Government for the prosperity of the people

Friday, September 19, 2014, Vol. 38, No. 38

The reporting out of the U.S. on China is uniformly downbeat. By applying our western perspectives, China appears inhumane, politically oppressive, over-indebted and fragile.

From the American perspective, functional nations should look more, well, like us.

They should have democracy, inalienable property rights, free and open markets, freedom of expression, apple pie, etc. Our national belief in the ideology of American exceptionalism defines our worldview.

Looking East to West

The Chinese see things differently. When Deng Xiaoping politically and economically liberated China in 1979, he promoted an empirical approach to development, relying on trial and error and observable results.

Let’s apply this Chinese approach to the big question of democracy.

First, understand that democracy will slowly germinate in China, as the Chinese leadership well knows. The recent ruling in Hong Kong allowing people to vote from a preordained slate actually connotes progress.

However, Chinese leadership also understands that for a nation developing as quickly as China, fully deploying democracy today would likely prove counter-productive.

Like China, India has a billion people and unlimited potential. Unlike China, India happens to be the largest democracy on earth. Unfortunately, with 50 percent of the population illiterate, elections have largely been populist beauty pageants.

Since the British exodus in 1950, those elected have had questionable qualifications and poor achievement records. Democracy has not delivered mass prosperity gains in India.

The United States, arguably the longest running uninterrupted democracy on the planet, has become politically paralyzed. The nation desperately and visibly needs to resolve big issues like entitlements, tax reform and immigration.

Unfortunately, unconstrained media-fueled polarization on all of these issues renders them toxic and unresolvable. America has substituted campaigning for governing.

From the Chinese perspective, would installing a populist campaign centric, issue paralyzed, ideologically polarized governance system help better achieve national goals?

While their autocratic system has notable flaws, its relentless efficiency has accomplished historic prosperity gains for the Chinese people.

Ironically, according to polling work from the Washington based Pew Research Center, 92 percent of Chinese are confident in President Xi Jinping, while 44 percent of Americans are confident in President Obama.

In fact, the number of Americans who approve of the Chinese president actually exceeds the number that approve of the American Congress. The Chinese way works for the Chinese, even if the American way is “better.”

Bottom Line: Horrific memories of Tiananmen define our Western perspectives on political suppression in China.

In truth, the root cause of Tiananmen was less political than it was economic.

Runaway inflation, food shortages and soaring unemployment rates ignited the protests. The political response from Chinese leadership was not to sanction democracy but to institutionalize economic growth.

While those who sacrificed their lives could not deliver political democracy, they did deliver far greater democratization of economic gains for their countrymen.

Consequentially, rapid prosperity gains over the past 25 years have significantly rebuilt constituent confidence in the Chinese governance system.

On the list of systematic risks within China, political revolution ranks lower today that it has for centuries.

David Waddell, who is regularly featured in the Wall Street Journal, USA Today and Forbes, as well as on Fox Business News and CNBC, is president and CEO of Memphis-based Waddell & Associates.