If a Newly Freed Tree Falls in a Formerly Communist Forest and No One Hears it, Does it Still Make a Sound?

Media reports of good news are rare, but today's events in China deserve more attention than Anna Nicole Smith's drug prescriptions, which seem to have captivated the celebrity-obsessed media (I would write 'liberal media' but since Fox News dedicates as much air time and web space to Smith as any other news source, I must be fair and balanced).

In my March 8th post, "America and China Move Steadily in Opposite Directions," I wrote about the irony inherent in Communist China's consideration of legislation to protect private property rights, while America, courtesy of the Kelo V. New London City (CT) Supreme Court decision, is moving in the opposite direction. At the time that post was written, the private property protection legislation in China was undergoing debate and had not yet been voted on, though its creators expressed optimism that it would pass. Activists seeking reform in China frequently exude similar optimism but often meet with rejection of their ideas, and so it was with cautious hope last week that I wrote about their efforts in the area of personal property protection.

Those hopes were rewarded today with the report that China did in fact pass the proposed personal property protection legislation, in what should have been a story that trumped meaningless celebrity "news" stories in today's publications and network news programming. The importance of the newly passed protection law should become more evident as private investors and entrepreneurs flock to China, since their profits, infrastructures, and intellectual property will belong exclusively to them rather than shared or owned outright by the Chinese government. China has been moving steadily toward a true market-based economy, and the lack of the right of ownership was a significant obstacle to private investors wanting to create and profit from their businesses.

The Washington Post report of today's legislative achievement in China described the event, in part, as follows:

legal scholars said it broke ground by establishing new protections for private home and business owners and for farmers with long-term leases on their fields.

These goals had long been sought by the entrepreneurs who now account for more than half of China's production; the swiftly climbing number of urban families who have bought their own apartments; and the millions of farmers whose croplands are increasingly coveted by real estate developers.

"This law speeds up our market economy development," said Chen Shu, a member of the National People's Congress and secretary general of the Guangzhou Lawyer's Association, who participated in drafting the legislation over the last several years.

Jiang Ping, a scholar who advised officials drawing up the law, said it is significant because it helps codify a property law system that has been evolving through regulation in recent years as the country moves away from socialism.

The final sentence in the quotation from the article is truly stunning. There have been monumental ideological battles over the past 90 years between socialism and free market capitalism, and the sincere wish of all who came of age during the Cold War was not that America would be forced to defeat these ideologies through armed conflict (while rightly making certain we could do so if necessary) but rather through friendship, shared economic interest, and internal changes within socialist nations. While this process was slow and often disparaged in the media, it wrought social upheaval in the former Soviet Union and its satellite states.

We are, perhaps, witnessing giant steps toward freedom and economic prosperity in China, and such legislative changes should be publicly recognized, praised, and rewarded by American political and corporate leaders. Momentum is critical to any political or social reform, and China's momentum is currently carrying it in the right direction.

China's Communist Party attempted to minimize media coverage of the debate on this issue, apparently out of fear that additional protections would be demanded too quickly by the Chinese people. The Communist desire to move slowly and pull tightly on the reins predictably resulted in more attention and support for the cause of property rights. According to the Post:

To muffle critics, Communist party censors had barred China's media from covering the disagreements. Gong's petition was ordered off the Internet, for instance, and the Beijing-based magazine Cai Jin was forbidden to distribute last week's issue because it contained discussion of the controversy.

The resulting irony was that the Communist party, having silenced its most faithfully Communist members at home, forced them to turn to foreign journalists to air their views, which then bounced back on foreign-based websites. At his book-lined Beijing University office, Gong was busy through the week receiving foreign television crews and newspaper correspondents.

Once a people tastes the sweet nectar of limited government and economic independence, it will no longer accept anything less. China appears to have recognized this and while seeking to apply controls to the pace of implementation, is allowing economic reality to lead it into what optimists are sure will be a bright future.

America and China Move Steadily in Opposite Directions

America is becoming China, while China is becoming America. As one who came of age during the Cold War and was inspired by Ronald Reagan’s aggressive fight to roll back Communism, I read my opening statement with equal parts dismay and disgust. As I examined an article appearing in today’s online Washington Post, I was struck by the truly remarkable irony in the events the report described.

Maureen Fan’s article, “China Legislature Introduces Property Law” caught my eye as I scanned the Post, and my heart was filled with hope as I read the following excerpts from the article:

In preparation for likely approval, China's legislature on Thursday began examining a much-debated law that helps protect private property in an increasingly well-off society.

Though the Communist Party still believes the state owns all land, the growing economy has meant that private property "has been increasing with each passing day" and the protection of it is the "urgent demand of the people," the draft legislation states.

"As the reform and opening-up and the economy develop, people's living standards have improved in general, and they urgently require effective protection of their own lawful property accumulated through hard work," said Wang Zhaoguo, Deputy Chairman of the National People's Congress, in introducing the latest draft of the measure to the legislature.

Individuals shall own "their lawful incomes, houses, articles for daily use, means of production and raw materials," the legislation states. "Lawful deposits and investments of individual persons and the gains derived from their investments shall be protected by law." Illegally taking possession or destroying any such property is forbidden.

Of course, China has not renounced Communism or state ownership of land, but the significance of this legislation that appears headed for approval should not be underestimated. China’s government according individual ownership rights to personal property, financial accounts, investments, profits, and “means of production and raw materials” would be perhaps the most important move toward human rights it has made in recent memory. The Communist government appears to realize that its economy relies heavily on private investments, and keeping investors happy is critical, even if doing so requires loosening state control over personal property.

According to Fan’s research, it has taken Chinese activists 14 years to move the pending legislation to this point, but they are optimistic that economic reality will secure final approval. Economics wields a powerful influence over property rights policies, and governments tend to be at the mercy of those who create and maintain consistent revenue sources. If granting and protecting personal property rights appeases China’s growing wealthy entrepreneurial class, the Communist government may consider that as a small price to pay to maintain its hold on other aspects of Chinese governance.

It may take another 14 years, but the next step for China’s property rights advocates will focus on land ownership rights which, as America’s Founding Fathers understood, establish true freedom for individual citizens who could not be removed from their dwellings or livelihood by government. China’s property rights activists recognize that they have made great strides with the personal property legislation, but the fundamental right to the land itself is the ultimate goal:

“As long as the problem of land ownership is not solved, conflicts on unfair land seizure cannot be avoided. Since land is in the hand of the government, a developer can bribe an official and make the official claim that the land is seized for public use," said Liu Xiaobo, a leading political dissident and literary critic. "If the developer could get the approval from the official, he is legally entitled to seize the land."

Still, Liu said the legislation had benefits. "This is the first law in our country for property protection. The public can at least cite a specific law when their property rights are violated," he said.

Though China's Constitution states that "lawful private property is inviolable," farmers and even city dwellers are routinely forced from their homes when developers and local officials decide the property is more profitable as an apartment block, government building or major shopping mall.

As I read the quoted paragraphs above, my initial excitement at witnessing China moving, albeit slowly, in the direction of increasing individual property rights was dampened by the contrasting direction in which America is heading when it comes to this same issue of property rights. As China prepares to approve extended rights, America, the great champion of human rights and liberty, is experiencing a steady increase in seizures of privately owned land by local governments, only to see that same land given to developers who promise huge increases in tax revenue from profitable commercial developments or high density residential housing.

The concluding paragraph of Fan’s article, as quoted above, ironically described precisely what is currently occurring in China and America. The difference lies in the fact that China is moving slowly away from such land seizures, while America, compliments of the 2005 Supreme Court decision in Kelo v. City of New London (CT), is moving steadily in the opposite direction.

In July 2005, popular radio and TV personality Larry Elder wrote a powerful commentary for World Net Daily in which he provides examples of eminent domain land seizures and how, despite nearly unanimous public opposition to the Supreme Court’s ruling, the pace of seizures by local governments is increasing as they seek to secure a larger tax revenue base in their communities. Lest one think that these seizures only happen to owners of “blighted” or “deteriorating” properties, Elder included the example of the Gamble family in Norwood, OH, whose home for 35 years was anything but blighted:

I interviewed Joy and Carl Gamble on my nationally syndicated radio program:

Joy: Six months after we retired, we opened up the newspaper and found out this developer ... wants our neighborhood. We had a nice home and a lovely neighborhood ... we were not a slum. We were not a threat to the health and welfare of Norwood.

Larry: The City Council said your neighborhood is deteriorating and blighted.

Joy: "Deteriorating" is so broad. ... Everybody's home is deteriorating. And now by this ruling by the Supreme Court, we are all renters. Nobody owns their home. ... Matter of fact, we're worse than renters – we're serfs.

Larry: Higher tax base, more revenue for the city, so the heck with Joy and Carl Gamble.

Joy: That's correct, and we lost our home. ... We had to flee or be evicted.

Larry: Did they offer you fair market value?

Carl: Yes ... but we haven't touched the money.

Larry: You don't want the money. ... You weren't going down to Florida and retire. You want to stay in your home.

Carl: That's what we told them.

Larry: They're offering you twice, three times, what they first offered you, Joy, and you're not taking it?

Joy: It's not a question of money. It's our home ... money does not buy everything.

Yet money was the prevailing factor that led to the city’s seizure of the Gamble’s home. The city reportedly was seeking an annual $2 million tax revenue increase in order to balance the city’s budget.

The Gamble’s were evicted, moved to Kentucky, but continued their legal battle. In 2006 the Ohio Supreme Court ruled in favor of the Gamble’s as co-plaintiffs, but it was too little too late to save their neighborhood, as reported by USA Today: the 3 plaintiffs’ houses were “the only houses left in what used to be a neighborhood of about 70 middle-class homes.” Residents in other states have lost similar battles. Remarkably, the ACLU, NAACP, and the AARP have all filed briefs on behalf of threatened land owners, yet the seizures nationwide continue at an ever increasing rate.

Government attempts to seize private land on behalf of private developers were already increasing prior to the Supreme Court’s Kelo decision. As Elder wrote:

Most Americans, no doubt, assume that this rarely happens. But according to the Institute for Justice, it occurs far more often than we think. From 1998 to 2002, government, at all levels, used eminent domain to acquire, or attempt to acquire, private property for private purposes on over 10,000 occasions.

As I reread Elder’s WND commentary, the contrasting influence of economics, positive in China and negative in America, was troubling. While Chinese activists struggle to acquire property rights America once held inviolable, America’s local governments are slapping long-time residents and even churches with eviction notices and eminent domain condemnation declarations. The city of Sand Springs, OK, set its sights on a local church that serves the local black community. The church building, only 7 years old and reportedly in good condition, stood in the way of a proposed commercial development anchored by a Home Depot. Churches are particularly endangered by eminent domain seizures because the Supreme Court’s Kelo decision established that economic improvement was sufficient justification. Churches are tax exempt and thus produce no revenue for cities. In the minds of many city councils, nearly any tax revenue producing enterprise would be of more value than a church.

Although I disagreed with many legal decisions made by former Supreme Court Justice Sandra Day O'Connor, I applauded her dissent in the Kelo decision. She understood the incredible danger inherent in the court’s decision, and in her forceful dissent, warned Americans that:

The specter of condemnation hangs over all property. Nothing is to prevent the State from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory. . . .

Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random. The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms. As for the victims, the government now has license to transfer property from those with fewer resources to those with more. The Founders cannot have intended this perverse result.

America and China appear to be passing each other on the property rights highway, heading in opposite directions, both motivated by the desire for money. Unless the trend in America is reversed, in coming years my Cold War generation may witness the advent of greater property rights in Communist China than in the “land of the free."