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thinking (xin si wei). Chinese scholar Jixuan Hu (1991: 44) writes, ‘‘By setting up a minimum group of constraints and letting human creativity work freely, we can create a better society without having to design it in detail. That is not a new idea, it is the idea of law, the idea of a constitution.’’ To accept that idea, however, means to understand and accept the notion of spontaneous order and the princi- ple of nonintervention (wu wei) as the basis for economic, social, and political life.

China’s leaders and people can turn to the writings of Lao Tzu for guidance. According to noted Chinese philosopher Wing-Tsit Chan (1963: 137), the Lao Tzu

strongly opposes oppressive government. The philosophy of the Lao Tzu is not for the hermit, but for the sage-ruler, who does not desert the world but rules it with noninterference. Taoism is therefore not a philosophy of withdrawal. Man is to follow Nature but in doing so he is not eliminated; instead, his nature is fulfilled.

It is in this sense that Lao Tzu writes,

When the government is non-discriminative and dull, The people are contented and generous. When the government is searching and discriminative, The people are disappointed and contentious [Lao Tzu, 58; Chan 1963: 167].

‘‘Lao Tzu Thought,’’ not ‘‘Mao Zedong Thought,’’ is the beacon for China’s future as a free and prosperous nation. Deng Xiaoping (1987: 189) implicitly recognized Lao Tzu’s way of thinking when he said,

Our greatest success—and it is one we had by no means antici- pated—has been the emergence of a large number of enterprises run by villages and townships. They were like a new force that just came into being spontaneously. . . . If the Central Committee made any contribution in this respect, it was only by laying down the correct policy of invigorating the domestic economy. The fact that this policy has had such a favorable result shows that we made a good decision. But this result was not anything that I or any of the other comrades had foreseen; it just came out of the blue. 10

Although China can return to its own vision of freedom by embrac- ing and extending Lao Tzu’s thought, the idea of ‘‘market Taoism’’ can be enhanced by a deeper understanding of classical liberal economic thought and a study of free-market institutions and public choice. In

10Kate Xiao Zhou (1996: 4) describes the demise of China’s collective farms and the creation of the household responsibility system (baochan daohu), with its township and village enterprises (TVEs), as ‘‘a spontaneous, unorganized, leaderless, nonideological, apolitical movement.’’


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