Reform and Development in China

After 40 Years

Wei Shan, Lijun Yang

• Publisher: WSPC
• Year: 2019
• ISBN:
  9789813274167
• Topic: Politics & International Relations
• Subtopic: Asian Politics
• Index: Politics & International Relations

This book provides a comprehensive review of China's experience in reform and opening up from political, social, and economic perspectives. It attempts to engage existing scholarly debates in three areas — first, how the party-state has evolved in the past four decades and whether it remains a Leninist system or has departed from this system; second, how public attitudes, values and behavior have been intertwined with institutional change, and how the state is expanding its welfare coverage to enhance regime legitimacy. Second, how China has attempted to explore new engines for its growth, with consideration towards environmental protection and technological progress.

Chapters in this book are selected from three years of conference presentations co-organized by the Institute of Public Policy (IPP) at the South China University of Technology and UNESCO. Since 2014, IPP and UNESCO have co-hosted a series of annual international conferences and invited leading scholars from China, Europe, and the US to discuss the major challenges to China and the world.

Contents:

• The Reform of the Party-State:
  • China as an Innovative State and Its Implications for the World (ZHENG Yongnian)
  • A Turning Point (Maybe) in Reform and Opening Up (Joseph FEWSMITH)
  • Social and Political Mobility of State-owned Enterprise Executives in the Reform Era: The Rise of China's Supermanagers (Kjeld Erik BRØDSGAARD)
  • Political Meritocracy and Democracy: Confucian Meritocratic Democracy? (HE Baogang)
• Mass Attitudes and Social Policy:
  • Public Policy Satisfaction in Urban China: Evidence from Survey Data (TANG Wenfang and Dong 'Erico' YU)
  • The Chinese Voter: 1993–2013 (SHAN Wei and TANG Wenfang)
  • China's Social Policy Reform: The Perspective of 'Fragmented Developmentalism' (ZHAO Litao)
  • Evolution of Poverty Reduction Strategies in Rural China (QIAN Jiwei)
• Development: Towards Green and Technology-Driven Growth:
  • The Rise of New Green Industries: A Dynamic View of China's (and India's) Eco-Modernizing Experience (John A MATHEWS)
  • China's Bet on Technological Progress as an Engine of Sustainable Growth (LU Ding)

Readership: Academics, policy-makers, professionals, undergraduate and graduate students, interested in Chinese philosophy and culture.Reform;Opening Up;Political Reform;Meritocracy;Leninism;Chinese Communist Party;Green Industries;Social Policy;Technology And Economy;Poverty Reduction;State-Owned Enterprises;Policy Satisfaction;Cadre System;Voting0 Key Features:

• Differing from competing topics, this book covers a wide range of issues crucial to China's reform
• Contributors include leading scholars like Prof Yongnian Zheng, Prof. Wenfang Tang, and Prof Joseph Fewsmith

Part 1

The Reform of the Party-State

Chapter
1

China as an Innovative State and its Implications for the World

ZHENG Yongnian

East Asian Institute, National University of Singapore,
Singapore

1.Introdution

“Is China’s political system innovative?” The reason I use this title for this chapter is that while China is increasingly becoming relevant to people’s daily life in different parts of the world, the country seems to have become a political entity that we have never seen before. Its leaders have mentioned it on different occasions that China wants to chart a political course distinct from what is practised elsewhere.

What motivated me to discuss this subject are the two articles that I read in February and March of this year. Let me explain these two articles briefly.

The first article appeared in the Forbes magazine (February 23, 2014). It was written by Eamonn Fingleton, and the title of the article was “Upside-Down Propaganda: How China Keeps Fooling The New York Times, The BBC, and Other Wishful Thinkers.” According to the author:

“For nearly two decades now, Beijing has worked through various witting and unwitting surrogates, many of them Westerners, to persuade the United States and Europe that China’s rise is somehow an illusion. Beijing is playing on an apparently limitless capacity for wishful thinking in the West and, to anyone who has been following the story, the motive is obvious: to foster complacency and procrastination. The point is that the slower Westerners are to understand how profoundly the map of world power is changing, the less effective will be any Western efforts to moderate Beijing’s ambitions.”

The author cited many examples of wrong predictions made by Western media such as The New York Times, The Economist, and the Times: “Yet we now know that the earlier predictions proved not only wrong but the diametric opposite of the truth. Instead of conveniently collapsing, China continued to grow faster than any other major nation in history. The fact is that China is now more than three times bigger in real terms than it was in 2003 and nearly six times bigger than it was in 1998.”

I am not sure whether it was the Chinese government’s agenda to fool the media in the West. Since many in China are often surprised by the country’s radical development. I am sure that no one, including any of the Chinese leaders, is able to predict the future of China. But Fingleton was right in pointing out that all previous predictions of Chinese economic system’s demise have proved premature.

The second article is a six-page piece in The Economist (March 1–7, 2014), entitled “What’s gone wrong with democracy and how to revive it.” The article discusses how democracy in different parts of the world is going through a difficult time today. Democracy is in retreat, indeed. Outside the West, democracy often advances only to collapse. “Where autocrats have been driven out of office, their opponents have mostly failed to create viable democratic regimes. Even in established democracies in the West, flaws in the system have become worryingly visible and disillusion when politics is rife” (pp. 47–48). “Democracy has too often become associated with debt and dysfunction at home and overreach abroad” (p. 48). The argument that democracy is in crisis is widespread today. But what makes this article relevant to my discussion are the two following reasons that The Economist believes are behind today’s democratic crisis.

According to the magazine, the two main reasons are the financial crisis of the period 2007–2008 and the rise of China. The financial crisis exposed fundamental weaknesses in the West’s economic and political systems, thereby undermining the self-confidence that had been one of their assets. Many people became disillusioned with the workings of their economic and political systems — particularly when governments bailed out bankers with taxpayers’ money and then stood by impotently as financiers continued to pay themselves huge bonuses.

The 2008 financial crisis took place in the heart of Western democracies. It is not difficult to understand how this crisis has affected democracy. But why single out China? China is not a part of the democratic world. How did China affect democracy?

According to The Economist, the reason is simple; it is due to China’s economic rise. Here is an extract that I wish to quote at length here:

“The Chinese Communist Party has broken the democratic world’s monopoly on economic progress. China has been doubling living standards roughly every decade for the past 30 years. The Chinese elite argue that their model — tight control by the Communist Party, coupled with a relentless effort to recruit talented people into its upper ranks — is more efficient than democracy and less susceptible to gridlock. The political leadership changes every decade or so, and there is a constant supply of fresh talent as party cadres are promoted based on their ability to hit targets. China’s critics rightly condemn the government for controlling public opinion in all sorts of ways, from imprisoning dissidents to censoring Internet discussions. Yet, the regime’s obsession with control paradoxically means it pays close attention to public opinion. At the same time, China’s leaders have been able to tackle some of the big problems of state-building that can take decades to deal with in a democracy. In just two years, China has extended pension coverage to an extra 240 m rural dwellers, for example — far more than the total number of people covered by America’s public-pension system. … China offers an alternative model. Countries from Africa (Rwanda) to the Middle East (Dubai) to South-East Asia (Vietnam) are taking this advice seriously” (p. 49).

Moreover, I quote “as China’s influence has grown, America and Europe have lost their appeal as role models and their appetite for spreading democracy… Why should developing countries regard democracy as the ideal form of government when the American government cannot even pass a budget, let alone plan for the future? Why should autocrats listen to lectures on democracy from Europe, when the euro-elite sacks elected leaders who get in the way of fiscal orthodoxy?” (p. 51).

Therefore, the magazine’s conclusion is “China poses a far more credible threat than communism ever did to the idea that democracy is inherently superior and will eventually prevail.”

After reading these two thoughtful pieces, an immediate question came to my mind: despite such radical changes in the past three decades, why is China’s political system still there? According to Marx, economic changes must lead to political changes. If one believes Marx, then one must give an answer to this question.

Related to this question, we can also ask many other questions: How has the Chinese political system been able to survive? What is the nature of the Chinese political system? How does it function? How does it differentiate itself from other political systems? Is it in serious conflict with democracies in the West?

I have been thinking about these questions at least for two decades: “When will the Chinese Communist Party (CCP) collapse?” This was the question that was most frequently asked in the aftermath of the crackdown on the pro-democracy movement in 1989. I went to Princeton University for my Ph.D. program in 1990. Princeton gathered a group of Chinese dissidents who fled from China after the crackdown. There were frequent debates on the future of China. As a part of the pro-democracy movement, I was interested in their debates. There was a strong consensus among them that the CCP would not be able to live long, and it would soon collapse. The reason was simple: it cracked down on the pro-democracy movement and believed that democratization could be avoided.

Today, almost a quarter of a century after the pro-democracy movement, this continues to be the standard question people ask when they look at China. The rise of the Jasmine Revolution and the collapse of the regimes in the Middle East and North Africa in recent years rendered many to believe that the days of the CCP are numbered, and it could collapse in years, months, and even days. In recent years, the Bo Xilai affair, which was seen as a bitter power struggle within the regime, has reinforced this pessimism.

However, such a perception is far from the reality. The CCP continues to survive and expand. Today, it has become the largest political party in the world, with more than 80 million members. While it is legitimate to ask whether the CCP will collapse given the fact that the party is facing mounting problems, it is more important and meaningful to ask why it has survived and developed.

To understand the survivability of the CCP, one has to understand the CCP’s capability to learn, to adapt and to change. In other words, one has to look into how the CCP has innovated itself according to changing environments.

In this discussion, I want to focus on the political innovations. But before I get into that, I would like to dwell a little on China’s economic progress first. After three decades of what the late Deng Xiaoping called “socialism with poverty,” the CCP has finally understood, absorbed and is implementing the seven pillars of Western wisdom which have enabled the country to pursue wealth and power, including free market economies, science and technology, a culture of pragmatism and education. No one will deny that these factors are behind China’s remarkable record of economic growth. According to IMF statistics, in purchasing power parity (PPP) terms, China’s share of global GDP was less than 10% of that of the US (2.2% versus 25%). Despite this large starting gap, The Economist magazine has projected that China’s GDP will overtake the US by 2019. China’s GDP will then be $21.05 trillion while the US’s will be $20.96 trillion.

In recent years, policy makers and policy researchers inside China had debated if China will fall into the so-called “middle-income trap,” which essentially refers to an economic phenomenon where a country which attains a certain income level (due to given advantages) will become stuck at that level. The middle-income trap occurs when a country’s growth plateaus and eventually stagnates after reaching middle-income levels. The problem usually arises when developing economies find themselves stuck in the middle, with rising wages and declining cost competitiveness, unable to compete with advanced economies in high-skill innovations, or with low-income, low-wage economies in the cheap production of manufactured goods.

I am not going to discuss whether China will fall into this trap. My point is that the Chinese leadership is acutely aware of this possibility. China has shown many signs of this trap. But with this keen level of awareness, China has started to search for various strategies to avoid the trap, introducing new industrial processes, finding new markets to maintain export growth and, more importantly, ramping up domestic demand. China is attempting to avoid the pitfalls of some of the East Asian economies such as Thailand, the Philippines and Malaysia, which have fallen into the middle-income trap. China’s immediate neighboring economies such as Japan, South Korea, Taiwan and Hong Kong have provided it with good examples. All these high-income economies have demonstrated that to avoid the middle-income trap, an economy must move from growth that is dependent on cheap labour and capital to one based on high productivity and innovation. In this regard, China will have to build a highquality education system which encourages creativity and supports breakthroughs in science and technology. As a part of the East Asian community, China is expected to sustain its economic growth and become a high-income economy. In the next 15 years or so, a 6–7% annual growth, lower than the official target of 7.5% set by Premier Li Keqiang at the recently concluded National People’s Congress, will lead the country to realize this goal.

In my view, the biggest challenge for China is still political, namely, the survival of the CCP. As many have pointed out, the CCP can be brought down by corruption, internal party struggles and massive social unrest. However, China’s experiences since the reform show that many problems the CCP has encountered are developmental in nature. Many other regimes in the developing world had experienced the same problems although they may differ in terms of scale and complexity. But unlike many other developing countries which do not have the pillar of governance, China’s strength is the existence of the CCP. While many negative things can be attributed to the CCP, one cannot deny that the CCP has also done good things. Overall, it is a fast learning organization, learning from other countries and from its own past. The current anti-corruption campaign is a good case. In a short period of time, dozens of high-ranking party cadres and government officials have been investigated and arrested. Due to its rampant and widespread corruption, the CCP was regarded by many people as hopeless and helpless, and its only choice was to wait for its inevitable demise. However, waves of anti-corruption campaigns in the past decades have demonstrated that as long as the party leadership has a strong political will, the party can perform.

It is important to note that engaging in anti-corruption is the minimum requirement for the survival of the CCP. More important is that the CCP has to innovate itself by setting up new sets of institutions. The leadership is fully aware of it. The evolution of the CCP since the reform and opening up has its own reasons.

In the past three decades, the CCP has transformed from a one-party personal dictatorship to an increasingly open party system. This differentiates the CCP from other communist parties in the Eastern bloc before they collapsed. After the fall of communism, Eastern European states chose the Western path, allowing different interests to found different political parties. To avoid the misfortune of party collapse, the CCP has chosen a different way by opening up the political process to all social and interest groups. Due to this approach, China has evolved into an open party system under one-party rule.

Openness is becoming an important feature of China’s party system. Any political system that is not open will become exclusive and closed. Only with openness can politics be inclusive. In the West, political openness materializes through external pluralism, i.e., multi-party politics, in which each kind of interest can find representation in a party. In China, political openness is realized through a set of mechanisms I call “internal pluralism,” which means the openness of the ruling party. When different interests emerge in society, the ruling party opens itself to them, absorbing them into the regime and representing their interests through different institutions and mechanisms.

The institutional transformation of the CCP has been very rapid. Since no opposition party is allowed, for any social groups, entering into the political process of the CCP is the most efficient way to express their interests. The “Three Represents” concept proposed by Jiang Zemin in the early 2000s typically reflects the CCP’s realistic perception that it has to represent different social interests. Today, China’s increasingly large middle class, including private entrepreneurs, has demonstrated very strong ...

Table of contents

• Cover
• Halftitle
• Series Editors
• Title
• Copyright
• About the Editors
• Contents
• Introduction
• Part 1 The Reform of the Party-State
• Part 2 Mass Attitudes and Social Policy
• Part 3 Development: Towards Green and Technology-Driven Growth
• Index