James Goldgeier says China refutes the notion that capitalism and democracy must go together.

Question: How do we engage with a country that is economically strong but politically repressive?

James Goldgeier:  Well, the big idea-- The Clinton administration, it's interesting, Clinton, in the '92 campaign really beat up George H. W. Bush for what he called-- what Clinton called coddling the butchers of Beijing. That is, not paying enough attention to human rights issues. But when Clinton came into office he realized that he would really have to deal with this rising power and try to work out a relationship with that power. And the idea behind the Clinton policy was that China needed to be brought into the international institutions that the United States had created in order to have China be part of the international community and not try to undermine what the international community was doing. And probably most significantly during the Clinton years, this was the process of bringing China into the World Trade Organization. The legislation for that had been passed in 1994. It was a big achievement for the Clinton team. And by the end of the Clinton time in office, the United States had managed to bring China into this organization on the notion that if you gave China a stake in, for example, the international trading order, that you could make China a more cooperative partner of the United States as opposed to a country that might seek to undermine American interests. The other thing that I think people really believed, and this a problem for where we are today, there was a notion that basically comes out of how we think about the way countries develop. And that is this notion, and we've seen it, for example, in South Korea and Taiwan and other places, that countries develop economically. They may have authoritarian state, but as they develop economically, there is a growth in the number of people that come into the middle class and that middle class then starts demanding more political freedom and so you get an openness of the political system. And, you know, we had that in South Korea, we've had that in Taiwan. There was an expectation in the '90s that as China developed economically, and as you had a rise of the middle class, that it would open up more politically. And that hasn't happened, and that's the big challenge today. How do we deal with a country that's so economically strong, but in which the party that rules that country doesn't look like it's going anywhere and seems to have created an alternative model of capitalism? We in the United States like to think of capitalism and democracy as going together. And if the Chinese are able to have capitalism, but with an authoritarian system, then they provide an ideological alternative to other countries out there where the leaders want to get rich but don't want to open up the political system, and that's a big challenge for the United States

Question: Will we ever see a viable challenge to the government from China’s middle class?

James Goldgeier:  Well, what we've seen is that there has been a real growth in income.  I mean there's certainly still a lot of people who live in poverty in China, but, you know, there are hundreds of millions of people who have been advantaged by the economic growth who seem to be focused on their economic well-being.  And as long as can achieve that economic well-being, they don't, at least so far, have chose not to organize to do something about the political system.  We don’t know how long that will last, but certainly, the system seems to be functioning now.  Just as, for example, in Russia, you know, a lot of people in the West complain about the authoritarian trend that's taken place since Putin became president in 2000, but the lives of the Russian people have improved greatly and there's not a huge outcry against the political system, so we may be seeing the emergence of these authoritarian capitalist regimes that really can, you know, remain, for themselves, be stable.  They are more assertive in the international system and they're going to be a challenge for the United States.

Recorded on: 07/08/2008