3. Governance Without Governing: The Retreat of Authoritarianism and China’s Economic Boom

• Chairman Mao founded the People’s Republic of China in 1949. During his reign he practically wiped out commercial activities, eradicated property ownership, suppressed capitalistic thoughts, and turned all citizens into members of the state that tried to plan and dictate all economic activity. People were confined to the place where they were born. The results were disastrous as the entire society lingered in a state of stagnation and GDP was near the lowest in the world.
• In 1978 after Mao’s death, a group of peasants in the small village of Xiaogang decided to take a risk and make a secret deal that would allow each to own their farm and to keep all they produced. In essence they brought back the family farm. This experiment was a huge success and they were soon lauded as heroes thanks to the vision of the new leader Deng Xiaoping. The story illustrates the constraining effect of government planning and the liberating power of autonomy that motivates and promotes creativity. As people were allowed to own their own businesses and travel about the country, China started an era of unprecedented growth that continues to this day even though it has slowed a bit.
• China became the world’s factory as Western companies set up shop to take advantage of China’s workforce. The Chinese have also become big time consumers. This was all made possible when the government retreated from planning and regulating. It has also created enough wealth for the government to invest in skyscrapers, a space program, infrastructure, and an advanced military. To accomplish this, China relied to a large extent on innovations originating in the West. The question now is, can China’s education system produce more innovative and creative individuals.

4. Hesitant Learner

• Throughout history, the Chinese have always had a fear of cultural contamination from the West. This has resulted in periods of isolation and lack of progress. The Confucian tradition still runs deep, and the government remains opposed to Western forms of government and cultural values. In spite of their amazing economic growth inspired by Deng Xiaoping, China still needs to move to a new stage where it can innovate rather than simply borrow or improve on existing technology.

Share this: