China’s ‘Success Story’ in Perspective

In his latest book, political scientist Stein Ringen compares China’s development with that of South Korea and Taiwan.

“The Chinese story is the greatest success story of our time,” Chinese Foreign Minister Wang Yi said at the 2014 World Economic Forum in Davos. This line is debunked as “a fantasy that has now been told so many times and in so many versions that it is becoming perceived truth” by Oxford University professor Stein Ringen in his new book The Perfect Dictatorship: China in the 21st Century (2016, Hong Kong University Press).

Ringen admits that he is by no means an authority on China. Rather, as a political scientist and sociologist, he has spent the last four decades analyzing states and social systems all over the world. And when it comes to Chinese economic growth, Ringen points out that it has been “in its best times, pretty typical for East Asia.”

Official statistics regarding China’s economy has always been subject to debate. Consultancies like Capital Economics and Lombard Street estimates that the Chinese growth in the past years has been hovering around 4 percent.

Ringen comments on a study from research group Conference Board, which finds that the actual annual growth in years with official rates of about 10 percent have typically been between 7 and 7.5 percent: “Taking the best growth periods from China and other East Asian countries, the study finds China’s growth to fall slightly short of that of South Korea, Taiwan, and Japan.”

More importantly, he highlights that South Korea and Taiwan have become high income countries, whereas China remains a middle income country with vast income gaps and huge class differences. But because of its vast size, China often gets attention for sheer numbers like “lifting 600 million people out of poverty.”

But it’s seldom pointed out that 200-300 million Chinese still live in dire poverty. This, Ringen shows, is largely a result of bad redistributive politics and a regressive tax system. China’s income tax might be low, but by Ringen’s calculations, based on a minimalist principle, a range of hidden taxes and alternative fees makes the actual taxation rate of a Chinese citizen between 55 and 67 percent.

“In its taking, the Chinese state is a highly developed one and second to none in its extraction and taxation. In its giving, it is underdeveloped up against its fiscal and administrative capacity,” says Ringen, who lays out a detailed map of the welfare system, or lack thereof, in China.

As is common practice in socialist states, China takes good care of government employees and the military in terms of social benefits. But marginalized groups such as poor farmers or migrant workers are still second-class citizens, enjoying much less social protections than city dwellers. According to Ringen, this shows how the social welfare system is based on “purchase of legitimacy” — a way by the state to buy loyalty from the groups needed to keep its monopoly on power.

The commonplace Chinese argument that the country needs to get rich before rolling out a nationwide welfare system is seen by Ringen as a “bad excuse.” Yet again, comparisons with South Korea and Taiwan are strikingly relevant. Just like in Ringen’s native Scandinavia, the two Asian tiger economies established an extensive social welfare system at an early stage of development rather than after becoming high income countries.

As a result, South Korea managed to grow its economy without leaving any big groups of the populace behind, despite starting from an even “lower base” than China, the country being in ruins in 1953 after the devastating Korean War.

Apart from redistribution, Ringen states that development in East Asia has been different also in its nature: “China’s modernisation is narrowly economic. In South Korea and Taiwan, modernisation has been comprehensive; economic yes, but also political and social.”

While the Chinese Communist Party was always busy jealously defending its monopoly on power, eliminating non-state institutions in the process, the South Korean government cooperated early on with non-state forces to realize its mission of modernization. Instead of subduing the population with strength and by reflex, the authoritarian regime of South Korea in many aspects worked together with the society before the protests in 1987 that led to democratic reforms.

But in China, the party-state until this day dominates society; the civil service is an organisation of the Communist party, civil society remains suppressed and even NGOs are more like state agencies than voluntary organizations. When nationwide protests erupted in China during the spring of 1989, the absence of a civil society like that in South Korea made it possible for the party to strike back fast and hard.

Like in 1989, the Chinese government today still justifies its monopoly on power by saying that stability is a necessity for economic development. This can, naturally, be argued both ways: democratic reforms might unleash more energy and creativity to sustain healthy growth in the long run, as has been the case in Asia’s tiger economies and beyond.

This is of course mainly subject to speculation, but Ringen nevertheless notes how South Korea and Taiwan managed the transition from autocracy to democracy in a smooth and productive way: “Both these countries chose a path of political opening up, and both have outperformed China in economic development.”

There are other new books, like The Dictator’s Dilemma (2016) by Bruce J. Dickson, that stress the fact that most Chinese are content with the political status quo, both due to gradual improvements and fear of political instability if the system changed.

Dickson reached his conclusion by public surveys. But he forgot to ask a very important question, namely why there are no viable options to a one-party state in China.

The answer is neatly formulated by Ringen: “The [Chinese] regime has given itself the insurance that the party-state has been kept strong and civil society weak, the insurance of fear that there would be nothing but chaos for China to fall back on if the party-state were to crumble.”

This has been done by a costly combination of propaganda and an ever growing internal security apparatus, which Ringen shows as he walks us through the details of repression in modern China. Not even scholars like Dickson can or try to deny the persecution that is taking place, or the fact that the situation has worsened since Xi Jinping assumed power.

But while Dickson settles for calling China a “closed political system”, Ringen even refrains from naming China “authoritarian.” It is much too nice a label! Neither will he call China a “dictatorship” (to unsophisticated and primitive). Instead, he brands the country as a “controlocracy”: an entirely new term justified as the Chinese state has developed to perfection a mode of control ”hard in effect but soft in execution.”

This controlocracy has, in Ringen’s words, “contributed less than it should by its economic and other capacities, less than it generally claims, and less than it is often given credit for.” For is it really the Communist party that has lifted 600 million Chinese out of poverty? Is it not the laborious population of China that has created its own relative well being by hard work, after finally having been liberated from the dogmatic shackles of the cultural revolution and other political campaigns launched by the party?

Out of phenomena such as stability, economic growth, less poverty, more social protection, and modernity, Ringen argues that China’s regime can only claim to have delivered a certain degree of stability. Quite on the contrary, more Chinese could have enjoyed higher living standards were it not for graft, protection of state-owned enterprises and an internal security budget that is in fact bigger than that of the military.

Or, as Ringen puts it: “A state that can keep 1.4 billion people under constant Orwellian control and that is perfectly capable of putting 2 million bureaucrats on the job of keeping bad information out of the internet could give the poor and small in society more help and support than it does, if it wanted to.”

While other books in recent years — notably the so called “People’s Trilogy” by Frank Dikötter — have done a good job questioning the legitimacy of the Communist party on historical grounds, Ringen is doing exactly the same thing on the basis of the China’s current social system. “This,” he concludes, “is a state that takes not primarily to serve its people but to maintain itself.”

Being an experienced political scientist, Ringen can’t withstand the temptation to finish the book with a prediction. The Chinese state today seems to work in order to preserve its own existence, rather than promoting an ideology. (Communism, obviously, is an abandoned project.) But should Xi Jinping’s mantra of “The Chinese Dream” take the shape of an ideology, Ringen warns that China could turn into a “perfect facist state.” And no one can tell what might follow.