The Underestimated Party-State – Arthur Kroeber

Arthur Kroeber, the managing editor of China Economic Quarterly published following essay on the Financial Times:

People in the rich world perturbed by China’s rise spend a great deal of time these days consoling themselves with a political fantasy.

China’s economy may be growing fast, the argument goes, but unless that growth is matched by political reform – specifically, the adoption of Western-style democracy – then economic progress will grind to a halt.

This argument has plenty of what the music business calls crossover appeal. The yellow-peril school of Chinaphobes like it because it enables them to forecast the imminent collapse of a sclerotic state unable to manage the dynamic forces it has unleashed. Idealists, of either the liberal or the neo-conservative persuasion, find it validates their view that evolution towards an Anglo-American style capitalist democracy is the inexorable course that all nations must follow, failing which they must stagnate or collapse.

Few seem willing to accept the possibility that the Chinese party-state will manage to keep rapid economic growth going for a long time, while reforming the political system only slowly and on terms dictated mainly by Chinese culture and bureaucratic history – not on Western, and particularly not on Anglo-American lines. Yet for anyone who cares to analyse China on the basis of empirical evidence, rather than appeals to bogus axioms of political development, this seems the most likely outcome for China in the next two decades.

The China-must-reform-as-we-say-it-must fantasy has been most clearly articulated by two recent books. China’s Trapped Transition, by Minxin Pei of the Carnegie Endowment, claims that corruption has so overwhelmed the Chinese state that it is rapidly losing the capacity to deal with all sorts of social problems. The Writing on the Wall: China and the West in the 21st Century, by Will Hutton (reviewed by Martin Wolf in the FT on February 2), asserts that “the Chinese economy and the Chinese Communist Party are in an unstable halfway house” between socialism and capitalism, and that the party must surrender its monopoly on power – soon – or risk economic collapse.

Both books, not to mention legion other critics, are right to point out that China faces a staggering array of problems: corruption, income inequality, water shortages, environmental degradation, the potential for epidemic disease and so on.

But where these books and the legion other critics go spectacularly wrong is in their assessment of the Chinese party-state as “sclerotic,” “rigid,” “unresponsive” and so on. The Chinese party-state has many exceedingly repulsive aspects, and certainly uses ruthless repression as one of the tools of governance. But if for no other reason than an interest in self-preservation, it is responsive to all manner of ills. Critics’ underestimation of the party-state’s ability to identify and address problems is a severe failure that leads them into erroneous diagnosis. [Full Text]

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