Interesting statistics announced today by the China Internet Network Information Center (CINIC) that 253 million people in the country are now online, meaning China now has the world’s largest number of Net users in the world (topping the US’ 223 million). These numbers are still much inferior to the country’s stock of mobile-phone users (500 million) but nonetheless, the continued growth of China’s online participant community bears watching. Least of all because the current user-base represents a penetration rate of only 19% suggesting that as the country develops, and as infrastructure spreads West throughout China, it will dwarf the rest of the worlds (i.e. start publishing/marketing in Mandarin). CINIC projects the number of Chinese users to grow to 490 by 2012.

The growth of China’s online community has been acknowledged by many within the Chinese Communist Party, including the country’s most powerful leader, Hu Jintao. In mid-June he took part in an online web-chat at the People’s Daily website that marked the first time a senior party official publicly engaged with internet users. While commentators noted that “there was no real substance to the online conversation,” it has since been referred to as symbolic of the central governments acknowledgement of the internet as an important source of public information and public opinion.

This would seem to auger the path towards democratization that many have hoped the Internet would catalyze in China and elsewhere in the world. But whereas the growth of China’s online population may indeed force the government to listen into a new medium, whether it forces change is another question. Remember, it’s been nearly 20 years since the June 4th incident and change has been, as Mao predicted, “like crossing a river, feeling for the pebbles one at a time.”

And so as China has transformed itself into a capitalist autocracy, whether its evolution includes our liberal notion of democracy is up for debate. This week’s edition of the New Yorker carries a great article on China’s “new generation (of) neocon nationalists” and the role they’ll play in determining China’s future. Author Evan Osnos notes that the Internet is being used successfully as a meeting place for a generation of tech-savvy ‘angry youth’ who view the country’s sovereignty on internal and external affairs as trumping the promise of a liberal democracy. Chinese nationalism is, according to them, on the upswing thanks to the Internet and tools that allow them to network with, and transmit information to, like-minded Chinese who see democracy as but one more attempt by the outside world to influence China’s internal progress. One of those interviewed states “Chinese people have begun to think, one part is the good life, another part is democracy. If democracy can really give you the good life, that’s good. But, without democracy, if we can still have the good life why should we choose democracy.”

As I wrote back in January, the rise of the Net and its ability to engage citizens is equally applicable to globalist or nationalist schools of thought. While on one hand it has, and will continue, to break down the barriers of distance and standards that exist between nations and people, it holds an equal ability to reinforce those very walls by those who see what’s beyond them as threatening to the sovereignty and future of their nations. And given the unequal distribution of the proceeds of globalization (whether that be measured by the impact on a US auto-worker or an African farmer), and mankind’s predisposition to protect those closest to them, I can’t help but think that we’ll never quite reach Nicholas Negroponte’s prophecy that one day the Nation would “evaporate like a mothball…from solid to gas directly…wherein there will be no more room for nationalism than there is smallpox.”

Instead, I’m much more inclined to think that we’re headed back to the city state models of Ancient Greece and Northern Italy where the confluence of local interests and priorities with a knowledge economy that can accommodate rural locations could well yield a new form of local/national government and a much richer form of democracy and participation.