Essay: Free Minds and Markets
	China and Brazil show that there is no single path to modernity
	By Michael Elliott

Posted Monday, May 31, 2004; 20:00 HKT
There was a poignancy, as well as a significance, in the state visit to China by Brazil's President Luiz Início Lula da Silva last week. That Lula should have wanted to warm his country's ties with China was not surprising—not because his Workers' Party has its ideological wellspring in the Marxism to which Beijing still pays occasional mumbled lip service, so much as because the two nations' economies are complementary. China's economic boom is sucking in commodities like soy beans and steel, of which Brazil is a major exporter. Moreover, because they need to cope with persistent levels of poverty in their own country, Brazilian policymakers doubtless thought there was much to learn from the Chinese experience, which has been little short of miraculous. At the World Bank conference on poverty eradication in Shanghai last week, which Lula attended, Bank president James Wolfensohn said that China "in the last 20 years has taken three or four hundred million people out of poverty." It is safe to say that not since the dawn of time has there been a transformation of the lifechances of so many in so short a period.

The poignancy, of course, comes from the fact that Lula is a lifelong democrat and dissident who is the President of his nation by virtue of an exuberantly free election in 2002—and that he visited China just a week before the 15th anniversary of June 4, 1989, when the mainland's student democracy movement was crushed in Beijing's Tiananmen Square. The mainland's "Lulas"—those who argued 15 years ago, as he did in Brazil, for democratic reforms in the face of a central government fearful of their demands—are in exile, or tucked away in academic backwaters, or have joined the mainland's numberless ranks of entrepreneurs. Some of them, lest we forget, are still in prison.

Inevitably, China's astonishing progress in the past 20 years is leading to a rethink of both development economics and the relationship between economic and political freedoms. I would argue that, in its essentials, the Chinese model has followed pretty standard prescriptions for growth: let the market set prices, open your economy to world trade, free state-owned enterprises from the red tape of bureaucracy, manage your fiscal and monetary policy prudently. (O.K., the Chinese haven't done the latter so brilliantly of late—watch for a bad-debt crisis coming soon, as the years of easy credit unwind.) But given China's success, there is a temptation to go further, and to argue that when it comes to the sequencing of policy, economic reforms should be put before political ones. In this view, democratic exercises such as free national elections, which can lead to wild swings of policy and whose victors can be held hostage to special-interest groups, can be postponed. After all, what most people "want" is prosperity. In a much quoted (though somewhat contested) recent survey by the United Nations Development Programme, 55% of Latin Americans polled said they would support authoritarian governments if they appeared likely to solve economic problems. In like manner, you could make a case that, since the moment when Vladimir Putin was first anointed as Boris Yeltsin's successor in 1999, Russia has followed the "Chinese" path of reform—one that strengthens the state and keeps democratic change within narrow bounds but which allows market forces to set basic economic conditions. Whether in Russia or China, those who argued in the late 1980s and early 1990s for the importance of democracy are apt to be subject to lectures on History (Importance of Being on the Right Side Of) and Eggs (Impossibility of Making Omelets Without Breaking Them).

But beware generalizations. There is no single path to modernity, to that happy state of free minds and free markets. Nations' pasts and presents are too different from each other for that to be the case, something that U.S. President George W. Bush explicitly recognized in the most important passage of his speech on Iraq last week. "I sent American troops to Iraq," said Bush, "to make its people free, not to make them American. Iraqis will write their own history, and find their own way." Conceivably, Iraqis will decide that economic and political reforms need to go hand in hand, as others have done. There is no shortage of democracy in Eastern and Central Europe, while India—which is posting rates of economic growth of a magnitude once seen only in East Asia—has just seen a peaceful transfer of power from one political party to another in the largest expression of popular democracy the world has ever known. There is nothing incompatible between political freedom and economic growth.

Few people can make that case as convincingly as Lula, a man who was often dismissed as impossibly radical, who won the presidency of Brazil at the third attempt, and who is now following a broadly liberal set of economic policies. When it comes to the interplay of democracy and economics, indeed, Brazil has as much to teach China as the other way around. I wonder if Lula gave the Chinese leadership that message? And if he did, I wonder if they heard it?

	Mother Courage [Apr. 09, 2004] Parents and widows of Tiananmen victims speak out against the Chinese governmentÑbut not without risk Postmortem [Mar. 18, 2004] A courageous doctor prods Beijing to admit that Tiananmen was a "mistake" Unsafe Havens [Aug. 22, 2003] His house on Beijing's Nanxiao Lane was once a refuge to him. Now Ma Jian knows that home is simply where he is, and something he carries inside himself You Can't Go Home Again [Aug. 04, 2003] Yang Jianli returned to China to see how his country was faringÑand was jailed Great Escape [Sep. 25, 2002] Zhang Boli's riveting memoir tells how the Tiananmen leader dodged the wrath of Beijing More Related Items | Search all issues of TIME Magazine