Pachta, Lukas

English

Policy Documentation Center

  
 
 
 
 
Chinese mix of communism and wild capitalism is unsustainable  
Lukas Pachta  
 
Democracy cannot function without capitalism. This has been proved several times 
throughout the history, most notably in 1989 for the last time. More interesting question for a 
political scientist today is whether capitalism can work without democracy and freedom. 
Some Asian countries seem to demonstrate that it is possible; Taiwan, South Korea, 
Singapore, Malaysia and China could serve as an example but unlike China, the other 
countries listed above have been liberalising their political systems and some of them - South 
Korea or Taiwan – have in fact replaced authoritarian politics by full-fledged democracy. 
Fareed Zakaria makes the point that liberal capitalism prepares the ground for democracy: 
capitalism means trade and trade means opening to the foreign partners who bring money, 
know-how and ideas in. Following this theoretical point of view, the Australian PM John 
Howard is quite right was quite right when he said that “China’s mix of authoritarian politics 
and a liberalised economy is unsustainable in the long term”. 
But why then the economic liberalisation in China has not been followed by the 
democratisation or at least liberalization in the sphere of politics? Why the opening of China 
to the world has not brought about the same effect in this sense, as elsewhere in the world and 
in Asia?  
 
One of the usual answers is that China is too big and too complicated to govern that even free 
market capitalism requires strong hand of the government. To boost this argument, a 
comparison of China and India is often made. India, country of freedom and democracy and 
another Asian booming economy, is often criticised for not being able to tame inflation and to 
provide for adequate business infrastructure. Chinese structures, on the other hand, are quite 
efficient in managing both issues. Investing in India, one needs to study quite complicated 
system of federal and local taxes and other rules, talk to a lot of stakeholders and there is no 
guarantee there once will be a road to your factory. In China on the contrary, one only needs 
to see several bureaucrats in Beijing who, if convinced about the profitability of the project, 
usually offer such guarantees which can be only dreamt of in India. However, there is always 
a dark side of things and China is full of them. Chinese leadership seems now to be less 
willing to give the same incentives to the foreign investments as in the past and the same 
bureaucrat, who once gave a green light to starting your project can later demand for bribes to 
keep it going.   
More generally, it is true the Chinese regime is much more repressive than other (non-
communist but also communist) authoritarian regimes in Asia (except North Korea of course). 
The political oppression in China impacts seriously the social conditions of Chinese citizens 
turning them often into the modern slaves who are being exploited in the name of Chinese 
capitalism. The rich-poor differences are rising extremely; the poverty and social unrest are 
boosted by the strict rules and repression (prohibition to move to the cities, the one child 
policy, etc.). It is paradoxical to see a communist country, which declared to create a just and 
egalitarian society, allow for severe capitalist exploitation of her population (in order to 
ensure profits for its new economic elite.) Such a situation seems to be unsustainable, but not 
by virtue of the Chinese citizens’ “lust for democracy” but rather due their lust for reasonable 
living and social conditions. To some extent, the Chinese communist power is sawing off the 
branch it is sitting on.  
 
 
     
 
    
   


Chinese mix of communism and wild capitalism is unsustainable

Abstract

Similar works

Full text

Available Versions

Policy Documentation Center