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China's bigger secret - and its relevance to Australia? (Email sent 20/7/10)

Colleen Ryan
Australian Financial review

Re: 'China's big secret', Australian Financial Review, 16/7/10

I should like to suggest that China's 'big secret' is not the pervasive influence of the Communist Party, as Richard McGregor suggested in the book your article reviewed. Rather it is the way in which power is exerted.

My interpretation of your article: China seems to visitors to have endless possibilities and to be free-wheeling and unregulated. However naive foreigners eventually discover complexities that engulf them. The Communist Party is never visible, yet its tentacles are pervasive (see The Party by Richard McGregor). Communist party has cemented its grip on power, rather than surrendering to market. The Party has marginalised all opponents - so that it alone has the ability and skill to run the country. No alternative is allowed to exist - and this is how Party maintains its stranglehold (with state ownership of strategic industries, Party Committees in all major companies with total control over choice of personnel, the introduction of unions and Communist Party Committees into privately owned companies). The involvement of Communist Party committees (with responsibility for the functions that matter most) is never publicly disclosed. The GFC convinced China's leaders of the superiority of their system. The Communist Party system is both (a) rotten, corrupt, costly and often dysfunctional; but also (b) flexible enough to absorb everything thrown at it (Ryan C., 'China's big secret', Australian Financial Review, 16/7/10).

Under 'Asian / Confucian' traditions, power is traditionally exerted by having control of access to information (most particularly by bureaucracies). Making decisions is the traditional Western criteria for having power, but this is the role of subordinates in 'Asia' (eg see Asian Power and Politics). This origin of this approach and its implications are further explored in the detailed comments on Time may not be on China's Side.

It is necessary also to recognise that 'marginalizing all opponents' who might have the ability and skill to run anything is not likely to be simply applied within 'Asian' nations such as Japan and China, but rather is a component of traditional Art of War strategies to defeat foreign opponents (eg by behind the scenes suggestions to opposing leaders about steps which superficially seem constructive to them, but which have the effect of hollowing out opponents' competences, particularly in handling information).

Australia's governance competencies have been 'hollowed out' very severely in recent years (arguably as a consequence of politicisation of public services by political leaders who believed that it was necessary to overcome 'bureaucratic resistance', but in doing so eliminated any serious reality checks on their often inadequate policies) - see Decay of Australian Public Administration. As a result, the competencies needed to provide realistic information to key decision makers has been severely weakened, and Australia is increasing at risk from the half baked policies of political populists (see On Populism).

No one will ever know whether Australia's leaders were subjected to outside encouragement to 'hollow out' the competencies needed for effective government, but in a regional environment in which the ability to access practical information and experience is now becoming the basis for economic and political power, it seems highly desirable to begin reversing the damage that naive politicians have done as soon as possible.

John Craig