Teaching Comparative Government and Politics

Thursday, August 15, 2013

Confucius with Communist characteristics

John Delury, writing in Foreign Affairs, suggests that Chinese economic policy has more to do with morality than with economics.[Many thanks to K. Sue Witmer, who teaches in Manchester PA for recommending this article.]

Austerity with Chinese Characteristics

This year, to the consternation of the world’s luxury-goods producers, “austerity” became one of Beijing’s most prominent political buzzwords. Since becoming head of the Chinese Communist Party last November, Xi Jinping has announced a steady stream of belt-tightening measures… It’s only natural that Western commentators have been quick to interpret China’s austerity drive in terms of their own long-running debate about macroeconomics… politicians and economists are arguing the economic merits and drawbacks of budget-cutting and deficit spending.

But it would be a big mistake to interpret Xi’s ban on shark-fin soup as an extension of… the West’s “turn to austerity” since 2010. Whereas Western austerity has been an economic policy tool, in China its essence is primarily political. China has a long history of turning to frugality not to stimulate business confidence but, rather, to combat the disease of corruption. It’s safe to say that Xi has been thinking less of Milton Friedman or John Maynard Keynes than of China’s own political reform tradition, stretching from Confucius to the Communists.

Confucius?

The Confucian approach to ensuring virtuous government through frugality has been a consistent thread in Chinese politics well into the modern era… Mao demanded that Communist Party cadres reject the slightest hint of bourgeois comfort, including by wearing a uniform of a nondescript Mao suit… he was effective at creating the perception that the Communists were incorruptible, in stark contrast to the Nationalist Party’s reputation for graft. As Confucius would have predicted, this helped the Communists win the “hearts and minds” of the people.

This is a standard trope among Chinese reformers going back to Sun Yat-sen and Feng Guifen, who argued that elections and representative assemblies would reduce the distance between the people and the government, and thus tighten the bonds of the nation. Xi too wants to keep the people close to the Party, but to do so through austerity, not democracy.

It is clear, then, that Xi sees a lot more at stake than mere GDP growth; austerity implicates the very future of the polity. The Communist Party wants to win the “people’s trust” with top-down anti-corruption campaigns based on austerity exhortations, as well as punishments for high-profile officials who get caught with their hand in the cookie jar… To put it bluntly, whereas in the EU and United States the alternative to austerity is stimulus, in China austerity’s alternative is democracy.

In this light, it is worth remembering that the last major challenge to Communist Party rule -- when millions of Chinese occupied Tiananmen Square in the spring of 1989 -- centered on two popular demands: more democracy and less corruption… This helps to explain the real significance of Communist Party austerity, and why Xi has made fighting corruption from the top down a centerpiece of his agenda.

In the short run, it may be easier for the party to try to discipline itself, and to regain public confidence by catching the “tigers and flies” who abuse power at the people’s expense. But in the long run, Xi might find that the burdens of this top-down, self-policing approach are too much to bear for Beijing's most powerful. The only sustainable solution for deeply rooted corruption will likely be to strengthen democratic mechanisms and civil society organizations, and empower the media and the courts, so that top-down discipline is matched with bottom-up accountability. Whatever austerity's merits as an economic policy, as a method of political reform, it will probably soon reach its limits.