A review of the development of the industrialized nations, whether of Europe, the United States, Russia or Japan, shows that at the very beginning of their industrialization they all connected their economy with international trade and the world economy. They thereby accumulated primary capital by means of exporting blood and iron, and importing large quantities of resources. In sum by opening to foreign markets they enabled their economies to take off through industrialization and international trade.

What of China? Britain’s invasion of China in the Opium War (1840-1842) was more than 20 years before the Japanese Reform, but China retained a "closed door" policy until the end of the seventies of this century when it began to change. So, although China is different from the Western countries as well as from Russia and Japan, and cannot (and should not) take the "blood and iron," viz., the domestic and overseas predatory approach, never-theless, external stimulation is indispensable.

In economy, science and technological management there is quite a distance between the West and China. In the process of the transition from an agricultural to a modern industrial society, it is an historical fact that China has fallen behind. To complete their modernization the Western countries went through a number of revolutions, viz,. scientific, civil (bourgeois democratic) and indu-strial. Those three revolutions took place only in Western countries so that modern science and technology, modern industry, modern capitalism and modern democracy -- all facets of modernization -- come from the West.

More concretely, after the 16th century, the West integrated the creations of all people working in science and culture; even-tually it first conceived modern science and its related social struc-ture. In the 18th century, the structure of science combined with the open system of technology to form the structure of modern science and technology which brought about the first industrial revolution. During that period, the bourgeois democratic revolution in the Western European countries promoted the historical interaction of the structures of modern science and technology with the social structure so that in the last three hundred years, science projected its rational spirit multi-dimensionally upon the whole of society. Hence, any traditional society must change its original social for-mation, which change is precisely the process of Western moder-nization.

Non-Western modernization, generally, is the effect of rec-eiving the Western modernization revolution as a cultural tran-smission. Max Weber said that no non Western society can spon-taneously create modern science, technology, professional per-sonnel, capital and democratic legislation system. For non-Western countries such as Japan and China, industrial civilization is some-thing heterogeneous. Surely industrialization and modernization are common tendencies in human development, but there are es-sential differences between the processes of modernization East and West.

Especially for China, as an agricultural country with a less developed economy, the original revolutions of modernization, e.g., science-technology, democracy and the industrial revolution cannot be created homogeneously, but must be imported hetero-geneously. Any import process from a heterogeneous civilization necessarily will have impact on the traditional order and even cause social disorder. That is the cost which the late-developing countries must pay for their modernization. Hence, without courage and sa-crifice the process of modernization cannot begin.

TO ECONOMIC DEVELOPMENT IN CHINA

The cost of the democratic revolution in China is well-known, but that is just one aspect of the whole modernization re-volution. Moreover, the establishment of a democratic regime does not mean the thorough and complete realization of democracy. For an agricultural country composed largely of small family-farms, the realization of democracy is a long process closely related with the modernization of science, technology and industry. Without those, especially without a change from backward agriculture and small family farmers, who are the main part of the people, it is impossible thoroughly to realize democracy. For that, it is ne-cessary to accept the external impact and pay the cost.

The problem of democracy is the most essential aspect of the system of "ends and means" and requires an external impact. The modernization of science, technology and industry would appear to be even more the case, but in real history this has not been so. After the Song dynasty, China gradually fell behind the West. One of the important and direct causes was the "closed door" policy, a re-luctance to accept external influences. When the Western countries opened the door by force of warships and guns, goods, technology and culture poured into China. Then the Chinese elite began to realize the usefulness of Western science, technology and manage-ment. However, mainly and finally it was agreed that "Western knowledge comes from the East", learn (only) the barbarous Wes-tern production technique, "Chinese ends with Western means", viz., what is inherited from the ancestors will never be touched.

After the democratic revolution and the establishment of the socialist state, this was combined with, or expressed as "keeping socialist purity." Whenever there was need to import more Western things, there were such cries of critique as "complete Westerni-zation," "a total negation of the tradition," "national betrayal" and "taking the capitalist road". Joint-ventures were not permitted, and contracts, leases, auctions, mortgages, loans, bankruptcy, bidding and stocks all were regard as capitalist things which socialism could never adopt. The result was that the economy was imprisoned and could not develop.

Historically, the main theme of the modern history of China has been a search for modernization. This long, winding road from a partial, especially economic, modernization to all-round syste-matic modernization can be divided into four periods: (1) the Wes-ternization Movement initiated in the latter half of 19th century, whose goal was material or technical modernization; (2) from the early reformist movement to the Reform Movement in 1898, and eventually the Revolution in 1911, whose goal was mainly to seek political modernization; (3) the "May Forth" Movement, whose goal was cultural modernization. In each of these periods an ac-ceptance of external influences is necessary and the entire process demonstrates that the closed, conservative and backward tradi-tional consciousness must be discarded. The last more than one hundred years move from conflict to fusion between Chinese and Western cultures, from tradition to accepting external influences. Without discarding the bonds of a backward consciousness, re-formist open door modernization would be but hollow words.

There is need now to re-evaluate capitalism. For a long time there was a bias against capitalism which was taken as the source of endless evils in modern society. Capitalism was taken to mean: op-pression, exploitation, poverty, starvation, aggression, war and all social disasters; it had no merits at all. As a matter of fact, however, capitalism is a form of human civilization, a step in its evolution.

Undoubtedly capitalism has its inherent contradictions, and exploitation, oppression, aggression, etc., are real. However, as a civilized social form, it also includes or accompanies modern science and technology, bourgeois democratic legislation and the socialization of large scale industry which drive, as well as express, social progress. The inherent and insoluble contradictions, the dark evil side, is the inevitable price of social progress. Capitalism fi-nally will be replaced by socialism, but its emergence and existence is also a result of historical selection. The advantage of the socialist approach in China has been to develop a directive theory so as to avoid the extreme evils of capitalism, but we cannot skip over the step of modernization.

Furthermore, contemporary capitalism is not wholly mono-poly capitalism, but is entering a period of "social capitalism" in which the economic factors, including production, capital and the adjustive mechanism of social life are more socialized.

Firstly, the socialization of production: with the development and popular usage of computers and related technology, the capa-bility for obtaining knowledge and communicating information has been promoted to an unprecedented degree. That leads to much closer interpersonal relationships in society. The social division of labor becomes more detailed and cooperations is broadened. This centralization and dispersion take place simultaneously. Industrial structures change rapidly, the service industry expands and the economy as well as the world economy are increasingly synthe-sized. In these tendencies, the key is that with the usage of ma-chines (including computers), the productivity of labor is greatly promoted and thought becomes the main factor in the development of production. Hence, the speed of innovation and the speed of knowledge and technology rises ever higher.

Secondly, there is a socialization of capital. The corporation is an open system in which ownership is distributed; the state, com-munity or socially owned sector of the economy and even inter-national or multi-national companies have been developed.

Thirdly, there is a socialization of the adjustive mechanisms of social life: the macroscopic control of economic activity has been enhanced and improved, while the anarchistic has been miti-gated. The state plays a much stronger position in the distribution of national income, the development of public enterprises, public welfare and social security. All those alleviate some of the social contradictions so that the whole society is not the same as it was with monopoly capitalism before World War II. This can be inter-preted even in terms of the socialist factors gradually growing into a developed capitalist society. Still more is to be learned then from contemporary Western countries.

The socialist approach does not require skipping over moder-nization. Indeed evolution and non-Western modernization require external or Western influences. This implies even more deter-mination in opening the door and a greater readiness to respond to external influences.