How Communist is Communist China?

On several occasions during my 10 days in China, I've been told that there are 70 million members of the Chinese Communist Party. And yet it's nearly impossible to find an orthodox Marxist in Beijing. When you stand in Tiananmen Square and look toward the Forbidden City, you see a huge portrait of Mao flanked by slogans. The slogans used to say things like "Long Live Marxism-Leninism." Today, they're simply nationalistic: "Long Live the People's Republic of China!" (Click here to follow Daniel Gross).

While class struggle and common ownership of property may have motivated the revolution, Mao's heirs are more interested in outcomes than process. At least a dozen times, officials and businesspeople have quoted Deng Xiaoping's line about not caring whether a cat is black and white, as long as it catches the mouse. Chinese structures—whether socioeconomic theories or apartment buildings—don't have to be elegant; they just have to stand up. And so far, 30 years into the great China experiment, the elites are confident that the grafting of capitalism onto a state-controlled economy, overseen by a government controlled by a Communist Party, is standing up.

The headquarters building of the China Academy of Engineering is a testament to the nation's growing ability to create elegant structures. Light spilled in through a large glass wall. The green building was paved with recycled marble tiles and boasts a sophisticated heating and cooling system that relies on recirculating water from deep in the ground. In a large reception area, whose centerpiece was a glass case filled with trains and planes, we met Xu Kuangdi, a veteran apparatchik, engineer, manager, and leader. Xu, an academic who served as mayor of Shanghai from 1995 through 2001, is vice chairman of the National Committee of the Chinese People's Political Consultative Conference and president of the Chinese Academy of Engineering Sciences. And while the format of the meeting was old-school—we sat in large, comfortable chairs in a setting more like an audience than interview—there were several times during the meeting when I felt as if I were on the set of CNBC's Kudlow & Co. For the only class struggle this veteran Communist discussed was the struggle of the newly rich to hold onto their gains.

Xu boasted China's engineering triumphs: the 88-story building in Shanghai, designed by an American architectural firm but built by Chinese engineers; the 67 bridges over the Yangtze River; the Olympic structures; high-speed rail; supercomputers. And when we asked how we would square the experience of modern China—parts of Beijing are a luxury retailer's paradise—with Communist Party doctrine, he had a ready response. Karl who? "We're not a bookish party," he said. Besides, the Communist Party has always been flexible when it comes to dealing with national priorities. It cooperated with the Kuomintang to fight the Japanese. "Mr. Marx is still widely respected by the party and the party members. He's a great mind in the people's history." Just because many of his ideas are outdated—they were devised in a period without today's developments in science and technology—it doesn't means he's forgotten. "I want to compare it to God in your mind. Maybe you don't go to church every week. But that doesn't follow that God is not in your heart." Marxism, like religion, is "still a power that controls the morality of the people."

Of course, in China, Marxist morality shifts over time. And today, the most moral thing that Chinese policies and people can do is promote economic growth and development, regardless of the distributional outcomes. In our time in China, we heard several reasons why the massive country simply couldn't adopt Western-style democracy. The population is too large and too diverse. Democracy promotes the sort of arguing that hinders growth. The performance of other Asian countries seemed to have suffered when fractious democracies emerged from authoritarian or military rule. Xu added a new one: It would promote unhealthy class warfare. If elections were to be held in a large geographical area where gaps between the rich and poor are wide, and in which people have different educational backgrounds, "it might cause turbulences to society," he said. "If somebody just went out in the street and shouted, 'I will divide the property of rich people into poor people,' I think he would be elected. But it is useless, as parity will not solve the problem of economic development." Yes, the creation of wealth in China has been wildly uneven. But this, too, is consistent with the party's goals, doctrine, and history, according to Xu. "Sometimes when we have the faith we have to take different approaches to realize our beliefs. The ultimate goal is the common prosperity, but we have to let a group of people to get rich first."

How do you say "trickle down" in Mandarin?

Daniel Gross is also the author of Dumb Money: How Our Greatest Financial Minds Bankrupted the Nation and Pop!: Why Bubbles Are Great For The Economy.