Will China's Capitalist Revolution Turn Democratic?

Minxin Pei is a senior associate at the Carnegie Endowment for International Peace and author of China’s Trapped Transition.

by Minxin Pei

Communist China has experienced a monumental capitalist revolution in the last two decades, with an economy that is now six times bigger than it was 20 years ago. A minor player in the global economy in the 1980’s, China today is the world’s third largest trading power. But if these stunning economic statistics make you think that so much capitalist development must also have brought more democracy to China, think again.

Most Westerners believe in a theory of liberal evolution, according to which sustained economic growth, by increasing wealth and the size of the middle class, gradually makes a country more democratic. While the long-run record of this theory is irrefutable, China’s authoritarian ruling elite is not only determined to hold on to power, but it also has been smart enough to take adaptive measures aimed at countering the liberalizing effects of economic development.

Thus, for all its awe-inspiring economic achievement, China has made remarkably little progress in political liberalization. Indeed, judging by several key indicators, progress toward democracy in China has stalled, despite unprecedented economic prosperity and personal freedom.

For instance, in the mid-1980’s, Chinese leaders seriously discussed and later drew up a blueprint for modest democratic reforms. Today, the topic of political reform is taboo. Nearly all the major institutional reforms, such as strengthening the legislature, holding village elections, and building a modern legal system, were launched in the 1980’s. Since the Tiananmen Square massacre of June 1989, however, not a single major democratic reform initiative has been implemented.

Instead of democratic transition, China has witnessed a consolidation of authoritarian rule – the strengthening of a one-party regime through organizational learning and adaptation. Since 1989, the Chinese Communist Party (CCP) has been pursuing a two-pronged strategy: selective repression that targets organized political opposition and co-optation of new social elites (the intelligentsia, professionals, and private entrepreneurs).

This strategy emphasizes the maintenance of an extensive law enforcement apparatus designed to eliminate any incipient organized opposition. Huge investments have strengthened the People’s Armed Police (PAP), a large anti-riot paramilitary force whose specialty is the quick suppression of anti-government protests by disgruntled industrial workers, peasants, and urban residents. Frequent deployment of the PAP is a major reason why the tens of thousands of collective protests that occur each year (74,000 in 2004 and 86,000 in 2005) have had a negligible impact on China’s overall stability.

To deal with new emerging political threats, such as the information revolution, the Chinese government has spent mightily on manpower and technology. A special 30,000-strong police unit monitors and screens Internet traffic, advanced technology is deployed to block access to overseas Web sites considered “hostile or harmful,” and Internet service and content providers, both domestic and Western, must comply with onerous restrictions designed to suppress political dissent and track down offenders. The regime has even conducted multi-agency exercises to test whether different government bodies could cooperate closely to keep “harmful information” off the Net during an emergency.

Having learned from the collapse of the Soviet Union that a bureaucratic ruling party must co-opt new social elites to deprive potential opposition groups of leaders, the Communist Party has conducted an effective campaign of expanding its social base. The urban intelligentsia and professionals have been pampered with material perks and political recognition, while new private entrepreneurs have been allowed to join the Party.

This strategy of pre-emptive political decapitation has produced enormous dividends for the Party. In the 1980’s, its principal adversaries were the urban intelligentsia, who constituted the backbone of the pro-democracy movement that culminated in Tiananmen Square. Today, the mainstream of the Chinese intelligentsia is an integral part of the ruling elite. Many have joined the Party and become government officials, and a large percentage enjoy various professional and financial privileges.

Predictably, the intelligentsia, usually the most liberal social group, is no longer a lethal threat to party rule. Worse, without support from this strategic group, other social groups, such as workers and peasants, have become politically marginalized and rudderless.

Although the Party’s carrot-and-stick approach has worked since 1989, it is doubtful that it will retain its efficacy for another 17 years. To the extent that China’s authoritarian regime is by nature exclusionary (it can only incorporate a limited number of elites), the co-optation strategy will soon run up against its limits, and the Party will no longer have the resources to buy off the intelligentsia or keep private entrepreneurs happy.

At the same time, selective repression can contain social frustrations and discontent only temporarily. As long as much of Chinese society views the current political system as unjust, unresponsive, and corrupt, there will always be a large reservoir of ill will toward the ruling elites.

When things go wrong – as is likely, given mounting social strains caused by rising inequality, environmental degradation, and deteriorating public services – China’s alienated masses could become politically radicalized. And, unlike past protests, which have usually been allied with students or members of the intelligentsia, popular disaffection might not have the virtue of rational leaders with whom the government could talk and negotiate.

So it may be premature for the Party to celebrate the success of its adaptive strategy. China’s rulers may have stalled democratic trends for now, but the current strategy has, perhaps, merely delayed the inevitable.