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While my photographer was taking pictures of Tiananmen Square prettily blanketed by snow last week, an elderly woman wearing a checkered wool headscarf nudged my arm and indicated she wanted to talk.

Before I had a chance to find out what she wanted, police had descended from all directions. They began barking questions at her. “Are you Falun Gong?” one asked.

“No,”she replied. Only then did I notice the tattered cloth bag slung over her shoulder on which was printed the symbol of the banned Falun Gong sect.

The police had seen it too, and despite her denial, the woman was hauled away in one of the police vans kept on standby to remove the Falun Gong practitioners who persist in staking their claim to legitimacy by wandering onto the square.

This has been going on for months, and I have seen it many times before. But it still does not cease to amaze me that a country ruled by the most powerful and ruthless dictatorship left on the planet, in charge of the world’s largest army, somehow deems it necessary to lock up elderly women just because they believe in a faith that conflicts with Marxism.

It’s not just Falun Gong. Roman Catholics and Tibetan Buddhists are also hounded, and it’s getting worse. It is now illegal to tell fortunes, an ancient Chinese practice. Opium perfume was pulled from stores last week, apparently because the authorities want to fight drugs and the name offends them.

Independent research was outlawed last summer, making it all but impossible for foreign companies to test new markets or for academics to conduct scholarly studies. Police in Shanghai last week ordered companies to register the names of all employees who use the Internet at work.

At the dawn of a new century in which new technologies and new ideas are advancing around the world at unprecedented speed, you have to question the long term viability of a system that seems so intent on resisting change. Economic reforms, yes. China wants to share in the new prosperity heralded by the process of globalization, and it wants to be a global power. But political reforms? A leader of vision and stature might yet emerge to steer China down a different path of enlightenment and tolerance.

There is no sign of such a person among today’s leaders, and that begs perhaps the biggest question about China’s future. Can a government that insists on curtailing its citizens’ ability to think independently, one that continues to lock up people who dare to be different and that will even resort to banning a perfume because it doesn’t like the name, possibly hope to compete in a world of ideas and innovation?

China’s leaders recognize the challenge. An extensive campaign is under way to promote the party’s new mantra: science and technology. But China’s leaders also are acutely aware of the dangers posed by new technologies to their hold on power, to their ability to restrict access to information, to their control over their own citizens contacts and interactions with one another. Barely a week passes without some new restriction or rule being slapped on the Internet.

As notion of the socialist state crumbles, people’s lives are being spun in countless different directions by the very un-Marxist winds of change gusting across the world and into China.

China’s accession to the World Trade Organization could further accelerate those changes. Millions of Chinese indoctrinated from birth to believe the state would take care of them are already being thrown out of work, and many millions more will lose their jobs once foreign companies are allowed to compete with China’s hopelessly inefficient state monopolies. It is no wonder that religion of all varieties is the fastest growth industry in China.

At some point during the next century, probably around the midway mark, China will overtake America as the world’s largest economy, assuming China’s economy continues to grow. The implications of that are potentially profound. The ways in which China chooses to exercise its newly found power in the world and the ways in which America responds, will shape the future of the world for decades to come.

But what kind of China is this contender for superpower status going to be? That is something that is impossible to predict, precisely because China is a dictatorship. Regimes whose power derives from the barrel of a gun, to paraphrase Mao Tse-tung, are inherently unstable; they must forever live with the fear that one day the gun will fail.

In the meantime, another ideology is emerging that could save the Communist Party from irrelevance. As the rallying cry of socialism rings increasingly hollow, the Communist Party is harnessing deep feelings of national pride to its well-worn rhetoric.

In a society no longer able to believe in socialism and which isn’t allowed to believe in anything else, nationalism is turning into a cohesive force. In the wrong hands and under the wrong circumstances, these sentiments could turn dangerously hostile toward the outside world.

Central to the party’s appeal to nationalism is the question of Taiwan and its “reunification with the motherland.” President Jiang Zemin has made Taiwan a personal political crusade, one that he may feel obliged to act upon if Taiwan doesn’t roll over and agree to be reunified with its motherland–which it almost certainly won’t as long as China is the kind of country that forbids freedoms taken for granted by the Taiwanese.

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Liz Sly, formerly posted in the Mideast, Washington and Africa, has covered China during three years of dramatic changee, highlighted by the 1997 return of Hong Kong.