- The Washington Times - Wednesday, November 16, 2011

The following is an excerpt from “Bowing to Beijing” (Regnery Publishing, Nov. 14, 2011):

One of the most widely believed myths about China today is that market reforms, a growing economy and a purportedly more progressive government are leading to a new age of opportunity. PRC propagandists point out that the country’s middle class has grown from nothing a few decades ago to 100 million or so in 2010. What is left unsaid is that the middle class makes up less than 10 percent of the nation’s population (compared to 60 percent in America), and that the average person still earns a paltry income in China, where per capita gross domestic product (GDP) is just $3,744 (compared to $45,989 in the United States).

Meanwhile, backed by the Communist Party, a new, privileged class is taking root and maturing into an entrenched, hereditary oligarchy. Commonly called “the Princelings,” this elite cabal comprises a small number of families - led by 200 to 300 descendants of the founders of the Chinese Communist Party - and their cronies who maintain a stranglehold on business and government in China. While publicly genuflecting to the notion of a classless, communist workers’ paradise, the People’s Republic has been taken over by an all-powerful aristocratic clique that crushes any competition for wealth or position and is gradually becoming a billionaire’s club. …

Princelings are Communist Party animals, and there’s little doubt that the law of the jungle rules in a modern China run by the party. The powerful Princelings and their cronies are becoming untouchable as they grease the palms of police, prosecutors, judges and other government officials. In February 2011, a Chinese Communist Party (CCP) official was freed from detention without charge or investigation after his 27-year-old wife and two young children were murdered in their home. The government reported the tragedy as a murder-suicide, but the dead woman’s family claimed the communist cadre killed his kin after the wife complained that he was cheating on her. All three were cremated without autopsies being released to the public or even to the victims’ family.

It may seem shocking that blood is spilt among this red version of bluebloods, but it shouldn’t be - in fact, it’s a perfectly logical phenomenon in a system in which descendants of revolutionaries believe their family history entitles them to rule their country. This attitude also imparts a feeling that they and those who serve them are above the law. Despite the official pretensions to a classless society, China’s class system has become so ingrained that Communist Party leaders who don’t have a distinguished family pedigree are derisively referred to as “shopkeepers.” The reference is straightforward - while the millions of shopkeepers work hard and scrape by on small change taken in every day, their overlords are free to rake in the big cash as titans of industry.

While the Princeling clique occupies the economy’s commanding heights, the benefits of China’s storied economic growth do trickle down to some individuals and families. Although upward mobility is difficult, it’s certainly not impossible if one can cultivate the right connections.

The middle class, although still relatively small, has encompassed millions of new entrants in recent decades, while a growing class of businessmen has become bona fide plutocrats. China apologists point to this social climbing to argue that China will become freer once the growing middle class begins demanding political liberty to match its economic freedom. But they have it precisely wrong - in fact, upwardly mobile Chinese citizens are learning to love the Communist Party that has underwritten their success.

“Accepting Authoritarianism,” a book by California State-Long Beach professor Teresa Wright, explains how China’s prospering capitalist class has paradoxically become the strongest bulwark for the communist state. In general, reform is not appealing to Chinese business leaders because they have been co-opted by the Communist Party. No one gets rich without the tacit approval - if not the overt helping hand - of the authoritarian government. The state controls resources, property, labor, permits and everything else needed to operate a business, so businessmen have to play ball with Beijing. Contrary to propaganda about the Middle Kingdom being a new, laissez-faire Wild West where entrepreneurial gunslingers shoot it out in a competitive marketplace, the bureaucracy picks winners and losers in this centrally controlled economy.

Some of communism’s biggest supporters are China’s new millionaires and the white-collar professional class. The status quo in the country is working out well for them, so there’s no reason to rock the boat. Moreover, democratization is not in their interests because it would potentially create untold numbers of new rivals for their privileged positions. From the perspective of corporate titans, political reform would raise operating costs and threaten the bottom line. “Should workers gain the right to vote, they likely would support higher wages and improved working conditions, thus diminishing the profits of private capital,” Professor Wright explains.

The party keeps labor costs in line, which makes firms dependent on the Politburo for profitability. The extent to which entrepreneurs are in bed with party leaders - and the corruption that is part and parcel of the relationship - means big business is opposed to greater transparency in the system because it would expose this unholy alliance.

Economic development in the People’s Republic is centered on intensifying class warfare and class envy among the people. There’s not much to tie the 1.3 billion Chinese together in a common cause or a shared sense of nationhood. The different classes don’t trust one another, and divisions exist across regional and ethnic lines. Country folk dislike urban dwellers, a feeling that’s reciprocated in the cities. These divisions are countenanced by Beijing because they work to the government’s advantage. The only thing that keeps these people together in such a vast land is the Communist Party, which defines what Chinese identity is. For the majority, the party is China. Such societal fragmentation makes it less likely that the populace will unify to protest the regime.

Steps taken by the Politburo after the 1989 massacre of pro-democracy protesters at Tiananmen Square demonstrate how the cadres have consolidated their power. Late CCP leader Deng Xiaoping pushed dramatic economic liberalization, freer markets and foreign partnerships while simultaneously clamping down even harder on political dissent. Although freewheeling enterprise zones in such places as Shanghai and Shenzhen offer material signs of modernization, people in China are less free today than 20 years ago - and party control is less challenged. Affluence and state brutality have tag-teamed the polity to quell opposition. Beijing also has increased social-welfare entitlement expenditures to deepen the population’s reliance on government handouts.

Low public expectations have worked to the party’s favor too. The Chinese regime’s gulags, executions and general contempt for human life are appalling, but compared to Mao’s murderous rule in which tens of millions of Chinese starved to death or were brutalized in work camps, today’s sundry persecutions seem like peaches and cream.

It’s likely that China will continue to become richer without becoming freer, as the Communist Party has moved further away from political reform even as it promotes economic reform. Insisting they are creating a new political-economic model for one-fifth of the world’s population, leaders in Beijing believe they have nothing to learn from Western economies teetering on the brink of insolvency. The communists are doubling down on that bet, with Western consumers bankrolling the wager. The wild card is whether Beijing can keep its economic expansion rolling to match public expectations while handling demographic changes. A slowdown - let alone a major crash like the rest of the world recently experienced - would undermine the myth of communist invincibility. In the meantime, wealth creation stabilizes the party’s grip on power.

Brett M. Decker is editorial page editor of The Washington Times and a former Hong Kong-based editor and writer for The Wall Street Journal. William C. Triplett II is former chief Republican counsel to the Senate Foreign Relations Committee and bestselling co-author of “Year of the Rat” (Regnery, 1998).

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