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December 27, 2019

The most important year of the decade is the one that is just ending. The struggle that will most deeply shape the global scene in years to come is not occurring in Britain, the US, Europe or any Western country. It is underway in Hong Kong, where a popular demand for democracy is confronting the immovable power of the world’s most highly developed authoritarian state.

It is a struggle no government wants to see escalate. More realistic than its Western counterparts, the Chinese leadership shows few signs of believing the conflict can be definitively resolved any time soon. Incremental concessions and large-scale repression both carry high levels of risk for Xi Jinping’s regime. The ideal end-state for Beijing is probably long-term containment. But the situation in the former colony is not stable, and it is difficult to exaggerate the impact that suppressing the protestors by force would have on China’s position in the world.

It is often pointed out that Hong Kong’s economic importance has dwindled with the rise of mainland cities such as Shanghai. But this leaves out how much two-system governance shapes global perceptions of China and its future. Xi’s progress towards a neo-totalitarian surveillance state has deflated the Western elites’ confidence that China is on a path of slow evolution towards liberal democracy. Yet the fantasy still lingers. The likelihood that China will be an authoritarian great power in any realistically imaginable future is too disturbing to contemplate.

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2019: the year the West wised up to China

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It is worth recalling the comforting tale on which Western governments have modelled China’s development. The country was getting rapidly richer, and while average incomes remained low by international standards, the middle class was steadily growing. This process of embourgeoisement would lead to stronger demands for democratic freedoms, and China would become ever more like the West. Embedded in practically every Western government and regularly invoked by the Western businesses that operate in China, this is a story with almost no basis in reality.

It is true that the rise of the middle classes in early 19th-century Europe coincided with an expansion of liberal freedoms in some countries. This was the main thrust of Marx’s analysis of bourgeois democracy. (A little-noted aspect of recent liberal thinking is that it relies heavily on a crude version of Marxian class analysis.) But there is nothing in the historical record that says the middle classes are inherently a force promoting liberalism. In the late 19th century, they backed the restoration of monarchy and empire in France and militarism In Prussia. In the early 20th century, large sections of the European middle classes embraced ethnic nationalism and then fascism. There was not much sign of the freedom-loving bourgeoisie in interwar Europe.

While it is so far less developed, a similar pattern of bourgeois support for illiberal politics has emerged in many European countries since the collapse of the Soviet Union. Across the continent, far-Right parties enjoy the support of significant sections of the middle classes. In America, Trump’s constituency includes many from precarious middle income groups.

So, the linkage between the middle classes and liberal values is tenuous throughout Western countries. In the UK and other English-speaking countries, it is middle class students, professors and administrators that have shut down freedom of inquiry and expression in higher education. Woke capitalism and much of the mainstream media are continuing this trend. Threatened by what they call populism, bourgeois liberals have ditched the values that once defined them. Far from being a universal law, middle class support for liberalism looks like a brief historical accident.

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Another version of the story about China inevitably evolving towards liberal values focuses on those values’ role in underpinning prosperity. In this view, which is still received wisdom among mainstream economists, state-directed economies cannot sustain the continuous economic growth that is necessary for political stability.

Once again, this has little basis in reality. Central planning in the Soviet Union and Maoist China was a disaster, but from a longer historical perspective, dirigiste economic management has done remarkably well. Before the Great War, tsarist Russia had one of the fastest growing economies in the world. During the Meiji Restoration (1868-1890) Japan industrialised without importing anything like free markets or individualist values. The four Asian tigers — Hong Kong, Singapore, South Korea and Taiwan — all displayed dirigiste features during their most rapid periods of development.

At this point, liberal economists invariably invoke a theory about stages of economic development. Dirigiste methods may work in emerging economies, they tell us, but underperform as economies become more mature. Continuing growth requires rapid innovation in technology and business models, and this is impossible when economic life is state-directed. A flourishing knowledge-based economy necessarily requires political freedom.

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Why this must be so is never explained. China is matching or surpassing Western countries when it comes to AI, robotics, bio-science and other areas of science and technology. Why shouldn’t this state of affairs continue? Economists reply that China’s lead will shrink if the tilt to authoritarianism continues. In that event, economic growth will slow, and the legitimacy of Xi’s regime will dwindle. Unless liberalising reforms are introduced, the regime will eventually implode.

This a confession of faith, not an empirically-based prediction. There has never before been an experiment like that which Xi is conducting at the present time, so there are no precedents on which to ground a forecast. Economic growth may slow as China becomes more authoritarian, or it may not. Even if it does, the regime may not lose much in popular support. Anti-Western nationalism and a state cult promoting the superiority of Chinese civilisation may compensate for a slower rise in living standards.

The condition of Western countries will be important. If they are politically gridlocked, ravaged by culture wars and backward in science and technology, Xi’s regime could credibly claim superiority in meeting the needs of a modern population. To be sure, there would be little or no freedom of expression or privacy. Troublesome minorities would suffer hideous repression. But for the majority, China would be a real-life version of Huxley’s brave new world, in which dissent is engineered out of existence. What reason is there for thinking such a system could not survive Xi and last for decades?

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A digression on Russia may be useful here. To include Putin’s regime in the same category as Xi’s betrays deep confusion. Both are authoritarian and increasingly anti-Western, but that is pretty much all they have in common. It is not only that one is a fast-shrinking economy, the other an economy that is advancing and expanding. The power structures of the two countries are very different.

Xi’s China is a high-tech totalitarian regime governed by the disciplinary institutions of the Communist party. His is not the collective communist leadership practised in China in the past; it is more like Stalin’s style of governance, though less sanguinary. But China retains an institutional backbone in the party, while Russia is a semi-failed state kept going by deals among oligarchs brokered through Putin. Even if Xi’s regime were to flounder, it would almost certainly be replaced by another authoritarian order. Post-Putin Russia could conceivably enter a protracted period of instability or near-anarchy.

There is a deeper difference between the two countries, which brings us back to the crisis in Hong Kong: they are anti-Western in very contrasting ways. Under Putin, Russia has abandoned any Westernising of the kind that was attempted by earlier leaders, from Peter the Great to Lenin, Stalin to Gorbachev. This anti-Western stance may come from personal pique at having been deceived by Western promises not to encroach on Russia’s near-abroad, made to Putin by Western governments during his early years as president. But the assertion that Russia embodies a separate civilisation in a time of Western decadence — which he has often made — is not novel. Though Putin is too much of a realist to be a mystical Slavophil, the tenor of his thinking would be congenial to Dostoyevsky and was welcomed by Solzhenitsyn.

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If Putin has turned away from emulating the West, Xi’s stance is more ambiguous. His is a regime indebted to the West in many ways. Xi’s surveillance state originates not with Confucius or Lao Tse but the 19th-century British Utilitarian Jeremy Bentham’s Panopticon, a design for a rational prison. Where Russia belongs in the Counter-Enlightenment, China exemplifies the illiberal Western tradition of enlightened despotism.

On visits to China, I have found regime-friendly intellectuals studying Western thinkers as diverse as Edmund Burke, Alexis de Tocqueville and the Nazi-era jurist Carl Schmitt. What these intellectuals are looking for is not a universal model, but guidance in navigating China’s path through the world. In the West, Enlightenment universalism is a continuation of monotheism. There is no indigenous monotheist tradition in China. Daoism may posit a mystical nothingness underlying the universe, but nothing like a transcendental God laying down morality for all of humankind. The secular evangelism of the Enlightenment is as alien to Chinese traditions as the Christian mission of universal salvation.

What has the absence of monotheism in China to do with the crisis in Hong Kong? Quite a bit, in fact. Beijing is not advancing a “Chinese model” as an alternative to liberal democracy. Provided other countries respect Chinese power, China does not care what type of government they practice. Xi may have founded Confucius institutes throughout the world, but they promote the innate superiority of Chinese culture rather than any missionary campaign of conversion. China has shown no signs of wishing to govern the countries that it has succeeded in incorporating into its global sphere of influence. Whether it be in Africa or Australasia, local politics are relevant only inasmuch as they impact on China’s interests. Xi’s China is unquestionably an imperial power, but it is not driven by any civilising mission.

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The implications for Hong Kong are reasonably clear. A large-scale crackdown would negatively affect global perceptions of China, but Beijing will assess the damage in strategic not ideological terms. The cost would include capital flight to Singapore (which is already underway), reduced foreign investment on the mainland and a significant setback in global stock markets. It is these risks that hold Beijing back from deploying heavy-duty force.

What a major crackdown would do to China’s human rights record is of marginal significance, if any, to Beijing. It is the West — not China’s leadership — that has been beguiled by a theory of development in which the final stage is a liberal democracy that protects individual freedom.

China will crush protest in Hong Kong when it concludes that the costs of doing so are less than those of letting it rumble on. Factored into its calculations will be the fact that major instability in Xi’s regime would have highly disruptive consequences for Western economies. Sooner or later, Xi will conclude that mass repression in Hong Kong will bring little lasting danger to his regime.

For China, 2019 was just another year. For the West, it was the year in which its illusions regarding China’s political future began finally to unravel. The belief that China is evolving to become what the West once imagined itself to be is already history.

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  • September 11, 2020
    As usual, an interesting and I think, realistic, analysis of some of the strategic possibilities involved... Thank you Mr Gray. Read more

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