The Limits of Capitalism with Communist Characteristics

NEW DELHI – As US President Barack Obama prepares to embark on an historic visit to Cuba, the future of the communist-ruled island is the subject of widespread speculation. Some observers are hoping that the ongoing shift toward capitalism, which has been occurring very gradually for five years under Raúl Castro’s direction, will naturally lead Cuba toward democracy. Experience suggests otherwise.

In fact, economic liberalization is far from a surefire route to democracy. Nothing better illustrates this than the world’s largest and oldest autocracy, China, where the Chinese Communist Party (CCP) maintains its monopoly on power, even as pro-market reforms have enabled its economy to surge. (A key beneficiary of this process has been the Chinese military.)

The belief that capitalism automatically brings democracy implies an ideological connection between the two. But the dominance of the CCP – which currently boasts 88 million members, more than Germany’s total population – is no longer rooted in ideology. The Party, represented by a cloistered oligarchy, endures by employing a variety of instruments – coercive, organizational, and remunerative – to preclude the emergence of organized opposition.

A 2013 party circular known as “Document No. 9” listed seven threats to the CCP’s leadership that President Xi Jinping intends to eliminate. These include espousal of “Western constitutional democracy,” promotion of “universal values” of human rights, encouragement of “civil society,” “nihilist” criticisms of the party’s past, and endorsement of “Western news values.”