This year’s elections are pushing so-called Greater China into uncharted political territory. Ever since the rule of Deng Xiaoping, Chinese leaders have been convinced that colonial Hong Kong and “renegade” Taiwan would eventually return to the embrace of the motherland in exchange for limited autonomy. Instead, both are clamoring for the kind of democratic rights that remain verboten on the mainland–and that would be hard to contain in any unified federation. Optimists are heartened: they see an opportunity for Beijing to study new ideas, a political laboratory like the experimental Special Economic Zones created along the Chinese coast in the 1980s, which jump-started the country’s economic boom. Pessimists say pro-independence forces are using the ballot to wrench Taiwan and Hong Kong away from the motherland–and they fear a violent backlash.

A similar schism runs deep within the Chinese leadership in Beijing. On one side, there are those who are willing to experiment with democratic reforms. On the other are those hard-liners dedicated to perpetuating the Communist Party’s political monopoly. The last time the two factions clashed, 15 years ago, hundreds of student demonstrators died in the streets near Tiananmen Square. Today, tensions are nowhere near 1989 levels. But this election season is nevertheless a watershed moment: Beijing must choose either to embrace political reform at its margins–or to resist the trend with all its considerable power. Ultimately, it’s a decision about which road China will take.

Popular leaders in Hong Kong and Taiwan have the same advice: Beijing should cease opposing democratization in the two territories and at home if it wants to unify Greater China. They argue that doing otherwise has only exacerbated tensions. Since last July opposition to Tung–a man handpicked by Beijing to rule–has driven hundreds of thousands of Hong Kong citizens into the streets. Their anger has fueled calls for popular elections to replace him when his term expires in 2007. In Taiwan, more than a million people linked hands on Feb. 28 to form a “Great Wall of Taiwan Democracy” as a rebuke to China’s military buildup across the Taiwan Strait. In both places rallies have been swollen by middle-class people angered by Beijing’s shrill rhetoric and bully-boy tactics. " ‘I Love Taiwan’ doesn’t mean we all hate China," says Joe Chen, a student at the February protest. “We simply don’t like the pressure China is putting on Taiwan.”

By contrast, these democrats say, signs that the Communist Party was beginning to loosen its grip on the mainland would be heartening. The race in Taiwan between President Chen Shui-bian and his Kuomintang opponent, Lien Chan, remains neck and neck. Whoever wins, though, the election will not be decided on the question of reunification with the mainland–something not even the Kuomintang can viably support anymore. Both parties say they need to see concrete signs of change before contemplating closer political ties. Indeed, since mid-2002, Taipei has been secretly measuring democratic progress on the mainland as a means of determining whether reunification might someday be possible. “To some extent we believe a democratic China would [guarantee] Taiwan’s security because democracies don’t wage war on one another,” says a senior official familiar with the project. “In that sense, if China becomes a democracy, we can then negotiate.”

Many in Hong Kong would be happy if Beijing started by loosening up on the former colony. Under the “one country, two systems” theory propounded by Deng in negotiations with the British, the territory was to maintain its economic freedoms for 50 years after returning to China in 1997. “Essentially, Deng said, ‘You people can do things your own way’,” recalls a Western diplomat in Hong Kong. " ‘You can continue to go to the horse races, to have capitalism, and we won’t tell you what to wear’." The limited democracy the territory was allowed was meant to be revisited–and presumably expanded–after 2007. But in the meantime, the capitalist revolution that has overtaken the mainland has made Hong Kong’s economic liberalism much less of an issue. Whereas Beijing’s political control–symbolized most blatantly by the choice of Tung as so-called chief executive–has inflamed passions.

On Tung’s watch, Hong Kong stumbled during the 1997-98 Asian financial crisis, then declined further when the global dot-com bubble deflated after 2000 and Hong Kong manufacturers continued to flee to the mainland. His administration mishandled the SARS epidemic and, amid record unemployment and the softest local economy in a generation, made passage of controversial national-security legislation his top policy priority in 2003. The result: 500,000 Hong Kong demonstrators took to the streets to denounce him last July 1, the sixth anniversary of the handover. “Without Tung,” quips former Democratic Party chairman Martin Lee, “Hong Kong people wouldn’t love democracy half as much as they love it now.”

In effect, that bad personnel decision has shrunk Beijing’s room for maneuver. Rather than maintaining a strategic ambiguity about how and when to expand democracy in Hong Kong–which forestalled international criticism without challenging communist control–Chinese leaders are being forced to stake out a clear position. Demands for reform are near universal. After several of its candidates lost district-council elections last fall, even the DAB took up calls for replacing Tung by popular vote. DAB leader Ma Lik now supports universal suffrage by 2007. “If you think Hong Kong is not ready,” he says of Beijing, “then tell us your conditions. Tell us. Then we will try our best to meet [your] requirements to have full democracy implemented as early as possible.”

Why not answer his question? Some Chinese experts argue that addressing a call for greater openness in Hong Kong would both tamp down a brewing problem and send a positive signal to Taiwanese. Instead, Beijing has responded by blasting pro-democracy leaders in the territory as “unpatriotic”–a potent charge on the stridently nationalist mainland. Audrey Eu, a leading democratic lawmaker, thinks the criticism isn’t meant to stir up a real patriotic debate, but rather to serve as a prelude to negotiations. “You start with a hard line and frighten people,” she says, “so later any kind of softening will be taken with a lot of gratitude.” Others aren’t so sure. Reformist legislator Emily Lau says Chinese leaders are still too insecure about their own hold on power. “They’re worried that if [democracy] gets out of hand here it could be imported into the mainland,” she says. “And maybe they’re not wrong.”

The question is whether they shouldn’t have larger worries–whether their dream of unifying Greater China can be fulfilled without some degree of political reform. Using patriotism as a litmus test has already cost China dearly. Tung’s obvious love for China hasn’t made him an effective leader. Nor, in contrast, did President Chen’s “splittist” tendencies–as Beijing calls them–prevent him from floating a plan to increase cross-strait economic ties after he won office in 2000. In the former case Beijing unquestioningly backed a weak executive wrapped in the flag. In the latter it brushed aside a viable, mutually beneficial proposal from a rival deemed too suspect to trust.

Today, Beijing mistakenly assumes that if the Kuomintang’s Lien Chan wins the presidency in Taipei, a sweeping trade deal opening direct links across the Taiwan Strait could follow. Instead, mainland watchers on Taiwan say a victorious KMT would more likely revive a cold-war slogan: fangongbufanhua, meaning “oppose the communists, not China.” On the other hand, Chen advisers say the president is likely to downplay the independence issue if he wins and instead look for acceptable scenarios for unity. “We would like to find a political integration formula with the PRC,” says a senior official. Among the options: “multiple-sovereignty systems” patterned on the European Union or the British Commonwealth.

For now Beijing seems oblivious to such nuance, sticking with its old practice of demonizing its critics. But reformers in both Hong Kong and Taiwan clearly hope that pressure from their territories will sharpen divides in Beijing–and maybe expose them to the light of day. “With luck, policymaking by closed-door bargaining among party factions will burst into the open, and the idea that open competition among leaders and policies is the best way forward will assert itself,” wrote Michael DeGolyer, a specialist on Hong Kong’s transition to Chinese rule, in The Standard last week. That would move the democracy debate from the margins to the center, where it belongs.