China’s Achilles Heel

Amidst talks about China’s rising military prowess and debates over which, between cooperation or conflict, is the better path with which to achieve a more stable US-Sino relationship, China remains vulnerable on at least two fronts: the state of its currency and the state of its political affairs.

President Hu, in this Washington Post interview, acknowledges the importance of pegging its currency to the dollar, as the dollar remains the currency used for global trade and international financial transactions. He recognizes that China’s own currency cannot replace the dollar at the moment as “it takes a long time for a country’s currency to be widely accepted in the world.” Both countries have been accusing each other of currency manipulation that sets off global inflation. In particular, Hu has criticized the Federal Reserve’s effort to keep interest rates low, while Treasury Secretary Timothy Geithner has been critical of the Chinese government’s deliberate move to keep its currency value artificially low.

While on the surface it seems that the US has the upper hand in this monetary war, its monetary weapons can only be effective if they are grounded on sound principles. Sound money is a reasoned, principled way of commanding respect on the world’s financial stage. With honesty and integrity in the dollar comes leadership and strength.

China’s second vulnerability lies in its lack of liberalizing political reforms (in what the State Department would call human rights violations). In this same interview, Hu, however, was quick to explain China’s own version of its political reforms, which lie in an expanded socialist democracy.

We will continue to expand people’s democracy and build a socialist country under the rule of law in keeping with China’s national conditions . . . We will define the institutions, standards and procedures for socialist democracy, expand people’s orderly participation in political affairs at each level and in every field, mobilize and organize the people as extensively as possible to manage state and social affairs as well as economic and cultural programs in accordance with the law, and strive for continued progress in building socialist political civilization.

But how does socialist democracy justify continued government control over people’s political participation? Hu has this to say: The fact that China has enjoyed sustained, rapid economic growth and social stability and harmony proves that China’s political system fits China’s national conditions and meets the requirement of overall economic and social development.

All this affirms the communists’ unchanging yet abstract notion of the “people,” who are viewed as a collective whole and as mere instruments of the state to be used in attaining the country’s material well-being. This premise is central in Marxist-Leninist thought: the herd must be led by a party of vanguards, the “enlightened ones,” towards the right path of the communist revolution. Instead of benefitting from the enterprising and creative spirits of a free people, the Chinese government continues to treat its people as children, to be led.

For as long as communism fails to see the character, dignity, and freedom-loving nature of every human being and his tendencies towards enlightened self-interestedness, it is safe to say that in China’s future political horizon lies seeds of political dissent.