite of the anti-intellectual atmosphere, but those exceptions are indeed exceptions. For the most part, Chinese companies stay perpetually one step behind their foreign competitors.

Scores graduate from universities to find their education was useless. Manufacturing positions are now fewer because of rising wages and technological improvement; and bosses don’t want factory workers with degrees anyways.

Like unemployed youth in the Middle-East did in 2011, young Chinese take to the streets. The government tried to avoid another Tiananmen by making sure universities didn’t become independent hotbeds for radical thinking. But their attempts to maintain social stability have backfired tremendously.

Conclusion

These scenarios aren’t just possible, they’re already happening. Many I speak to say these endings won’t happen because the central government will step in and prevent the worst. But in spite of what many Chinese and most foreigners seem to think, China has one of the weakest central governments in the world. It must oversee tens of thousands of local fiefdoms, so even when the top leaders try to do the right thing, their orders get diluted, reinterpreted or ignored through multiple levels of corrupted bureaucracy.

Like most groups throughout history though, the party is reluctant to give up any of its absolute power. It clings to the notion that it can use its power to launch internal crackdowns and scare corrupt officials straight. But this approach has been failing for decades. For every situation it rectifies, dozens more pop up.

Only by outsourcing its supervisory role to commoners and media empowered by a rule of law enforced from the top can China’s model become sustainable.  China is the frog in heating water and time is running out. Hopefully the laobaixing will realize stability at all costs is usually the most potent recipe for chaos.

A few days ago I talked with a Communist Party acquaintance who has a fairly high position in the propaganda organ  (by “fairly high” I’ll just say he’s on speaking terms with several Politburo members). We got to talking about the upcoming power turnover and I asked whether he thinks the government will shift to the left with the likes of Bo Xilai’s neo-socialists or to the right with the Wang Yang progressive crowd. “Neither,” he replied. “It will go in a third direction. Domestically it will go to the right and in foreign policy to the left.”

This basically means further reform in freedoms at home while taking a more hawkish approach abroad. This seems like a very plausible scenario. He also said he worries that some current players vying for greater power could be catastrophic for China, were they to be put  in charge.

While speaking with him I realized that when you hear about the Communist Party through only certain mediums, it’s easy to form the idea that they’re a unified monolith; when actually nothing could be further from the truth. He’s a very rational guy who pretty well represents an unsung wing of the Party – a wing that didn’t necessarily get into politics to abuse their power and line their own pockets. He has most of the same concerns I do about China’s future. He worries about nationalists hijacking the government and letting the current situation deteriorate further. Some would criticize him, saying that since he’s part of the system, he’s complicit in the bad that it does.  But he seems to sincerely believe the Party’s power can be channeled for good; that people like him can steer it in the right direction from the inside.  He and I don’t agree on a lot of the methods to get this done, but his heart is in the right place. However, sometimes forces from the outside make it harder for people like him.

This week there was a great piece in New York Times called “Why China won’t listen.” The piece cited a congressional ammendment to express support for Chen Guangcheng, who’s under house arrest in Linyi, saying:

“Beijing does not indiscriminately reject all such ‘interference’; China and the United States conduct a dialogue on human rights through diplomatic channels. But Chinese leaders believe such dialogue belongs behind closed doors. The Chinese are saying to Americans, if you grant me face, I can be reasonable; if solving the problem will help me, I’ll consider it. But don’t expect me to make concessions under pressure.”

This is a dead-on assessment. Much of the foreign criticism toward China’s human rights is counter-productive. It backs Chinese leaders into a corner and forces them to take a hawkish anti-foreign attitude and even double-down on the practices being criticized. It drowns out the voices of reason who are trying to lead the country’s development in a positive direction. This, perhaps, is partly why there may be opposite directions for domestic and foreign policy with the new leadership.

This isn’t to say foreigners should stop criticizing China. Far from it. However, things like congressional censures, which do more for US politicians’ campaigns than China’s human rights, are the opposite of constructive. A lot of the other criticisms over Chen Guangcheng were perfectly legitimate, but still counter-productive.

It’s important to realize that substantive change in China can never be inflicted from the outside. The government and people alike would reject it on principle. The foreign media plays an important role in covering issues that Chinese media are either too scared to report or are directly barred from reporting. Dissemination of information is good. Calmly arguing how current policy is bad for Chinese people is good. But making fruitless public admonishments of the government is pointless and usually harmful. Every time a protester in San Francisco holds up a “Free Tibet!” sign they’re pushing the rational people in China further into the arms of the hawks. Things like petitions to free Chen Guangcheng and human rights groups blasting the government – their hearts are in the right place but their actions often result in the opposite of what they’re fighting for.

Rational people within the Party need to have some room to maneuver and get their voices heard over the shouting of the hardliners. They’re the only ones that have any hope of reforming the Party constructively. And while it might be satisfying to see the corrupt bureaucrats and iron fists get their come-upins in a full-on rebellion, steady reform within the confines of the current system would be much safer and better for everyone.

The Party isn’t some Darth Vader-run empire of evil. As much as I, and many others focus on the absurd and horrible things some quarters of it carry out, there are a lot of good people in the Party trying to get good things done. Reporting, objective analysis and pressure from foreign governments behind closed doors are the only things foreigners can really do to help those people improve China’s situation.

China Daily recently reported  on new compulsory ethics classes for government officials. It said, “The ethics campaign, which will be ‘of great significance’ in lifting public confidence in the government and in civil servants as well as in consolidating the Party’s governance position, will be carried out from 2011 to 2015”

Lift public confidence in government? Maybe. Consolidate the Party’s governance position? Uh, I guess…if somehow that isn’t already 100% done. Do anything to actually improve officials’ ethics? *crickets chirping*

Any economist will tell you that the only thing that changes behavior on a wide scale is incentives. I’ve written about these absurd campaigns before and how they always neglect the only two things that actually deincentivize corruption: An untied press and an independent judiciary.

So I always wonder who these campaigns are really for. Are they just a show to pacify a public increasingly aware and intolerant of corruption? Or does the Party genuinely believe that officials can be trained to act ethically without actual public oversight?

I often think the latter is possible. Though absolute power has proven to corrupt absolutely time and time again, people always think they can be the ones to break the pattern. Hell, if you put me completely in charge I bet I’d create a utopia given my benevolence and 100% correct beliefs. So maybe the higher-ups see the Party as a flawed entity which can consciously overcome its shortcomings and become the benevolent force Mao (supposedly) envisioned.

But that same China Daily piece had another quote that shed further light: “Laws overlap ethics, but the law cannot fully cover all ethical issues, such as extra marital affairs, which tend to lead officials into corruption.”

While I’m sure there are exceptions, the idea that affairs “tend to lead officials into corruption” seems completely backwards. That’s not what the Party wants people to think though. They love showing how many mistresses fallen corrupt officials had; or how frivolously they lived. It shows that their corruption is a personal level moral issue; not a nationwide systematic one.

Lai Changxing, who was responsible for the “biggest economic crime in the history of the People’s Republic of China” in a black market import racket, used to keep an extravagant mansion/brothel where he’d entertain government officials with wild sex parties. After they all fell off the horse, the mansion was turned into a museum open to the public to showcase Lai’s and the officials’ depravity. (It was later shut down after guests swarmed in and marveled at how awesome being a corrupt official is).

So this new ethics plan seems to target the alleged route of corruption in the Party’s narrative: immoral lifestyles. That’s the narrative they’ve been pushing so now they have to show they’re doing something about it.  And they’ve given themselves five years to implement it – probably about as long as they can plausibly draw it out.

But the real question is if, and for how long these campaigns can actually placate the masses’ impatience with corrpution. Stay tuned…

For those who haven’t heard of the horrific incident in Foshan, here’s a link with a video that will absolutely ruin your day and faith in humanity. It shows a two-year old girl getting run over TWICE and ignored by 18 bystanders. She’s not expected to live.

It’s hard to say how much of the bystanders’ ambivalence was universal human psychology and how much can be attributed to distinctly Chinese characteristics, but it’s becoming harder to downplay the latter. This is just the latest in a string of despicable stories to come out of China in recent years.  Consider these, some of which are just one instance of recurring events:

This list, unfortunately, isn’t even close to being exhaustive. It would be very tenuous to connect these all directly to any single factor, as most regard fear of legal liability as the main culprit in the Foshan story, for example, while the one-child policy is oft-cited for the child-trafficking problem. And of course, these things happen in other countries too, but their sheer scale and consistency in China is hard to write off, as many Chinese themselves have noted. There could be one thing at least partially contributing to all of this:

Hell.

Or rather, a lack of it.

I’m a devout atheist and tend to think dogmatic religion plays a largely negative role in society, but I can’t count the number of times in China I’ve shaken my head and wished more people believed in hell.

In any collectivist society, shame among peers tends to have much more influence than internal guilt. So if it’s unlikely that they’ll be caught, punished and shamed, people have less incentive to refrain from despicable actions. There’s even a Chinese proverb alluding to the idea saying “Neng pian jiu pian” (If you’re able to cheat, just cheat). You can couple this with the moral void that’s been left in the wake of socialism’s demise and the tunnel vision focus on money that emerged in the 1990’s.

The idea of hell as a means to keep people honest might be pretty intuitive (if not a bit Machiavellian) but University of British Colombia psychologist Ara Norenzayan published a study entitled Mean Gods Make Good People: Different Views of God Predict Cheating Behavior. He gave subjects a math test they could easily cheat on and those who believed in a vengeful god typically chose not to cheat. “Fear of supernatural punishment may serve as a deterrent to counter-normative behavior, even in anonymous situations free from human social monitoring,” the study said.

Studies by the Federal Reserve Bank of St. Louis and Harvard have also separately found a correlation between belief in hell and lower levels of corruption and higher economic growth.

According to the Boston Globe, “[Harvard researchers Barro and McCleary ] collected data from 59 countries where a majority of the population followed one of the four major religions, Christianity, Islam, Hinduism, or Buddhism.[…] Their results show a strong correlation between economic growth and certain shifts in beliefs, though only in developing countries. Most strikingly, if belief in hell jumps up sharply while actual church attendance stays flat, it correlates with economic growth. Belief in heaven also has a similar effect, though less pronounced. Mere belief in God has no effect one way or the other.”

“The expectation that there is a cultural belief in hell or perpetual and eternal punishment for wrongdoing will act as a disincentive to wrongdoing,” Eileen Lindner, deputy general secretary of the U.S. National Council of Churches, told USA Today.

The Chinese Communist Party has traditionally held a less than hospitable attitude toward religion and regarded the Marxist view that it’s “the opiate of the masses” as a bad thing. But there are signs they’re starting to see the (again, perhaps Machiavellian) advantages to the opiate concept. This seems especially true with Christianity, given its belief in hell and less potential for the political complications associated with Islam in China.

In Nanjing the government has built a 5,000 seat mega church and given other funding to help boost Christianity. In the manufacturing hub of Wenzhou, where it’s estimated as much as 20% of the population is Christian, the government is starting to seriously study the link between Christian enterprises and economic success. One Christian factory owner told BBC, “I’m not saying those people who aren’t Christians are all bad, but from the percentage of the workers who are Christians, they seem to be more responsible. Also when they do things wrong, they feel guilty – that’s the difference.”

During the Mao-era, throwing the doors open to religion would have been unthinkable. Communism was the religion and Mao its god. Any other faith would have been competition. But now, with the death of religious socialism, supernatural religion’s spread is inevitable and SOME in the now strictly utilitarian Party seem to be recognizing that that might be in their best interest.

For many of China’s tens of millions of religious followers, the repression of their faith itself is the biggest grievance with the Party. Standing aside or even assisting religion would likely pay the government far greater dividends than holding the Maoist religion-as-a-threat attitude. It seems it could also have very real economic and socially-stabilizing benefits.

In a 2006 interview with Reuters, Li Junru, deputy head of the Communist Party School  made a very telling statement. When asked why India can handle democracy while China needs an authoritarian government, he explained that India has religion to control the people.

One has to imagine the Communist Party sees the appeal of biblical verses like Hebrews 13:17, which says, “Obey your leaders and submit to their authority. They keep watch over you as men who must give an account. Obey them so that their work will be a joy, not a burden, for that would be of no advantage to you.”

Today, as Libyan rebel forces close in on Tripoli, it seems yet another nation will overthrow their authoritarian rulers in the Jasmine Revolution. Since the movement broke out in December, political forecasters have devoted plenty of ink to speculation over if and when China’s authoritarian government will collapse.

For the record (and anyone at the Ministry of Truth who may stumble upon this), I don’t at all wish for a collapse or overthrow of the Communist Party. Gradual reform leading to real public accountability would be much better than the abrupt dismemberment they’re setting themselves up for with the current iron fist approach.

But in the fairly-likely event that they do dig their own grave, where does that leave a post-Communist Party China?

The Party would have you believe that the country would dissolve into absolute chaos; that they’re the Elmer’s glue holding the whole rickety apparatus together. Without them, people would take to the streets to pillage, rape, torture, kill, etc.  Plenty of foreign observers share that bleak outlook too.

But a few weeks ago I spoke with Uri Dadush, former World Bank director of international trade and author of the book Juggernaut: How Emerging Markets Are Reshaping Globalization. He said China’s GDP is projected to grow at around 5% annually for the next 40 years. “Even if there is a political crisis, that doesn’t mean that China will not grow,” he said.

In economic terms, revolutions aren’t as catastrophic as they appear to be, especially in recent history. This chart maps Egypt’s annual GDP growth for the past 50 years. This measure shows how much the GDP grew in a given year compared to where it was the previous year. It’s good for highlighting economically disruptive events.

Clearly, Egypt has always been a fairly turbulent country capable of enduring crises and quickly bouncing back, never dipping below 0% growth. But the most significant part is if this chart were extended to today. It would show a dip to 2% growth in the fiscal year ending this June, which included the Jasmine Revolution. Before the revolution, it was predicted to grow at around 5%. The government overthrow may have very briefly slowed growth and had some opportunity costs, but it was hardly chaos. Now Egypt’s economy is humming again and will probably hit 5% growth again by year’s end.

Here’s China over the past 50 years:

The two largest dips were during government directed campaigns; the Great Leap Forward being especially catastrophic. Then in 1987-1988 there was massive (over 20%) inflation of the Yuan which partly enabled the Tiananmen Square uprising. The crackdown did scare away some investment. Growth slipped a bit but remained positive and quickly rebounded.

An even better indicator of national well-being is per-capita GDP, because this shows how the wealth of the average person is growing or stagnating. A flat line here is bad; people aren’t getting any wealthier. A downward slope is very bad; people are becoming worse off. If you look at China by this measurement the story is very promising.

There’s a very gentle negative slope during the 60’s and the power struggle of the late 70’s, then it’s all upward. Tiananmen didn’t even leave a mark.

Let’s look at another country’s per capita GDP growth and see if you can spot when the revolution took place:

There’s a sharp decline beginning in 1996 ravaging the average person’s net worth by over 33%, but if you think that’s where the political upheaval was, guess again.

The Asian Financial Crisis devastated Thailand, but when a military coup a decade later overthrew the ruling Prime Minister after a year-long political crisis, there wasn’t even a blip. Per capita income continued to grow to its highest levels ever.

These economic charts don’t tell whole story, but they do tell a lot of things. They tell that, even in the midst of political crisis, people still buy things and people are still working at the store to sell to them. Then there’s a whole network of manufacturing and investment behind those people that continues to expand. So the idea that a political crisis throws the country into violent chaos is greatly exaggerated. And what may have caused a serious disruption even 30 years ago might be hardly noticeable now thanks to globalization.

Mr. Dadush explained, “The drivers of economic growth are very fundamental. They are much deeper than even big political developments. They have to do with technologies and ideas that have already been invented. Once they’ve been invented it’s very difficult to stop their spread. If you have more or less the conditions and you have educated people you can absorb these things and you will have economic growth. Educational openness to the world, the absorption of ideas and technology are very fundamental forces. They can be delayed by political disaster but they cannot be stopped.”

There are plenty of non-political things that can tank the economy, like a housing bubble, demographic decline, foreign financial collapses, protectionism, environmental catastrophe, natural disasters, etc. But contrary to what the Party would like everyone to believe and what all those (totally existent) foreigners who dream of seeing China in chaos believe, political upheaval doesn’t seem to be a serious threat to the economy or the common person’s well-being.

This doesn’t necessarily apply to developed countries as strongly though. Once they’re developed they rarely see more than 5% growth in a given year and become more vulnerable to market and political fluctuations, as you can see in this chart of the US and Japan:

But it will be a long time before China gets to that point as a nation; around 40 years according to Dadush. So China could bounce back much more easily from any political crisis than these nations could.  A prolonged civil war might be different, but that’s very unlikely. Even then, it wouldn’t be as destructive as one would imagine thanks to the fundamental global business presence.

Whatever replaced the CCP would certainly have significant long-term economic impacts, but the simple act of a power switch (non-violent or otherwise) would hardly knock growth and the institutions supporting it out of place. Even in a country that, as we all know, has its own “special circumstances.”

I’m sure economists (which I am not) and others can poke holes in this theory. Tunisia isn’t bounching back quite like Egypt, but it wasn’t growing as much to begin with either. And Libya is still in a drawn out civil war (again, extremely unlikely in China) and its recovery is yet to be seen. But none of these countries come close to having the business apparatus and distribution network in place that China does, which are both hedges against “chaos.”

However, the most important thing these economic charts don’t address is happiness during and after a revolution, which obviously doesn’t equate with economic stability. Economic growth still allows for unchecked corruption, wealth inequality, trampling of human rights, perversion of justice, unfair trade practices, arbitrary violence and wholesale withholding of important information. It would indeed be a shame if the Chinese people were ever subjected to that.

_______________________________

Chart Sources: World Bank data powered by Google Public Data Service (a great resource for comparing countries’ economic and social aspects)

Tom from Seeing Red in China just ran a great piece called “This system cannot last forever – China’s coming change” where he uses nice graphs and timelines to illustrate what many already suspect: the Communist Party’s economic-based legitimacy check is almost fully cashed. This graph tells the story best:

This shows that, in spite of incredible economic growth, Chinese aren’t any more satisfied with their lives now than they were 12 years ago. The post-1979 boom that lifted people out of poverty is bringing diminishing returns to life satisfaction.

It makes sense. Compare someone who lived through the Japanese invasion and Mao’s idiotic campaigns to someone born in the 90’s who grew up watching American movies and having their teeth brushed for them. The latter, which takes their economic standing for granted, could very well be the undoing of a Party that derives its legitimacy from pulling the nation out of poverty. So if that happens, what comes next? Here’s a few possibilities:

Scenario #1: The Party says, “This absolute power thing has been swell, but now it’s time allow real freedoms, which will move our economy up the value chain. It’s also time to give the public a real check on our power by allowing them a mechanism to throw out those who don’t represent them.”

It’s possible, but anyone who’s studied basic world history can figure out about how likely that is. Especially given that the only Politburo member who even pretends to want substantial reform is leaving next year.

Scenario #2: Give Marxist ideology another whirl.

That crapped out about the time Mao died, but the New Leftists are trying to revive it as a source of legitimacy. This might make for some fun nostalgia, but not very likely to sustain the government on its own. And it’s not like the CCP hasn’t been vainly trying to convince the public that socialism is still relevant all along anyways.

Scenario #3: That just leaves the CCP’s fail-safe pillar of legitamacy: Good old-fashioned nationalism. Anti-Japanese, and to a lesser extent Anti-American and European nationalism have worked wonders thus far. The “Century of Humiliation” narrative has left latent animosity toward these places and embedded a sense of gratitude toward the Party that rescued the country from the foreign imperialists.

But how far can this same old tactic go when it’s not accompanied with economic legitimacy? Not very. If the Party thinks its power has a clear and present existential threat, desperate times might call for desperate measures – wag the dog-type measures that seek out the nationalistic furvor a war brings.

The tried and true enemies of the US and Japan wouldn’t work for this. Either case would be economic suicide and put the Chinese Navy up against the US’s. Getting an naval ass-kicking wouldn’t do much to endear the Party to the people.

There’s Taiwan, which might make more sense. But again, economics and the possibility of a US military intervention makes it unlikely – on top of the fact that it could turn into a drawn out occupation with a resistant population. A failed attempt at taking Taiwan would just make matters worse for the CCP.

So that just leaves the South China Sea with a big target on Vietnam. China claims pretty much the entire sea, so military enforcement of these claims would be seen as perfectly legitimate and non-imperialistic by Chinese. The international community would cry foul, but if it got to this point, a bad reputation would be the least of the CCP’s concerns. And American military intervention on behalf of Vietnam would be tough sell to the broke American public.

Vietnam regularly patrols the sea, so getting a USS Maine-like incident to spark a war wouldn’t be hard. China is already the biggest baddest navy in Asia and has just rolled out its new aircraft carrier. It could be combat ready in five years, with a supporting fleet in ten – right about the time China’s economic growth is expected to slow considerably and the post-90’s kids will be adults.

Keeping the war naval would keep civilian casualties low, the PLA would get to show off its new toys, victory would be swift, and the average Zhou in China would get a patriotic hard-on. It would be the Persian Gulf War on steroids.

There would even be the added benefits of complete control over the sea’s resources and a warning to other neighbors that China is serious about its claims.

This strategy would only be a temporary solution to the Party’s legitimacy predicament though. The Persian Gulf War sent George H.W. Bush’s approval rating soaring to almost 90%…then he lost his re-election bid the following year. But, as James Fallows put it, China’s government is basically guiding a raft down white water rapids. It does everything it can to avoid the rock in front of it, which just allows it to confront the next rock behind it.

Wagging the dog would buy the government time, which would allow them to regroup and think up the next hair-brained scheme, which if history (or present) is any indicator, would involve a Stalinist clampdown. OR they could go back to scenario #1 and initiate substantive reforms. Hell, they could even do that now and avoid the whole thing. But if I were Vietnam, I wouldn’t get too attached to the South China Sea.

In a somewhat philosophical departure from this site’s usual content, I want to look at some of the ideological foundations of China’s “New Left.” Since Reform & Opening Up began in 1979, outsiders have tended to think true socialism in China is dead and exists in name only.  For the most part, Chinese leaders have outgrown the lust for socialism and the New Left, which advocates a return to Maoist egalitarianism, is a regressive force that wants to undo China’s capitalist development. But China has never really taken its eye off the ball of true socialism.

To understand where the New Left and the entire Communist Party are coming from you have to understand Marx’s stages of human development (abridged courtesy of Wikipedia):

  1. Primitive Communism:  Co-operative tribal societies (hunter-gatherer clans).
  2. Slave Society: a development of tribal progression to city-state; aristocracy is born.
  3. Feudalism: aristocrats are the ruling class; merchants evolve into capitalists.
  4. Capitalism: capitalists are the ruling class, who create and employ the proletariat.
  5. Socialism: workers gain class consciousness, and via proletarian revolution, depose the capitalist dictatorship of the bourgeoisie, replacing it in turn with dictatorship of the proletariat through which the socialization of the means of production can be realized.
  6. Communism: a classless and stateless society.

It’s important to note the difference between the socialism and communism stages. Communism is the ultimate endgame when the entire world has embraced socialism and there’s no longer a need for classes or countries. Communist Parties like China’s hoped to inspire international revolution with their socialist model and eventually achieve communism. But this doesn’t look to be on the horizon any time this millennium and is no longer any kind of immediate focus for China.

Moving to the socialist stage is still very much China’s intention though. China’s initial socialist movement, as well as every other that’s been attempted, failed to adhere to Marx’s order of development. They all tried to jump straight from feudalism to socialism without ever mastering capitalism. This was one of the implications of Mao’s “Great Leap Forward.” He hoped China could successfully leap over the capitalist phase into a socialist utopia. We all know how that turned out.

So when Deng Xiaoping initiated “Socialism with Chinese Characteristics” (AKA capitalism) it was an acknowledgement that China couldn’t rewrite the laws of Marxism. They’d have to go through the capitalist phase before they could achieve socialism.

Marx wrote that capitalism will then slowly dig its own grave because the rich will keep getting richer and the poor will keep getting poorer. Eventually the workers will notice the “unpaid labor of the working class” going to the capitalists (like seeing their bosses and leaders buy lavish homes which would take them several lifetimes to afford). The workers have then gained “class consciousness” and see the capitalists for the exploiters that they are. This is when they take back the fruits of their labor and achieve socialism through revolution.

Back in modern China, with inflation, corruption, environmental degradation, and already enormous income inequality worsening, the New Left thinks the time has come to transition from the capitalist stage of Marxism to the socialist egalitarian stage. There are those die-hard Maoists in the movement who never wanted to embrace capitalism, but for much of the New Left, they simply think this is the right time in history to take the step which was taken prematurely under Mao.

But there’s a problem. In Marx’s vision, the capitalist stage of development is under a democracy that’s basically controlled by the capitalist businessmen (sound familiar?). After the workers overthrow this system, the socialist stage dissolves the state and becomes a grouping of autonomous collectives, each democratically governing itself. Mao tried a bastardized version of this which was both premature and under central government control.

The problem is that China straddles these stages now. There’s no democracy to overthrow in the Marxist sense – only a failed socialist system that now has all the symptoms of an exploitative capitalist society…minus the democracy.

Some believe that socialism can be achieved through evolution without revolution, which is what the CCP is banking on. But traditional Marxists would say that’s impossible, since those leaders guiding the evolution would be corrupted and simply become capitalist oppressors themselves (again…sound familiar?).

So the Communist Party is in a sticky philosophical situation. How can they fall in line with the Marxist view of development? China has gone through many cycles in history where the ruling dynasty is overthrown by a peasant movement which then redistributes the wealth. Then that government inevitably becomes too tyrannical and corrupt, then the process repeats itself.

Wen Jiabao seems to think democratization first is the key. “Without democracy, there is no socialism. Without freedom, there is no real democracy,” he said recently in an interview with Xinhua. “Without the guarantee of economic and political rights, there is no real freedom. To be frank, corruption, unfair income distribution and other ills that harm people’s rights and interests still exist in China. The best way to resolve these problems is to firmly advance political structural reform and build socialist democracy under the rule of law.”

He also once repeated the words of Deng Xiaoping saying, “It will take a very long historical period to consolidate and develop the socialist system, and it will require persistent struggle by many generations, a dozen or even several dozen.”

Wen may see democracy as an end in-and-of-itself, or he may honestly believe it’s just the next step toward socialism. But either way he doesn’t seem to think the time is ripe for the socialist stage now. However, New Leftists like Bo Xilai seem to think they can guide a socialist transformation under the current authoritarian apparatus and start it now.

I’ve written before about both Bo and Wen, whom I suspect as individuals are using a lot of empty rhetoric and gimmicks for their own purposes. But their stated ideology is worth looking at because it represents two competing views within the Party.

So could either of their views altering Marxism work in China? Or could the true Marxist vision of socialism work?

Most would probably be inclined to say, “No, just look at history.” But again, socialism has never been tried in the way Marx laid it out. Attempts have always been bastardized in some form. Some would argue socialism is already starting to happen with the Scandinavian countries of Norway, Denmark and Sweden. They have some of the world’s highest tax rates, greatest income equality and all kinds of socialized welfare programs. Interestingly enough, they’re also ranked among the highest in per-capita income and happiness. And they’re evolving this way naturally – without the Marxist need for a revolution.

However, there are plenty of fundamental problems with Marxist socialism. He never anticipated how connected and interdependent the world has become. It isn’t clear how a nation of autonomous communes could be reconciled with an international market that depends on uniformity in currency, law, communication and transportation. And how can there ever be a Marxist revolution without some individuals hijacking the ideology in order to carry out their own agendas – as has happened with every other attempt? (See: Mao Zedong, Joseph Stalin, Kim Il Sung, etc.)

Then there’s the classic Achilles heel of socialism: Greed. Marx’s vision included “labor vouchers” that would be awarded to workers based on the amount of labor they contribute, which could then be exchanged for goods. Marx thought that this would be liberating for the formally exploited, as it would give them freedom to pursue their own interests and develop their own talents. But it failed to address what would motivate someone to spend seven years in medical school if their quality of life would be comparable to a high-school dropout.

So the pure Marxist vision of socialism would probably have to be tweaked if it were ever to work in practice, if indeed it ever could work. The New Left is convinced it can work, and will work, sooner rather than later. But with China still far from catching up to even the developed capitalist societies of the world, it’s hard to imagine a successful transition anytime soon. And it’s very hard to imagine China’s Communist Party will be the one to break the historical cycle both in China and the previous socialist movements of the world.

But to assume it’s totally impossible and that true socialism is dead in the world would be a bit hasty. The Communist Party still sees it as the ultimate prize and is being much more patient and flexible in its approach than any other nation ever has been. On the other side of the world, The U.S. and the PIIGS (Portugal, Italy, Ireland, Greece and Spain) seem like they’ll continue to vote and protest themselves lower taxes and greater benefits until they’re bankrupt; which seriously calls into doubt Francis Fukuyama’s “End of History” theory that capitalist democracy is the end-all-be-all of human development.

Of course, it’s very possible that no system will work in the long-run and humanity is screwed. People at the bottom of any system may continue to want more than they can produce. Those at the top may continue do whatever gives them with the most power – whether that means pandering to those at the bottom or using an iron fist and bastardized ideology keep a hold over them. It would be presumptuous for any ideology to declare victory now or for the foreseeable future, but whatever happens, it should be an interesting century for philosophers.