China's Dangerous Proposal for a New International Order

Richard Ebeling emails:

Dear Bob 

I have a new article on the website of the Future of Freedom Foundation (FFF) on, “Liberal Internationalism: True and False, Part I.” 

For the last seven decades the world, it is said, has been based on a liberal international order. But two questions arise what is liberal internationalism, and what is offered as its alternative in the world today? In part I of this two-part article I discuss the latter question first. China has proposed a new international order to replace and offer as a counter-weight to the current global system. But what is it politically and economically based on? 


Its political premise, I argue, is state-supremacy authoritarianism built on “harmony” and “solidarity.” The first means no dissent against or opposition to the ruling political power, in China’s case the communist party. The second means eliminating or manipulating many elements of civil society, especially religion or ethic separatism, that would threaten the uniformity of all social relationships as dictated and controlled by the state. 

It economic basis is a version of the command economy, which mixes elements of traditional socialism with state owned and managed enterprises with forms of economic fascism in which private businesses serve as junior partners in a state directed economic system. It also means a high degree of economic irrationality with prices and production often having little to do with actual market-directed decision-making and investment. 

But if China’s new international order would take the world back to collectivism of the command society, what defines the nature of a liberal international order? This will be discussed in part II of this article.

 Best,

Richard

Liberal Internationalism: True and False, Part 1
By Richard M. Ebeling

For more than the seventy years of the post–World War II era, the prevailing global order in the West was and has been called “liberal internationalism.” It has had two components, a political one and an economic one: “democracy” and “capitalism.”

Both are being challenged at the present time in various parts of the world, and have led to the idea of a “crisis of democracy” and a “crisis of the liberal economic order.” In their place have been proposed or implemented alternative authoritarian systems of government control and direction over both political and economic life.

For instance, with the rise of the new, post-Mao China, the nationalist and socialist regime in Beijing declared its offering of an alternative to American or European-style political democracy. The Chinese model is framed on the notion of centralized political power under which the government, and in China’s case the Communist Party, narrows the range of permitted political discourse and debate.

Harmony and solidarity equals collectivist tyranny.

Harmony and solidarity are said to take precedence over individual or small group interests in relation to the directions and needs of the greater State to which all citizens belong. “Harmony” in practice means the State’s defining and confining the terms and content of any and all political debate. In other words, a censorship of all ideological and policy views considered inconsistent with or contradictory to what has been laid down by the ruling political establishment. Many of those considered to be critics of the nature and policies of the Chinese government face arrest, imprisonment and, sometimes, permanent “disappearance,” with family and friends having no idea what has happened to the person presumptuous enough to question the wisdom of the Communist authorities.

“Solidarity” means no attempt by religious or ethnic groups to have a belief system or sense of identity other than the one promulgated by the political authorities. For instance, Christian and other faith-based groups that practice doctrines considered outside the “party line” in China have been declared illegal and prohibited; they are harassed and shut down, with some of their proselytizers arrested and sent off to labor camps.

If recent accounts in the media are to be believed, one of the most repressive of these methods of assuring social and national solidarity has been imposed in China’s western “autonomous” region of Xinjiang. The historical population of the area is the Uighurs, a people of Turkic origin who practice the Muslim faith. A few decades ago they made up nearly 90 percent of the people in the region. Over the last forty years, the Chinese government has brought about a (sometimes) conscripted population transfer of ethnic Chinese into Xinjiang, with the result that the Uighur portion of the population has been reduced to about 40 percent.

Resentful of what they view as a centrally planned attempt to undermine if not wipe out their ethnic and religious identity, segments of the Uighur population have protested and demonstrated against Chinese government policy. The authorities in Beijing have responded with various police crackdowns, to which a small number of Uighurs have replied with violent acts against Chinese persons and property.

The Chinese government’s reaction has been to set up a network of “re-education” or “vocational” camps that have been filled with thousands of Uighurs (even possibly as many as one million! according to some China watchers). And the numbers in these camps, according to the reports out of the region, continue to grow. Foreign correspondents find it hard to get Chinese government permission to travel there, and Internet and telephone communications with the outside world are restricted and sometimes cut.

If the reports are true, with some of them being based on satellite photographs showing the location and structures of a large number of re-education facilities, then the political model the Chinese government is offering the world is a society of concentration camps as the answer to dissent and disagreement with what is imposed by whoever holds the political reins within a country. Here is the new “democratic” ideal, as offered by the authorities busily making China “great again.”

If the Chinese government ever undertakes its publicly declared threat to invade and annex Taiwan, which it considers a renegade province of China, the entire island is likely to become one giant, terrifying “re-education camp,” as the people there will be brought to their proper nationalist and socialist senses that they are part of the greater Chinese State, whether they want to be or not.

China’s managed economy a likely house of cards

The economic component of the Chinese system in place of a liberal order is the planned and centrally managed economy. The new Chinese economic system is a blend of traditional socialism and introduced fascism. There are large segments of the Chinese economy that remain in government hands, a carryover from the Maoist years guided by the Marxist vision of a world without private ownership of the means of production. But to jumpstart the Chinese economy, degrees of privatization and private enterprise were reintroduced into the society beginning in the late 1970s.

But the direction of domestic investment, production, and employment; the fostering of an “export-driven” economy; and the facilitating of foreign direct investment and the integration of portions of Chinese manufacturing into global supply-chains of manufacturing, have all been guided by the central planners in Beijing or their political minions at the provincial and municipal levels.

As a result, virtually the entire Chinese economic “miracle” has been the product of government-business “partnerships,” in which domestic Chinese private enterprisers are the “junior partners” whose profits and freedom from arrest are always dependent on toeing visible and invisible lines of control emanating from the center of all power in Beijing.

The Chinese economic-success story, which has raised tens of millions of ordinary people out of an ages-long poverty in a matter of a few decades, which is due to the degree to which any private initiative and profit-making has been permitted, is significantly built on China’s greatly irrational foundation of continuing centrally planned and regulated production and employment.

Major industries and, indeed, entire mega-cities have been built where the central planners have wanted them to be; but, no doubt, many are not where fully competitive market-driven profitability would have placed them for the production of various and sundry goods and services meant for domestic and foreign demand. There is a manufacturing, housing, and financial house of cards in the new China due to its being based on the mix of socialism and economic fascism, which at some time is likely to be facing a great fall. All the central planners and all the Communist Party men will not easily put this wobbly government-managed Humpty-Dumpty economy back together again.

Yet, this is the political and economic alternative China is offering the world in place of the existing liberal international order. But what is liberal internationalism? The problem in answering this question is that it is possible to distinguish two such “liberal” orders, the one that prevailed prior to the First World War that began in 1914 and the one that has existed for most of the period since 1945, following the end of the Second World War. They have noticeably different sets of ideas behind them.

This article was originally posted in the December 2018 edition of Future of Freedom.

Dr. Richard M. Ebeling is the BB&T Distinguished Professor of Ethics and Free Enterprise Leadership at The Citadel, in Charleston, South Carolina.

Dr. Ebeling is the author of Austrian Economics and Public Policy: Restoring Freedom and Prosperity  (2016); Monetary Central Planning and the State (2015) as well as the author of Political Economy, Public Policy, and Monetary Economics: Ludwig von Mises and the Austrian Tradition (2010) and Austrian Economics and the Political Economy of Freedom (2003). And the editor of the three-volume, Selected Writings of Ludwig von Mises, published by Liberty Fund.

He is also the co-editor of When We Are Free (Northwood University Press, 2014), an anthology of essays devoted to the moral, political and economic principles of the free society, and co-author of the seven-volume, In Defense of Capitalism (Northwood University Press, 2010-2016).