Category Archives: Development

Is China’s Authoritarian Capitalism Better Than Liberal Democracy?

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(No it isn’t: just like trying to earn a living by gambling is not better than having a salary, even if potential returns are much higher)

Is China’s authoritarian capitalism better than liberal democracy (as “the condition and motor of economic development“)? That’s more or less what Slavoj Žižek, co-Director of the International Centre for Humanities at Birkbeck College, asks in the Letters section of the London Review of Books (Vol. 30 No. 8 · Cover date: 24 April 2008), at the end of a singularly even-handed description of the Tibet-China relationship (that by the way only victims of their respective propaganda machines will believe to be a story of good guys vs. bad guys).

Fareed Zakaria has pointed out that democracy can only ‘catch on’ in economically developed countries: if developing countries are ‘prematurely democratised’, the result is a populism that ends in economic catastrophe and political despotism. No wonder that today’s economically most successful Third World countries (Taiwan, South Korea, Chile) embraced full democracy only after a period of authoritarian rule.

Following this path, the Chinese used unencumbered authoritarian state power to control the social costs of the transition to capitalism. The weird combination of capitalism and Communist rule proved not to be a ridiculous paradox, but a blessing. China has developed so fast not in spite of authoritarian Communist rule, but because of it.

There are a few i’s to dot, and t’s to cross in Mr Žižek’s discourse. First of all, Taiwan, South Korea and Chile became “today’s economically most successful Third World countries” after getting rid of “authoritarian rule“. So from those examples it appears that dictatorship may gestate a successful economy, but more often than not “Authoritarian Rule” transforms itself into a suffocating mother, if not an evil stepmother.

More importantly, China itself is in a sense only the last manifestation of a truism: an (economically) enlightened dictatorship can be much more efficient than the collection of dirty tricks known as democracy. Voltaire likely believed in that, just as Plato and countless others, and even if it does sound like an elitist concept, it is obvious nevertheless. An intelligent, caring, politically and economically wise Prince can decide for the best of everybody in minutes, rather than wasting months trying to convince, negotiate, win over people, perhaps in interminable parliamentary committees.

Such a Prince can also guarantee decades of good governance, truly a blessing for his (or her) people.

There is a small matter though. Say, your Prince is Octavianus Augustus and peace and prosperity is for everybody. Then comes Tiberius, and things start out ok: only, to worsen with his increasing paranoia.

Then you’re stuck with Caligula. And Nero is not too far away either.

Things haven’t changed much in the intevening 2,000 years. The trouble with authoritarian rule, hence with authoritarian capitalism, is not its ability to generate prosperity: rather, its perfectly equivalent capacity to degenerate, quickly because almost without control, thereby hampering the growth of that prosperity if not killing it off entirely.

Speaking the language of the financial world: just like a new CEO can resurrect or destroy a Company, so a despotic Prince (or committee of Princes, aka the “Communist Party of China Central Committee“) is a recipe for increased earning opportunities and, for the very same reasons, for an increase in risk.

And that’s something that should definitely be factored in in any judgement about what to choose as “the condition and motor of economic development“. After all, who wants to continuously gamble all of one’s wealth?

The Death of Climate Change

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G-8 leaders are preparing to go through the motions about “doing something against Climate Change” (presumably, with similar successes as their wars on poverty and drugs). Countless pacts, accords, international conferences have not meant much as yet, and in all likelihood they won’t make any perceivable difference in the future either.

In the meanwhile, the “science” of Climate Change is as clay-footed as ever. A leading IPCC reviewer publicly states “We should respond prudently to the threats from climate change“. The NASA top honcho Michael Griffin commits the cardinal sin of saying the obvious against all “consensus”:

“I’m not sure it’s fair to say that [global warming] is a problem we must wrestle with [...]

I would ask which human beings—where and when—are to be accorded the privilege of deciding that this particular climate that we might have right here today, right now, is the best climate for all other human beings.“

In a further sign that something is amiss, there is not even the suggestion of designing a satellite capable of collecting global data and possibly evidence of global warming / climate change.

GoreSat itself is not mentioned anywhere, despite sitting ready to fly for the past 7 years.

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The above clearly indicates that “Climate Change” as a real issue has died already, or is at a terminal stage.

At best, it has revealed itself as a proxy for something different, at worst a smokescreen, ancillary issue.

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Let’s give everybody involved the benefit of the doubt. What is the real problem they are concerned about, then, if “Climate Change” is just a proxy?

Possible candidates include: (1) the will to counteract the power of global companies by establishing some kind of (toothed) global government; (2) a general feeling tha Humanity must be cleansed of its sins, especially of greed and of disrespect for the Environment; (3) a way of keeping the development of places such as China and India in check, by making their lives difficult with newly-fangled emission caps.

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But the one trouble I am presently more inclined to consider, it’s (4) the worry that there simply are too many humans alive at the same time, and their numbers keep on increasing: at the same time, we have the attitude but not the tools nor the will to provide them all with a decent life.

That’s a much more interesting topic than silly measures of atmospheric carbon dioxide and unreliable, patched-up, secretive historical temperature recordings.

Old World Bank

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An interesting if somehow obvious and subdued debate today on the BBC World Service’s “World Business Review” about reforming the World Bank, the International Monetary Fund, the International Finance Corporation and the International Development Association.

I do not have much faith in any reform at any of those institutions. Just as the UN’s Security Council, they are still stuck in the 1950′s and will keep themselves that way unless some major international crisis changes the lot.

Fact is the whole system has been managed (if not designed) in order to keep the international Order firmly in the hands of Americans and Europeans.

After all it is not far-fetched to say that the whole ideas of “Third World” and “Development” were not with us until the end of World War II, the start of the Cold War and most of all the end of Colonialism.

Why would the Old Boys want to relinquish their control right now? It’s just much simpler to leave things as they stand. “Development” in this respect is a side show, as demonstrated by the absence, after six decades, of any idea on what actually can push a country out of abject poverty (apart from luck, location, and luck of location).