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The China Fantasy: Why capitalism will not bring democracy to China

Monday, 21 June 2010.

by James Mann (Penguin Books, 2008, 126 pages)

Reviewed by Vincent Kolo

This short book makes an important and until recently quite rare contribution to the debate over China’s future. James Mann, former Beijing correspondent for the Los Angeles Times, helps to demolish one of the biggest myths in global politics – that the capitalist ‘market’ is set to bring democracy to China. Employing a polemical style, Mann shows how Western capitalist governments and especially successive US administrations have deliberately fostered this false idea in order to safeguard their lucrative business deals with the dictatorial but market-friendly Beijing regime. This is not a left wing analysis. At a guess, Mann stands somewhere in the middle of the bourgeois political spectrum. But with its merciless critique of the hypocrisy of capitalist governments and “business elites”, this book should play a very useful role in the ongoing discussion and struggle for democratic rights in China and Hong Kong. Chinese pro-democracy activists, many of whom unfortunately have illusions that Washington and the capitalist “international community” are on their side, should find this book a wake up call.

While there has been a phenomenal expansion of capitalism in China and integration into the global market including capitalist organs such as the WTO, IMF and G20, there have been no significant steps to relax authoritarian rule. If anything, the opposite is true. State repression is currently worse than at any time for fifteen years. Prison sentences for dissidents are getting longer as shown by the 11 year sentence meted out to writer Liu Xiaobo last December, and the five year sentence imposed on earthquake activist Tan Zouren in February. Liu Xiaobo is a prominent example of someone who mistakenly advocates capitalism as the way to achieve democracy. If he read Mann’s book he would perhaps realise he has fallen into a political trap by taking US politicians’ statements at face value.

This is “not a book about China itself” admits Mann. It is about what he calls “the China of the elites” – the view of China from governments and corporate headquarters around the globe. This can be summarised as putting business first and largely avoiding issues such as human rights and democracy that could upset the economic relationship with China’s leaders. To justify this stand the capitalist elites abroad have promoted the “claim that democracy will come inexorably to China someday, far off in the future, through the workings of broad historical forces and the magic of trade,” says Mann.

An example of this approach came from the former British Prime Minister Tony Blair, who during a 2005 visit to Beijing told reporters without offering the slightest evidence that “there is an unstoppable momentum” towards democracy in China. Mann’s book shows that such arguments are fallacious. He shows how top US capitalists like Maurice Greenberg, the former chief executive of AIG, went to incredible lengths to shield the Chinese regime from attacks over human rights in the US Congress that could have jeopardised trade and financial ties. Then of course there is the extensive role of US internet and technology companies in helping to create the hi-tech censorship and surveillance systems used by Chinese police. A gigantic business lobby has been built up in the US to insure that each administration follows policies conducive to what has become a highly lucrative relationship without getting “side-tracked” over the continuing operation of a brutal dictatorial system in China. Such reasoning is not exclusive to China of course. Although Mann does not mention this, US capitalism supports a host of dictatorial regimes – Saudi Arabia and other Gulf States for example – to further its own strategic and economic interests.

Top jobs in China

Mann lists a host of former top political figures who profit from the connections they built up with the Chinese government and business elite. “The proclivity of American officials to refrain from public criticism of China’s repressive system is reinforced all the more by the influence of money,” says Mann. Henry Kissinger, who made the historic visit in 1971 that opened US diplomatic links with Mao’s regime, started this trend, becoming a dealmaker for US corporate leaders. But nowadays according to Mann, Kissinger “stands out in his consulting work only because of the size of his fees.” This list includes Samuel R. Berger, Madeleine Albright, William Cohen, Mickey Kantor and Carla Hills, all from the Clinton administration, and Brent Snowcroft, who was George H. W. Bush’s national security advisor. Charlene Barshefsky, who as Bill Clinton’s trade representative negotiated China’s entry into the WTO, later became head of the China team at a top Washington law firm.

Collectively the US establishment peddle what Mann calls a “soothing scenario” that democracy will emerge automatically in China as a result of capitalist economic ties, and this, irrespective of the wishes or actions of China’s one-party state. This argument has completely dominated official policy towards China in the US, EU and elsewhere. One of its most outspoken enthusiasts is New York Times columnist Thomas L. Friedman, whose book The Lexus and the Olive Tree stated that “China’s going to have a free press. Globalization will drive it”. It is now ten years since that prediction was made!

Mann explains how this official mantra developed after the massacre in Beijing in 1989. He shows how US presidents from Nixon onwards, both Republican and Democrat, have adopted a largely unchanged position on China. During the so-called Cold War of intense rivalry between US capitalism and the Stalinist USSR, US administrations turned a blind eye to dictatorial practises in China on the grounds that it was a key ally against the USSR. The vicious anti-communist Ronald Reagan came up with the genial term “this so-called communist China” to explain his own government’s close ties. Under Reagan, the US and China cooperated among other things in funding and training the forerunners of the Taliban and al Qaeda fighters in Afghanistan in order to inflict defeat on the their common enemy, the Stalinist bureaucracy of the USSR. But following the 1989 Beijing massacre and the collapse of Stalinism internationally, Washington needed a new rationale for its intimate dealings with the Chinese dictatorship.

The new line began to emerge during the presidency of George H. W. Bush, who had served as head of the US liaison office in Beijing in the 1970s (before an official embassy was opened). The relationship was tested when over 1,000 youth and Beijing citizens were massacred on 4 June 1989 as the regime of Deng Xiaoping crushed the mass Democracy Movement. “Although Bush had announced in public a freeze on high-level contacts between American and Chinese officials, he secretly sent Brent Snowcroft to Beijing for talks with Deng Xiaoping in July 1989 and again five months later. After the visits were criticised, Bush explained that he didn’t want to isolate China,” Mann explains. Official US protests over the massacre and subsequent crackdown amounted to little more than a ‘blip’ in relations, which quickly refocused on the huge economic gains to be made through mutual trade and investment.

Similar hypocrisy towards repression in China characterised Bill Clinton’s presidency. As a candidate, Clinton had alarmed Beijing by denouncing Bush’s China policies and presenting himself as “an American that will not coddle dictators, from Baghdad to Beijing.” But this was just for the campaign trail. Once elected, Clinton became “the central figure in developing America’s post-cold war approach to Chinese repression”, according to Mann. It was Clinton; by manoeuvring to block Congress legislation that would have linked trade deals to China’s human rights record, who cemented a series of far-reaching agreements with China that culminated in China’s membership of the WTO in 2001. “The turnabout on China – combined with Clinton’s support for the North American Free Trade Agreement – solidified the close link between Clinton’s Democratic Party and the business community,” says Mann. These policies were dressed up with the same empty and dishonest platitudes. Clinton predicted that China’s WTO membership was “likely to have a profound impact on human rights and political liberty.” Yeah, right! George W. Bush also followed a similar pattern. As a candidate, Bush famously labelled China a ‘strategic competitor’, but as Mann shows, “Bush himself never used the phrase ‘strategic competitor’ after he was sworn in”.

The Emperor’s new clothes

Every administration since Bush the elder has fostered the idea that capitalism will bring democracy to China as an inevitable historical law. Mann’s book is akin to the boy in Hans Christian Andersen’s fable of the Emperor’s New Clothes, showing that this entire political wardrobe is a fiction:

“The elites need to keep Chinese wage levels low, so that the foreign investors keep on flooding into China. They have an interest in repressing political dissent so that the country looks quiet and stable to prospective investors. Needless to say, the Chinese business elites strongly support perpetuating the existing state of affairs for as long as possible. Similarly, American elites are content with the status quo. It enables American firms to shift manufacturing operations to China, where labour costs are low and corporate leaders don’t have to worry about independent trade unions.”

This argument is still broadly correct today, despite the Chinese regime’s attempts to stimulate domestic demand as a counterweight to falling exports and a more precarious global environment. The small steps in this direction have only touched a relatively narrow layer of the urban population. There is big resistance from factory owners and government officials at local and regional level to any general policy of wage increases for production workers. A recent survey for the 2010 National People’s Congress (NPC) showed that almost one in four Chinese workers have had no pay increase for five years.

Mann poses the question what would follow in the event of a collapse of the current ‘communist’ regime. Correctly, he places little hope in the democratic potentialities of China’s new bourgeois class, warning it “might choose to align itself with the military and the security apparatus to support some other form of authoritarian regime, arguing that it is necessary to do so to keep the economy running.”

Mann echoes criticisms that socialists and chinaworker.info have levelled against those politicians who repeatedly speak about the ‘rule of law’ as if this in itself represents a democratic advance: “The strongest impetus for the establishment of the rule of law comes from the corporations and investors that are putting their money into China. They need established procedures for resolving financial disputes, just as companies and investors require everywhere else in the world. It is in the interest of the Chinese regime to keep the investment dollars, euros, and yen flowing into the country, so Chinese officials are willing to establish some judicial procedures for the foreign companies. However, the result could well be a Chinese legal system that offers special protection for foreign investors but not to ordinary Chinese individuals...”

Demolishing the ‘Starbucks theory’

One of the most famous contributions on the theme of capitalism’s alleged democratising role was authored by New York Times columnist Nicholas D. Kristof, who in 2004 launched the ‘Starbucks theory’. According to Kristof, more western investments would bring more demands for ‘bourgeois’ democratic freedom in China: “No middle class is content with more choices of coffees than of candidates on a ballot.”

It is a common fallacy of capitalist commentators to see the middle class as the main force for democratic change in society. In fact in most advanced capitalist ‘democracies’ the most important civil and democratic rights have been won by mass pressure especially from the organised working class. Rather than the leading force in great social movements, the middle layers in society such as the urban petit bourgeoisie and the peasantry tend to play a supporting role, throwing their weight behind one or other of the main classes in society, the working class or the bourgeoisie. As is shown by the mass revolutionary movements against dictatorial capitalist regimes in South Africa, Iran, South Korea in the last three decades or more, while university students and other middle layers also displayed great heroism it was the organised working class that played the decisive role in shattering these regimes. Unfortunately in all of these examples, without the political weapon of a mass socialist party with a programme to abolish capitalism the working masses were robbed of the full fruits of these political transformations.

While Mann himself evidently does not see the role of the working class in this light, he nevertheless correctly poses the question, “is it possible that China’s middle-class elite will either fail to embrace calls for a democratic China or even turn out to be a driving force in opposition to democracy?” He points to the overwhelming poverty that still dominates the countryside where over 65 percent of the population live. The middle class, who’s spending as new homeowners and car buyers we read about all the time, are a relatively small slice of China’s population. Conjuring up a scenario not so far removed from the recent crisis in Thailand, Mann argues, “If China were to have nationwide elections, and if peasants were to vote their own interests, separate from those of the Starbucks sippers in the cities, then the urban middle-class would lose.”

But lacking a Marxist analysis, the book fails to distinguish – and it is a vital distinction – between the broader layers of the urban ‘middle class’ on one hand, and what Mann on the other hand calls the ‘middle class elite’ and sometimes the ‘business elite’ – an obvious reference to the capitalist class that has emerged over the last fifteen years in particular. This terminological muddle leads him to exaggerate the Chinese regime’s social reserves. While, as he points out, the capitalist ‘business elite’ favours the authoritarian status quo as the best way to make profits and keep the working class in a state of disorganisation, the outlook of the middle class in China is far more volatile and in a variety of future scenarios – such as a serious economic downturn – could move decisively into opposition to the regime, especially if a lead is given by a combative workers’ movement.

There is much in Mann’s book that socialists would take issue with, such as his repeated description of the Chinese state as “Leninist”. This is an uninformed use of this term, to put it mildly! During the era of the Maoist bureaucratically planned economy, China’s ruling party modelled itself on Stalinism, a system of top-down dictatorial rule that emerged from the physical destruction of Lenin’s revolutionary party by Stalin and his privileged officialdom. Of course, China’s leaders said they were ‘Leninists’, falsely claiming this as a justification for operating a bureaucratic one-party system. But Bush and Clinton claimed they care about human rights. Mann of all people should not take politicians’ statements at face value.

The main weakness in Mann’s view of China is that, while seeing through the hollowness of capitalism’s claim to bring democracy, he does not see a way out of this situation and especially does not appreciate the huge potential of Chinese workers to challenge the regime and create an alternative. Workers’ organisations, currently illegal but unstoppable under conditions of political crisis and mass eruptions, would with the right ideas and programme pull behind them significant sections of the urban middle classes as well as the rural masses. To bring about a decisive change from the current regime this movement would also need to settle accounts with capitalism, replacing it with democratic socialism, something that is outside the framework of Mann’s book.

The value of this book is in showing clearly why the democratic-capitalist ‘China fantasy’ is promoted so systematically by political and corporate leaders: “The Chinese and American elites share a common interest in the existing economic order... The business communities of China and the United States do not harbour these dreams of democracy. Both profit from a Chinese system that permits no political opposition, and – for now, at least – both are content with it.”

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