China: let the economic transaction rate drive the political modernization rate
Monday, November 28, 2005 at 3:55PM ■"China Gets a Passing Grade From Foreign Firms: After Four Years in WTO, Beijing Scores on Tariff Cuts, Not on Intellectual Property," by Murray Hiebert, Wall Street Journal, 28 November 2005, p. A11.
■"A Judge Tests China's Courts, Making History," by Jim Yardley, New York Times, 28 November 2005, pulled from the web.
The Chinese government, lorded over by the Communist Party, gets passing marks on everything it can control through diktat, just like any executive branch. But where China gets low grades is in those areas where dictating just doesn't work, where instead you need clear rules that are independently enforced.
China's skyrocketing private-sector economic transaction rate is fueling a skyrocketing public-sector judicial rate. For that to work effectively for the economy as a whole, the judicial system must be impartial, or able to repopulate the country's legal rule set with regularity as complexity rises in economic and social transactions.
When the government's diktat crosses that legal line, laws and regulations will be declared null and void, something that just happened in China for the very first time.
As one Chinese legal expert put it, "It was historic. For the legal process in China, it was a first, and it carried deep meaning."
The higher the economic transaction rate, the more this will happen, and the more this happens, the more marginalized the Communist Party becomes.
We speak of inevitabilities for a party that bases its legitimacy on economic development, not possibilities. Even Deng admitted that, eventually, there would be national democratic elections in China. The man could see the future with clarity.
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