I distinctly remember one day in one of my high school government classes when my professor told the class that economic growth and democratization are correlated. This notion was further proven to me when I read Seymour Martin Lipset: when a country’s economy grows and progresses to a more worldly economy, democracy “and democratic characteristics” are also developed—especially with communication and education.
As is usually the case with many of these “rules” and assumptions, there is an exception; and China is clearly the one in this case. According to Mary E. Gallagher, “China has maintained a rapid pace of economic growth for over twenty years without succumbing to political liberalization—indeed with only the slightest movement toward democratic government.” A key factor is the country’s foreign direct investment liberalization. In this case, therefore, economic growth has not influenced or aided the advancement of democracy (despite the opposite being the foundation of United States foreign policy toward China for the last two and a half decades or so), but has instead been credited with saving the Chinese Communist Party. By opening its borders to large flows of foreign capital, China’s communist leaders have related this economic issue to nationalist ones, thus leaving no space for any demands on political reform by society. Gallagher posits, “Economic development amid increasing openness has contributed to the stability of authoritarian rule in China.”
Foreign direct investment has furthermore created greater competition between firms and between workers. This competition has developed pressures to adopt capitalistic practices learned from foreigners. By obtaining more capitalistic practices, those in the state can gain not only capital and technology but also “the prestige that comes with ties to the international economy.” Because they are being separated by this competitiveness, workers are not able to unite into a strong urban class and uniformly protest for reform in the political sphere.
So, will China stop being the exception to Lipset’s correlation? Perhaps… but in the long run! Gallagher concludes,
While foreign investment may indirectly improve the environment for future democratization, through the promotion of the rule of law, transparency, and the freer flow of information, in the short term its presence has afforded the regime more time and more political space to pursue economic reform without political liberalization.
I can say I somewhat agree. After growing up in an environment that has always portrayed China as unfaltering and “übercommunist,” it is a bit difficult to imagine it as a “real” democracy. Gallagher’s argument, nonetheless, seems plausible. I really do hope that in the long run China’s integration into the global economy and interaction with democratic countries will hopefully influence its society and build a more stable foundation for future democratization; after all, it can be as Gallagher asserted: “political change has been delayed, not stopped.”
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