14.1 THE Great Challenge: Understanding Totalitarianism

Over seven decades ago, when Mises made his observations, the world had already seen the defeat of Nazi-Fascist totalitarianism. Thus, his references were primarily directed towards communist totalitarianism, the only enduring form of totalitarianism. As outlined in Chapter 6, the origins of communist totalitarianism can be traced back to the Middle Ages. In fact, Nazi-Fascist totalitarianism was, in many ways, an imitation of its communist counterpart. From a historical vantage point, the primary institution of totalitarianism has been communist. Emphasizing “totalitarianism” over “communism” is an attempt to uncover and recognize the inherent coercive nature of communism. This is crucial because the profound misunderstandings associated with communism serve as foundational elements in the creation and perpetuation of totalitarian regimes.

Shortly after Mises made these remarks, the rapidly expanding communist totalitarian system took control of a third of the earth’s population. His assertion that “all these efforts have been a complete failure” became evident. The modern totalitarian regime, underpinned by a totalitarian party, arose from the most extensive and fanatical secular religious movement in history. Totalitarianism categorically differs from traditional autocracy in ideology, operating mechanisms, and institutional origins. From the First World War and the October Revolution to the Second World War, the Cold War, and today’s emerging “New Cold War,” communist totalitarian regimes have exhibited a willingness and capacity to expand rapidly wherever they could at the cost of many lives. These are the direct consequences of the unique mechanisms inherent in totalitarianism. A thorough understanding of the ideology and mechanisms of communist totalitarianism is essential to meet its challenges. Unfortunately, both academic and policy circles have paid far too limited attention to this grave matter, which affects the lives of a significant portion of the world’s population. In the limited literature, most research on totalitarianism is confined to philosophy, historical records, or idiosyncratic issues. Comprehensive research on the basic mechanisms of communist totalitarianism is sorely lacking. The challenges posed by the lack of a deep understanding are particularly acute in the face of the urgent situation of the rapid expansion and threat of a communist totalitarian China.

The totalitarian system of the Eastern bloc collapsed at the end of the 1980s before its nature was fully understood. This lack of understanding is accompanied by a widespread misconception that communist totalitarianism is extinct in the world and that the CCP is not a totalitarian party. As a result, interest in further research into the poorly understood communist totalitarianism has declined. It is common to confuse the system under the CCP as authoritarian, likening it to the pre-1990s regimes in Taiwan and South Korea. Therefore, many scholars and politicians mistakenly believe that like the historical trajectory in Taiwan and South Korea, China will progress towards liberal democracy along with its rapid economic growth. This book aspires to offer a systematic empirical analysis of China’s communist totalitarian regime, as well as its institutional origins, with significant analysis on Russia. The concept of institutional genes, introduced in this book, serves as the theoretical framework for this empirical analysis. The systematic nature of this analysis sets it apart from previous academic studies on China, socialism, communism, and totalitarianism.

14.2 Summary of Institutional Genes and Institutional Evolution

This book introduces the concept of institutional genes, intending to provide a framework for analyzing institutional evolution. Based on empirical observations of institutional evolution, it draws inspiration from the ideas of many scholars. Scholars such as Hume, Smith, Mises, Hayek, Popper, and North have all emphasized that institutions emerge and evolve from the mass of spontaneous interactions among individuals and groups within society. Furthermore, institutions are structured and some of the structural components bear more significance than others. Those foundational and recurrent components in institutional evolution are what I designate as institutional genes. The incentive-compatibility nature of institutional genes dictates that the individuals who play a role in the institutional evolution recreate those basic institutional components under new names in new situations out of their self-interest. That is why those components are repetitive and foundational. The term “incentive-compatibility” originates from mechanism design theory but its essence was explored by Adam Smith and Friedrich Hayek long before the birth of that theory. Smith argued that in the grand chessboard of human society, every individual adheres to their “principle of motion” (motion in this context corresponds to action or behavior in contemporary economics), whereas the legislator envisages rules to regulate everyone with another set of principles. It is only when “those two principles coincide and act in the same direction, [that] the game of human society will go … harmoniously” (Smith, Reference Smith2011, part 6, chapter 2). The mechanism that enables these two principles to coincide and act in unison, as Smith articulated, is precisely the mechanism of incentive-compatibility. Of course, Smith’s discussion focuses on naturally occurring coincidences. While Smith’s discussion centers on naturally occurring alignments, mechanism design theory, in contrast, examines the behavior of individuals in society and, based on those observations, identifies or designs mechanisms that align with their incentives.

Smith’s theory centers on a harmonious society governed by the rule of law. This book extends this theory to autocratic systems where violence is widely practiced. When a system is based on violence, everyone’s principle of motion is forcibly altered due to tyranny. I refer to this as the tyrannical incentive-compatibility condition (see Chapter 2). Excessive brutality that violates this condition can destabilize and undermine the system. For an autocratic regime to endure, the rulers must ensure they adhere to this tyrannical incentive-compatibility condition. In addition to coercive force, this also encompasses controlling public opinion, brainwashing, and cultivating ideologies and societal norms that serve to endorse and validate the tyranny. Once entrenched, these ideologies and norms perpetuate themselves, influencing individual beliefs and guiding their incentives. Therefore, in any system, everyone follows their own principle of motion. Those principles are conditioned and influenced by the system in which people live and have lived, by historically formed social norms (which include culture, and beliefs, and so on), and they are based on the institutional genes.

The incentive-compatibility character of institutional genes includes both perfect rationality, which is the premise of game theory and mechanism design theory, and bounded rationality. The latter is prevalent in rules, in social consensus, and in social norms, that have evolved over time. Individuals who breach those rules or norms violate the incentive-compatibility condition of the society in which they live and, as a result, they tend to isolate themselves or even be punished. Hayek argued that the human capacity for collecting information and reasoning is extremely limited. To mitigate the heavy burden of information collection and rational reasoning, social behaviors performed by most individuals are grounded in compliance with long-standing and incentive-compatible rules, rather than relying solely on their rational reasoning. Hayek thus described man as a creature that follows rules (Hayek, Reference Hayek1973, chapters 1, 2, 4). Recent developments in contract theory and law and economics, both theoretically and empirically, further affirm Hayek’s argument. Hart and Moore demonstrate that in devising contracts, people intentionally use social rules or norms that must be adhered to as contractual provisions (Hart and Moore, Reference Hart and Moore2008). That is because the contract is always incomplete in practice, due to bounded rationality in designing contracts (Hart and Moore, Reference Hart and Moore2008; Frydlinger and Hart, Reference Frydlinger and Hart2022). Bolton and Brooks (Reference Bolton and Brooks2022) demonstrate that court enforcement of contracts is often based on compliance with social norms due to the insolvable difficulties of relying on an entirely rational approach to enforcement in reality.

The relationship between the concept of “institutional genes,” introduced in this book, and the notions of “institutional evolution” or “change” prevalent in the literature is of paramount importance. The framework of institutional genes, primarily employed for positive analysis, can also be normative when directed towards policy recommendations; its relationship with institutional change can be articulated in the following manner:

• Any stable institutional evolution or change, including reforms or revolutions, that is effectively realized within a society is considered to be based on the evolution or mutation of that society’s institutional genes.

• The evolution or mutations of institutional genes arise as a result of interactions among various interest groups, especially as they navigate new circumstances or address emerging crises.

• Initiatives or campaigns aimed at reforms or revolutions that neglect the characteristics or evolution of institutional genes or that fail to stimulate the requisite mutations of these genes will likely miss their intended objectives. In simpler terms, any institutional change that reformers or revolutionaries hope to effectuate successfully must be fundamentally rooted in institutional genes. Notable examples include the British Glorious Revolution and the establishment of constitutional democracy in the United States, both of which can be attributed to such foundational genes. Often, mutations in institutional genes are prompted by potent external factors, as seen in the totalitarian systems established in Russia and China.

14.3 An Empirical Analysis of Totalitarian Regimes

The Chinese are also Homo sovieticus, created in the same Marxist-Leninist laboratory, as studied in this book. However, Marx predicted that the communist revolution could only occur in developed capitalist countries like Germany. In reality, no developed capitalist country has established communist totalitarianism. The question is, why, contrary to Marx’s basic principle and prediction, was this laboratory able to establish itself in a pre-capitalist Russia and then in an even more “backward” China and why has it been so enduring and powerful in China? Understanding the origins and evolution of totalitarianism in China extends beyond mere scholarly endeavor. It touches on pressing contemporary issues that span the global economy, international relations, geopolitics, and the delicate balance between war and peace on the international stage. This book delves into the aforementioned question. Its main points can be summarized as follows:

1. 1) Essential parts of the institutional genes of Tsarist Russia and Imperial China served as the institutional origins of the Leninist party and the communist totalitarian regimes. Built upon these institutional genes, the totalitarian regimes in both nations were “created” through violent revolutions led by the party (see Chapters 4, 5, and 9–11 on China; Chapters 8 and 9 on Soviet Russia; and Chapter 6 on the origins of totalitarianism).

2. 2) When communist totalitarian ideology and systems (including systematic incitement and the use of terror as a threat) are effectively governing, their mobilization capacity is extremely powerful.

3. 3) Totalitarian parties’ superior mobilizing capacity stems from strategically exploiting the short-term interests of the vast majority of the population, including party members and cadres. They segment long-term goals that fundamentally infringe upon popular interests into multiple short-term, incentive-compatible phases. These phases are then implemented sequentially in a piecemeal manner (refer to Chapters 8, and 10–12 for empirical evidence). This strategy resembles constructing a vast, centralized, multistage Ponzi scheme, where each stage operates as its own distinct Ponzi scheme, furnishing exceptionally compelling incentives for the participants. By capitalizing on people’s short-term behaviors, subsequent Ponzi schemes are established and sustained. In addition to this feature, unlike traditional Ponzi schemes, which hinge exclusively on financial incentives, communist totalitarian Ponzi schemes also harness the tools of incitement and violence. These provide additional mechanisms to bolster short-term incentives alongside the allure of promotions and rewards. Moreover, incitement and violence often surpass the power of money in stimulating irrational group behavior.

4. 4) The inherent nature of communist totalitarian ideology and regimes necessitates continuous expansion, both internally and externally. This nature also dictates the brutal character of its expanding power. To safeguard democracy in the world, it is imperative to resolutely contain this expansion. However, achieving this requires a deep understanding of the system’s true essence. Discussing the avoidance of the so-called Thucydides Trap (Allison, Reference Allison2017) by equating the forces of emerging totalitarian regimes with those of other regimes not only misconstrues the nature of the Chinese totalitarian regime but also gravely misdirect the policy responses to its challenges.

5. 5) The first communist totalitarian regime, the Soviet Union, and its Eastern bloc, collapsed by themselves. Such self-termination is contingent upon its degeneration, including the totalitarian party’s losing control of society and the abandonment of the totalitarian ideology by society universally, even by a substantial portion of the party apparatus. During the degeneration process, the totalitarian system may transition into relatively lax authoritarian rule or it might suddenly collapse.

6. 6) The decline or collapse of a totalitarian regime is a necessary precursor for a shift towards constitutional democracy but it does not ensure such a transformation. A robust constitutional democracy is anchored in the right institutional genes, which necessitate the right conditions and adequate time to develop and flourish. Complicating this transition, totalitarian regimes, in their bid for survival, invariably strive to suppress or obliterate these emerging institutional genes at every opportunity. This makes a post-totalitarian transition to democracy even more challenging.

The conceptual framework introduced in this book, encompassing institutional genes and incentive-compatible institutional evolution, is heavily influenced by mechanism design theory and various branches of the social sciences, including political economy, political science, and jurisprudence. Evidence of institutional genes, as well as their emergence and evolution, is elucidated through historical narratives.

I am a political economist and an institutional economist with a passion for history but I am neither a historian, political scientist, or a legal scholar. Given this, I fully anticipate critiques of this book from experts in these fields. Even within political economy or institutional economics, I expect many will find points of contention with the arguments presented here. However, if this book brings more attention to the topic of communist totalitarianism or sparks debates about the methodology of institutional genes or institutional evolution in general, I will consider it a success from a purely academic point of view.

As for the broad and exploratory nature of this book, I can only offer a humble explanation: the topics discussed necessitate such a wide-ranging journey. Without venturing beyond the traditional boundaries set by academia in terms of disciplinary fields, historical periods, and geographical regions, it would be impossible to comprehensively address the origins and evolution of institutions.

It is particularly worth remarking that transcending the traditional disciplinary boundaries of the social sciences is essential when analyzing communist totalitarian regimes and their institutional origins. In such regimes, political power dictates resource allocations, while the economy reciprocally wields profound influence on political power, offering both foundation and function. Concurrently, the regime dominates the entirety of society, ensuring that economic and non-economic social organizations are indivisible from the party’s authority. Furthermore, the party directly controls the legislative and judicial systems, leveraging the law to regulate both the economy and society.

The historical narratives in this book serve as evidence for the empirical analysis of institutional genes, including their origins, evolution, and mutations. The narratives largely draw upon accounts considered authoritative within historical circles, as the primary aim of this book is not to unveil new historical materials or evidence. In terms of CCP history, the works of Gao Hua, Shen Zhihua, Yang Kuisong, and others have been extensively cited. For insights into the Cultural Revolution and the early stages of reform, references are made to works by Yang Jisheng and his contemporaries. On Soviet Russia, this book leans significantly on the works of scholars like Richard Pipes.

However, due to the unique perspective of this book, certain essential pieces of evidence are not available in secondary sources, requiring the sourcing of primary evidence. For example, certain key pieces of evidence pertaining to the origins and evolution of the CCP are cited directly from declassified official documents of the Comintern, the CPSU, and the CCP. This includes writings by Mao Zedong, Zhang Guotao, Chen Duxiu, and others, encompassing material not officially released within the PRC. Similarly, documents of the Narodnaya Volya are cited as evidence of the Bolshevik institutional genes.

14.4 Literature Overview

An enormous body of literature directly concerns or is relevant to the topics addressed in this book. Due to considerations of space, only a small portion that is most relevant to this book is briefly discussed here.

14.5 The Transformation Path in Taiwan: An Institutional Gene Analysis

Finally, using Taiwan as a case study, we employ the analytical framework of institutional genes to dissect the differing institutional evolutions between Taiwan and the PRC (mainland China). The focus is on the connection between Taiwan’s institutional genes and its institutional transformation.

Contrasting starkly with the totalitarian nature of the PRC, Taiwan underwent a peaceful transition from the KMT’s one-party authoritarian regime to a multiparty democratic constitutional system from the late 1980s to the early twenty-first century. Presently, Taiwan thrives as an affluent, advanced economy with a well-established constitutional democracy. In terms of democracy, freedom, and per capita GDP (adjusted for purchasing power), it ranks at the pinnacle in Asia, even outstripping Japan (EIU, 2022; Tyrrell and Kim, Reference Tyrrell and Kim2022; IMF, 2022a).

Did Taiwan and mainland China ever share the same institutional genes? If they did, a challenging question arises: Why was Taiwan able to undergo a successful institutional transformation, while mainland China remained ensnared in the totalitarian system inherited from Imperial China and the Soviet Union? Can the analytical framework of institutional genes explain Taiwan’s institutional transformation? What insights can Taiwan’s successful institutional transformation provide for the future development of mainland China?

Several prevalent explanations from the literature on Taiwan’s institutional transformation are delineated below. The first explanation, grounded in modernization theory, posits that the creation of a constitutional government in Taiwan stemmed from its economic development. Economic development in Taiwan was indeed marked by the significant rise of a middle class with private property rights, which became an institutional gene supporting constitutional transformation. However, it is important to note that, in contrast to Taiwan, whilst mainland China has engendered a substantial private sector and a sizable middle-income class during its economic reform, these businesses and individuals are denied the right to act freely in numerous domains. Consequently, business owners operate in perpetual uncertainty and are aware that ultimate control lies beyond their grasp. It is seriously misleading to assert in general terms that economic development will lead to democratic constitutionalism without distinguishing the actual mechanisms of ownership, considering the human rights of individuals in economic development, or identifying how the economy develops. The illusory expectation that China might transition to democracy as part of the economic development process was once largely misguided by such assertions that overlooked human rights issues.

The second popular explanation underscores the personal roles played by successive KMT heads Chiang Ching-kuo and Lee Teng-hui, asserting that their personal stance, vision, and charisma served as a pivotal factor. Although such an interpretation partially reflects the reality, it neglects other foundational and significant historical elements. Terminating authoritarian rule in Taiwan and establishing a constitutional and democratic system was a protracted and fraught process spanning many stages. Each significant stride in this process was not a proactive strategy orchestrated by the politically powerful but rather it emerged as a result of a gradual process, wherein leaders either acclimatized to or were compelled to capitulate to intense social pressure. Chiang suppressed several peaceful movements advocating for democracy before the mid-1980s. It was not until the later stages of his life when the change transpired. Starting from the late 1980s, and particularly from the 1990s onwards, the KMT leaders elected to conform to social trends in the face of substantial pressure. Throughout this process, they endeavored to surmount the resistance from the conservative faction of the KMT that defended the authoritarian rule, thus asserting themselves as respected political leaders. History demonstrates that significant social pressure was critical for overcoming the conservative forces within the KMT. Even if Chiang and Lee championed constitutional reform owing to personal beliefs and proficiently mastered the political tactics necessary to advance democratic reform, in the absence of this intense societal pressure, the vested interest groups of the KMT would have had sufficient power to depose them. Moreover, the forces that exerted such potent pressure towards democratic constitutional reform in Taiwan are the result of the evolutionary reinforcement of Taiwan’s institutional genes for constitutional democracy.

The third opinion attributes Taiwan’s successful institutional transformation to Confucianism or Neo-Confucianism. From a philosophical perspective, the academic community holds differing views concerning the relationship between Confucianism and constitutional democracy. Samuel Huntington perceives the two as conflicting values, while Yu Ying-shih sees them as complementary (Huntington, Reference Huntington1996, p. 238; Yü, 2016, chapter 13). We will not delve into Confucian philosophy here but rather provide an empirical overview of the extent of Confucianism’s popularity in Taiwan and its influence on Taiwan’s institutional transformation. Before Taiwan became a Japanese colony, Confucianism was far less prevalent there than it was in mainland China. Taking the imperial examinations for the jinshi (Presented Scholar) degree as an example, a mere 29 individuals from Taiwan were awarded the jinshi degree under Chinese imperial rule, compared with 1,373 in Fujian Province during the same period (and 26,813 nationwide; data from Zhu, Reference Zhu1963). Thus, Taiwan accounted for only 2 percent of those from Fujian and 0.11 percent of the total nationwide, despite Taiwan representing 19 percent of the population of Fujian and 0.73 percent of China’s population in 1880 (Cao, Reference Cao2001, vol. 5, pp, 694, 704). That is, it was many times below the national average.

After Taiwan became a Japanese colony in 1895, the standardized Japanese education system implemented since the Taishō period (1912–1926) had a profound impact on Taiwan’s ideology. In contrast, the Confucian component of standard Japanese education was limited to the level of literacy. Confucianism did not really become a major part of Taiwan’s education and ideology on a large scale until after the Second World War, when it was brought in by the Nationalist government. Moreover, the individuals who played the most significant roles in Taiwan’s democratic constitutional transformation (for example, the core members of the Democratic Progressive Party [DPP]) were primarily native Taiwanese who were not deeply influenced by Confucianism. For example, Lee Teng-hui, the KMT chairman, received a comprehensive Japanese education in his early years and later became a devout Christian. Among the Chinese intellectuals and KMT members who arrived in Taiwan after 1945 and were deeply influenced by Confucianism, some supported constitutional democracy in principle and others were against constitutionalist reform. An indisputable fact is that the majority of KMT conservatives during Taiwan’s institutional transformation were Confucian adherents, often citing the Confucian classics in their opposition to democratic constitutionalism.

A notable fact is that Taiwan’s institutional genes markedly differed from those of the mainland when the Nationalist government took over Taiwan after the Second World War. First, the institutional genes of the Chinese imperial system had only superficial roots in Taiwan. It was not until the Qing dynasty that Taiwan officially became a prefecture of the empire. Prior to this, during the Ming dynasty’s reign, after General Zheng Chenggong’s conquest of the island in 1662, control over Taiwan was largely symbolic without effective administration. The first regime to rule the whole island of Taiwan was established by the Dutch in 1624. Qing rule in Taiwan was rudimentary, both in terms of ideology and the formal institutions of imperial control. “The sky is high, and the emperor is far away”; the provisions for Chinese imperial control were never profoundly incorporated into the Taiwanese mindset. The limited influence of the imperial examination system and Confucianism during Qing rule in Taiwan underscores the minimal impact of these imperial institutions. As a result, Taiwan became a sanctuary for covert rebel groups escaping from Guangdong and Fujian. One of the most significant armed revolts in the Qing dynasty’s history was sparked by a faction of the Heaven and Earth Society in Taiwan during Emperor Qianlong’s reign, which then extended to the mainland.

Second, when the KMT and the CCP in mainland China were embracing Bolshevism in the 1920s, Taiwan was deeply influenced by the Japanese constitutional reforms, further differentiating its institutional genes from those in the mainland. In the late nineteenth century, Japan was the primary channel for introducing democratic constitutional thinking to both mainland China and Taiwan but such ideas were embraced much more in Taiwan. Under the Treaty of Shimonoseki between China and Japan, Taiwan was ceded to Japan in 1895 and has since taken a different path of development from that of the mainland. Perhaps the most important of these was the change that took place in Taiwan during the Taishō period (1912–1926) in Japan. Influenced by the European democratic movements of the time, the Japanese elite promoted democratic constitutionalism in both Japan and its colonies, allowing the institutional genes of democratic constitutionalism to gain an initial boost in Taiwan. In 1914, Japanese constitutional reformers and the Taiwanese elite formed the Taiwan Dōkakai (Taiwan Assimilation Society), advocating for equal treatment for Taiwanese and Japanese nationals and hoping that Taiwan would be incorporated into the Japanese constitutional system and have the right to elect representatives to the Japanese Diet. Taiwan’s first political party, the New People’s Society, was subsequently established and a petition campaign was launched to demand an elected parliament for Taiwan. From then on, the spontaneous, bottom-up demand for democratic autonomy has become part of Taiwan’s institutional genes.

As part of the Taishō Democracy policy, from 1919 onwards, Japan implemented the so-called “Extension of Home Rule Policy,” treating Taiwan as an extension of Japan, with the aim of establishing a system of local administration, law, and schooling in Taiwan identical to that of Japan. Although only partially executed, it incorporated elements of Taishō-Democracy-era democratic constitutionalism into Taiwan’s institutional genes, including bottom-up demands for grassroots autonomy and pressure for democracy. Under pressure from Taiwanese society, in 1935, the Japanese government decided that half of Taiwan’s prefectural (county), city, town, and village deputies would be elected by popular vote and this was fully implemented twice, in 1935 and in 1939 (Rubinstein, Reference Rubinstein2007, pp. 220–234). Entering the Shōwa era, Japan’s domestic politics changed. From the 1930s, militarist groupings in the army seized political power in Japan through assassinations and coup attempts. In the 1940s, Japan’s militarist government suppressed civil society and democratic demands both in Japan and in its colonies.

However, the institutional genes of constitutionalism that had formed in Taiwanese society in the 1920s were not completely eradicated by the suppression of militarism and resurfaced as soon as they had the opportunity to do so. Since being taken over by the ROC in 1945, there has been popular sentiment in Taiwan to restore local autonomy. Thus, in 1946, general elections for representatives of villages, towns, and cities were held in Taiwan. These were more driven by the demand of Taiwanese society than by the KMT. Evidently, a general election in Taiwan took place before the ROC Constitution was passed and no such comprehensive general election took place in any KMT-controlled province on the mainland. These representatives then indirectly elected county-level delegates, who, in turn, selected thirty senators. From 1950 onwards, administrative heads at the county level and below, as well as provincial and municipally directly governed council members and grassroots representatives, were directly elected by citizens. This means that from 1950 onwards, local governors at and below the county and city level, members of provincial and municipal councils, and deputies at the community level were directly elected by citizens.

Taiwan’s democratization process was severely hindered by the February 28 Incident of 1947, during which the ROC government killed more than 30,000 Taiwanese (Fulda, Reference Fulda2019, p. 124). Subsequently, the government implemented martial law. The following year, the “Temporary Provisions Effective during the Period of Communist Rebellion” (hereinafter referred to as “Temporary Provisions”) were enacted, superseding the constitution. However, the expansion of local autonomy did not entirely cease. Moreover, despite the ban on forming political parties and the restrictions of elections to local grassroots levels, the relatively stable and limited grassroots elections over several decades allowed the institutional genes of constitutionalism to continue evolving in Taiwan. The February 28 Incident and the subsequent repression intensified the conflict between the KMT as foreign rulers and the Taiwanese citizens, further fostering democratic consciousness and amplifying the local demand for autonomy in Taiwan.

Third, in stark contrast to the CCP’s continuous efforts to prevent “peaceful evolution” during its reforms, the significant development of the private economy, under thorough protection of private ownership in Taiwan, has become an integral part of the institutional genes of constitutionalism. The widespread recognition and relative security of private property rights shape the general motivation and capacity of the population to safeguard their interests. Aiming to eradicate the social roots of the Communist Party, the ROC government executed extensive land reforms in Taiwan, starting from the early 1950s. Under the ROC constitution, these reforms empowered Taiwanese farmers to own their land. Consequently, private enterprises began to thrive, shifting the state-centric economy of the 1950s towards one dominated by the private sector. Under the KMT’s one-party rule, the so-called “state assets” were, in essence, KMT resources. Even though the KMT ardently worked to uphold one-party authoritarianism, it diverged significantly from communist totalitarianism that sought to abolish private property. To foster economic growth, the KMT championed the expansion of private enterprises. In 1953, over three-quarters of loans issued by banks (predominantly state-owned) were issued to SOEs, with less than a quarter provided to private enterprises. With the steady development of the private sector, by 1979 the proportion of bank loans issued to private enterprises had risen to 77 percent (Kuo and Ranis, Reference Kuo and Ranis1981, p. 59). In 1986, on the eve of the lifting of bans on political parties and the press in Taiwan, the share of SOEs in GDP had fallen to just 17 percent.

Private property rights is the economic foundation for the development of independent associations, political parties, and the media. In the 1970s, Taiwan saw a surge in independent media and NGOs opposing the KMT’s one-party rule through active participation in local elections. However, a turning point emerged at the close of 1978. After the United States declared its recognition of the People’s Republic of China and terminated official diplomatic ties with the Republic of China, Chiang Ching-kuo announced a halt to all elections, leveraging powers vested by the Temporary Provisions. This decision ignited fervent opposition. The government’s response was a violent crackdown, leading to the Kaohsiung Incident in late 1979. Yet, the KMT does not embody a totalitarian ethos. Consequently, it cannot openly oppose the basic principles of constitutional democracy or fundamentally undermine its institutional genes. Thus, this suppression of demands for associational freedom and press freedom paradoxically bolstered appeals for reinstating elections and ending the prohibition on political parties and media. This shift piled immense pressure onto the KMT, accelerating the emergence of oppositional political factions.

Having developed over several decades, by the 1980s the institutional genes of constitutionalism in Taiwan were strong enough not only to render the authoritarian violent rule ineffective but also to spark stronger resistance. Ultimately, the KMT government was forced to lift its bans on political parties and the press in 1987, heralding the end of authoritarian rule.

In addition to internal pressures, strong external pressures and influences also made significant contributions. Foremost among these were pressures and influences from the United States on the KMT and the Chiang family. Those pressures intensified after Taiwanese agents assassinated the author of a biography of Chiang Ching-Kuo in the United States in 1984. It weakened the hardline conservatives in the KMT and forced Chiang Hsiao-wu, son of Chiang Ching-kuo and the then head of Taiwan’s secret service, to leave Taiwan and henceforth withdraw from politics. As a direct result, the influence the Chiang family had on Taiwan’s politics declined after the death of Chiang Ching-kuo in 1988, enabling Lee Teng-hui to resist conservative forces within the KMT and keep pace with public sentiment.

The other major external shock to Taiwan was the democratic transition in South Korea following the 1980 Gwangju Massacre, which was marked by violent upheavals. This was especially relevant as South Korea shared many similar circumstances with Taiwan. In late June 1987, under pressure from both domestic society and the United States, South Korean presidential candidate Roh Tae-woo, the one responsible for the Massacre a few years earlier, declared a democratization manifesto. This manifesto promised to end military rule, ensure freedom of speech, and amend the constitution based on constitutional principles. Facing similar internal and external pressures, just two weeks after Roh’s announcement of the democratic manifesto, Chiang announced the lifting of martial law in Taiwan, as well as the cessation of bans on political parties and the press.

Finally, while the maturation of institutional genes supporting constitutional democracy in Taiwan and the escalation of external pressures rendered the demise of authoritarianism in Taiwan nearly inevitable, both Chiang Ching-Kuo and Lee Teng-hui played undeniable roles in easing Taiwan’s peaceful transition from authoritarian governance to constitutional democracy. However, in many ways, the actions of these two figures – especially their respective behaviors – can also be interpreted as outcomes of the prevailing institutional genes within Taiwan. Chiang, as an authoritarian leader, maintained a repressive stance up until the late 1980s amidst rising demands for democratic constitutionalism. Yet, he progressively relaxed his control in deference to public opinion and largely sidestepped events akin to the Gwangju Uprising in South Korea in May 1980. His astute decision to appoint Lee Teng-hui as his vice-president in early 1984 and, later, his wise concession to popular sentiment in 1987 by lifting bans on political parties and the media, further underscore his responsive leadership.

Shortly after the bans on political parties and the media were lifted, several political parties, including the DPP, sprang to life, ardently advocating for a democratic government to protect their rights. Yet, entrenched conservative elements within the KMT clung to the aspiration of preserving the one-party authoritarian regime, staunchly opposing any reforms that might erode their dominance. Demands for constitutional democracy and clamors for reform, driven by opposition parties, students, and a plethora of social groups, reached an unprecedented crescendo. In March 1990, on the eve of the National Assembly’s presidential elections, university students in Taipei initiated the Wild Lily Movement. They outlined four core demands: the dissolution of the antiquated National Assembly, which had been elected on the mainland in 1947; the convening of a national affairs conference; the annulment of the Temporary Provisions and the reinstatement of the constitutional order; and the charting of a roadmap for democratic reform. Thousands congregated in the city’s main square advocating for their cause, while the DPP rallied tens of thousands in solidarity. Amid this groundswell of public sentiment, the freshly re-elected President Lee Teng-hui engaged with numerous protest leaders at the Presidential Palace, committing to actualizing their four demands. He concurred that the students could form an inter-school entity to monitor the national affairs conference and the progression of democratic reforms, assuring them of their enduring right to stage further demonstrations (Lin, M., Reference Lin1990, p. 141).

After being elected as the eighth President of the ROC by the National Assembly, Lee harnessed the impassioned student protests and the accompanying social movement, transforming them from a challenge into a powerful catalyst for democratic reform. In tune with public sentiment, within two years he fulfilled the four demands he had pledged to the movement. The annulment of the Temporary Provisions and the dissolution of the National Assembly not only had an immediate and profound influence on society but also laid the groundwork for the subsequent establishment of a robust constitutional system in Taiwan.

The primary obstacle to establishing a constitutional system in Taiwan originated from among the social elite, many of whom were influential KMT members who had retreated from the mainland to Taiwan. These individuals represented the traditional power bloc within the KMT and controlled vast resources across various sectors in Taiwan. The establishment of a constitutional system is incentive-incompatible with their interests. It is unlikely that the ruling party in an authoritarian system would voluntarily relinquish power, automatically abandoning one-party rule and transforming the authoritarian system into a constitutional system of multiparty competition with checks and balances.

Responding to strong societal pressure for local grassroots autonomy, Taiwan introduced grassroots local elections as early as the 1940s. Initially, these elections seemed not to pose a direct threat to KMT dominance. However, as these local elections gained momentum and substance, they began to challenge the KMT’s authoritarian rule. Local KMT officials, a product of these elections, often held views distinct from those of many KMT dignitaries from the mainland. They were more inclined towards expanding the scope and scale of elections, as well as pushing for constitutional reforms. This divergence in views created a rift within the KMT. Lee Teng-hui capitalized on this internal divide, promoting reforms within the KMT. He empowered KMT officials who had emerged from local elections, thereby intensifying the divisions within the party. Consequently, the social changes brought about by the early local elections and the changes within the KMT became the driving force behind electoral reform at the provincial and municipal levels, as well as in the National Assembly and the Legislative Yuan.

The foundations laid by local elections, land reform, privatization, civil society organizations, social movements, and several other early reforms set the stage for transformation to constitutional democracy, marked by the opposition party’s maiden victory in the 2000 presidential elections. Since that pivotal moment, both the KMT and the DPP have experienced victories and losses in presidential and legislative elections. The evolution and maturity of constitutional democracy in Taiwan have guaranteed its freedom, stability, and continuous economic growth. Under this democratic framework, Taiwan transitioned from a middle-income economy at the end of its authoritarian era to one of the world’s most advanced economies. By 2022, its per capita GDP by purchasing power parity surpassed Australia, Canada, the United Kingdom, all large EU countries, and it was three times more than that of mainland China (IMF, 2022a).

In the following I provide a brief summary of Taiwan’s institutional transformation from the perspective of institutional genes.

1. 1) Divergent Institutional Genes from the Beginning: Before becoming a Japanese colony in 1895, Taiwan’s institutional genes were already different from those of mainland China, owing to the relatively short duration of Chinese imperial rule over Taiwan. The Japanese colonial period further differentiated Taiwan’s institutional genes from those of China.

2. 2) Emergence of Institutional Genes of Constitutionalism: The institutional genes that Taiwan inherited were already starkly different from those of the mainland when the KMT took over after the Second World War. The Taishō Democracy period under Japanese rule endowed Taiwan with democratic-leaning institutional genes. In contrast, the mainland gravitated towards communist totalitarianism, heavily influenced by the Soviet Union, whilst Taiwan remained largely untouched by such influences.

3. 3) KMT versus Institutional Genes of Constitutionalism: Unlike the CCP, the KMT exhibited a duality. On the one hand, the party’s real power lay with conservative forces rooted deeply in the Chinese imperial tradition. On the other hand, a faction, primarily made up of intellectuals, championed constitutional democracy. This internal dichotomy was mirrored in the party’s overarching goal, which leaned towards constitutionalism, epitomized by the ROC Constitution. While conservative elements attempted to suppress democratic inclinations, they could not completely eradicate the inherent institutional genes supportive of constitutionalism. Because the KMT anchored the legitimacy of its rule in constitutionalism, any deviations from this path necessitated justifications. This contrasts sharply with communist ideology, which regards constitutionalism as its foremost adversary (following the lines of Marx, Lenin, Mao) and seeks to eliminate any trace of it.

4. 4) External Influence: The United States played a pivotal role in nurturing the growth of pro-democracy institutional genes in Taiwan and in reinforcing their prominence within the region.

The implications of Taiwan’s transformation to constitutional democracy for China can be outlined as follows:

1. 1) Enlightenment: The seeds of constitutional democracy had been sown in Taiwan well before its institutional transition. Key components include an appreciation for individual freedoms and rights, a consciousness of a democratic constitutional framework, and active civil society engagement. The awareness and education of both the elite and the general populace form a vital part of the genetic makeup for constitutionalism.

2. 2) Private Property Rights and Civil Society as a Foundation: The long-term development of private property rights and civil society, which includes community and grassroots autonomy, combined with the fortification of social forces safeguarding property rights and civil liberties, laid the foundation for Taiwan’s institutional transition.

3. 3) Decay or Fall of Totalitarianism as a Precursor: The collapse or substantial decline of a totalitarian regime is a prerequisite for nurturing constitutional institutional genes and for spawning societal demands for such governance. Taiwan was never subjected to totalitarian rule. The KMT, while authoritative, was not totalitarian; it did not monopolize every facet of society nor did it eradicate every avenue for the growth and survival of constitutional institutional genes.

14.6 Institutional Transformation of the Communist Bloc and the Role of Institutional Genes¹

The communist totalitarian bloc led by the CPSU, primarily the former FSU-EE countries, once aspired to conquer the world but it collapsed peacefully three decades ago. Since 1991, the Soviet Union, and since 1989, the CEE countries of the Communist Bloc have ended their totalitarian communist systems and moved towards market economies and constitutional systems based on private ownership. Since the implantation of the totalitarian communist system in China from the Soviet Union, the foreign totalitarian institutional genes have hybridized with China’s traditional institutional genes. This hybridization has gradually evolved into the institutional genes of the totalitarian communist system with distinct Chinese characteristics. What drove the collapse of the communist totalitarian regimes in the FSU-EE? What lessons can we learn from these collapses? And how can these lessons help us understand the future of China’s communist totalitarian system?

It is well documented that the collapse of the totalitarian system of the FSU-EE Bloc was closely linked to the failure of its economic reforms (Zhuravskaya et al., 2024). However, economic failure was not the sole factor. Instead, this collapse was also caused by a combination of highly complementary political and economic factors, as well as institutional genes inherited from each country’s history. These factors are summarized as follows.

First, on the political front, since the 1980s, there was an emerging social consensus among some social elites and leadership within the FSU-EE Bloc to loosen or even abandon totalitarian control.² This shift was related both to the long and widespread popular resistance to totalitarian rule and to the awakening of humanity as the economic situation continued to deteriorate. The long-term resistance to totalitarian rule and the awakening of humanity were tied to the institutional genes of these countries. The worsening economic situation and the long-term failure of the economic reforms stemmed from the severe incentive problems created by the communist totalitarian system. These economic failures intensified the disillusionment, antipathy, disgust, and resistance to the communist totalitarian system. In turn, political dissatisfaction with the communist totalitarian system further worsened the incentive problems.

Totalitarian systems are built and sustained by violence. However, violence cannot sustain economic growth. Essentially, all the countries of the Communist Bloc achieved high growth rates for a period through massive centralized resource mobilization. In the early 1960s, Khrushchev confidently vowed at the United Nations that the superior socialist system, with its rapid growth, would bury capitalism. However, no communist totalitarian economy has ever achieved economic development (measured by GDP per capita) above the middle-income level. Instead, all Communist Bloc countries experienced a rapid decline in economic growth after reaching the middle-income level and even the most advanced Communist Bloc members achieved significantly lower levels of economic development compared to the advanced capitalist countries.

One of the fundamental factors hindering the economic development of a communist totalitarian system is its economic and institutional foundation, namely, state ownership. State-owned enterprises are the core assets of the Communist Party. Whether in manufacturing or finance, SOEs functioning as party and government agencies were only responsible for managing state assets. Since the government will never let an insolvent SOE go bankrupt and will surely bail it out, SOE executives, aware of this situation, generally take on large amounts of debt to expand and strengthen the SOEs without worrying about the risks associated with borrowing. This common phenomenon under a communist totalitarian system is called the soft budget constraint syndrome (Kornai, Reference Kornai1980).

The SBCs severely distort the incentives of SOEs, leading them to prioritize expansion by investment over efficiency. Inefficient SOEs expand by accumulating high debt to gain scale advantages, compensating for their innovation disadvantages. This results in deteriorating efficiency, operating losses, and economic stagnation throughout the entire economic system. In response to these pressures, the FSU-EE countries embarked on economic reforms, beginning in the late 1960s. Since the aim of the reforms was to preserve the communist totalitarian system while reversing the economic decline, these reforms were premised on retaining state ownership and striving to improve the planned economies and management. Even the most radical Hungarian reforms were limited to so-called market socialism, that is to say, replacing centralized planning with market competition without changing the dominance of state ownership in the economy. In summary, the failure of economic reforms in the FSU-EE countries was because these reforms did not address state ownership. State ownership always creates the problem of SBCs, which inevitably lead to the failure of reforms (Kornai, Reference Kornai1992). The inability to change the constraints of state ownership stems from the ideological and institutional incompatibility of communist totalitarian regimes with private ownership.

Prolonged economic stagnation posed enormous difficulties and challenges for the FSU-EE countries. Social discontent was rampant, with large-scale strikes and demonstrations in many countries and regions. In 1982, after his promotion from head of the KGB to leader of the USSR, Andropov openly stated that the greatest threat to the security of the USSR came from poverty and the resulting riots or strikes, rather than from imperialism and dissidents (Medvedev, Reference Medvedev2017, p. 39). This clearly demonstrated the anxiety among the top echelons of the FSU-EE communist parties due to the failure of economic reforms.

When Mikhail Gorbachev came to power in 1985, there was a general consensus among the top leadership of the Soviet Communist Party that the main cause of the prolonged economic stagnation was a general loss of enthusiasm and motivation in Soviet society, coupled with widespread rebellious sentiment. The Soviet Central Committee referred to those negative factors as a “mechanism of deceleration” resisting the Soviet system and believed the Soviet Union was on the brink of crisis. Consequently, they believed that to move forward, it was necessary to launch reforms addressing a range of political, economic, and ideological issues simultaneously (Yakovlev, Reference Yakovlev1989, in Aganbergyan, Reference Aganbergyan1989). Under this guiding principle, Gorbachev promoted Perestroika, meaning comprehensive restructuring or reforms, to address all of these problems holistically. The 27th Congress of the Communist Party of the Soviet Union (CPSU) proposed reforming the economic mechanisms and introducing democratization to reverse the stagnation of the past decade. Perestroika and democratization became the main slogans of the Communist Party. Additionally, the Soviet Communist Party gradually liberalized freedom of speech and allowed dissident physicist and Nobel laureate Andrei Sakharov to return to Moscow (Lowenhardt et al., Reference Lowenhardt, Ozinga and Ree1992, pp. 74–75).

Gorbachev’s economic reforms were toothless. The 12th Five-Year Plan under Gorbachev’s presidency focused on machinery manufacturing and technological improvements (Medvedev, Reference Medvedev2017, p. 38). Specific reforms aimed to address issues of over-centralization and bureaucracy. During subsequent inspections, Gorbachev emphasized that the central government should not intervene in the day-to-day operations of basic economic institutions and that enterprises should be left to fend for themselves. He also suggested, in principle, that most problems should be resolved locally and that the best management methods should align with both industrial and regional principles (Medvedev, Reference Medvedev2017, pp. 43–45). At the same time, he pushed for the legalization of individually owned enterprises under the guise of reform but avoided mentioning the concepts of privatization and private property rights.

To gain political legitimacy, Gorbachev referred to his reforms as the second wave of the Leninist New Economic Policies (Aganbergyan, Reference Aganbergyan1989, p. 9), which appeared similar to Deng Xiaoping’s 1982 articulation of the nature of China’s economic reforms. However, in essence, Gorbachev was more concerned with political democratization, which eventually violated Leninist principles. In terms of economic reform, his efforts failed to make any substantial progress because he did not and could not address the incentive problems of economic issues within the party-state bureaucracy.

Not only in the Soviet Union but in all Eastern bloc countries, economic reforms were ineffective and their economies were deteriorating. They faced urgent challenges to their financial, fiscal, economic, and social stability. This led more elites in these countries to fundamentally question the reformability of the communist totalitarian system (Hewett, Reference Hewett1990a). Even those primarily concerned with the economy recognized that fundamentally changing the communist totalitarian system was unavoidable. The root of the problem was state ownership but communist regimes were not allowed to abandon it. Many social elites in the FSU-EE Communist Bloc, including economists, intellectuals, and even high-ranking Communist Party figures, began to focus on human rights issues, freedom, and democracy, rather than limiting themselves to economic issues. They gradually converged on a consensus to abandon totalitarian control in all aspects (Zubok, Reference Zubok2021).

In 1990, after the collapse of all the CEE communist totalitarian regimes, the Soviet economy slumped to a level deemed dangerous by the Soviet leadership. Under multiple political and economic pressure, Gorbachev tentatively accepted the “500-Day Reform Program” drafted by Stanislav Shatalin and Grigory Yavlinsky that summer. This comprehensive reform proposal garnered support from reformers both within and outside the CPSU, especially from Gorbachev’s political rival Boris Yeltsin. However, Gorbachev eventually abandoned it due to strong opposition from conservative factions in the CPSU. With the abandonment of this reform program, the Soviet leadership began to focus on managing the increasingly divisive political situation, leaving economic reforms off the agenda (Zubok, Reference Zubok2021, pp. 131–216; Taubman, Reference Taubman2017, chapters 14–15).

The discussion of this unimplemented “500-Day Reform Program” is important here because it fully reflects the reform ideas of the CPSU and the Soviet social elite at that time. Fundamentally different from any reform plan or idea of the Chinese Communist Party, this plan was a comprehensive scheme to abandon totalitarianism. Building on the political reforms already underway in the Soviet Union (see below), the plan proposed returning sovereignty to the republics, stipulating that the new Soviet government would be limited to serving the republics without interfering in their internal affairs.³ Economically, the plan called for the establishment of a market economy within two years, with prices determined primarily by market supply and demand and the full privatization of most enterprises. The ruble was to become a freely convertible currency and the economy as a whole was to be transformed from bureaucratic and military-oriented to consumer-oriented. The plan also stipulated that the republics would independently determine the method and pace of introduction of the market but that the USSR had to maintain a unified market with uniform tariffs and no economic borders between the republics. The “500-Day Reform Program” included rapid privatization and measures to strengthen fiscal discipline to control inflation, aiming to create conditions for a fully open market (Hewett, Reference Hewett1990b).

The “500-Day Reform Program” was not an isolated incident. Five years before the plan was proposed, at the beginning of Gorbachev’s rise to power, Yakovlev had already submitted a comprehensive reform program with similar ideas. He noted that the Soviet Union’s “problems are not just economic, but fundamentally political.” With regard to political reform, he emphasized democracy, human rights, transparency, and the independence of the judiciary. He asserted that “the judiciary must be truly independent of all other powers.” Notable reform suggestions included the institutional reform of the Communist Party, transforming it into a Communist Union with two factions or even two parties with a joint Politburo as the supreme ruling body and the direct election of the national president. The directly elected president would also serve as the chairman of the joint Politburo and Parliament (Yakovlev, Reference Yakovlev1999, pp. 205–212).

It is particularly noteworthy that the mere failure of economic reforms or economic stagnation is not sufficient to drive the social elites of communist societies to form a consensus to abandon totalitarianism because the elites’ interests are nested in the system and rely on totalitarian political power. The Communist leadership, as the ruling group of the totalitarian regime, is the largest vested interest group holding power. Without other factors, the rational choice for the rulers and ruling groups during economic stagnation would be to maintain power at all costs. To preserve their power, totalitarian rulers would use violence to suppress dissent and eliminate any potential resistance in its infancy.

Therefore, the formation of a social consensus among social elites and within the Communist leadership to relax control or even abandon totalitarianism in a totalitarian society largely depends on factors beyond the economy. One such factor is the importance and prevalence of humanity and humanitarianism as intrinsic values in society. Indeed, the upper echelons of the Communist Party of the Soviet Union, as well as those in Poland, Czechoslovakia, Hungary, and other countries, showed tendencies to relax totalitarian control long before the economy had collapsed. The institutional genes inherited from their histories were crucial in this aspect. Additionally, the Eastern bloc region had close interconnections historically. A shock to one country often triggered chain reactions in many other countries in the region.

Despite the fact that the countries of the Central and Eastern European bloc were established under communist totalitarian rule by the violence of the Soviet Red Army, the different institutional genes that the countries inherited from history have resulted in varying degrees of acceptance of or resistance to communist totalitarianism in each country. This influenced not only the stability of totalitarian rule in these countries but also the direction of institutional transformation after the collapse of totalitarianism. Some countries historically progressed further and earlier in the pursuit of human rights, freedom, and democracy. Without exception, all of these countries, such as Poland, Czechoslovakia, and the Baltic States, had long possessed certain institutional genes in favor of democratic constitutionalism. These countries not only led the way in rejecting communist totalitarianism but also relatively smoothly established constitutional democracies, becoming economically developed nations. In contrast, countries with a history of highly autocratic systems often ended up with authoritarian regimes disguised as democracies after the collapse of totalitarianism. Under such authoritarian regimes, economic development has also been difficult. Most of the former Soviet Union countries, except the Baltic States, fall into this category.

Poland, Czechoslovakia, Hungary, the Baltic States, and Germany, for example, had experienced elected monarchs and some form of parliament since the Middle Ages. In these countries, a sense of preference for constitutionalism and national independence had long existed in society. These institutional genes made it difficult to establish communist totalitarianism in the absence of external violence. The violent revolutions waged by the Comintern in Hungary and Germany both failed and development in other Central and Eastern European countries was also slow. Although Poland did not experience a complete modern democratic constitutional system in its history, it had a long tradition of parliamentary systems dating back to the Middle Ages, nurturing a rudimentary constitutional consciousness. Poland had established a national parliament, known as the Sejm, since the fifteenth century, one of the oldest national parliaments in Europe. The subsequent Polish–Lithuanian Commonwealth, which lasted for over two centuries, had monarchs elected by the nobility and national parliament members elected from various regions, with local governance relying on local parliaments (Jędruch, 1998). Although not a modern democratic system, the social consensus formed by this elite parliamentary system became the foundation for resisting totalitarian rule. Under the influence of this social consensus, even radical Marxists, such as Rosa Luxemburg, a Polish-born leader of the Second International (the global proletarian revolutionary organization founded by Engels), firmly opposed Leninism and Bolshevik totalitarianism.

In Poland, although the Polish United Workers’ Party (PUWP), the communist party in Poland, gained a majority of votes and came to power, it was never able to establish a solid totalitarian regime due to the constraints of Poland’s inherited institutional genes. Throughout the history of the communist regime, none of the PUWP’s leaders were staunch totalitarian rulers. Their general weakness was itself an important factor in fueling the forces of resistance to the totalitarian system in Polish society. The institutional genes unfavorable to totalitarianism that Poland inherited from its history include the enormous influence of the Catholic Church, the tradition of civil organizations among the Polish populace, and the tradition of protecting private land ownership by farmers.

Intimidated by the powerful influence of Catholicism in Poland, the PUWP never managed to take over or suppress the Church since the establishment of its totalitarian regime, making Poland the only communist totalitarian state to allow the existence of a Church independent of communist rule, entirely out of the PUWP’s control. Catholicism had been the state religion of Poland since the tenth century, and the vast majority of Poles were devout Catholics when the communist regime was established. To avoid inciting resistance from Catholic believers, the PUWP had no choice but to allow the Catholic Church, which maintained close ties with the Vatican, to continue operating in Poland. This allowed the Catholic Church to become a part of Polish society that the PUWP could not control, increasing its influence over time.

While the PUWP did not dare to follow Soviet control of the Russian Orthodox Church by relying on both carrots and sticks, it still tried to compete with the Church for influence in order to maintain its rule in Poland. However, it lost this competition. In 1960, two years after the PUWP suppressed the Poznań uprising (discussed below), the government decided to grandly celebrate the millennium of Polish Christianity to win public favor, trying to influence the majority of Poles, who were Catholic. On July 22, 1966, PUWP leaders presided over the official celebration of the millennium of Polish Christianity, with the participation of the PUWP military. On the same day, the Polish Cardinal led another large-scale celebration (Davies, Reference Davies2005).

The Catholic world provided significant support to Polish Catholics and the Polish Catholic Church. In 1967, the Vatican appointed the distinguished Polish priest Karol Wojtyła as a cardinal. In 1978, he was elected by the Vatican to be the Pope of the Catholic Church as Pope John Paul II. This further connected the Polish Catholic Church to the global Catholic world. Facing this overwhelming influence, the PUWP had no choice but to continue adopting a conformist strategy on Catholicism.

The year after Pope John Paul II ascended to the papacy, the PUWP invited him to return to Poland where he co-hosted a grand commemoration of the 900th anniversary of the death of Poland’s Patron Saint Stanislaus, a martyr killed by the crown. This elevated the influence of the Church in Poland to new heights. The establishment of the Independent Self-Governing Trade Union “Solidarity” (Solidarność) by Polish workers two years later was closely related to this growing influence.

Pope John Paul II’s significant impact on Polish society was directly linked to Poland’s institutional genes. First, the historical importance of Catholicism in Poland prevented the PUWP from banning or fully controlling the Church, allowing it to survive and expand, and allowing the Pope to exert substantial influence over the Polish populace. Second, what set Pope John Paul II apart from other Popes was his direct challenge to totalitarian rule. His philosophy and courage to directly challenge totalitarian rule were shaped by the environment that nurtured him, rooted in Poland’s institutional genes and the social consensus in Polish society that pursued human rights, constitutionalism, and resistance to totalitarianism.

Another institutional gene in Poland is the long-standing tradition of labor unions and worker movements. The large-scale worker movements in Poland not only deeply influenced the country but also acted as a catalyst for the collapse of the entire CEE Communist Bloc. In 1956, four months after Khrushchev’s secret report, a general strike of 100,000 workers broke out in Poznań. This was the first large-scale spontaneous workers’ movement in the whole communist world. The strike was temporarily quelled by tanks and military police. However, there had been sporadic spontaneous workers’ movements throughout Poland since then. The 1970s saw a resurgence of the labor movement in many parts of the country, producing many labor movement leaders. In 1980, the dismissal of labor movement leaders from the Gdańsk shipyard (then the Lenin Shipyard) triggered a general strike on a scale never seen before. Workers from hundreds of factories across Poland joined the strike in support of the Gdańsk workers. The nationwide strike forced the government to concede to many of the workers’ demands, leading to the famous Gdańsk Agreement (Gdańsk Social Accord) (Persky, Reference Persky1981). This agreement not only recognized independent trade unions but also paved the way for freedom of association. Legalized unions and social organizations continually staged strikes and demonstrations, including nationwide strikes, to defend human rights. This made it difficult for the PUWP to maintain totalitarian control over the population (Ekiert and Kubik, Reference Ekiert and Kubik2001).

Immediately after the signing of the Gdansk Agreement, Polish workers established Solidarity (Independent Self-Governing Trade Union). This was the first national independent workers’ organization in the Communist Bloc. Subsequently, Poland saw a surge in civil organizations, strikes, and demonstrations (Persky, Reference Persky1981). The Polish government then suppressed the Solidarity movement and imprisoned its leader, Lech Wałęsa. However, in 1983, Pope John Paul II visited Poland again and insisted on meeting the imprisoned Wałęsa. He publicly encouraged people to continue their fight for human rights and stated that martial law must end. Everywhere the Pope went, people were enthusiastic and openly expressed their grievances with the communist regime. A month after the Pope left Poland, martial law ended (Ekiert and Kubik, Reference Ekiert and Kubik2001).

The establishment of Solidarity and the government’s concession to end martial law under public pressure was the first time in the communist world that a government resolved a conflict through peaceful means due to civilian pressure. This highlighted the weakening of totalitarian rule and marked the first step toward the peaceful dissolution of the FSU-EE communist regimes a few years later.

The series of events in Poland had a profound and broad impact on the entire Communist Bloc. Since the Poznań strike in 1956, each instance of Polish resistance against communist totalitarianism triggered a domino effect within the bloc. After the suppression of the Poznań workers’ movement, the moderate PUWP leader Władysław Gomułka took office, attempting to introduce reforms and pacify the Poles. This immediately sparked a nationwide revolution in Hungary, demanding the withdrawal of Soviet troops and calling for freedom and constitutional governance. Although the Hungarian revolution was brutally crushed by Soviet forces and the Warsaw Pact, the deterrent effect of the suppression was only temporary and localized.

Parallel to Poland, Czechoslovakia served as another catalytic force in bringing down Eastern bloc communist totalitarianism. As one of the birthplaces of the Reformation, Czechoslovakia was a republic with a relatively well-developed parliamentary democracy before the Second World War. The country’s institutional genes made establishing a totalitarian regime particularly difficult. At the 1945 Yalta Conference, Stalin promised Roosevelt and Churchill that the people of Central and Eastern Europe would be allowed to determine their governing systems through popular voting. However, to ensure they could gain ruling power in the Soviet-occupied countries, the Communist parties supported by the Soviet Union relied on violence, coercion, and distortion of votes or referendums to gain sufficient votes in most of those countries (Plokhy, Reference Plokhy2010; Nohlen and Stöver, 2010). Reflecting the social sentiments of the time, the Communist Party of Czechoslovakia (KSC) was unable to establish a communist totalitarian regime as it failed to secure enough seats until the KSC staged a coup in 1948 (Korbel, Reference Korbel1959).

In 1967, under the relatively relaxed control of the Communist Bloc, some writers in Czechoslovakia began systematically criticizing the Communist Party, demanding literary independence from party control (Williams, Reference Williams1997, p. 55). Like dissenters in any totalitarian regime, they were purged. However, there was sympathy for these dissidents in Czech society, even within the Communist Party. Influenced by this social consensus, the KSC leader who purged these writers was soon forced to step down and Alexander Dubček became the party leader. While claiming to uphold Communist Party leadership, he simultaneously relaxed totalitarian controls, limited the power of the secret police, advocated for freedom of speech, and even considered moving towards a multiparty system. In 1968, the KSC introduced a political program called “socialism with a human face,” initiating the reforms known as the Prague Spring (Williams, Reference Williams1997).

“Socialism with a human face” was an attempt to infuse communist totalitarianism with a degree of humanity. However, ideologically and institutionally, humanity directly conflicts with totalitarianism. Even if the intent of the reforms was to consolidate totalitarian rule, emphasizing humanity fundamentally undermines such a regime. Recognizing the threat that the KSC’s reforms posed to the entire Communist Bloc, the Warsaw Pact, the military alliance of the bloc led by Brezhnev, sent troops to suppress the Prague Spring. However, the spirit represented by “socialism with a human face” was not extinguished by military suppression; instead, it spread widely across the Communist Bloc, influencing leaders like Gorbachev and some others within the FSU-EE Communist parties.

Marxism, the ideology of communist totalitarianism, asserts that human society consists only of classes, with no humanity separate from class. In a class society, there is only the dictatorship of the ruling class over the ruled; socialism must be the dictatorship of the proletariat. This theory has been highly effective in inciting revolution and violence (see Chapters 6, 8, 10, and 11). With this ideology, the Communists eliminated humanity and humanitarianism, which enabled Lenin to create a violent totalitarian system based on the institutional genes inherited from Tsarist Russia. It was this ideology that enabled Stalin, Mao, and other communists to perfect the communist totalitarian system and to use this machine to persecute large numbers of their political enemies and challengers both inside and outside the party. The continuous purges within the communist parties created immense fear among party members. This forced some communists to re-examine the consequences of a dictatorship of the proletariat that utterly denies humanity, driven by concerns for their own safety.

The introspection on humanity within the Communist Bloc began with the Soviet Union’s de-Stalinization in 1956. Khrushchev’s secret report at the 20th Congress of the CPSU started this process. Out of the self-interest of the majority of the CPSU leadership and party members, Khrushchev attempted to reduce the fear that had permeated the Communist Bloc during Stalin’s era (Jones, Reference Jones2006). However, using violence to instill fear both within and outside the party is a necessary component of totalitarian rule and maintaining fear is a pillar of communist totalitarianism.

Khrushchev’s de-Stalinization had barely begun when it triggered Polish uprisings and Hungarian revolutions that shook the totalitarian regimes. To prevent a domino effect within the Communist Bloc and to maintain totalitarian rule, Khrushchev responded to the events in Poland and Hungary with Stalinist-style violent repression, abruptly halting the nascent introspection on humanity. His successor, Brezhnev, fully restored Stalinism and the suppression of the Prague Spring was part of this restoration. However, repression is one thing, eradicating humanity is another. During the revolutionary period, the Communist Party relied on inciting class hatred. Nevertheless, inciting class consciousness after the establishment of a totalitarian system inevitably created instability (as seen in China’s Cultural Revolution, see Chapter 12).

In the absence of class consciousness, even the most twisted ideology struggles to find convincing reasons to eradicate humanity. Therefore, no other autocratic regime, apart from Marxist-Leninist ones, has attempted to completely eradicate humanity. Even during the most brutal periods of Tsarist and imperial Chinese rule, there was still some space for humanity. In any society, the extent to which people identify with humanity is a significant part of the social consensus and is part of society’s institutional genes. Thus, the fundamentally anti-humanity nature of Marxist-Leninist ideology will inevitably clash with the pre-existing humanity in any society. De-Stalinization and the Prague Spring’s call for “socialism with a human face” were the initial steps taken by communist leaders toward reclaiming humanity.

In 1985, Mikhail Gorbachev, influenced by the spirit of the Prague Spring, became the supreme leader of the CPSU. Upon taking office, he promoted socialist democracy and relaxed totalitarian control on several fronts. While attending the funeral of his predecessor, Chernenko, Gorbachev openly repudiated Brezhnevism in front of the leaders of the Eastern European Communist parties, fundamentally rejecting the juridical basis for Soviet intervention in East Germany, Hungary, and Czechoslovakia. He emphasized that the CPSU valued equality among the allies and respected their sovereignty and independence (Taubman, Reference Taubman2017, p. 363). These principles he emphasized later ensured that the people of those countries could choose to abandon totalitarianism without fear of Soviet intervention.

Although Gorbachev genuinely believed in socialism-communism and was committed to preserving the Soviet Union, he also believed that socialism must have a human face and that the plight of the communist camp was brought on by a lack of humanity. The core of Gorbachev’s “new thinking” was that the CPSU could rule without the use of violence. Such perceptions, represented by Gorbachev and Dubček, fundamentally contradicted the basic ideology of communist totalitarianism and effectively undermined the totalitarian rule of the Communist Bloc. When the countries of Central and Eastern Europe realized that their actions against totalitarian rule would no longer be met with violent repression by Soviet and Warsaw Pact troops, movements opposing totalitarianism quickly spread, putting an end to totalitarian rule that had abandoned its violent oppression.

Gorbachev’s comprehensive reforms primarily focused on political system reform. Shortly after taking office, he promoted the ideology of socialist democracy, advocating for new political thinking, democratization, and socialist pluralism, and encouraging the formation of informal associations (Aganbergyan, Reference Aganbergyan1989). Socialist democracy had been included in the Stalin Constitution as early as 1936 and was a typical anti-democratic propaganda term. However, Gorbachev’s version of socialist democracy was genuine; it seriously loosened totalitarian control and continued the de-Stalinization process. This ultimately pushed the totalitarian regime towards its demise.

The conservative faction within the CPSU, both ideologically driven and vested-interest-driven, persisted in its repression of dissidents at home and abroad, including the suppression of the Prague Spring. To them, the concept of socialist democracy could only be used as a deceptive propaganda slogan and it was prohibited in any serious discussions. Andropov, Chernenko’s predecessor, who was followed by Gorbachev, had clearly warned about the dangers of socialist democracy (Zubok, Reference Zubok2021, p. 42).

The current of promoting socialist democracy within the CPSU had its origins in the brief period of de-Stalinization under Khrushchev. Although de-Stalinization was quickly reversed at the institutional level, the liberalization movement continued to simmer beneath the surface. One of the strategies was to deliberately leverage the so-called writings of the young Marx (philosophical articles written by Marx before he became involved in the communist movement and when he was not yet a Marxist) as the theoretical foundation for advocating humanity. Since the 1960s, Soviet intellectuals had introduced these writings from the West. They sought to find an orthodox Marxist path to a socialist democracy that embraced humanity. Some of them, including Gorbachev and his key aide Medvedev, viewed the advocacy of socialist democracy and individual freedoms as part of Marxist-Leninist and socialist ideology, without realizing that this fundamentally contradicted Marxist-Leninist communist totalitarianism.

In his 1987 book, Perestroika: New Thinking for Our Country and the World (Gorbachev, Reference Gorbachev1988), Gorbachev systematically outlined his ideas for implementing democratic socialism. His Perestroika intended to launch fundamental political reforms by allowing freedom of assembly and freedom of speech and publication. He emphasized that democratization was the central task of the CPSU, stating that Glasnost meant openness and transparency, allowing people to know everything and giving them the right to learn the truth about past events in the Soviet Union. To ideologically support the shift towards humane socialism and democratic socialism, Gorbachev urged Politburo members and Soviet leaders to read and discuss the writings of the young Marx on humanity and humanitarianism (Zubok, Reference Zubok2021, pp. 32–35). He genuinely believed that reform or socialist economic modernization had to rely on socialist democracy, otherwise, the people would feel alienated and become lazy, like slaves (Zubok, Reference Zubok2021, p. 34).

In addition, there was also a group within the CPSU that no longer believed in communist ideology. Represented by Gorbachev’s key aide, Yakovlev, they strategically used certain writings of Marx and Lenin to promote democracy and freedom with the purpose of undermining communist totalitarianism (Taubman, Reference Taubman2017; Medvedev, Reference Medvedev2017; Yakovlev, Reference Yakovlev1999). Meanwhile, many of the leading figures in Russia and the Baltic States who promoted independence movements, including Boris Yeltsin, never used Marxist-Leninist rhetoric as a cover (Medvedev, Reference Medvedev2017).

The constitutional amendments and parliamentary elections carried out between 1988 and 1989 were the most significant political system reforms in the USSR. According to the planned reform, new Congresses of People’s Deputies of the Soviet Union would be created at all levels through universal suffrage in the republics of the USSR and the elected chairmen of the Congresses would simultaneously be the first secretaries of the Communist Party of the republic. With this institutional reform, Gorbachev tried to form an alliance between the Communist Party Secretariat and Parliament to counteract the traditional bureaucratic system formed by the central ministries of the Soviet Union (Lowenhardt et al., Reference Lowenhardt, Ozinga and Ree1992, pp. 76–77). In pushing for this reform, Gorbachev demanded that party members vote and express their opinions based on their conscience and that in return the CPSU would not use party discipline to punish members for their voting choices (Taubman, Reference Taubman2017, chapter 12). This effectively abandoned the basic principles of a Leninist party.

Gorbachev later summarized that the purpose of this reform was to peacefully end the Communist Party’s one-party rule. He stated that the goal was to transfer power from the Communist Party to the Soviets through free elections, forcing the party to “voluntarily relinquish its dictatorship.” Gorbachev described his mission as “cutting off” the Kremlin conservatives and replacing them with new external forces (Taubman, Reference Taubman2017, pp. 558–559). Whether or not posterity believes Gorbachev’s retrospective statements, and regardless of his original intentions, the indisputable fact is that this reform of the political system transformed the Soviets into parliaments of the people. By enabling the election of deputies and presidents of Soviet republics, this reform fundamentally undermined the foundations of totalitarianism.

Although Gorbachev tried hard to preserve the Soviet Union, the efforts to dissolve it went hand in hand with those dismantling the Communist Party’s political monopoly almost simultaneously within the country. After the republics elected their parliaments and leaders, the calls for sovereignty and independence grew louder in Russia, the Baltic States, and other republics. The newly elected parliaments and leaders, in their legitimate capacities, demanded a multiparty system and sought independence from the Soviet Union. Russian leader Yeltsin openly called for a multiparty system as early as 1988 (Zubok, Reference Zubok2021, p. 39). Lithuanian leaders also called for a multiparty system while seeking independence. Although Gorbachev publicly accepted their demands for a multiparty system, he still tried to prevent the dissolution of the Soviet Union (Zubok, Reference Zubok2021, p. 104).

While Russia and the Baltic States were struggling for independence from the Soviet Union, Poland, Hungary, and Czechoslovakia were the first countries in history to peacefully rid themselves of totalitarian regimes by ending communist rule. After two major strikes in Poland in 1988, the PUWP was forced to negotiate with the Solidarity movement in early 1989. The negotiations resulted in recognition of Solidarity’s legal status and an agreement to hold national parliamentary elections on June 4. Solidarity won the national elections, replacing the PUWP to form the Polish cabinet. Solidarity leader Lech Wałęsa was elected president of Poland in 1990. The leaders of the PUWP, who had served as prime ministers and presidents of Poland, resigned in August 1989 and early 1990, respectively (de Nevers, Reference de Nevers2003, chapter 3). After more than three decades of resistance and repression, the communist totalitarian system collapsed peacefully in Poland.

Similar to the events in Poland, Hungary’s political situation quickly followed suit. At the end of 1988, the Hungarian parliament introduced a package of democratic reforms, lifting press and party bans and allowing the establishment of independent trade unions. On National Day in March 1989, large-scale demonstrations demanded negotiations between the Communist Party and non-communist political forces. These negotiations began in April and resulted in a constitutional reform agreement by September. In October, the Hungarian parliament announced that multiparty elections and the direct election of the president would be held in 1990. The Communist Party was defeated in the elections and stepped down from power, bringing an end to the totalitarian communist rule in Hungary (de Nevers, Reference de Nevers2003, chapter 4).

The domino effect of the fall of communist totalitarianism spread quickly in CEE countries. Between 1988 and 1989, numerous demonstrations erupted across Czechoslovakia to commemorate the Prague Spring of twenty years earlier and to mourn its victims. The indecisive repression by anti-riot police led to even larger demonstrations and a nationwide general strike. Under such pressure, the KSC announced at the end of November 1989 that it would relinquish one-party rule. Multiparty elections held in December produced a new parliament and president (de Nevers, Reference de Nevers2003, chapter 5). Since then, the moderate “Velvet Revolution” has peacefully transformed Czechoslovakia from a communist regime to a constitutional democracy.

When Poland, Hungary, and Czechoslovakia peacefully ended communist rule, they were still members of the Warsaw Pact, the world’s largest military alliance capable of suppressing challenges to communist regimes. At that time, the Soviet Union still had tens of thousands of troops stationed in Poland and hundreds of thousands in other CEE countries. The fate of the CPSU was closely tied to the fate of the CEE Communist Bloc. However, the Soviet Union decided not to use military force to suppress Poland, Hungary, Czechoslovakia, and East Germany. The Communist leaders in these countries, facing pressure from demonstrations and strikes, also chose not to use their own military forces to suppress the protests, which made it possible for these nations to avoid repeating past tragedies.

Totalitarian regimes begin with violence and end with the cessation of violence. Ending violent repression of dissent is a necessary condition for ending totalitarian rule. The question is, what conditions lead totalitarian rulers to stop using violence?

Totalitarian rulers typically do not refrain from using violence to protect their power when their rule is threatened. However, Gorbachev honored his promise, made when he first took office, to respect the sovereignty of other Communist Bloc countries and did not resort to violence even when the survival of the Communist Bloc was seriously challenged. This decision was influenced by changes in the balance of social forces and social consensus, including changes in the social consensus among some top communist leaders. The connections between these changes in social consensus and institutional genes will be explained later.

On the one hand, the forces advocating for freedom in Poland, Hungary, and Czechoslovakia had grown stronger after decades of repression and setbacks. Nationwide organizations and trade unions and the nationwide demonstrations and strikes they organized made the cost of repression prohibitively high. On the other hand, some members of the Soviet Bloc’s upper echelons, including Gorbachev and his aides, as well as the leaders of the Polish, Hungarian, and Czechoslovak Communist Parties, underwent a cognitive or ideological change. They abandoned or relaxed their belief in the dictatorship of the proletariat, believing that socialist democracy, or negotiation and compromise, should be the way to address the challenges they faced. Gorbachev hoped that each of the CEE countries would produce their own version of Perestroika. He was relieved and even pleased when Poland, Hungary, Czechoslovakia, and East Germany each ended communist rule in their own way (Taubman, Reference Taubman2017, chapter 13; Gorbachev, Reference Gorbachev1995, chapters 31–33).⁴

In contrast, the so-called “reformists” of the CCP, represented by Deng Xiaoping, differed greatly in their perceptions and objectives from the Communist Party leaders of the FSU-EE Bloc who pushed for reforms in the 1980s, represented by Gorbachev. The CCP viewed talk of democracy merely as a tool to maintain the party’s power. Deng Xiaoping regarded Gorbachev as an “idiot” for genuinely implementing political democratization, as doing so would inevitably lead to loss of power. At the same time, Deng believed that economic reform was necessary to maintain and strengthen power, which required maintaining firm control (Vogel, Reference Vogel2011, pp. 423–424).

In fact, the difference between the CCP and the FSU-EE communist parties in adhering to totalitarianism had been evident shortly after Stalin’s death. Soon after Khrushchev’s secret report on behalf of the CPSU in 1956, the CCP publicly opposed de-Stalinization in various forms, with Deng playing a crucial role and earning Mao’s high praise (Vogel, Reference Vogel2011, chapter 12). To prevent an anti-communist trend similar to that in Poland and Hungary from occurring in China, Mao quickly launched the Anti-Rightist Campaign to comprehensively purge intellectuals, with Deng being one of the top leaders and the main executor of this campaign (Vogel, Reference Vogel2011, chapter 12).

Although de-Stalinization was brief in official terms, from the perspective of fundamentalist communists, it opened a Pandora’s box of humanitarianism within the totalitarian regimes. Its impact on the FSU-EE countries was profound and long-lasting. Gorbachev and many of his top aides, such as Yakovlev, were deeply influenced by de-Stalinization (Taubman, Reference Taubman2005, chapter 11). De-Stalinization allowed and induced the recognition of human rights within Soviet and Eastern European societies to flourish, fostering doubt and even resistance against the fundamental values and practices of communist totalitarianism. This trend, labeled “revisionism” by the CCP, continued to grow even during Brezhnev’s return to Stalinism. Dubček’s “socialism with a human face” in 1968 and Gorbachev’s promotion of democratic socialism starting in 1986, which intentionally relaxed totalitarian control, were both consequences of this “revisionist” trend.

In contrast to the de-Stalinization trend in the FSU-EE Bloc, shortly after Mao’s death, Deng Xiaoping in 1979 ordered the arrest of dissidents calling for “political modernization,” that is to say, political liberalization, and declared the Four Cardinal (Totalitarian) Principles as the untouchable red lines for China’s reforms. In the early 1980s, Deng and other CCP elders thoroughly suppressed any attempted de-Maoization efforts within the CCP, preventing de-Maoization from ever starting in China. Moreover, during the 1980s, Deng initiated two anti-bourgeois liberalization campaigns and removed Hu Yaobang from his position as the General Secretary of the CCP for failing to suppress bourgeois liberalization vigorously. In 1989, Deng personally mobilized tanks and hundreds of thousands of troops to crush the peaceful demonstrations in Beijing and placed Zhao Ziyang under house arrest (Vogel, Reference Vogel2011, chapter 13).

After Poland, Hungary, and Czechoslovakia ended totalitarian rule by universal suffrage, the CPSU also decided to end its one-party rule in August 1991. Responding to these serious threats, Deng Xiaoping convened an emergency meeting with General Secretary of the CCP Jiang Zemin, who had recently returned from Moscow, military leader Yang Shangkun, Premier Li Peng, and other top CCP leaders. He emphasized that regardless of what happened in the Soviet Union, the CCP must maintain its unchallengeable leadership and not be influenced by external events (Vogel, Reference Vogel2011, p. 657). Deng assessed that the collapse of the CPSU was due to the failure of Soviet economic reforms. In this emergency, he went on a southern tour a few months later and pushed for economic reforms with all his might to keep the CCP in power. The success of these economic reforms, driven by the development of a private economy under China’s RADT governance structure and the integration of trade and investment with developed countries, not only preserved the CCP’s power but also allowed China to replace the Soviet Union as a totalitarian superpower (Vogel, Reference Vogel2011, chapter 13).

However, the decade-old issue of the reformability of the socialist economy now applied to China. Like the Soviet Union in the 1980s, soon after China became a middle-income country, its economic growth rate continued to decline sharply, entering a period of stagnation beginning in 2019. Starting in 2023, China faced increasing risks of financial and fiscal crises. Similar to the stagnation in the FSU-EE countries during the 1980s, the CCP has found itself at a loss. Nevertheless, economic stagnation or even crises do not necessarily mean that China will undergo an institutional transition similar to that of the FSU-EE countries.

The collapse of the Eastern bloc totalitarian regimes was not only due to the failure of economic reforms but also political changes. The reforms in those countries in the 1980s were comprehensive attempts to transform the totalitarian system into democratic socialism (or socialism with a human face) in the face of severe socioeconomic challenges. An economy under socialist ownership could not improve efficiency through reforms and the utopia of democratic socialism was unachievable. However, the Soviet and Eastern European Communist parties genuinely hoped to present a more humanized face towards that utopia. They took a big step towards democratization by loosening the totalitarian grip on all fronts. This essentially shook up totalitarian rule. Under tremendous social pressure and with the desire for a human face, the communist leaders of the Soviet Union, Poland, Hungary, and Czechoslovakia all stepped down peacefully following democratic procedures, one after the other.

In contrast, the CCP’s economic reforms, unlike those in the Soviet Union and Eastern Europe, are of a different nature – a new-age Leninist New Economic Policy designed solely to salvage the communist totalitarian system, always on alert for any threat to totalitarian rule, including from entrepreneurs (see Chapter 13). When totalitarian rulers are determined to cling to power at any cost, they will not relax their grip on totalitarian control even in the face of economic collapse. Additionally, the CCP’s strategy of implementing economic reforms to preserve power and the institutional genes of the governance structure inherited from its history are different from those of the Soviet Union.

Despite being revisionist in terms of leaning towards humanitarianism, the Soviet and Eastern European Communists firmly believed in socialism, particularly socialist ownership. Their economic reforms adhered to state ownership, which led to SBCs. Economic reforms that maintained this ownership structure were doomed to fail. In contrast, under the slogans of socialism and Marxism-Leninism, the CCP allowed for significant changes in the ownership structure of the Chinese economy, permitting private enterprises to become the mainstay of the economy, which led to China’s economic growth. Kornai in the 1990s described the CCP as a party akin to a Christian church that does not believe in Jesus.⁵

However, a caveat is necessary here. As previously mentioned, the development of the private economy in China was not a result of a deliberate policy of the CCP but rather the outcome of two institutional genes at work: the RADT governance structure and some market economy elements inherited from history. As the private sector saved the Chinese communist regime, its legitimacy was recognized in 2004 (see Chapter 13).

Nevertheless, fearing that the further growth of the private sector could become the foundation for peaceful evolution or a color revolution, thus undermining its power, the CCP has maintained strict totalitarian control over private enterprises and entrepreneurs. Particularly since 2019, the CCP has tightened its control and cracked down on private firms, including all the largest e-commerce companies. Combined with other factors, this ultimately halted China’s growth, leading to more serious economic stagnation and even risks of severe financial or economic crises in China. In stark contrast to China’s economic woes, about half of the FSU-EE countries transitioned to democratic constitutional systems and became developed economies through free private ownership and market economies.

It is worth noting that the constitutional reforms promoted by Gorbachev and the Soviet elite played a crucial historical role in peacefully ending totalitarian rule. This also provided the Central and Eastern European countries with the opportunity to choose their own systems, helping them to end their totalitarian regimes. However, most former Soviet states lacked the institutional genes necessary to establish a democratic constitutional system. Concretely, the lack of universal private ownership, the lack of civil society based on private ownership, and the lack of a social structure evolving from the bottom up based on civil society make it difficult for these countries to form a social basis for checks and balances on power. Under these conditions, establishing the institutions of electoral and parliamentary systems could formally end totalitarian rule but this was not sufficient to establish a democratic constitutional system. Thus, the transition of many former Soviet states, particularly Russia and Belarus, to authoritarian regimes was neither accidental nor solely the result of individual leaders such as Putin. To some extent, the drastic collapse of the Soviet Union in 1991 followed by the changes to authoritarian rule in Russia and Belarus resemble the 1917 February Revolution and its consequences (see Chapter 8). Indeed, Yakovlev, one of Gorbachev’s main aides involved in planning the political reforms, later lamented that the lessons of the Russian 1917 February Revolution had not been learned (Yakovlev, Reference Yakovlev1999, p. 107).

The genuine belief in socialist democracy or socialism with a human face by some FSU-EE communist leaders or elites was a key factor behind the collapse of totalitarianism there. This belief sharply contrasts with that of the CCP leaders and elites, who launched reforms to safeguard their power and thus always resolutely defended totalitarian rule at any cost. Although the CCP was derived from or cultivated by the CPSU and its fundamental communist totalitarian ideology was imported from the Soviet Union, the difference regarding humanity and humanitarianism, which is not part of communist ideology, is related to the institutional genes and social consensus on humanity across the regions. Specifically, it is related to whether historically one had experienced or been influenced by the Enlightenment.

Mankind’s systematic recognition of human rights and humanity began with the Enlightenment and the social consensus on human rights formed the ideological foundation of modern democratic constitutionalism. Most FSU-EE countries had gone through the Enlightenment or had been influenced by it, thus shaping the related social consensus and institutional genes. China, however, never experienced the Enlightenment and was largely unaffected by it. During the Enlightenment period, China remained in a state of self-imposed isolation. Only a few Chinese intellectuals in the late nineteenth century had a superficial understanding of the Enlightenment.

Contrary to the social consensus required for democratic constitutionalism, the ideological basis for the establishment of a totalitarian system was class struggle against humanity. Marxist-Leninist theories of class and class struggle are tools for systematically eradicating people’s recognition of human rights and humanity. The Communist Party relied on class struggle to replace humanity in order to mobilize the masses to establish a communist totalitarian regime. After establishing a totalitarian regime, ensuring that people do not form a social consensus about humanity is crucial for maintaining totalitarian rule of repression. However, traditional Marxist-Leninist theory did not provide a framework for this. On the contrary, Marxist theory asserts that socialism is a classless society. When class theory no longer applied to a classless socialist society, it rendered all Marxist-Leninist theories opposing humanity obsolete. In 1936, when Stalin declared that the Soviet Union had established socialism, he also announced that classes were eliminated in the Soviet Union. Stalin’s justification for the Great Purge was to eliminate the 5th Column, or spies from the West. But that could only be a short-lived excuse. In the long run, without a theory of class and class struggle, the presence or absence of institutional genes about human nature in the original society became important in guiding the people’s social behavior.

In the FSU-EE countries, including Russia, which is the furthest in that region from the center of the Enlightenment and arguably among the weakest in receiving its influence, the social elite had been influenced by the Enlightenment since the eighteenth century. The institutional genes that evolved from the Enlightenment contained a certain longing or social consensus for humanity, human rights, and freedom. A recognition of humanity and human rights, even in their most primitive form, fundamentally conflicts with totalitarian rule. The widespread recognition of humanity and human rights in the FSU-EE societies enabled the push for de-Stalinization after Stalin’s death and triggered the revolutions in Poland and Hungary. It also fostered the advocacy of socialism with a human face and democratic socialism in the 1960s and 1980s.

The anti-totalitarian uprisings in Poland and Hungary in 1956 and the Prague Spring in 1968, were all violently suppressed by the military. However, violence could not extinguish the pursuit of human rights and freedom. By the 1980s, the consensus on de-Stalinization had gradually spread within society, including among some Communist Party upper echelons in the FSU-EE Bloc. Gorbachev and many around him had long been influenced by de-Stalinization and the Prague Spring. His friends included Czech comrades who had participated in the Prague Spring (Zubok, Reference Zubok2021, pp. 32–35). One of his main aides was Soviet theorist Georgy Shakhnazarov,⁶ who worked in Prague during the Prague Spring, was deeply influenced by the idea of “socialism with a human face,” and systematically advocated for “socialist democracy” by publishing related works (Taubman, Reference Taubman2017).

At least partly driven by their awareness of human rights and humanity, the communist parties of the Soviet Union, Poland, Hungary, and Czechoslovakia gradually loosened their grip in the name of political democratization, to varying degrees. They ceased using party discipline against political opponents, abandoned severe purges such as exile and imprisonment, and limited violent repression of demonstrators. In turn, the relaxation of totalitarian rule, while gaining social support, created or consolidated a social consensus for popular political participation.⁷ Social participation generated continuous pressure for further democratization.

In addition to the relaxation of control, in the final years before the collapse of totalitarian rule there were open discussions among the upper echelons of the communist parties in the Soviet Union, Poland, Hungary, and Czechoslovakia about establishing a multiparty system or creating institutionalized factions within the communist parties. These developments clearly demonstrate that the transition from relaxing totalitarian control to ending it in the FSU-EE countries was the result of both social pressure and an enlightened social consciousness.

In stark contrast to the Soviet and Eastern European experience, China did not undergo the Enlightenment in its history. Consequently, people in China hold very rudimentary or primitive views on humanity or are influenced by Confucianism, completely lacking the concept of human rights. From the perspective of the Enlightenment and a social consensus and from the standpoint of humanity and humanitarianism, China’s institutional genes differ significantly from those of the Soviet Union and Eastern Europe.⁸ These differences in institutional genes have led the CCP not only to firmly resist the de-Stalinization initiated by the CPSU but also to use the opportunity of resisting de-Stalinization to further tighten its totalitarian control in a more extreme direction.

During the Khrushchev era, the CCP labeled the CPSU’s de-Stalinization and revival of humanity as revisionism, insisting that class struggle continues throughout the socialist phase. It subsequently launched the Anti-Rightist Movement and the Cultural Revolution. These campaigns in China further entrenched class consciousness, justified the use of violence, and eradicated the already weak awareness of humanity from Chinese mind. No sooner had humanity begun to recover after Mao than Deng decisively and resolutely blocked de-Maoization efforts within the CCP, declared the Four Cardinal Principles to uphold Mao Zedong Thought, and suppressed the peaceful pro-democracy demonstrations in 1989. For more than thirty years since then, the CCP has continuously imprisoned and suppressed anyone demanding respect for human rights and political freedom.

At the same time, the CCP has deliberately distorted the meanings of humanity and human rights in various ways and waged an extensive information war against democratic systems and the institutional transformation of the Soviet Union and Eastern Europe. This strategy has contributed to the prevalence of widespread materialism in Chinese society and deepened a cynical or distrustful attitude towards human rights and humanity among the populace. Ironically, when a society is solely concerned with materialism, it becomes difficult for that society to evolve towards a democratic constitutional system, thereby hindering its further economic development. Even in the face of serious economic problems, such a society’s institutional framework remains resistant to change.

Let us conclude this section by briefly outlining a few other major differences between the institutional transitions in the FSU-EE Communist Bloc (before 1989) and the efforts of the CCP to prevent such a transition. One significant difference worth noting is the institutional arrangement for successors within the party.

Within the CCP, there are two competing groups for power succession, the so-called “princelings faction” and the “Youth League faction” in the literature on the Chinese Communist Party. In fact, these two groups are not political factions in the usual sense but rather reflect the origins of their power or their different social strata. The princelings faction refers to a power group composed of the descendants of high-ranking party officials,⁹ whereas the Youth League faction refers to a power group originating from the Communist Youth League.

In contrast, the succession system in the FSU-EE communist parties was fully institutionalized, moving from the Komsomol (Communist Youth League) to the Communist Party, with no phenomenon akin to the Chinese princelings. After Stalin, Soviet leaders such as Khrushchev, Brezhnev, Andropov, Chernenko, Gorbachev, and Yeltsin all came from blue-collar families, received higher educations, and were gradually selected and promoted within the system from the Komsomol to the upper echelons of the Communist Party (Lowenhardt et al., Reference Lowenhardt, Ozinga and Ree1992, p. 73). Understanding this difference between the Chinese and Soviet totalitarian regimes helps explain the emergence of figures like Xi Jinping (also Bo Xilai and Wang Qishan) in China and Khrushchev–Gorbachev in the Soviet Union.

The Communist Youth League system within the CCP was transplanted from the Soviet system. As a branch of the Comintern, the CCP duplicated the Komsomol system under the name of the Communist Youth League (originally called the Chinese Socialist Youth League) from its inception. Deng Xiaoping and Hu Yaobang both started their communist careers as members of the Youth League. The princelings in the CCP, however, are a product of the CCP’s opposition to de-Stalinization, known as a successor cultivation system established during the Sino-Soviet split. This system was set up by Mao with strong support from the upper echelons to prevent de-Stalinization (or de-Maoization) in the future in China. It was to a considerable extent inherited from the Chinese imperial system and the institutional arrangements for power succession in Chinese secret societies and was highly incentive-compatible with high-ranking CCP cadres and their descendants.

Driven by the motivation to hold power, this successor cultivation system played a crucial role in the launch of the CR. The core members of the so-called Red Guards, who later became known as the princelings, were significantly empowered during the CR, which further strengthened this system. After the CR, the CCP further bolstered it (see Chapters 12 and 13). Xi Jinping, Bo Xilai, Wang Qishan, as well as Jiang Zemin and Li Peng, are all princelings. Hu Jintao, Wen Jiabao, and Li Keqiang belong to the Youth League faction. Many with princeling backgrounds have a strong sense of entitlement to power, seeing themselves as the rightful inheritors of totalitarian power, which, in turn, generates a stronger motivation to maintain the totalitarian system.

The second major difference lies in the influence of the military within the power structure of the Communist Party. In the Soviet Union, the military did not have the ability to significantly influence major decisions at the highest levels of the Communist Party. The CPSU heavily relied on the secret police, the KGB, in the power struggles. This arrangement allowed Gorbachev to resist military pressure to use force both domestically and internationally. In contrast, the Chairman of the Central Military Commission in the CCP, a position that controls the military, has held a decisive role in the party’s power structure since Mao Zedong (from the Anti-AB League purge to the Cultural Revolution) (see Chapters 10 to 12).

Mao’s famous quote, “Political power grows out of the barrel of a gun” not only applied to the CCP’s seizure of power but also to its internal power struggles and, more importantly, to safeguarding the CCP’s totalitarian regime. This is evidenced by the actions of CCP leaders. In May 1989, Zhao Ziyang, the General Secretary of the CCP, met with Gorbachev during the student demonstrations in Tiananmen Square. He mentioned that the Chinese were watching the democratization reforms in Soviet Union enthusiastically.¹⁰ He also stated that the Communist Party must grant democratic rights to the masses under a one-party system; failing that, the problem of multipartyism will become inevitable (Gorbachev, Reference Gorbachev1995, pp. 489–491). However, Deng Xiaoping, leveraging his established power base within the CCP’s military, personally mobilized hundreds of thousands of troops to suppress the peaceful demonstrations, rendering the hopes for political reform mentioned by Zhao futile. More than thirty years later, Xi Jinping’s first move after taking office was to consolidate military power under the guise of an anti-corruption campaign. He then relied on military power to reassert tight control, pulling China back towards totalitarianism.

Finally, let me briefly summarize the comparison between the institutional transitions in the FSU-EE countries and China’s forty years of economic reforms:

1. 1) Communist totalitarian systems are fundamentally unreformable, making economic reforms destined to fail, leading to economic stagnation. Recognizing the irreformability of the system was a primary motivation for the FSU-EE countries to abandon totalitarianism. China, having experienced relatively successful reforms in driving a desperately poor economy to become a middle-income country, is now on a path similar to the Soviet Union in the late 1970s, i.e., stagnation.

2. 2) Totalitarian rulers can always use violence to maintain their power and rule. The peaceful abandonment of totalitarianism in the Soviet Union and Eastern Europe was not solely due to economic stagnation. Significant social pressure and a societal awareness of human rights and humanity were also decisive factors. Such social pressures and awareness are highly complementary to each other and are related to its institutional genes.

3. 3) China’s weak societal awareness of humanity and human rights, the institutional characteristics of military intervention in politics, and the princeling succession system, make the peaceful abandonment of totalitarianism in China more difficult.

4. 4) For a transition from a totalitarian system to another system, the collapse of totalitarianism must occur first. However, transitioning to democratic constitutionalism requires the presence of relevant institutional genes in society, which include widespread private property rights, a civil society, and a social consensus on human rights, property rights, and the rule of law and constitutionalism.

14.7 Concluding Remarks on the Concept of Institutional Genes

In this book, the trajectories of the evolution of institutional genes are shaped by institutional constraints, random mutations arising from shifts in ideology and preferences, and external forces or shocks. Consequently, institutions evolve based on a mix of regularities and random factors, meaning they are neither wholly random nor completely deterministic. While we cannot predict specific details, we can identify key determining factors, making the general directions of change somewhat predictable.

Much as in the life sciences, where our comprehension of evolution of the species is directional and probabilistic rather than deterministic, institutional evolution, when analyzed through the lens of institutional genes, also exhibits a directional and probabilistic character. In the realm of the life sciences, the stochastic nature of evolution primarily arises from the randomness of genetic mutations. Likewise, in the social sciences, the mutation of institutional genes is stochastic. A unique distinction, however, emerges: humans perpetually use their understanding of society to influence it directly. Such human intervention can consequently induce mutations in the institutional genes. In this context, the line differentiating the researcher from the subject of study becomes blurred. Moreover, the ways in which human actions sway these institutional genes, combined with the ensuing consequences, are dictated by a myriad of random factors.

As a result, those who trigger these institutional gene mutations, be it Qin Shi Huang, Mao, or anyone else, might remain oblivious to or dismissive of the long-term implications of their actions. Emperor Qin Shi Huang’s comprehensive eradication of the nobility induced mutations in institutional genes, laying the foundation for the junxian system. Emperor Wu of Han’s exclusive promotion of Confucianism resulted in mutations which became the institutional genes of Confucianism and the imperial examination system. The Comintern’s role in founding the CCP led to mutations which set China on a path to totalitarianism, and Mao Zedong’s instigation of the GLF and the CR prompted mutations that culminated in totalitarianism with Chinese characteristics, that is, RADT.

By comparison, efforts like the 1898 Hundred Days’ Reform and the 1901 Gengzi Reform, both of which aimed to establish a constitutional monarchy, as well as the 1911 Xinhai Revolution which sought to institute a republic, did not incite a notable evolution of institutional genes favorable to constitutionalism in China. Similarly, neither the Russian 1905 Constitutional Revolution, which resulted in a constitutional monarchy, nor the Russian February Revolution of 1917 that set up a de facto republic, managed to catalyze a significant progression of institutional genes supportive of constitutionalism in Russia.

Yet, when viewed from the perspective of institutional genes, these ostensibly random, major historical phenomena are not wholly arbitrary. Amidst a multitude of incidental events, the pivotal factor determining the success or failure of a policy, reform, or revolution lies in the incentive-compatibility or-incompatibility of each institutional change. This compatibility, in turn, is profoundly influenced by its relationship with the existing institutional genes. As such, historical events that seem random are not entirely devoid of patterns. Instead, they are probabilistic outcomes influenced by specific stochastic regularities.

Lastly, I want to underscore that while this book primarily centers on China, the concept of institutional genes is a general one. Beyond understanding China, my aspiration is for this concept to be further developed and applied across various contexts. This would enable us to systematically uncover patterns of institutional evolution, deepen our analysis of the path-dependence phenomenon in institutional changes, and strengthen our ability to comprehend the trajectories of institutional evolution across past, present, and future timelines.