The United States Of China By Scott Moore

Yet federalism’s biggest benefit for China is its promise to better address the concerns of restive minority regions.

Last week, China’s two primary legislative bodies, the National People’s Congress and the People’s Political Consultative Congress, convened their annual meetings in Beijing. Although the delegates’ primary function is to ratify decisions made by Communist Party leaders, the occasion of the two assemblies often stokes debate on policy reforms.
The delegates had much to discuss, including a recent murderous rampage on civilians at a train station in the south, linked by the government to a separatist movement in the west. Yet the most promising path for long-term political reform in China was not on the agenda: federalism.

China is by far the world’s largest and most populous country not to use a federal system of government. Beijing tightly controls all political power and major decision making. In contrast, countries from Australia to Venezuela have tried to solve the problem of governing large and diverse territories by granting substantial autonomy to sub-national regions. These forms of federalism vary and, in places like Russia, even co-exist uneasily with authoritarianism.

Federalism has much to offer China – but it would require the leaders in Beijing to give real political and decision-making power to local authorities. As the current system works, the role of provincial and local governments is simply to implement policies from up on high.

In order to carry out the central government’s dictates, local leaders are given wide discretion over how to spend money. Most national laws and regulations establish specific targets that provincial and local governments must meet, but local officials are left to deploy resources as they see fit. China’s energy legislation, for example, sets efficiency targets that each province is responsible for meeting individually.

Surprisingly, local governments in China are responsible for a larger share of total government spending than in the federal United States or Switzerland. But this economic decentralization does not equal federalism: Local governments only carry out policy, they do not determine it.

This hierarchical structure reflects a long tradition of Chinese political thought. The notion of a single unitary state, or dayitong, has historically been seen as the natural goal of any government, and Chinese scholars and leaders have long warned of the dangers of “localism.”
But adopting federalism would help to ease one of modern China’s most fundamental governance problems: The fact that local officials often implement central policies halfheartedly, if at all. Caught in a system that gives them plenty of responsibilities but no accountability to constituents, China’s local officials emphasize short-term economic growth over compliance with directives like antipollution and social welfare targets. The result is that environmental and social policies are often badly implemented. If provincial and local officials had a greater voice in developing policy, they would have a greater stake in the outcome of these policies.
This has always been a major problem in environmental protection: The central government sets unrealistic standards that local governments can’t meet without jeopardizing economic growth. If local leaders could set locally appropriate standards, they would have both greater accountability and greater interest in ensuring these standards are met.

Yet federalism’s biggest benefit for China is its promise to better address the concerns of restive minority regions.

Federalism is the best way to accommodate regional demands for autonomy short of breaking up the country. It is the smartest long-term strategy for dealing with separatist movements in Tibet and Xinjiang. In theory, these and several other minority-dominated areas are “autonomous regions.” In practice, Beijing calls all the shots and these regions enjoy nothing like the autonomy found in most federal systems. This facade is unlikely to preserve social stability in the long run. Implementing federalism would help ensure that minority-majority regions are given representation in the political system and help to address demands for greater autonomy.

Even more importantly, federalism represents the only conceivable, peaceful long-term solution to Beijing’s nagging problem of Taiwan. China has made clear that independence for Taiwan is unacceptable, but Taipei is equally unequivocal that it will not live under an illiberal People’s Republic. A form of federalism in which Taiwan – along with Hong Kong, Macau and China’s ethnic-majority regions – maintain substantial autonomy is the most viable way forward.

Of course, a workable federal system in China would probably bear little resemblance to the systems of the United States and other Western countries. Instead, it might look more like the arrangements adopted by India, Pakistan, Malaysia and several other Asian countries, where the central government plays a far stronger role than it does in the West, and where many provisions are designed to preserve national unity. India’s Constitution, for example, gives the central government power to intervene in local government if the country’s integrity is threatened.

The great lesson of federalism is that countries can often become stronger by adopting a looser union. If China’s leaders want to ensure their country’s peace and prosperity over the long run, they would do well to chart a course toward a federal future.
Scott Moore is a research fellow at Harvard’s Belfer Center for Science and International Affairs, where he studies Chinese politics.