Chapter 3 introduces the theoretical framework with an examination of the regime’s changing approach to labor control. It explains why the Chinese regime has moved away from overt coercion and adopted atomized incorporation and argues that the change could be understood from a political economy perspective. The empirical findings show that the central government and the local governments in developed industrial regions have a new incentive to implement pro-labor policies, even when they undermine the profitability of export-oriented sectors. The chapter contrasts the specific components of the new strategy with the strategies of authoritarian labor control observed in Latin America and East Asia.

This chapter probes the short- and long-term costs of blunt force regulation. Case studies and local news reports show that workers do protest, businesses do resist, and local bureaucrats do publicly criticize the short-term nature of blunt force solutions. How does the state guard against the political risks of blunt force regulation? Using two cities as case studies – one wealthy and developed, and the other poor and industrial – this chapter shows how the state concentrates the costs of blunt force pollution reduction on the groups that are the least able to push back. It targets smaller, private firms or industries that rely on temporary, transient labor. These strategies are effective at preventing unrest, but exacerbate inefficiencies in the economy and may complicate efforts to reduce pollution in the future.

After the Neolithic transition, arguably the most important economic shift was the industrial revolution. Prior to the industrial revolution, for the previous 10,000 years, the world relied (almost) exclusively on small-scale agriculture or pastoralism for economic production. The industrial revolution, starting largely with the development of the steam engine, had a profound effect on the material relationship of the individual to economic production, as individuals became part of industrial production. This change also had significant impacts on demographics: cities grew as the economics drove mass migrations away from rural areas to industrialized areas. Industrialization also had a long-lasting effect on politics, as workers organized to make improvements in working conditions and shift the power balance between labor and capital. Marxism was born of this struggle, and I explore the premises behind this philosophy, and the reasons for expansion as well as ultimate failure of this profoundly influential economic model. Here I speak to the contradictions between modern humanism and the authoritarian application of Marxism, drawing in the discussion on chaos and complexity and the difficulties with attempting central control on something as complex as a national economy.