Qin Hui, "Looking at China from South Africa" 7

Qin Hui, “Looking at China from South Africa:  Where Are We Going and Where Have We Come From?  Comparison of Future Prospects”[1]　
 
Translation by David Ownby　
　　
The Comparability of the “Low Human Rights Advantage:” What China and South Africa are both “Not”
　　
The fact that China and pre-democratic South Africa share many similarities is not because one made a conscious decision to learn from the other.  The government of pre-democratic South Africa was very anti-communist, and never established relations with China.  China knows little about South Africa.  And of course, no one in 1940s South Africa could have known anything about China’s “temporary residence pass,” which only appeared in the post-reform era. 
　　
However, the two not only share a superficial resemblance, but certain specific trends (such as the tendency of migrant labor to form households, or the evolution from labor requisition, to “pass” labor mobility, to the free search for employment and housing) seem to be cast from the same mold.  This is surely the result of the logic of the two systems.  In the context of globalization, both countries relied on a low human rights advantage to develop their competitive strength and create the “miracle” of rapid economic growth.  They both artificially suppressed or diminished the bargaining power of certain groups through institutionally created status barriers, hence diminishing what some Chinese economists have called “transaction costs” (not the same “transaction costs” as discussed by Western economists which assume the protection of the interests of those involved), particularly the costs of labor (not limited to wages), land, and the maintenance of stability and order, all of which resulted in a rapid process of “primitive accumulation.”  Neither China nor South Africa practiced a system of “free competition” which limits the power of the rulers, nor were they a model of the “welfare state” which invests the rulers with responsibility for the people, and as such they are difficult to discuss in the context of “left and right” which is the norm in constitutional democracies.
 
I should point out that the “advantages” I have attributed to the two countries are not the same as “primitive accumulation” as generally discussed in the context of the seventeenth century, because at the time, the modern concept of human rights did not exist, and the whatever advantages “pirate nations” possessed were not in comparison with those of “high human rights countries.”  From a historical (and not a purely moral) perspective, what is most worthy of study is not why or how these “pirates” were so uncivilized (although this should be criticized), but rather why other groups who lived in worlds just as savage, or even more savage, than the jungle world of the modern and contemporary era—such as the ancient Assyrians, or the Mongols, or, setting aside “Western prejudices,” the Spanish, or even their ancestors, the Viking pirates of Northern Europe—why were they unable to create a new world in the way the pirate nations did?[2]  If we reject the modern standard of human rights because “they used to be wild too,” then what’s the difference between this and the previously mentioned South African excuse that “their ancestors cheated us, so what right to do have to talk to me about human rights?”
 
What I call a “low human rights advantage” is also different from what we find in normal authoritarian or “undemocratic” countries.  The basic meaning of authoritarianism is that its politics are essentially undemocratic; this does not necessarily mean that the economy is unfree.  Some authoritarian regimes, like Taiwan and South Korea in East Asia, did not democratize during their periods of rapid growth, but their economies remained open, nor did they carry out institutional discrimination, as did China and South Africa.  They used the iron fist[3] to ensure political stability, but not to create social division (such as artificially creating status distinctions, artificially limiting types of permissible housing, expulsing the poor, building “cities for aristocrats,” etc.).  In terms of investment, they also employed state guidance on macroeconomic policies, but rarely “sought out investors” in a way that prohibited stakeholder groups from bargaining, artificially reducing so-called “transaction costs” and accelerating capital accumulation.  From another angle, authoritarian countries cannot become genuine welfare countries, but they can, through “imperial grace,” carry out certain welfare policies.  For example, welfare measures were developed in the Soviet Union and Eastern Europe, even if the autocrat could dispense with such measures at a whim.  But in countries like South Africa or China that have practiced “negative welfare” for many years, such practices are rare. 

In sum, “low human rights” countries are countries will low freedom and low welfare.  Politically authoritarian countries are not necessarily all like this.  More totalitarian countries, like North Korea, are also “low human rights” countries, but they are not part of globalization and have no particular “advantage.”  If a country wants to participate in globalization then it must follow certain rules of the market economy, which include freedom for a part of the people or a part of the territory (i.e., allowing migrant labor), even if the rest of the people and the rest of the territory remain in a state of “super-economic coercion.”  This leads to the emergence of the “binary” system (as already noted, this is not Lewis’s “dualism”).  This is not the case in North Korea, nor is it the case in the Central and Eastern European countries that have changed under democratic conditions.
 
A “low human rights advantage” is also not the same as a “low wage advantage.”  Even if wages will never be high in an economy with a low human rights advantage, low human rights and low wages remain two separate things.  In simple terms, if workers cannot strike, this means that human rights are low, while whether workers who are permitted to strike can achieve higher wages is a different question.  Workers with low wages may well live in a ghetto, but workers in conditions of low human rights often are deprived even have the right to live in a ghetto.  In the context of low wages, India’s are lower than China’s and many countries in the south of Africa pay wages that are less than those in South Africa, but South Africa has an easier time “attracting investment” than its neighbors, and the same is true with China and India.  Why is this?
 
To put it even more clearly, this “advantage” is not the same as the “free competition handicap” of the “pre-welfare” era.  Nineteenth-century Europe was no longer the era of primitive accumulation, but “freely hired laborers” lacked wage and welfare guarantees, and living conditions in the ghettos were terrible, to the point that today’s critics call the system “savage capitalism.”  We cannot say that such criticisms are without reason, but what was backward about the system was especially social protections, and there was nothing illegal about the poor living in “shanties,” which eventually prompted Mandela’s cry for the “right to not have our ghettos destroyed.”
 
In sum, both China and pre-democratic South Africa engaged in “primitive accumulation,” but not the same primitive accumulation as in the seventeenth century.  Neither China nor the former South Africa is democratic, but their status systems are different from those of other authoritarian countries.  Wages in China and in South Africa (in the case of blacks) are low, but what is more important is that bargaining is not allowed, and unlike the situation in most low-wage countries, wages are still not rising.  China and South Africa are both low-welfare or negative-welfare countries, but this welfare situation has nothing to do with laissez-faire or “savage capitalism.”  China and South Africa both engaged in the “planned economy” and “state ownership,” yet they are unlike the former Eastern Europe, which had no status system, and unlike North Korea, which is closed off to the world.  China and South Africa are both known for their status barriers, but these barriers are part of the state system and are unlike India’s illegal caste system based in “popular habits.”  In other words, there are not many countries that can be grouped together with China and South Africa on these questions, which suggests that the comparability of the two is unquestionable.
 
I should further point out that “advantage” chiefly refers to its logic in relation to rapid economic growth, and is not a value judgement.  And this link exists in the context of globalization.  An “economy of low human rights” lacks the spirit of innovation, and in the absence of the innovations of “high human rights economies” obtained via exchange, would not achieve high growth rates.  Yet “high human rights economies” cannot use the iron fist of low human rights economies to achieve primitive accumulation, so in the globalized system, if the market is globalized while human rights standards are not, this truly creates the phenomenon in which low rights economies can create the “miracle” of rapid growth.  Of course, whether this high growth means that the citizens of those countries reap the benefits and advance together with the economy is another question that needs to be examined before the system can be affirmed.  If you close off the country to globalization, as in the case of the low human rights economy of North Korea, then there will be no miracle.  And if you engage in globalization without a “low human rights advantage,” then you have countries like those of Central and Eastern Europe, which have achieved high growth rates, but no “miracle” (although we should still compare the benefits the citizens have obtained with the situation in China).
 
Moreover, the “low human rights advantage” is a horizontal comparison, and it assumes an orderly environment; war-torn low human rights countries like Somalia obviously cannot expect any economic growth.  Nor is this “advantage” in contradiction with the improvement of human rights over time.  In the course of China’s thirty years of reform and opening, and especially in the twenty years since 1989, China has made a certain amount of progress in terms of freedom and welfare.  As is clear from what I said above, pre-reform era China was much worse in terms of human rights than today’s China, and this is why I affirm the progressive nature of China’s reforms, and reject the New Left argument that pre-reform China is superior to reform-era China.  But this does not affect my critique of the present level of human rights in China.
 
Isn’t the same true for South Africa?  In terms of human rights progress, the apartheid system was better than the earlier system of black slavery, and the later apartheid system was better than the earlier apartheid system.  This is clearest in the events of the years following the election of the Botha government in 1978, when South Africa loosened many apartheid measures in public spaces, abandoned the law prohibiting interracial marriages, revised the pass law, allowed blacks residing in the cities to rent long-term or even to buy, accepted part of black migrant workers as permanent city dwellers, relaxed restrictions on blacks’ access to technical positions and on black promotions, raised black wages, acknowledged blacks’ rights to unionize through the amended industrial adjustment act, and in 1985 even offered to restore South African citizenship to those in black homelands and abolished hiring discrimination, among other measures.  If we go further back, we can find the same pattern:  we have criticized the system of “migrant labor,” but we also know that labor requisition during the era of the Glen Gray Act[4] was much worse.  We have criticized the system of “dormitories for migrant labor,” yet we acknowledge that by the end of the apartheid era the percentage of workers living together with their families was already quite high, or at least in comparison with the situation in China.  In terms of rapid economic growth, even as we pointed out the naked inequalities of the system, we also must admit that blacks obtained something from the rapid growth.  Black wages in South Africa increased over time, and in comparative terms, were higher than those of surrounding countries in southern Africa.  In fact, South Africa’s democratization in 1994 was not a sudden event, but instead a process of quantitative and qualitative changes, the result of earlier black human rights movements and international pressure gradually moving things forward.  Yet none of this means that we should alter our overall critical attitude to the human rights situation in South Africa during this entire period.
 
Changes in the “Low Human Rights Advantage” Due to Globalization:  The “Fogel Impact” and the “Sullivan Impact”
 
Comparing the “low human rights advantage” in horizontal (spacial) terms is not to deny the positive function of the improvement in human rights on economic growth in a chronological sense (there is almost no debate concerning its positive effect on the quality of growth or how growth is shared, so I will not discuss these here).  Improvements in human rights in reform-era China, compared to China prior to the reforms, naturally had this positive effect, in the same way that migrant workers, a low human rights form of labor, contributed to economic growth in South Africa, in the sense that migrant labor is a form of progress when compared to the black slave system or the requisition of black labor.
 
The problem is, this theory does not explain why, in horizontal or spacial terms, countries that are clearly more advanced in terms of human rights have (or had, during a certain period) economic growth rates that were lower.  For example, why are growth rates in Central and Eastern Europe lower than in China (even if people may live better in Central and Eastern Europe)?  Why are the growth rates of certain democratic African countries lower that the growth rate of South Africa? Why is it China, and not Central or Eastern Europe, that floods the world with cheap goods?  In fact, in the context of globalization, this is not really a deep mystery:  if we understand the fundamental importance of “the strength of competition” to “attract investment” to the economic growth rate under conditions of globalization, then is it not abundantly clear that a country without unions, and that can confiscate land at will, be much better at “attracting investment” than a country with developed unions and respect for property rights (like the countries of Central and Eastern Europe)?
 
This kind of “low human rights advantage” truly demonstrates the logic that “bad money drives out good.”  I have previously cited the work of Robert Fogel (1926-2013), the American economist and Nobel Prize winner on the “efficiency” of the Southern slave economy prior to the American Civil War.  Fogel proved that in the context of a unified economy, the southern slave economy was more efficient than the northern, non-slave, economy, but his point was not to praise the slave economy.  Quite the contrary, he argued that if the South had been independent (and not part of the continental economy), then it would not have been efficient.  But as long as the two economies remained integrated, the North feared that it would not be able to rely on “economic efficiency” to transform the South (this was Fogel’s true insight and the source of much debate).  If we push this counterfactual inference even farther, it might be true that the South could have transformed the North:  if northern capital had moved south in large amounts (slaves in the South were tied to the land and could not move to the North in large numbers), then the South could have flooded the North with cheap commodities produced by slave labor, creating unemployment and chaos in the North, and perhaps the North would have been the first to collapse (or to avoid collapse, the North might have adopted the South’s “low human rights” system, without which they could not have won this “competition”). 

Of course, had the North truly collapsed, then Southern “efficiency” would have disappeared as well, because the true strength of a free economy lies in innovation.  Without innovation, there is no economic progress, including the “efficiency” that would have come from the importation, by the Southern slave industrial economy, of northern technology.  So this kind of “competition” looks to be lose-lose.  Clearly, Fogel argues that it was justice, and not efficiency, which finally transformed the South.  This is his argument for the necessity of the Civil War:  when the North transformed the South through war, this removed the danger that the Southern “low human rights advantage,” in the context of the unified American economy, would be a case of “bad money driving out good.”  Northern technological innovation was extended throughout America, and Southern efficiency (as well as justice, of course) increased.
 
At the time, Fogel’s research was unconcerned with globalization (his focus was on a “unified America”).  But according to his logic, if the “low human rights regions” in today’s globalized world are unable to transform themselves, then this perhaps will ultimately lead to a globalized “civil war 南北战争.”[5]

At the same time, if capital and other elements from the “high human rights regions” of the globalized world flow into the low human rights areas, this can also bring about positive changes in the low human rights countries.  As Xia Jisheng, whom I cited earlier, pointed out:  “To a certain extent, foreign economic activities are a means to export Western ideas of human rights, which subtly influenced the racial viewpoints of South Africans, eventually bursting the dikes of the apartheid system.”  On one level, the influence of international sanctions on South Africa was very important.  This was especially true in 1985 when South Africa declared a state of emergency in some regions and suppressed the blacks, provoking universal condemnation.  The “moral diplomacy” of the Western countries triumphed over the “diplomacy of interests,” resulting in severe sanctions, which clearly played an important role in South Africa’s subsequent transformation.  Prior to this, the “weakness” of Western sanctions had been consistently criticized. 
 
From another angle, whether an earlier use of severe sanctions to limit South Africa’s ties with the world economy would have helped to change South Africa is difficult to determine.  Historically, outside pressure had always led the Boers to circle the wagons.  This was awkward for the comparatively more open English speakers, and on occasion increased suffering for the blacks.  At the same time, even during periods when international sanctions were weak, it is clear that economic openness “subtly” increased human rights consciousness in South Africa.  The human rights views of many foreign companies in South Africa were more enlightened than those of South African companies, particular those of Afrikaners.  In 1977, Leon Sullivan (1922-2001), member of the board of General Motors and an African-American preacher, put forth six principles that American companies in South Africa should follow, which subsequently came to be known as the “Sullivan principles.”  These included:  no apartheid in company public spaces; support for blacks to organize unions; equal pay for equal work for all employees and higher wages than the local minimum living standard; training for blacks for managerial and technical positions; promotion of blacks to management positions; improvements in housing, transportation, medical treatment, education, and other welfare items for employees. By 1980, 137 American businesses had pledged to implement the Sullivan principles.  The European Union also mandated that their businesses in South Africa follow similar principles, and especially emphasized the rights of blacks to join unions.  These measures by foreign firms exercised considerable pressure on South African companies, and played an important role in creating the conditions in which, by the 1980s, the apartheid system was harder and harder to sustain.
　
In fact, even if foreign companies do not consciously spread the “Sullivan principles,” the entry of large amounts of foreign capital can still change the nature of relations between labor and capital in the host country:  when capital trends toward surplus (or moves away from scarcity), the bargaining power of labor declines, while when labor trends toward scarcity (or moves away from surplus), the bargaining power of labor increases.  Although the artificial political pressure of autocratic regimes can delay these effects, they will eventually appear as the trends dictate.
 
At the same time, we see the opposite effect in high human rights regions that export capital.  This capital, in their own countries, flees from unions that they cannot afford to antagonize, and when the cheap commodities flood back in from the low human rights regions in which capital has taken flight, this leads to capital shortage and surplus labor in the high human rights regions.  Unions decline, welfare is threatened, the balance of power between labor and capital is destroyed.  The disaster of the return of “savage capitalism” is hard to avoid.
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So it’s natural for the left wing in developed countries be opposed to globalization.  This is the upshot of the “Fogel impact.”  But it is strange that the low human rights regions into which investment is flowing also oppose globalization.  The rising strength of the ANC, and even of the South African Communist Party, benefited from the conscious or unconscious application of the Sullivan effect.  Their mission was not to oppose market globalization, but to promote the “globalization of human rights.”
 
What should be pointed out is that if there is not a “globalization of human rights” accompanying market globalization, meaning that at least the most basic of human rights will be commonly respected, then the “reverse impact” mentioned above will be hard to avoid.  In fact, transnational economic exchange contains possibilities other than the “Sullivan effect.”  When foreign capital enters a low human rights region it may well follow local customs, learning unspoken rules on how to “handle” officials, how to use the power of government to oppress workers, how to confiscate land, how to run off troublesome environmentalists and NGOs…South Africa had all this.  Does China?  Enough said.  And some foreign companies acculturate all too well, to the point that they don’t fit in any more when they go back home and bring this adverse impact to their native lands.
 
In sum, globalization produces a clear increase in the mutual influence between countries, and even a purely economic relationship can produce effects outside the sphere of the economy.  In the past, people seem to have paid attention only to the positive side of these influences, meaning the way in which high human rights countries influence low human rights countries by spreading ideas of human rights.  But some people like this influence and others fear it (like some South African Boers who talk about “English colonial conspiracies”).
 
In fact, influence always cuts both ways.  When high human rights regions influence low human rights regions by raising the profile of human rights, we can call this the “Sullivan effect,” based on the example of the Sullivan principles discussed above.  And when a low human rights advantage influences a region with high human rights, producing a diminution in rights, then we can call this the “Fogel effect,” building on Fogel’s scholarship discussed above (not that he would have approved of it, even if he certainly demonstrated it).  I certainly hope that the Sullivan effect wins out over the Fogel effect, but in fact, it is still too early to tell.   On this point, I should note an important difference between South Africa and China:  there is no way that South Africa can compare with the size of China’s economy.  And it will be much harder for the international society to change China than it was to change South Africa.  Quite the contrary:  little South Africa can hardly “change the world,” but the probability that China will change the world is surely much greater. 
 
 
 Notes


[1] 秦晖, “从南非看中国：何去何从 前景的比较,” available online at http://www.aisixiang.com/data/33585.html , published on Aisixiang on May 12, 2010.

[2] Translator’s note:  Qin’s point appears to be that the “pirate nations,” i.e., the colonial powers of the seventeenth century, played a major role in the primitive accumulation that made capitalism possible, and thus were a force for progress, while China and South Africa are parasitic free riders.  See J. L. Anderson, "Piracy and World History: An Economic Perspective on Maritime Predation," Journal of World History, 6. 2 (Fall, 1995): 175-199, available online at https://www.jstor.org/stable/20078637 .

[3] Translator’s note:  the “iron fist of government” is contrasted to the “invisible hand of the market.”

[4] Translator’s note:  The Glen Gray Act, passed in 1895, was a stepping-stone in the eventual construction of the apartheid system.  See https://www.sahistory.org.za/article/apartheid-legislation-1850s-1970s.

[5] Translator’s note:  This is a play on words.  The Chinese term for the American Civil War is “the war between the South and the North,” which Qin transfers to the divisions between “north and south,” developed and non-developed, on a global scale.