Democracy Stifles Economy?

작성일 : 2016-03-14 21:51 수정일 : 2016-12-26 23:57 작성자 : 임현진 (

Democracy Stifles Economy?


“In his book The 5000 Year Leap, Skousen explains that throughout history, governments have typically been monarchies or aristocracies, with the occasional attempt at pure democracy. While each of these forms of government has their strengths, there are enormous dangers attached to each as well. For example, a monarchy with its strong center of power is useful for important central needs, such as war. On the other hand, an aristocracy, with its wealthy nobles, will be concerned with protecting the wealth and the development of the nation's natural resources. Both of these areas of focus are important for a healthy nation. However, if not restrained, each can (and will) develop into an oppressive system. As for democracy, the masses may have their say, but the views of the minority have no voice, resulting in democracy spoiled by the rule of passion over reason.”


The above passage is from an English textbook I studied at school for KSAT (Su-neung Exams) and it intrigued me throughout my learning experience in that I have a lot of interest in different forms of government, and especially, democracy. According to the passage, democracy does not seem to have much power in the world politics. Then, how has it come to be the ruling form of government in modern society, with 115 countries out of 167 countries governing based on democratic ideas?


In today’s article I would like to introduce interesting, conflicting views on democracy by Chinese intellectuals. One insists that democracy is almost a “must” for a country to develop, and the other disagrees.


Ted Talk by Yasheng Huang: Does Democracy Stifle Growth?

He poses this questions to us: is democracy bad for economic growth? To illustrate his point, he suggests data from two Asian countries. If you were to answer, “Which are the two Asian countries? And which is democracy?”, how would you respond?


You might think Country A is China and Country B India, as China is the country that developed at an astonishing rate in one-party system, and the two countries are often compared as they are both rising economies, Both have a huge population, but China is a communist country whereas India is a democratic one. In fact, Country A is democratic India and Country B is authoritarian, military-ruled Pakistan.


These data show us how misleading the argument is that “‘monarchies’ stifle growth” . Huang adds that the economists in love with authoritarian governments are blinded by the success of East Asian Model like Taiwan and South Korea. However, he warns that these countries were the few chosen jackpots, lottery-many others who adopted authoritarian government failed.


Huang further compares India and China, the democracy and communism in the large scale. China surpassed India in terms of economic growth, even when China was dysfunctional during the Cultural Revolution. Nevertheless, he did not attribute the success to authoritarian government but rather to the human resources of China. Even more, it was thanks to the dynamics of Chinese political system that moved to be less authoritarian and more democratic. In terms of political changes, China introduced village elections, increased the security of the proprietors and land leases, and introduced financial reforms and rural entrepreneurial revolution as well. With more democratic moves, came more economic growth in China.


Nevertheless, Huang believes that more rapid and active political changes must be shown towards democracy and that “the political reforms are a must for China to maintain its growth”.


This Ted talk was enlightening in that unlike many economists who argue that authoritarian form of government gets penalty for its contribution to economy, he viewed ‘democracy’ as a motivation for economy. This argument has been viral for decades in South Korea when it comes to reviewing the works of the former President Park Jung Hee, the dictator.


Eric Li challenges the above talk by Yasheng Huang that China is well performing with its own unique political system and that no change is required. Li completely redefines the Chinese one-party political system from operationally rigid, politically closed, morally illegitimate to the system of adaptability, meritocracy, and legitimacy.


Unlike the first common belief that one-party system is incapable of self-correction and adapting, China’s range of policies has been wider than any other country in recent decades, which ranged from land collectivization to privatization of farmland, and to Den Xiaoping’s market reform, and lastly to Jiang Zemin’s opening Party membership to private businesspeople. Moreover, to counteract corruption, the Party limited the mandatory retirement age to 68~70. As can been seen, Li argues that the Party self-corrects itself in dramatic fashions and is reforming itself to the fundamental level, and even pointing out that the need for political reforms is a mere “rhetorical trap behind a political bias”.


Unlike the second commonly made assumption that one-party system concentrates power to the few, he rebuts that a powerful political institution named the Party's Organization Department successfully operates meritocracy: a pyramid divided into keyuan, fuke, ke, fuchu, and chu level. Each level of officials get assigned portion of the country for them to rule proportional to their level. The competitiveness of this system is backed by the fact that only 40,000 of the 900,000 fuke make it to the ju level and about 200 get their seats in the Central Committee. All this process takes three decades of time and energy, and Li says even Xi Jinping, the son of formal Chinese leader, was no exception.


Lastly, unlike western view that multi-party election with universal suffrage is the only source of political legitimacy, Li believes in the intrinsic legitimacy of the Chinese Party-competency. He says how contradictory it is that Western democracy is failing to perform when the Westerners are exporting (or forcing) democracy around the world, as if it were the only regime qualified to survive. He compares the International Transparency rank of China, which is around 75 and is moving up, with that of India, which is 94 and dropping, arguing that more than half of the regimes in the world with lower Transparency level than China is electoral democracies. The meta-narrative of the 21st century that election is the panacea for corruption does not work with Li.


He is confident to argue that “China’s political model will never supplant electoral democracy” and criticizes the West for pretending that their democracy is universal. He is not speaking to unilaterally praise the communist system in China but stands to make a point that plurality in political system has to be accepted in this age. Both democracy and communism can be ideals simultaneously and the world is not destined to develop in one direction only to democracy.


Listening to Eric Li’s talk, I thought, at first, that he must have been captured by the Sinocentrism or that the Chinese government might have lobbied him to glorify its regime. However, I finally accepted the idea that the system of current China might have worked smoothly throughout its growth. Maybe I’ve excessively been filled with the Western emphasis on democracy.


Nevertheless, I cannot stop agreeing with Yashen Huang’s claim that democracy has to settle in China sooner or later. Indeed, uprisings for democracy are taking place all over China and it seems many Chinese are in a hankering for freedom of speech and freedom from authoritarianism. As Winston Churchill said: “Democracy is the worst form of government, except for all those toher forms that have been tried from time to time.” However, Eric Li has his point in that every country should have their own form of government and that plurality has to be considered. In that, China should pursue its own unique democratic government, as it is doing now by combining communism with open-market economy.


The first Ted Talk I watched was that of Sheryl Sandberg, the author of Lean In, and I have been watching some of the Ted Talk video clips since then. Talks like these broaden my perspective by allowing me to communicate with worldwide intellectuals.



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