Duly Noted – Can Tyranny Survive Capitalism?

 There is a connection between political and material advancement.




In its last posting, Duly Noted reacted to a new catchphrase of the Left. The words that provoked the riposte were “can democracy survive capitalism?”


The response emphasized that the suggested incompatibility is a verbal trick. Freedom, as a system, cannot prevail without a matching economic order. That means laissez faire. Attempts to abolish the capitalism of individual holders will not produce a capital-free order. State capitalism is the achievable alternative. With the added economic means that order will complete total dictatorial control. Elites convinced of their moral superiority are tempted to welcome such an arrangement.


A special connection between concentrated economic and political power could not be included into the original essay. It was the crucial case of Mainland China that needs examination in a context that connects liberty and capitalism. Insert into that thought a “while maintaining single-party dictatorship”.


From the modern perspective, we find a correlation between dictatorship and backwardness. At the dawn of what is by Western reckoning the Modern Era, we find tyrannies that have supported progress. The case of the “Enlightened Despots” comes to mind. So do “Prussian reforms”. Peter the Great applied old-fashioned autocratic power to modernize his reluctant Russia. The motive of reforms by fiat was not the improvement of the lot of the common man. The goal was to enable useful subjects to bear the burden of expansion to dominate the region, and in the 20th century, the world.


The pursuit of power being its motor, modernization was wanted not for the sake of the subjects but for its military consequence. Through this process the “soldiers” became the most “modern” component of left-behind societies. Modernization pursued to attain more clout meant that, the updating would be followed by aggression and expansion. In Europe, Prussia’s and Russia’s example illustrate this. Japan’s modernization during the Meiji Restoration – in reality a power-oriented revolution from above – fits the pattern. We may add that Ataturk’s measures were also reactions to weakness and a nationalist resistance to humiliations. It is to be underlined that democratization has not been the motive of accelerated modernization ordained from “above.” In practice, increasing efficiency and augmenting freedom are separated entities.


Admittedly, the modernization initiated from “below” by society, enabled a middleclass to rise. These efforts were not only progressive in intent but also “democratic” in their effect and augmented the international might of the state. America’s rise and England’s role as a world power are suitable examples.


China’s modernization is unfolding. Notable is that it happens in response to the will of a single party dictatorship. The power monopoly of the Party is not based on a majority but is justified by political orthodoxy. It does not matter that this orthodoxy cannot invoke centuries as its precedent. The ruling orthodoxy is legitimized by a modernistic secular faith, namely Marxism.


Marxism sold itself as an answer to industrialization’s problems and was meant to show the way to the perfect social order based upon material progress. In reality, Marxism made bad economics into a dogma. Regardless of its claimed progressiveness, where it became state doctrine, it cemented backwardness and hindered development. By this standard, the ultimate Marxist society is found in North Korea’s praxis. If we extrapolate from Communism’s record, what has evolved and continues to evolve in China is rather unexpected.


China combines a tyranny with progress through state controlled capitalism. Unusual is that China’s economy is internationally competitive. A reminder: German National Socialism combined totalitarian power with reliance on an inherited advanced economy. Thanks to the limited freedom of enterprise, the Nazi’s approach resulted in a highly competitive military economy. Peking’s stash of America’s debt substantiates the claim of success – even if abetted by an American majority’s consent to bankrupt the country.  We are left here with the image of an authoritarian system that modernizes in order to improve its bite. This juncture demands a caveat. Knowing history provides useful precedents to hone judgments. However, understanding history demands that the shift of the fundamentals be recognized.


Contemporary modernization requires new qualities. From a work and resource based economy we have gone to a skill and innovation based one. Originality, flexibility and entrepreneurial skills are crucial. China’s success is the result of a mixing capitalism and dictatorship. This raises the question, whether the required capitalism is compatible with the dictatorship. China’s leadership, as affirmed lately, is determined to maintain a one party-system run according to the matching centralistic blueprint.


This concept demands the coexistence of the authoritarian political system and the increasingly free market oriented economy. This ignores the difficulty of indulging in two things at the same time. One is a social-economic order that develops by efficiency-derived free market-inspired rules. The second one is political system whose ticking mechanism is driven by springs that contradict the forces that move the economy. The image the discrepancy creates is an odd clock. Its two hands are driven by dissimilar mechanisms and are made to turn in different directions.


Post-Mao modernization has served China well as a country and so she has gained global weight. Millions of Chinese have earned a life of relative luxury and a multitude could develop the hope to share that good life. Ultimately, this process will make the present’s controlled transformation by tutelage into a self-driven process. As it unfolds, the Party will lose its relevance for those busy climbing up the stepladder of mobility.  Invoking Lincoln, we ask whether in the long run a country be half-free and half-slave?


In time, the Party’s choice could become twofold. It might join the process and adjust its role. That would make its political rule match the increasingly pluralistic system that

evolves spontaneously. The other would be to react to its growing redundancy, to repress society’s threatening autonomous development. As he contemplates the latter, the Chairman of that moment should be reminded of bit of history that remains relevant. Revolutions are not so much the product of brutal oppression but of frustrated hopes.

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