I think you are right. the education of the grassroots is an final advantage of a nation.
I don't know what's going on in China. But as I observed, China is taking some jerks in the reforms and transition to a more powerful nation. The princeling, or the elite, usually have the sight for a long view, and its inside from their memory of grow-up, therefore the instinct. While the leaders from the general public or the low castle tend to take practical path.
the education of the grassroots provides more access of those people to the top league of the political arena, thus melting into with with more fresh spirits and opinions. if you look at all powerful nations throughout the history, you will find that's a universal phenomenon.
The sad story of Pakistan, and other developing nations, notably South Asian nations and South American nations, is the invisible segregation of the class, we need a revolution to break up these fences, all people need equal access of knowledge, self awaking of political sense, instead of being part of the voting machine, some great thinkers, and so far.
China and Japan, together with other east asians, are already up in the highland, you guys have no reason to be pessimistic.