That was an excellent movie...but it took place many many years before the 'Cultural Revolution'.
I like your question, and I think that an 'advance of a society' at the expense of the individual / freedoms is not an advance of a society, but only one segment of it. As for being tolerable, sadly, yes. There are many example through history that shows this. Take for example the United States. It would not be nearly as rich today if it didnt do it at the expense of some of its citizens (slavery). It was an ugly part of history, it also advanced the US, and was tolerated for far too long. Today we see many examples of it not only in obvious places like China and Russia, but also in so called democracies. One thing that is clear is that our capitalist system is built on winners and losers. If you don't have those, the system fails. So we turn a blind eye...and that is sad.
I forget who it was that said it, but the phrase 'democracy is the worst system of governance, except for all the other ones' or something to that affect is still very apt.