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China — 30 Years of Reform

December 18, 2008


It was 30 years ago that the resilient Chinese politician Deng Xiaoping began reforming China’s economic system by embracing free market reforms. Audra Ang, in an article published in the Washington Post, reports on a speech delivered by the current Chinese Communist Party leader Hu Jintao to mark the occasion [“30 years transform China, but not its politics,” 18 December 2008]. She writes:


China marked the 30th anniversary of the start of its capitalist revolution with a speech Thursday from Communist Party leader Hu Jintao, who urged continued economic reform but said it would not lead to Western-style democracy. He praised the economic changes of the last three decades, including opening the door to free market reforms and foreign trade, which have brought a massive transformation to the country. ‘Since the reform and opening up, the fundamental reason for all the achievements and progress we have made has been our creation and development of the socialism with Chinese characteristics,’ Hu said in a speech during a ceremony at the Great Hall of the People. The concept, frequently touted by the leadership, refers to the jettisoning of the centrally planned economy while maintaining strict authoritarian one-party communist rule. The theory ‘not only showcases the vitality of contemporary Chinese Marxism, but also opens more room for further innovation of theories,’ Hu said during his 90-minute address, which was nationally televised. ‘We need to draw on the beneficial fruits of mankind’s political achievements, but we will never copy the model of the Western political system,’ Hu said.”


I’m sure that the newspaper — not Ang — wrote the headline that claims politics in China has not changed over the past 30 years. To be sure, China remains a one-party system, but that party has made significant changes over the past three decades. Government-controlled newspapers now selectively report on government corruption — something that was unheard of 30-years ago. The government still incarcerates some political protestors, but it is has become somewhat more tolerant than in the past. Hu’s remarks underscored the fact that politics have made some changes and that further “innovations” would be made in the future. I suspect that single-party rule will be around for some time, but that more multiple candidate elections will also be held — beginning on the local level. The Chinese people are eager to vote some of the rats off the ship. Hu offered his remarks in the Great Hall of the People.


The Great Hall was the site of a Communist Party gathering on Dec. 18, 1978, that endorsed small-scale private farming, the first step toward abandoning the late leader Mao Zedong’s vision of communal agriculture and industry. China’s economy has since grown into the world’s fourth-largest behind the U.S., Japan and Germany. Annual per capita income has soared to about 19,000 yuan ($2,760) last year, up from just 380 yuan in 1978. Along with private enterprise and capital markets have come greater prosperity and stability than ever before. Virtually all Chinese families now have at least one television and, in the cities, a washing machine — rare items three decades ago. Some 15 million families own private cars, and many Chinese also own their own homes. ‘Nowadays, we worry instead about eating too well rather than not eating enough,’ says Guo Linchun, 78, retired music teacher in Beijing. ‘Now, living standards have improved so much, we see not only televisions, so many people even own cars.'”


Anyone who watched the Beijing Olympics knows that not all is rosy in China, however. Rapid industrialization brought with it a number of environmental and social problems.


The modern industries have also brought many modern ills: pollution, industrial accidents and product safety scandals. And China’s heavy reliance on exports and foreign investment ensures that the uncertainties now afflicting the global economy are haunting the Chinese as well. Hu said China needed to firmly focus on economic development to weather the current crisis. ‘Standing still and regressing will lead only to a dead end,’ he said.”


The fact that Chinese leaders are not looking to once-again hide its economy behind a bamboo curtain is a good thing. They have been acting as responsible international actors during the current financial crisis. They have also learned that economic prosperity has emboldened China’s new middle class.


As economic growth slows and factories close, job losses threaten to fuel political unrest. Authorities have slashed interest rates and promised to spend more than half a trillion dollars to stimulate the economy. The latest problems may widen a wealth gap that has already alarmed China’s leaders, who worry about social instability caused by people who have missed out on China’s economic boom. ‘In the past 30 years, we attached great importance to promoting a harmonious society through achieving social equality while developing the economy,’ Hu said.”


Anyone familiar with China knows that most of the wealth there can be found along the urban coastal areas, while the more agricultural rural areas in the interior remain mostly impoverished. Although the Chinese are a patient people and take a long-view of history, leaders there understand that the wealth gap can create a great deal of impatience among those who globalization has passed by. One subject about which Chinese leaders have not had a change of heart is Taiwan.


[Hu] also said one of the other great achievements of the last 30 years was ‘opposing Taiwan independence.’ China and Taiwan split amid civil war in 1949. Beijing continues to claim the self-governing island as part of its territory, and has threatened force if Taiwan declares formal independence.”


One need only look at the development of China’s military to be convinced that two of its leaders’ top priorities are securing internal political stability and ensuring that Taiwan does not become an independent state. Internal stability is a big concern because millions of Chinese remain in poverty’s grip.


Despite the massive growth and China’s material wealth, it is still considered a developing country. According to the World Bank’s most recent estimates, more than 100 million of the 1.3 billion Chinese still live on less than $1 a day. That’s way down from 800 million three decades ago, but hundreds of millions more get by on just $1 to $2 a day. Simmering protests over pollution and industrial accidents have prompted authorities to pledge better enforcement of environmental, labor and safety standards.”


Political change will come more slowly than most Western observers might like, but change will come. It must come because if China is to assume its place at the head table of world affairs it must play by the same rules that other leading nations play by. China has moved a significant way down that path already. The Beijing Olympics demonstrated that Chinese leaders care a lot about how the world views them and their achievements. If the international community is to progress, it must move forward together. That doesn’t always happen. On the 30th anniversary of China’s reform movement, however, it’s fitting to put off criticism for a day and congratulate the Chinese people on coming so far so fast.

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