Chinese Government Turns Against Foundation of China’s Own Prosperity

China, ruled by a one-party dictatorship, owes its increased influence in the world to the economic liberalization that has unleashed the energies of Chinese people.  The Party, however, lives not for its people but for itself, and now turns against the forces that created new happiness and greater autonomy for many millions, and toward greater control (and redistribution) to the advantage only of a powerful clique.

Li Yuan reports Private Businesses Built Modern China. Now the Government Is Pushing Back:

HONG KONG — The comments were couched in careful language, but the warning about China’s direction was clear.

China grew to prosperity in part by embracing market forces, said Wu Jinglian, the 88-year-old dean of pro-market Chinese economists, at a forum last month. Then he turned to the top politician in the room, Liu He, China’s economic czar, and said “unharmonious voices” were now condemning private enterprise.

“The phenomenon,” Mr. Wu said, “is worth noting.”

Mr. Wu gave rare official voice to a growing worry among Chinese entrepreneurs, economists and even some government officials: China may be stepping back from the free-market, pro-business policies that transformed it into the world’s No. 2 economy. For 40 years, China has swung between authoritarian Communist control and a freewheeling capitalism where almost anything could happen — and some see the pendulum swinging back toward the government.

State-controlled companies increasingly account for growth in industrial production and profits, areas where private businesses once led. China has stepped up regulation of online commerce, real estate and video games. Companies could face higher taxes and employee benefit costs. Some intellectuals are calling for private enterprises to be abolished entirely.

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