The Chinese lesson for Brazil – 01/08/2023 – Elio Gaspari

It’s in bookstores “How China Escaped Shock Therapy”, by the German economist Isabella M. Weber. The book goes further, showing why and how China succeeded. He is a product of the quality of his intellectual training and the vigor of Chinese academia. The professor used a rich bibliography and, above all, interviews, in Chinese, with 44 economists and bureaucrats.

Those who want to cut corners can start by watching Weber’s interview with reporter Mario Sergio Conti, on GloboNews’ Diálogos program that will air this Friday. It will reveal the conversations between the Chinese and the then Minister Delfim Netto in the 1980s, during the inflationary decline of the Brazilian Miracle.

Weber makes an erudite study of the Chinese economy and arrives at the moment of the reforms that woke up the giant: “The invisible hand [do mercado] was introduced under the guidance of the visible hand [do Estado]”. Many countries at many times have tried this and found themselves in the dark. China succeeded because its decisions were made through a subtle consultation process.

At the summit, Chinese politics are fierce. President Liu Shaoqi died in 1969 in a dungeon and the powerful wife of Mao Zedong killed herself in jail. (At least 16 million Chinese and possibly 40 million starved to death.) After Mao’s death, subtlety operated in the midfield.

In China’s renaissance, figures emerged who during the Cultural Revolution (1966-1976) had been banished or imprisoned. Sun Yefang, for example, said that “the law of value was not the hallmark of capitalism, but a universal economic rule.”

In 1977, when General Sylvio Frota thought that President Ernesto Geisel had something of a socialist in him for having restored relations with China, Mao’s successor, Hua Guofeng, sent exploratory missions to the world to study the necessary reforms for China. In 1978, when the Era of Deng Xiaoping began, he had a simple slogan: “Seek truth from facts”.

Weber’s book is also a dive into the ideas of economists of all stripes. The Chinese listened to former defenders of Stalinist orthodoxy and liberals like Milton Friedman. (In 1973 Friedman was in Brazil, but president-elect Ernesto Geisel did not have a free schedule to receive him.)

Weber shows that the Maoist model was turned upside down by experimental gradualism. Internal struggles persisted. Prime Minister Zhao Zhiang died in 2005 under comfortable house arrest. Despite this, Chinese economists and bureaucrats listened to each other. In a crude comparison, the Chinese toucans listened to Eduardo Suplicy and the PT members listened to Pedro Malan.

Two generations, which could have clashed, converged, looking forward. Mao sent millions of young people to re-educate themselves in the countryside. Some of them were at the core of the turn because they understood poverty. One of them was Zhou Jiaming, the one who talked with Dolphin. He grated an exile until 1989.

In Pindorama, at a time when Geisel had no agenda for Friedman, a banker’s publisher managed to get the American professor Paul Samuelson to agree to the deletion of some paragraphs in his book where he predicted that the Brazilian Miracle could turn sour.

Weber closes his book with the voice of the poet Antonio Machado (1875-1939): “Walker, your footprints are the path and nothing else; walker, there is no path, the path is made by walking”.

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