Chrystia Freeland, global editor at large for Thomson Reuters, in the Washington Post has a good take on why China, like all of us, needs both capitalism and democracy:
state capitalism may falter as China gets richer [because] it may be hard to allow people to become consumers without letting them become real citizens, too. One of China's big economic challenges over the next decade will be to allow its domestic market to grow. That will mean giving the Chinese people more spending power. As the Chinese become more bourgeois, they may demand more political rights, too. . .
[China’s] state capitalism [needs] innovation. The American political economy has many flaws . . . But America has one great virtue that no other country has yet to replicate: When it comes to innovation and its translation into things people want, America is unbeatable. This is the country of Apple, Google and Facebook. These are the inventions driving the technology revolution, and only an open society can create them. . .
[China's] centuries of stagnation [stemmed from] its centralized, authoritarian state. As economic historian Joel Mokyr has written, "the absence of political competition did not mean that technological progress could not take place, but it did mean that one decision maker could deal it a mortal blow." Meanwhile, in chaotic, divided, inefficient Europe, when one ruler decided to repress his innovators, "they did no more than switch the center of economic gravity from one area to another."
Freeland, born in Canada but of Ukrainian background, a student of Russia’s exit from Communism, has that appreciation for the freedoms we take for granted that comes best from those who know oppression. She concludes,
Dictators are easy to admire, especially at a distance. Free markets and free societies always look messy and inefficient, especially up close. But when it comes to inventing the modern world, and living at its edge, so far the best model the world has come up with is democratic capitalism.