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An article in the Epoch Times (behind a paywall) talks about China's cycle from Deng Xiaoping to Xi Jinping and its implications for the future of China:
Some 50 years ago, when China began its remarkable period of development, then CCP leader Deng Xiaoping described development realities as a phase in the nation’s journey to a more perfect socialist future. It worked. Chinese enterprise flourished, the economy grew at a phenomenal rate, and millions were lifted from poverty. This description of what China was doing implicitly forecasted its own end, that at some future date, the country would become more socialist. Some have described Deng as cynical, saying that he used his characterization simply to get around communist ideology. Others say that he sincerely meant what he said. It matters little now. The man has been dead for years. What is clear is that the current leader, Xi Jinping, seems to have taken Deng’s phase narrative on board and that it is about time for China to take the next step into a more socialist phase of its political-economic life. Acting on that belief, he has done considerable economic harm to his country.
Xi is demonstrating that you can have a robust economy or you can have communism/socialism, but you can't have both. Embedded in the genius of capitalism is the individual, their freedom to decide and act independently, and in the aggregate have the free market decide winners and losers. Communism/socialism does not feature any of that. Like Deng, you can relax state control in some measure in any of those variables and get positive economic benefits. Like Xi, you can increase state control, but you will lose the economic benefits.
This was predictable for a long time. It has been known ever since Adam Smith described it in 1776. Amazing how men of that time saw things that were true in all times and societies. And so it was that those who favored trading with China in the hopes that it would democratize China were not entirely wrong. But they failed to understand that with the West coming to favor corporatism and more central control, it masked the actual progress and likelihood that China would be "pacified" through trade.
At this juncture the odds favor the West being less free, less truly capitalistic, and that China will become more free and more capitalistic. Capitalism is the economic expression of natural rights. The West has largely abandoned that understanding and we will all be poorer as a result.
Discussion (14)
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Excellent post. Especially reminding us that we are drifting more towards the Chinese system than sustaining and growing our own free system.
The problem is, in the West, the people who control every single institution, want communism.
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I am someone who very rarely uses the word "never," because never is a long time. But I declare that this is an eternal struggle and will never be settled once and for all. Regardless of all of the examples history provides us just in the last hundred years (East vs West Germany, North vs. South Korea) it seems to be human nature to think that governments know better than individuals, and should set prices, direct industries, and encourage people to do this and discourage them from doing that. It's not an American problem or a Chinese problem, it's a human problem. Even people who agree with the free market in principle can probably rationalize why they are an exception and the government should interfere in the market to help them.
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In more basic terms, many people believe THOSE OTHER people must be controlled, but not themselves, of course.
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True and true. Capitalism is how people naturally behave when there is no government or power imbalance, and specialization is limited but real. Government should be there to check power imbalances. Increased specialization is a knowledge/skill imbalance and invites government regulation for health and safety reasons. John Adams said our form of government required a moral people. The same can be said for capitalism.
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