But history will not stop with us, any more than it did with all the others - Marx and Lenin among them - who thought they had mastered its secrets. The triumph of liberty will certainly be transitory; new forces will eventually arise that will swing the balance back to power once again. It is not clear at the moment, though, where they will come from, or when they will arrive. It would be prudent to be on the lookout for them; it would be wise to be prepared for their effects."
     -- John Lewis Gaddis "Coping With Victory,” The Atlantic, May 1990

China uses the same light bulbs as the rest of the world. They aren't light bulbs with Chinese characteristics."
     -- Chinese dissident Bao Tong

In 2010, we do know what “came next” in terms of Gaddis’ prescription of new forces that swing the balance of power. Specifically for the Russians came the “Stalin-lite” easy-to-digest authoritarianism of Vlad the Paler Putin. There, opposing forces are represented by Gary Kasparov and Boris Nemtsov, among others.

In China, the real balance of power shifted in an unpredictable direction towards the ultimate oxymoron: indisputably successful command-and-control capitalism as practiced in post-Deng China. They call it “capitalism with Chinese characteristics.”

What this appears to mean is a capitalism that minimizes the free market. Fortunes are created by manufacturing goods for export, where markets are vigorous; internal consumption is watched closely to control inflation. But the real balance of power shifted in an unpredictable direction towards the ultimate oxymoron: indisputably successful command-and-control capitalism as practiced in post-Deng China.

In its May30/31, 2009 issue, The Wall Street Journal published an interview with the Chinese dissident Bao Tong. One illuminating comment bears on our topic: "Some people say China has its own unique characteristics and should follow its own path. I don't believe that. As I see it, China uses the same light bulbs as the rest of the world. They aren't light bulbs with Chinese characteristics."

In theory, at least, every company in China is owned by the government. Perhaps the next swing of the historical/economic pendulum will have something to do the duality of market-based capitalism – what makes it so great for building an economy is its capacity for creative destruction. What will be the political fate of a country that 1) can’t afford to grow at 10 per year due to resource constraints and environmental damage; 2) can’t afford not to grow at 10 percent a year due to demographic reality and the expectations of every worker and manager in the country; and 3) cannot find a scapegoat because every significant decision is made centrally by the government? The “back end” of capitalism allows for and requires flexibility, when industries and even whole economic sectors fail and the need to adapt and innovate is paramount. Can the Central Committee handle that? That is market capitalism at its best and most merciless.

In the interest of prudently being on the lookout, as Gaddis recommended back in 1990, perhaps we see the political gravity shifting in China in the curious phenomenon of bloody assaults on elementary schoolchildren by knife (or cleaver) swinging middle aged men. The first was judged to be mentally disturbed. The next two were possibly “copycats,” whatever that means. The fourth, and deadliest, assault on May 12 was by a “normal” man who knew his victims and had a longstanding dispute with the headmistress of the school.

The inexplicable viciousness and repetitiveness of these assaults are difficult to comprehend. Two years ago, when earthquakes destroyed poorly built schools and the world witnessed hundreds of parents standing outside pancaked schools, devastated and angry. The government was unnerved by crowds charging corruption and payoffs had put their children at risk. Perhaps the schoolyard assaults reference some form of political metaphor whose full meaning cannot be grasped outside of China. Perhaps the schoolyard assaults are some form of canary-in-the-coalmine early warning of a festering social unrest with consequences that are difficult to predict.

So it is possible that the powers that be in China will learn the real purpose of capitalism and democracy – and it isn’t building wealth. Capitalism and free markets are simply the best frameworks for managing change when things aren’t going so well, because they are the most transparent and therefore create the fewest self-perceived victims.
 

This Dispatch was written with the assistance of Brian Prioleau