It is a mistake to think of China as being in a transitional stage politically. The China the world sees now is the one that will exist for at least the next decade, and quite likely well beyond that. In almost every area of governance, reforms are under way, aimed at improving official China’s performance, making it more responsive and flexible, more effective and resilient, and better equipped both to protect and project the national interests. Some reforms will lead to an increase of freedom, but others will lead to tighter oversight. The overall goal will remain the preservation of official China’s current system, not its replacement.
This creates something of a challenge for the nations of the West. Ever since the collapse of the Soviet Union, Westerners, and Americans in particular, have assumed that multiparty democracies and laissez-faire markets will eventually triumph worldwide. The global financial crisis may have shaken this conviction, but it hasn’t fundamentally altered it. China’s development trajectory, however, suggests there is an alternative: countries can build a powerful economy by allowing market forces a sizable, but ultimately limited, role, and popu-
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OFFICIAL CHINA
lations can support the government and economy without being granted political representation.
Whether this is a model for others to emulate is debatable. It is deeply rooted in China’s specific economic and social conditions, so it may not be easily transferable. But official China believes that there is no reason to change political systems, and most of the Chinese people agree with them. In their eyes, the system works; it may not be perfect, but particularly since the early 1990s, it has delivered. The living standards for the vast majority of the population have risen (in some cases, enormously), and personal freedoms and opportunities have grown to an extent unimaginable a generation ago. While many Chinese criticize the Communist Party in their daily conversations, in the same way that Americans casually criticize American political parties, they believe that their country is reemerging as a global power in large part because of the guidance that the Communist Party exercises over society; and that the party’s influence throughout Chinese society is a desirable factor, if not a prerequisite of China’s continued development.
This does not mean that the Communist Party will be fully immune to external change in the future. The rise of personal freedom and enabling technologies, such as the Internet, will result in the increased scrutiny of leaders and their actions at all levels. And with the world becoming ever more interconnected, not just economically, but also politically, other external pressures will appear that are difficult to fully foresee today.
And in some ways, China’s strong central control may prove to be a boon for the West. For instance, with regard to climate change, official China’s ability to unilaterally impose strict environmental controls may give it an advantage over Western nations, which need to secure the consent of electorates.
For business leaders, negotiating relationships with official China will require a depth and subtlety of understanding that goes far beyond the sloganeering that characterizes much discussion of China’s politics. It is a mistake to let the authoritarian side of China’s political
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system block engagement with the Chinese government. Instead, businesses should keep an eye on the two balancing acts that Chinese leaders must maintain. Domestically, they have to respond to people’s needs and desires while attempting to shape them; internationally, they must be engaged with other countries while protecting their own sovereignty. Although the Communist Party may remain invisible to most visitors, it continues to be omnipresent. As it moves toward a rule whose resilience is based more on responsiveness than repression, it may well create a new form of government entirely: an omnipresent, benign, market-supporting, outward-looking, business-enabling authoritarian regime.
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CHAPTER 5