Acton Commentary

China's Road from Serfdom


China's rulers have a time-tested penchant for attempting the impossible. After the founding of the People's Republic in 1949, they tried to industrialize and communize the economy through mass coercion, and produced not equality but a totalitarian state and mass starvation. For the past two decades, they have attempted something no less impossible: to create the outline of a capitalist economy (with private property and freedom of enterprise) without free association or a modicum of free speech.

It's true that in the past, countries such as Chile have managed to practice both one-party political authoritarianism and capitalist economics. But the mix has never been a stable one and often leads to a socialist backlash. China's recent crackdowns on speech and religion are the first attempt to juggle the two in the post-Internet world. If the regime hopes to disprove the conventional wisdom in the West that freedom is a seamless garment, its latest moves will end up as a case study in political failure.

Most implausibly, the regime is attempting to regulate the content of all websites in the country. Under the cover of protecting state security, the Communist Party has claimed the right to register all companies using encryption technology, monitor and directly censor Web content, and even ban sites from employing journalists. No one yet knows how the draconian regulations will play themselves out. They might be quietly ignored even by the censors. But if fully enforced, they could seriously harm the booming technology sector and provide more fodder for the anti-China protectionist lobby in the U.S.

Western and domestic observers alike have been dumbfounded by the timing and sheer scope of the regulations. The best explanation may be that members of China's ruling class, always looking for ways to maintain their control, lag far behind the rest of the country in their understanding of the information revolution. They seem to believe that the World Wide Web can be controlled the same way television and, to some extent, radio can be controlled. They simply are unaware that the borderless Internet operates outside the usual rules of the nation-state's regulatory apparatus.

If China's central government had its hands full trying to control fax machines a decade ago, they will find controlling Web communications beyond the power of any mortal man, much less a lumbering and bloated government bureaucracy. It isn't as easy as tapping a phone or reading someone's mail. Even the U.S. government, with all its technological sophistication, was forced to back down in its efforts to control encrypted Web content.

Equally as ambitious, and just as likely to fail in the long run, is China's ongoing attack on freedom of religion. Most recently, President Jiang Zemin called the spiritual movement Zhong Gong, which has 10 million followers, a cult, and shut down its 100 offices. Coming on the heels of the much-publicized outlawing of Falun Dafa, this is the second huge spiritual movement to be suppressed in the last few months, adding forms of traditional Chinese spirituality to a list of banned faiths that includes orthodox Roman Catholicism.

At the same time, China is stepping up its efforts to privatize state industries, permit greater freedom in labor mobility and choice of occupation, and is even encouraging the private accumulation of wealth. But with economic liberalization and private wealth comes a shift of power away from government and toward the private sector.

By necessity if not intent, the ruling class that liberalizes the economy ends up surrendering power, not just in one area but every area. Today it is China's entrepreneurial class and religious dissidents who can rally around Chairman Mao's dictum from the Little Red Book: “All reactionaries are paper tigers. In appearance, the reactionaries are power, but in reality they are not so powerful.”

During the first half of the 20th century, governments all over the world imposed new economic controls over their citizens, and these controls ended up compromising civil and cultural liberty. It was the genius of Nobel Prize-winning economist F.A. Hayek to point out in his 1944 book “The Road to Serfdom” that a government that regiments the economy will end up regimenting all of private life too.

But the process also works in reverse. The road to freedom includes not only economic liberty but civil, cultural and religious liberty as well. To be sure, there are those on the left and right in the U.S. and other democracies who still resist the logic of liberty, favoring only one or two free sectors while supporting government controls in others.

But if political experience since the 1989 Tiananmen Square massacre, and especially since the mass distribution of new information technologies, have taught us anything, it is that freedom is all of a piece — now more than ever. If people own property, they are going to use it in ways that irritate the regime. If they have the freedom to own and use a computer, they will write things of which their rulers don't wholly approve. If they are allowed to rent and purchase real estate, groups the government doesn't like will meet and thrive.

China's recent efforts at civic control will impose new hardships on political dissidents but also on entrepreneurs who have very high hopes for the future of this remarkable country, host to one of history's greatest economic recoveries. But in the long run, Chairman Mao may again have been right when he declared, “The people, and the people alone, are the motive force in the making of world history.”