China at the End of History


The end of history
Francis Fukuyama’s The End of History thesis famously argued that liberal democracy is the final form of government. Its key premise: successful industrialization will inevitably create an large educated middle class that demands democracy. An indicator of how far along industrialization will liberal democracy emerges, as noted by Francis Fukuyama, is when the country have around USD6,000 purchasing power (in 1992 PPP USD). This premise has largely been correct since its pronouncement, with the exception of Singapore and a handful of resources-rich states where purchasing power could raise without creating a large educated middle class.

China democratizing?
Since China enter WTO in 2001, China’s purchasing power has ballooned to USD4,700, after adjusting inflation and purchasing power parity, closing in on the USD6,000 milestone. However the size of its educated middle class is far from the average of countries considered free fry Freedom House.

Average population tritiary enrollment rate (1)

While China is not a free country by any standard, there is some low-level movement towards democracy. Freedom house gave China the exactly the same score in 2002 and 2010: political rights 7 and civil liberty 6 (7 being least free, 1 most free). Some have suggested (as have Fukuyama) instead of democracy, Chinese communist party (CCP) might push towards a soft-authoritarian political system akin to Singapore, the only industrialized exception to the stated premise. Continue reading

Why Vote when it wont affect the outcome?

Just voted today in Taiwan’s presidential election, why did i vote when i know perfectly well voting wont effect the outcome of the election?

According to a research cited by Stephen Dubner and Steven Levitt, “Of the more than 16,000 Congressional elections, in which many more people vote, only one election in the past 100 years – a 1910 race in Buffalo – was decided by a single vote.” and as they correctly argue the closer the election is the more likely the winner will be decided by a lawsuit. therefore they add people who spent the effort to cast their vote are properly “not very bright and therefore wrongly believe that [they] will affect the outcome.”

Although i mostly agree with their argument, i do want to add a few point.

In a presidential election, while the candidate with the most votes wins the election, the margin of his/her victory will have an effect on how powerful his/her administration may be. The larger the margin is in each individual electoral districts will have an influence on how much the congressperson from those districts will cooperate (or antagonize) with the president on issues the president campaigned on.

For example, a congressperson is unlikely to vote against a pro-choice bill if the his/her district voted heavily in favor of a president who ran on a pro-choice campaign platform, because the presidents victory signals a pro-choice majority in the district.

Furthermore, the act of voting in a group, as i did today with my family is not a bad way to encourage and make sure those people in the group actually go out and vote. Its an excise of peer pressure and cheater detection.

Are these sufficient reason for an rationally thinking economist to vote? I don’t know, properly not, lol.

Bob Tsao (曹興誠)’s misguided view of democratic governance

I was very impress with Bob Tsao (曹興誠)‘s cross strait peaceful coexistence act (兩岸和平共處法), however his concept of democratic governance stuns me as misguided.

In a post he wrote following KMT’s election victory gaining control over 3/4 of the legislature seats.



In a subsequent post, Tsao wrote




A commercial airplane only has a singular and clear objective of bring its passenger to an agreed destination it is therefor not an appropriate apology to a democratic government where it has multiple task to accomplish and multiple values it need to respect.
So, no matter what is the predominate task at hand, the multi member legislature whom represent various member of the society will make sure that the executive do not achieve one task while trumping other equally important tasks and values of the people. This is precisely why democratic governments operate on consensus instead of single minded decision making.

Having said that i do conceit the point that there are circumstances where professionalism need to trump democratic ideal where democratic deliverance is not a realistic option, for example during a war. We do not need democratic consultation for every military strategy, as long as the military is acting in the interest of the people in good faith. But, extreme circumstances was not what Tsao had in mind, as least thats the impression I gather from his post.

This flawed view of governance might be a common syndrome among the so called CEO statespersons – elected heads of government who came from business executive culture, America’s George Bush Jr, Thailand’s Thaksin Shinawatra, and South Korea’s Lee Myung-bak all fits this profile. In business, executive’s sole objectives is always making as much money as efficiently as possible, very straightforward. Whereas government has to provide national security without jeopardise personal freedom, respond to inflation without damping economic growth, foster industrialisation without polluting the environment. The job of the government is never straightforward. And although, shareholders do exist to provide check on the CEO via shareholder meetings and share market, they are far less powerful than the constrain on a executive in government. The difference between a business environment and government may be the factor contributing to CEO blunders in elected office.

CEO Statesperson coming into the government are more likely to be single minded, witness by Bush Jr’s obsession with war of terror. Bush was willing to lift restriction to allow wire taping US citizens without a warrant, forgo America’s stance against torture, destroy the world’s good will for America by invading Iraq and openly reject United Nations monopoly on war legitimization. CEO statspersons have limited regard for dissents and democratic oversight. Bush says people do not understand the historic significance of his policies and that he will be vindicate in time. Key members of Bush administration have refuse to attend congressional hearings or release requested paper. Firing members of his administration who openly disagree with him, admiral William Fallon, general Eric Shinseki, and attorneys in justice apartment.

I am not saying that this correlation is absolute, not every CEO statesperson will be as narrow minded as Bush, or that disregard for democratic ideal is unique to CEO statespersons. What I am saying is that more than career politicians, CEOs who have spent most of their life running successful businesses might carry memes that does not fit easily with democratic institution.