[Market Economy Guide] Is Reunification Always Good?

Of course, unification is good if it expands freedom and exchange,

but if unification leads to dictatorship, everyone becomes worse off.

In the film Hero, the protagonist Nameless (played by Jet Li) is a master of the so-called “ten-step assassination.” He can kill any target within ten steps without fail. Qin Shi Huang, aware of the movements of such martial assassins, allows no one within 100 steps of him. After enduring countless hardships, Nameless manages to get within ten steps of Qin Shi Huang and gains the chance to kill him, but at the final moment he gives up the assassination. Why did Nameless make that choice?

The Meaning of China’s Qin Dynasty

Before setting out to meet Qin Shi Huang, Nameless encounters Broken Sword (played by Tony Leung), who has long sought to kill the emperor. Unexpectedly, however, Broken Sword tries to dissuade Nameless from assassinating him. When Nameless asks why, Broken Sword quietly writes the characters for “all under heaven” in the sand, revealing his true thoughts. His view is that China must be unified to build a powerful nation, and that even if Qin Shi Huang is a cruel dictator, he must not be killed but followed instead. That was Broken Sword’s belief, and also the view of this film’s director, Zhang Yimou.

But unification is not unconditionally good, nor is it unconditionally bad. Unification that expands people’s freedom and increases exchange is good, but unification that restricts freedom is not desirable. If unification helps increase interaction among people and enrich their lives through the expansion of markets, then it raises economic freedom and brings significant benefits. On the other hand, if unification reduces domestic and external competitive pressure and thereby shrinks political and economic freedom, it can lower quality of life and make everyone unhappy.

Europe’s City-States

After Rome, no vast unified empire emerged in the Western world. Europe’s city-states competed fiercely to become better cities, because only then could they attract more merchants. Then as now, merchants constantly moved in search of cities with better public order, legal systems, and business environments. In economics, this is what is known as “voting with their feet.” Taxes paid by merchants were a major source of revenue for city-states, and in many cases the ruling groups of those city-states were merchants themselves. It was in the embrace of these freely competing city-states that the famous Renaissance was born.

China, too, though known for its unified empires, was once in a situation not so different from Europe. If one looks at China during the Spring and Autumn and Warring States periods, the many small states scattered across the map look strikingly similar to today’s map of Europe. Lasting some 500 years around the turn of the first millennium BCE, the Spring and Autumn and Warring States periods were not simply ages of division. They were a stage for the flourishing contest of ideas known as the Hundred Schools of Thought, including Daoism, Mohism, Legalism, and Confucianism, through which philosophy and ethics advanced dramatically. It is hardly an exaggeration to say that nearly every idea the human mind could produce emerged during that time.

Even today, the expression “Spring and Autumn and Warring States period” is often used metaphorically to describe a situation in which numerous participants gather in a field and compete without limit. For example, in professional sports one might read, “This season is expected to be a Spring and Autumn and Warring States period as team strengths have become more evenly matched.” An age of division does not necessarily carry only negative connotations.

Bureaucracy and Entrepreneurship

But afterward, China took a different path from Europe. From the Sui Dynasty in the 6th century, which ended the Wei, Jin, and Northern and Southern Dynasties period, to the final Qing Dynasty, dynasties changed but the continent as a whole largely maintained a unified system. An age of division like the Spring and Autumn and Warring States periods never returned. Freedom of thought also disappeared. Qin Shi Huang’s burning of books and burying of scholars alive is a representative example. Under the Qin, Legalism briefly dominated, and after the Han, Confucianism ruled the thinking of the Chinese people.

At first glance, one might think that the absence of division would have made life better, but human affairs do not work out so simply. China’s great cities no longer needed to compete as fiercely as the city-states of Mediterranean Europe. Moreover, the rulers of those cities were usually career officials dispatched by the central government. While the cities of Renaissance Europe were run by the entrepreneurial spirit of merchants, bureaucracy prevailed in China’s cities. The history of Western ascendancy since the modern era may, perhaps, have already been foreshadowed at the time of Qin Shi Huang’s unification of all under heaven.

■ Please remember

Unification is not unconditionally good, nor is it unconditionally bad. Unification that expands people’s freedom and increases exchange is good, but unification that restricts freedom is not desirable. If unification helps increase interaction among people and enrich their lives through the expansion of markets, then it raises economic freedom and brings significant benefits.

Sung-no Choi, President of the Center for Free Enterprise (CFE)

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Original title: [시장경제 길라잡이] 통일은 무조건 좋은가

Author: Sung-no Choi

Date: 2020-08-17

Source: https://www.cfe.org/bbs/bbsDetail.php?cid=column&pn=7&idx=23000