The Fable of Liberalism that Saving the World
by Bruno Guigue, Voltaire Net, October 9, 2018
French version published by Voltaire Net
Translated by Dennis Riches
Comparing the status of the People’s Republic of China, Cuba, and India, basing his analysis on the work of Jean Drèze and Amartya Sen, Bruno Guigue shows the social progress of state regimes compared to the backwardness of a “liberal” regime (in the sense of the “Chicago Boys” or University of Chicago school of economic thought). He does not mention the question of financial investments and the alliance advocated by Deng Xiaoping between the Communist Party and transnational corporations and prefers to focus on the Commons. While some state regimes have failed, others have succeeded, and they were more successful than they would have been if they had followed “liberal” prescriptions. – Voltaire Network, Paris, October 9th, 2018
In the West, liberalism is considered an unsurpassable doctrine. A pure product of European genius, it is said to be the source of the wonderful feats which developed societies boast of. But the dominant ideology does not just attribute all virtues to liberalism at home. It also claims an influence beyond borders. According to its most enthusiastic followers, liberal recipes save the world! A French columnist, for example, can claim in a televised debate—without being contradicted—that “liberalism has eradicated poverty in China”. In the face of such certainties, reason fails. How can we convince believers of this fanatical doctrine that in China an ideology advocating free competition and prohibiting state intervention is non-existent? China should instead be seen as a sovereign state led by the Communist Party and charged with planning the country’s long-term development. It is a strong state that relies on a flourishing private sector, certainly, but also on a powerful public sector holding 80% of assets in key industries. For those who have not yet noticed, in China, the state controls the national currency. The banking system is controlled by the state, and the financial markets are under close surveillance.
It is clear that the international opening initiated by the communist power in the 1980s has made it possible to capture valuable resources and obtain technology transfers. But there is no connection between this bold trade policy and liberal dogmas, be it market self-regulation or outright competition. Liberalism did not invent commerce, which existed long before any liberal idea germinated in Adam Smith’s brain. “Strong state”, “long-term planning”, and “powerful public sector” are phrases that do not smack of ordinary liberalism, and to credit this doctrine for the spectacular progress of the Chinese economy makes no sense. Poverty was overcome thanks to liberal prescriptions? In the imagination of liberals, certainly. In fact, China’s economic success owes more to the iron fist of the state than to the invisible hand of the market. This mixed economy led by the Chinese Communist Party has borne fruit. In thirty years, GDP has multiplied by 17, and 700 million people have been lifted out of poverty. Since the reduction of poverty in the world in the same period is mainly due to Chinese economic policy, liberalism can hardly be the reason for the recent progress made by mankind.
To see the relationship between liberalism and development, the comparison between the two Asian giants is also instructive. In 1950, India and China were in a state of extreme decay and misery. China was worse off than its neighbor, with a lower GDP per capita than sub-Saharan Africa and an average life expectancy of 42 years. Today, China is the world’s leading economic power, and its GDP is 4.5 times that of India. It is not that the latter has not made any progress. Quite the contrary. After having laid the foundations of a modern industry in the aftermath of independence in 1947, it has experienced accelerated development for twenty years, and it occupies a leading position in IT and pharmaceuticals. Although it displays impressive annual growth rates, it carries with it a mass poverty that China has finally managed to overcome. The authors of Splendor of India? Development, Democracy, and Inequality , Jean Drèze and Amartya Sen, summarize the paradoxical situation of the country: “India has climbed the per capita income ladder at the same time as it has slipped to the bottom of the slope of social indicators.”
Despite record growth rates, the country’s social situation is not bright. It is better to be born in China than in India, where the infant mortality rate is four times higher. The life expectancy of Indians (67 years) is significantly lower than that of Chinese (76 years). One third of Indians have no electricity or sanitation, and malnutrition affects 30 per cent of the population. How to explain such a discrepancy? For Jean Drèze and Amartya Sen, “India is the only BRICS country that has not experienced a phase of major expansion of public aid or economic redistribution. China made tremendous early progress in achieving universal access to primary education, medical care, and social protection, long before embarking on market-oriented economic reforms in 1979.” For an Indian economist (Nobel Prize in Economics 1998) to say that India should have done what China did—economically, of course—he must have good reason to think so. What he says is extremely clear: India, unlike China, has lacked massive government investment in education and health. India did not suffer from a surplus, but from a state deficit.
But why? The explanation provided by the two economists about education policy is particularly interesting: “Indian planners did the opposite of their counterparts in communist countries, in Moscow, Beijing and Havana. The latter made great use of universal school education, considered a fundamental socialist requirement, and none of them would have allowed large proportions of children to go unschooled.” In India, on the other hand, “the prevention of mass education by the upper classes and castes” has slowed down the spread of primary education, leading to a considerable delay in access to education. It is the ideological orientation, not an obscure inevitability, that explains the difference in levels of educational development between the two countries. The ruling elites of the new India may have claimed progressive ideals, but they did not bet on raising the educational standards of the Indian masses, the “untouchables” being relegated to the margins of a hierarchical society. This is far from the egalitarianism—including between men and women—advocated by the Maoist ideology of the People’s Republic of China.
To emphasize such a contrast, Amartya Sen quotes a comment the Indian writer Rabindranath Tagore made during his trip to the Soviet Union in 1930: “In setting foot on Russian soil, the first thing that caught my attention was that, in education at least, the peasantry and the working class had made such progress in those few years that nothing comparable had happened even to our upper classes in a century and a half.” We can say what we want about communist regimes, but it is undeniable that they have bet on universal education, health for all, and female emancipation. The historical continuities being sometimes striking, we can also compare this little-known comment of Tagore on the USSR of the 30s with another document: the result of the study on reading (“PIRLS”) conducted by the International Association for the Evaluation of Educational Success. Conducted in 2016 on 319,000 CM1 students in fifty countries, this study compares students’ performance in reading and comprehension of a written text. Russia came out on top (tied with Singapore). But that’s probably a coincidence.
In any case, one thing is certain: in both the People’s Republic of China and the USSR, public education—and especially primary education: reading, writing and arithmetic—was a priority. If China has been able to solve problems which India is still struggling with (illiteracy, insalubrity, infant mortality), it is certainly not because it is more “liberal”. In fact, it is exactly the opposite. By providing the country with a solid public infrastructure, Chinese socialism—despite its mistakes—has created the conditions for the country’s long-term development. The leaders of the Communist Party may praise free trade, but they know that the cohesion of Chinese society does not depend on international trade. Before opening up its economy, China had an education and health system that enabled it to face global economic competition. Clearly, China is now reaping the fruits of its efforts.
Of course, it was not liberalism that made Deng Xiao Ping impose the one-child policy. By proceeding with this intrusion into the private sphere, Beijing has succeeded in the gamble of birth control essential to development. Everyone agrees today that it was worth the effort. But it is difficult to attribute to liberalism the success of a drastic regulation of births imposed by the Communist Party! Under a pluralist regime, such a policy would not even be conceivable. Neither pluralistic nor liberal, the Chinese regime could plan the country’s development by sacrificing private interests on the altar of the general interest. In the meantime, the results speak for themselves. And it is likely that the Chinese understand the need all the better as this policy has been relaxed. In India, Indira Gandhi’s attempts have not had the same success, and the demographic problem continues to weigh on the country’s development.
But the example of demography, precisely, shows that the question of development arises in a different light if we re-examine the Indian situation more closely. “The Indian states that are doing well,” say Jean Drèze and Amartya Sen, “are those that had previously laid a solid foundation for participatory development and social welfare, and actively promoted the expansion of human capacities, particularly in the areas of education and health.” With a human development index that is by far the highest in the country, Kerala (southwestern India) is a social showcase for the subcontinent. It is also the state in India where the demographic transition is the most complete, which contributes to the positive evolution of the status of women. However, the decline in the birth rate is directly correlated with the rise in the level of education. Very poor at the time of independence in 1947, Kerala embarked on an ambitious program of educational and health development, creating the conditions for economic development from which it now perceives the benefit. With a per capita income that is the highest in the nation (70% higher than the Indian average), a school enrolment rate of 98%, an infant mortality rate five times lower than the average of the Indian states, this state of 34 million inhabitants—that the Western press never mentions—also has the characteristic of supporting the political and social role of women.
These successes are not new. They are the result of a long-term policy. As in China, the state’s development goes hand in hand with long-term concerns. “Kerala continues to advance rapidly on various fronts and its lead over other states does not seem to be diminishing over time,” say Jean Drèze and Amartya Sen. Since the 1980s, the development of Kerala has been regularly denounced by commentators suspicious of state intervention who considered it unsustainable or misleading, or even likely to lead to debacle. It has appeared, however, that the improvement of living conditions in this state has not only continued but accelerated, with the help of rapid economic growth, fostered in turn by the attention given to primary education and human capabilities.” Kerala’s advance over other Indian states is not a legacy of the pre-independence period because in 1947 Kerala was extremely poor. This progress was the result of a political struggle, the key moment of which was in 1957, when Kerala was the first state to elect a communist-led coalition. Since then, they have exercised local power alternating with a center-left coalition led by the Congress party. In any case, it does not seem that the communists of the Communist Party of India (CPI-M) and their allies—who have been in power again since 2016 after making Kerala the most developed state in India—have drawn their inspiration from liberal doctrines.
In short, to continue saving the world, liberalism will have to prove that it has something new to contribute to the two most populous states on the planet. That Communist China is responsible for most of the effort to eradicate poverty in the world, and that this event goes unnoticed by Western opinion, speaks volumes about the prevailing ideological blindness. This analysis could go on to show that a small Caribbean State subject to an illegal blockade has nevertheless managed to build an education and health system unparalleled among developing countries.
With a 100 per cent school enrolment rate and a health system lauded by the World Health Organization, Cuba has recently achieved the feat of offering its population a life expectancy higher than that of the United States and an infant mortality rate equivalent to that of developed countries. The methods used to achieve this were not liberal, but everyone has their own conception of human rights. By reducing the infant mortality rate from 79 per cent in 1959 to 4.3 per cent in 2016, Cuban socialism saves thousands of children a year. To contemplate the miraculous effects of liberalism, one need only look at what is happening in the region. Haiti, for example, is an American protectorate where life expectancy is 63 years (against 80 for Cuba), and on the other side of the island, the Dominican Republic is only a little better off. Life expectancy there is 73 years and infant mortality is five times that of Cuba.
But these trifles are of little interest to the followers of liberalism. They see this doctrine as a white knight—it is true just by saying it—spreading its benefits from this West that has understood everything and wants to communicate the benefits to populations who are overwhelmed with emotion in front of so much kindness and ready to embrace its faith in homo economicus, the law of the market and free competition. Taking the fruit of their imagination for the real world, they confuse private initiative—which exists to varying degrees in all social systems—with liberalism—an “above-ground” ideology that exists only in the minds of liberals to justify their practices. If society were what the liberals say it is, it would be as regular as the motion of the planets. The laws of the market would be as inflexible as the laws of nature. Like a conductor, the market would harmonize competing interests and distribute resources equitably. Any public intervention would be harmful since the market spontaneously generates peace and harmony. The strength of liberalism is that this belief legitimizes the law of the strongest and sanctifies the appropriation of the common good. That is why it is the spontaneous ideology of the money-thirsty oligarchies, of the greedy bourgeoisies. The tragedy of liberalism, on the other hand, is that it is put on the shelf whenever a society prioritizes the well-being of all and puts the common interest before special interests.
Bruno Guigue is the author of Communisme, published by Editions Delga in 2022. No English translation available at this time.
Video: the author discusses the book (in French)
Publisher’s blurb: Sweeping away received ideas, this book traces the history of communism, from its theoretical elaboration to its contemporary achievements. It is a rereading of the events of the twentieth century that restores their true meaning. Contrary to the dominant discourse, it shows that communism is far from having said its last word.