Wang Hui, "The Economy of Rising China"
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Translation by David Ownby
"Wang Hui (b. 1959) is the best-known member of China’s New Left. He is Professor of Chinese Language and Literature at Tsinghua University in Beijing, and initially worked on Lu Xun 鲁迅 (1881-1936), China’s most famous modern writer, but Wang has published on a wide range of issues, including history, philosophy, geopolitics, and economics, as well as literature, much like critically engaged post-modern scholars in the West. Wang’s field, broadly defined, is “discourse.” ..The New Left arose in the 1990s as a form of resistance to neoliberalism. ...
To many, “socialism with Chinese characteristics” looked suspiciously like capitalism, which seemed to imperil both the party, corrupted by the new possibilities for a quick buck, and the people, all too often left by the wayside.
The New Left was “new” because it was different from an older, more conservative “left” that had never really endorsed Deng Xiaoping’s reform agenda or the opening to the West. The New Left (the moniker was chosen by their liberal opponents in an attempt to smear them) was instead modern (indeed, often post-modern) and international. ...they were opposed to neoliberalism, both for its hegemonic, “end of history” discourse and because of the challenge it posed to the heritage of Chinese socialism at the grass-roots level. "
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The development of China’s economy has defied many predictions—since 1989, China’s collapse has been predicted over and over, but China has not collapsed. Instead the theories of collapse have collapsed. For this reason, people have started to seek an explanation for why China not only has not collapsed, but has continued to develop. In the process of reform and opening, there have been many debates in favor of and against reform, and these debates have often touched on how to evaluate questions related to the socialist era and the era of reform. More and more people believe that no matter how we evaluate the achievements and difficulties of the socialist period and the period of reform and opening, China’s economy has been built on the foundation of these two traditions. At the same time, the ongoing world-wide financial crisis and the contradictions accumulated over a long period also signal that China cannot and should not simply return to the past developmental model, whether we mean by that the traditional planned economy model, or the developmentalist model whose only goal was GDP growth. We need to find a new way to think about China’s experience over the past 60 years.
Independent Sovereign Character and its Political Meaning
In discussions of the China model, many scholars emphasize the stability of China’s development, arguing that there has been no great crisis. This is incorrect. In the thirty years of reform and opening, China’s biggest crisis was that of 1989. China survived this great crisis, but the traces of the unfortunate outcome can still be found in different areas. That crisis also had an international aspect, although it was political instead of economic.[12] China’s crisis can be seen as the prelude to the crisis of the Soviet Union and Eastern Europe. Like China, these countries were also socialist countries led by Communist parties, so why did China not fall as they did? What were the features that maintained China’s stability and fueled China’s rapid growth? After 30 years of reform, how have the conditions that made that possible changed? If we want to discuss the Chinese path or China’s uniqueness, this is the first question that we have to answer.
The collapse of the Soviet Union and Eastern Europe had complex and deep historical causes, including the opposition between bureaucratism and the masses, the authoritarian politics of the Cold War era, and the difficulties in the people’s livelihood caused by a shortage economy, among others. By way of comparison, the capacity of self-renewal of the Chinese system has proved to be much stronger. Even after the conflicts of the Cultural Revolution, in which high-level state and party officials were sent by Mao Zedong to work and live at the base-level of society, the state displayed a responsiveness to the needs of base-level society when these same officials resumed power in the late 1970s. This was not the case in the Soviet Union and Eastern Europe. But I will not engage in a detailed discussion of the ins and outs of these questions here. My main point is to stress the difference between the Chinese system and those of the Soviet Union and Eastern Europe, which is that China independently and autonomously sought out its line of social development, and on this basis created its unique sovereign position.
In his memoirs, Egon Krenz (b. 1937), the last General Secretary of the Communist Party of the former East Germany, explained the reasons for the collapse of the country after 1989, and mentioned many factors, among the most important of which were the internal changes within the entire USSR-Eastern European bloc brought about by changes in the Soviet Union. During the Cold War, Western economists often used the notion of the “Brezhnev rule” to make fun of the “incomplete sovereignty” of Eastern European countries. In the terms of the “Washington Consensus,” Eastern European countries did not have full sovereignty, but were under the control of the Soviet Union, so that if the Soviet Union had problems, the entire USSR-Eastern European system would collapse.
After WWII, the system of national sovereignty was affirmed, but in fact, in the world at that time, very few countries possessed genuine sovereignty. This was true not only of countries in the Soviet bloc, but also those in the Western alliance. In Asia, the sovereignty of countries like Japan and Korea within the Cold War structure was subject to American global strategy, which meant that they were not completely sovereign nations. Under the Cold War structure, both camps were systems of allied nations, and if the hegemon of either camp went through a change or a political transformation, the other countries would necessarily be deeply affected.
At the end of China’s civil war, the PRC was established. In the early period of PRC history, China stood on the socialist side of the bipolar Cold War system, and the conflict between the US and China in Korea in the early 1950s did even more to increase the antagonism between China and the US and its allies. During this period, and especially during the period of the First Five Year Plan (1953-1957), China’s industrial development, post-war reconstruction and international status all received immense help from the Soviet Union, and in a certain sense China may be said to have been in a dependent relationship with the USSR.
Nonetheless, just as China’s revolutionary process had its own unique path, China eventually sought out its own unique developmental path as well. From the mid-1950s, China actively supported the non-aligned movement, and later also developed open disputes with the Soviet Union, not only on political issues, but on economic and military issues as well, and gradually broke away from what some scholars called its “lineage relationship” 宗主关系 with the USSR, establishing its own independent position in the socialist system and in the world.
Despite the division of the Taiwan Straits, the Chinese nation’s political character is sovereign and highly independent and autonomous, and the national economic and industrial systems shaped under the leadership of this political character are also highly independent and autonomous. Without this autonomy as a precondition, it is very hard to imagine China’s path of opening and reform, and it is also very hard to imagine China’s post-1989 fate. At the outset of the process of reform and opening, China already had an independent and autonomous national economic system, which was a precondition for reform. China’s reform has its own internal logic; it is an autonomous reform, a dynamic—not passive—reform, which is completely different from the various “color revolutions” of Eastern Europe and the Middle East and their complex backgrounds.
China’s development is not only different from the dependent economies of Latin America, it is also different from the East Asian model as represented by the experiences of Japan, South Korea, and Taiwan (even if in terms of the role played by the state, of government industrial policy and on certain developmental strategies there are similarities and interactions). But from a political perspective, the precondition of China’s reform was autonomy, while to a large degree the development of those countries can be considered dependent (the difference with Latin America is that the dependent relationships of the Cold War became the political precondition for development).
This relatively independent and complete sovereign nature was created through the practice of a political party, and this is an outstanding feature of twentieth century politics. No matter how many errors of theory or practice the Chinese Communist Party has committed, its anti-imperialism and its later debate with the Soviet Union were the basic elements culminating in China’s sovereignty, and on these questions one cannot make a limited judgement based on minor details. As a result of its open debate with the Communist Party of the Soviet Union, China first shook off the lineage relationship between the two parties, and subsequently shook off the lineage relationship between the two countries, thus becoming a new, independent model.
In other words, the roots of this sovereignty are political, a special political independence developed in the course of relationships between political parties and political progress, and expressed in the realms of the state and the economy, among others. It is hard to understand the meaning of independence and autonomy from standard notions of sovereignty. In the history of colonialism, standard notions of sovereignty may have been unrelated to independence and autonomy; for example, countries that signed unequal treaties were, from the standpoint of international law, sovereign nations, but such sovereignty had nothing to do with independence and autonomy. In fact, the gradual dissolution of the extremely polarized structure of the Cold War era is related to China’s consistent criticism of and struggle with this bipolar structure; had China not entered the scene, the possibility of the US and the USSR engaging in direct resistance would have been much greater.
In the realms of economics, politics, and culture, China’s explorations of the path of socialism and her experiences with reform produced all sorts of errors, problems and even tragic results, but during the 1950s, 1960s, and 1970s, the Chinese government and political party continually adjusted its policies. These adjustments were not directed by outside forces, but for the most part were self-adjustments based on problems encountered in the course of practice. As a mechanism by which a political party corrects its path, theoretical debates, and especially open theoretical debates, played an important role in the process of self-adjustment and self-reform in which the party and nation were engaged. Because of the lack of a democratic mechanism within the CCP, line struggles often can turn into power struggles fueled by ruthless attacks, but such factors should not obscure the historical importance of debates over line or theory.
From this perspective, we need to rethink certain habitual interpretations of the reform era, for example, the idea that the reform did not possess a preconceived model or strategy, that we “crossed the river by feeling the stones.” This is obviously correct, but in fact the lack of a preconceived model is the special characteristic of the entire Chinese revolution, and Mao Zedong said something to this effect in “On Contradiction.” What do we rely on when we do not have a model? We rely on theoretical debate, on political struggle, on social practice. On what we call “from practice to practice.”
But Mao’s conclusion regarding practice is in itself theoretical; practice cannot not possess preconditions and directions. In the absence of basic value orientations, we wouldn’t know where we were going while we “crossed the river by feeling the stones.” In “On Practice,” Mao Zedong cited a passage from Lenin : “Without revolutionary theory there would be no revolutionary movement.” The creation and promotion of revolutionary theory also plays a decisive role at certain key moments. When there is something to be done (and it doesn’t matter what) in the absence of a program, a method, a plan or a policy, how you go about deciding on a program, method, plan or policy is of decisive importance. When politics, culture, the superstructure, etc., impede the development of the economic base, then politics and culture are the core elements and become the most decisive things.
In the process of China’s revolution and reform, theoretical debate played a very important role. The origins of theories relating to reform are found in ideas related to the socialist commodity economy, which means they developed out of discussions of such notions as commodities, the commodity economy, laws of value and bourgeois rights, just as they were molded by socialist practice. The discussion of the question of the law of value occurred in the 1950s with the publication of essays by Sun Yefang 孙冶方 (1908-1983)[13] and Gu Zun 顾准 (1915-1974)[14], against the greater background of the Sino-Soviet split and Mao Zedong’s analysis of the contradictions within Chinese socialism. The same question once again became a central issue in inner-party debates in the mid-1970s.
In the absence of such theoretical debates, it is very difficult to imagine how subsequent reforms could have developed according to the logic of the law of value, distribution according to labor, the socialist commodity economy and even the socialist market economy. Today, debates about what path of development to follow are no longer limited, as they were in the past, to inner-party debates, but the importance of theoretical debates to the adjustments of the policy line remains very important. If there had not been the criticism of and resistance to the GDP-driven pure developmentalism[15] from within and outside of the establishment in the 1990s, the exploration of the new scientific development model 科学发展模式[16] would never have made it onto the agenda.
In the 1990s, following the change in China’s political structure, debates in Chinese intellectual circles partially came to replace the function of what heretofore had been inner-party debates on line, and had important impacts on adjustments of national policy on the three rural issues 三农 of the 1990s, on medical reforms 医疗改革 after 2003, on state enterprise reform 国企改革 and labor rights 劳动权利 in 2005, and on theory, propaganda, and social movements related to environmental protection.
These days people often speak of democracy as a correcting mechanism, but in fact theoretical debates or debates on party line are also correcting mechanisms, correcting mechanisms for the CCP. Because of the lack of democratic mechanisms within in CCP, in the history of the twentieth century, debates over the party line often produced violence and authoritarianism, and we should think long and hard about this, but criticism of the violence that characterized inner party struggle should not lead us to negate theoretical struggle or struggle over the party line, because in fact these latter serve as the mechanism allowing us to shake off authoritarianism and find the path of self-correction. The slogan “practice is the sole test of truth” asserted the absolute importance of practice, but this fundamental question is itself theoretical, and we can only understand the importance of this slogan by grasping the importance of theoretical debate.
Peasant Dynamism
Whether in the early revolutionary struggles or during the age of socialist construction and reforms, the sacrifices and contributions of the peasant class have been enormous, and their dynamic spirit and creativity have been deeply impressive. Compared with other third world countries, over the course of the twentieth century, the mobilization of China’s rural society and organizational reforms of rural society have been revolutionary and unprecedented. In the wake of land revolution and land reform, the entire rural order was thoroughly reorganized.
This long-lasting and intense period of rural reform produced three important results : first, the peasant class obtained a strong sense of political consciousness; even in Eastern Europe or the Soviet Union we rarely saw such a long-lasting armed struggle and land revolution. In the absence of this background, the long-lasting peasant mobilization, with land relations and reform at its core, would have been impossible. Compared to many socialist and post-socialist countries, the value of equality is more deeply rooted in the hearts of the Chinese people.
Second, if we wish to truly understand the relationship between Chinese socialist movements and peasant movements, then we must also understand the role of the Chinese revolutionary party. The establishment of the CCP was a product of the international communist movement, but what was different about it was that the core mission of this socialist party was to mobilize the peasants, and through peasant mobilization to create a new politics and a new society. After thirty years of armed revolution and social struggle, this party finally came to be linked to social movements at the most basic level, and its grass-roots nature and organizational and mobilizational ability are quite different from those of the parties in the socialist countries of Eastern Europe.
Today’s media and commentators too often attribute the success or failure of China’s revolution to this or that leading figure, and fail to discuss fully the revolutionary process itself. And because of reflections on the violence that occurred in the course of the revolution they ignore or even deny that the process produced a new social agency. To carry out socialist revolution in a society made up chiefly of peasants, we must accord critical importance to subjective dynamism, to the subjective will of the leaders, but looking solely at this aspect leaves us unable to understand history.
Third, the new land relations produced by the Chinese revolution and reconstruction provided the precondition for the reforms. Had they not experienced this kind of deep social transformation, it is difficult to imagine that traditional peasants and their social organization could have displayed this kind of dynamic spirit. On this point, it will suffice to take a look at the conditions of peasant societies or market societies in Asia (particularly South Asia) and Latin America to understand clearly that in those societies where, even today, they have not gone through such intense land reforms, the peasants remain for the most part dependent on landlords or the encomienda, and they do not have and cannot develop a strong sense of autonomy. The process of land reform is intimately linked to the spread of rural education and the rise of literacy, as well as the growth in the capacity of self-organization and technical abilities. Under conditions of market reform, the heritage of these earlier experiences was transformed, becoming the preconditions of a mature labor economy.
In the face of neoliberalism, Chinese society, in comparison to other societies, has been stronger in demanding equality and rejecting corruption, and for this reason the lower classes have played a strong role as checks and balances. This is different from this situation in the early 1990s when several countries evolved rapidly toward oligarchy, and the reason for this has to do not only with the country or the party, but should also be explained from the angle of social strength. At the end of the twentieth century, questions related to the three rural issues and to migrant labor, such as how to deal with urban-rural issues in a market economy, or how to solve the land problem, once again became topics of discussion in contemporary China. Because of the high degree of reliance of the rural economy on the urban economy and the process of marketization, many peasants migrated, becoming a new urban working class, and a peasantry formerly ensconced in rural land relations is being transformed into a low-priced source of labor for the coastal areas and for urban industry and commerce. This process has a deep relationship with the contemporary crisis of the rural areas.
The Role of the State
Another crucial element in understanding reform era China is how to understand the nature of the Chinese state and its transformation. As many historians have demonstrated, East Asia has a rich and ancient tradition of states and state relations. For example, Giovanni Arrighi (1937-2009) argued in his recent book, Adam Smith in Beijing, that: “In the context of nation-states and interstate systems, the national economy was not the invention of the West…Throughout the entire eighteenth century, the world’s most important national market was not in Europe but rather was China.” He further analyses the reasons for the development of the contemporary Chinese economy, and especially its attractiveness to outside capital, and argues that “The principal attractiveness of the PRC for foreign capital is not its rich resources of cheap labor….but instead is high quality of that labor in terms of health, education and self-management ability, coupled with the rapid expansion of the productive capacity of China’s domestic economy.” In his understanding, Adam Smith was not a leader in the creation of the market order, but was rather a thinker with penetrating ideas about the nature of state regulation of the market. Generally following this line of analysis, the Beijing University economist Yao Yang 姚洋 (b.1964), in a summary of the conditions behind China’s economic development, argued that a neutral government or a neutral state constituted the preconditions for the success of China’s reforms.
State capacity is an important question in the context of reform. I have two observations to supplement what Arrighi and Yao Yang have said. Arrighi’s viewpoint is built on a narrative in which Chinese and Asian national markets have a long tradition, yet in the absence of the Chinese revolution and its reorganization of social relationships, it is difficult to imagine that the traditional “national market” would automatically transform into a new national market. Late Qing efforts to build military strength and a commercial system through state strength, and unstinting land reform efforts after the 1911 revolution created a national market unlike that of traditional times, newly configured domestically and in relations with foreign countries.
In criticizing Sun Yat-sen’s “Plan for National Development,” Lenin pointed out that land revolution and a new national program with socialist or popular welfare overtones would fulfill the prerequisites for the development of agricultural capitalism. In discussing the nature of the modern Chinese state, we cannot abstract it from the preconditions of the land relations brought about by the Chinese revolution and the change in the status of the peasantry. For example, people criticize the experiment of the Great Leap Forward, but rarely note that this same experiment was the result of the ongoing changes in land relations in modern China. On the one hand, the small peasant economy of lineages and families came to an end, and on the other, family property, lineage and territorial relations were reorganized into a new set of social relations. Village reforms were reforms of the commune system, but at the same time were also constructed on the basis of the social relations created by this experiment. Early village reforms were carried out at the initiative of the state, a reform movement involving many efforts to manage and adjust the prices of rural commodities. This reform movement in fact inherited many elements, and the development from township industry to township enterprises unfolded according to a logic that was not that of neoliberalism[17].
As for Yao Yang’s argument that the history of the modern revolution and socialism produced a neutral government, the precondition for this was actually not neutrality. China’s socialist practice devoted itself to the creation of a state that would represent the universal interests of the majority of the people, and the precondition for this was a rupture with the notion that the state or the government would be linked to special interests. From a theoretical perspective, this socialist state practice was produced through an early revision of Marxist theory, and texts like Mao Zedong’s “On the Ten Great Relationships” and “On the Correct Handling of Contradictions among the People” are the basis of this new state theory. Because a socialist state takes the representation of the interests of the majority as its mission, then under market conditions it is freer than other forms of state from connections with interest groups. Only in this sense can we describe it as a neutral state.
This was a key element in the success of the early reforms, and is the basis for the legitimacy of the reforms. Without this precondition, different social strata will have a hard time believing that the reform pushed by the state represents the interests of that stratum. Moreover, the technical term “neutral” camouflages its actual content, which is that the universal nature of the interests represented by the state is constructed on the basis of the Chinese revolution and on socialist practice. At least in the early period of reform, the legitimacy of the program came precisely from the fact that interests represented by the socialist state were universal.
It is difficult to define the nature of the Chinese state on the basis of a single formula because it contains within itself many traditions. In the process of reform, people often used labels such as “reform” and “anti-reform,” “progressive” and “conservative,” to describe the contradictions and struggles between these traditions, from the perspective of the history of development trends, the strains, checks and balances and contradictions among the traditions also played an important role. In the socialist period, we saw two, or indeed many forces that mutually fed one another, as well as the sublimation of the “extreme left” and the “extreme right”; when market reforms became the mainstream, had there not been the checks and balances of socialist strength within the state, within the party, and within all social fields, the state would have rapidly been monopolized by interest groups. In the mid-1980s there were calls for privatization, but against strong resistance from both within the establishment and without, the idea of first establishing the market mechanism prevailed. This was the key to China’s resisting the Russian-style shock treatment.
In other words, social capital accumulated during the socialist period constituted a brake on social policy at this key moment of transformation. Even in this sense, it is difficult for us to define these critical forces as opposed to the revolution. Actually, in the ideological debates that erupted in the 1990s, we can find a similar phenomenon. The critique of developmentalism finally stimulated the emergence of ideas related to scientific development or other kinds of development. Chinese society’s universal condemnation of and resistance to corruption was also a force pushing for reform of the system. The neutrality of the state emerged out of the mutual interaction among the above-mentioned non-neutral forces.
There are many lessons to be learned from the reform, such as human talent and strategy, educational reform and other economic policies and measures, but I feel that the things discussed above are foundational, and for that reason are frequently overlooked. These points are part of the most unique features of China’s twentieth-century experience.
Changes in the Structure of Sovereignty
Under the new conditions of globalization, regionalization, and marketization, all of the conditions discussed above are facing an important challenge: the bases of social relationships, economic activities and political subjects are undergoing changes. If we cannot grasp the new historical conditions and the direction in which they are moving, it will be difficult to arrive at new and effective mechanisms and policies. To understand these changes, we need to add a few remarks about some new trends in the contemporary world.
First, with the trend of globalization, traditional sovereignty is currently undergoing a great transformation. The current process of globalization is expressed in two basic ways. The first is the globalization of cross-national movements of capital, which brings with it cross-national production, consumption and movement, involving many migrants in a relationship of dependency on the markets created by trade and investment and the associated dangers. The second are the new international regulatory agencies set up to manage and respond to the cross-national movement of capital and its dangers, such as the WTO, the European Union and other national or regional organizations. The former kind of globalization is more like a non-governmental force, while the latter is a mechanism designed to coordinate and control this non-governmental force, and both work simultaneously.
In the wake of these important changes, the form of state sovereignty has necessarily also evolved: in the context of global movements of capital, basically beginning from the early 1980s, China’s economy gradually turned toward an export-driven mode, as transnational production created China’s position as the “world’s factory,” which was completely different from the past relationship of labor and capital, bringing changes as well in the form of new relationships between coastal and inland areas and between cities and rural areas. With the gradual opening up of the financial system, China’s foreign reserves surged to first in the world, and the economy came to be greatly dependent on international markets, particularly the American market. The idea of “Chimerica”[19] is perhaps exaggerated, but given the transformation of the relatively independent national economy into a form containing considerable reliance [on outside markets], the term nonetheless delivers a potent message.
In the context of new regulatory agencies, China has joined the WTO and other international treaties and agreements and participates actively in regional organizations, to the extent that is difficult to discuss the structure of China’s sovereignty from a traditional perspective. The current financial crisis has revealed that the root of the crisis itself lies precisely in the threat to social autonomy, in other words, a crisis anywhere can become our own crisis. And we cannot solve the crisis by simply using the former tools of sovereignty (for example, when China’s international trade practices are accused of dumping, subsidies or special protectionism, China cannot solve the problem simply by employing national sovereignty, but must instead go through international mediation; the dangers of high foreign exchange reserves cannot be resolved through the tools of national sovereignty either, but again must go through international treaties and protection; contagious diseases and their prevention are now international matters as well). International cooperation is an inevitable choice. For this reason, under conditions of globalization, in open international networks, how to fashion an autonomous, new form of sovereignty is a new question that requires us to consult history and to engage in renewed reflection.
Next, not only in the realm of globalization, but also in domestic terms, the nature of the state is also changing. To simply describe China as an “extremely sovereign state” too often conflates the positive side and the negative side. Unlike Russia, China’s reforms did not go through the “shock treatment,” and the state’s ability to guide the economy remains quite strong. China’s financial system is relatively stable, because China did not completely take the neoliberal path; China’s land has not been privatized (even if land can readily change hands to meet the demands of the market), which not only provided the basis for the preservation of the low-cost nature of China’s rural society, but also made possible national organizations using land resources to initiate and push forward land certificates.[19]
These topics all are related to state capacity and its meaning. The Chinese state should take up its responsibilities, for example by actively resolving the rural crisis, rebuilding the social security system, protecting the environment, increasing investment in education and reforming the educational system. On these fronts, the Chinese government must transform its posture from that of a developmental government to that of a social welfare government, a transformation that will also force the Chinese economy away from an over-reliance on exports and toward an economy driven by internal demand.
Whether these positive social policies can be carried out will not be decided solely by the will of the state. After 30 years of reform and the efforts of those pushing for market reforms, state organs are deeply implicated in market activities to the point that it is no longer appropriate to describe the various bureaus and ministries of the state as “neutral.” The state does not stand alone, but is embedded in the social structure and in relation to interest groups. The question of corruption today is not solely a question of the corruption of individual officials, but is also connected to social policies, economic policies and the question of special interests.
For example, the development of the high-carbon industry and energy projects has frequently been dominated, or even monopolized, by certain interest groups. Efforts to contain such groups through public policy include public discussions, social protection movements, and different traditions from within the state and the party. At the end of the 1990s, for example, the great discussion of the “three rural issues” prompted an adjustment of national rural policy; in 2003, the SARS crisis produced a great discussion of the health care system and led to changes; in 2005, the debate over the reform of the state enterprise system and a large-scale workers’ movement led to a series of related policies; calls from within the state system demanding an end to corruption and strict party discipline provided impetus for the anti-corruption movements[20]…But domestic and international interest relationships have penetrated state mechanisms to an unprecedented degree, to the point that even the process of law-making, the question of how to ensure that the state and its public policies represent broad interests and not the interests of minority interest groups, has already become a pressing problem.
The Paradox of the Staticization of the Party 政党国家化
A discussion of the state has a direct bearing on the question of the development of democratic mechanisms. Discussions of the question of the Chinese state must confront a basic paradox : on the one hand, in comparison with the governments of many other states, Chinese government capacity is widely acknowledged, as is evidenced by the mobilization of aid in the wake of the Wenchuan earthquake 汶川大地震 that occurred in May, 2008, by the rapid fashioning of market-saving plans after the financial crisis, by the successful staging of the 2008 Olympics, and by the efficiency of various local governments in terms of organizational development and crisis resolution—all of these signal the outstanding advantages of Chinese state capacity.
Yet on the other hand, even if public opinion surveys show that the people are broadly satisfied with government performance, still, in some regions and at some periods, contradictions between the officials and the people are very acute, and the policy implementation ability of various levels of government as well as their level of honesty are often subject to doubt. The most crucial question is that these kinds of contradictions often trigger a crisis of legitimacy. By contrast, in some countries, even if state capacity is weak and the government ineffectual, the economy lagging and social policies not implicated, there still does not exist a systemic political crisis. This question is intimately related to democracy as a source for political legitimacy.
In the 1980s, the question of democracy seemed fairly straightforward. Having gone through 20 years of democratic mobilization, on the one hand, democracy still was the most important source of political legitimacy; on the other, simply importing Western democratic methods in the Asian region in the 1980s and 1990s seemed less attractive. After the crisis of the new democracies and the fading of the “color revolutions,” the democratic movements in Eastern Europe, the Middle East, and other regions fell into decline after 1989.
At the same time, in Western and Third World democracies (such as India), the emptiness of democracy was becoming a universal crisis. The crisis of democracy is intimately linked to the conditions of marketization and globalization :
1. The major form of political democracy in the post-war period was either the multi-party or bi-party parliamentary system, but under conditions of marketization, political parties progressively lost the ability they once had in the earlier period to represent the people, and in order to get votes, the political values of the political parties became ever more ambiguous, which led to the eclipse of representative democracy in all but name.
2. The relationship between democracy and the state under conditions of globalization also faced a challenge : because economic relations increasingly transcended the realm of the traditional national economy, thus escaping the control of the state, all states had to shape their political arrangements in conformity with the demands of the international system;
3. Following the conversion of political parties into interest groups, or even the emergence of oligopolies, formal democracies progressively became political structures disconnected from the base levels in their societies, so that the demands of those dispossessed groups were unable to be represented in the political realm, which led these groups to employ non-governmental means of protection (such as the rise of “Mao Zedong” in India[21]). Under these conditions, not only formal democracy, but at times even the state itself came to be hollowed out in many places.
4. Because the electoral process relied on large amounts of money and financial strength, in different democratic counties there existed both legal and illegal forms of electoral corruption, which damaged public faith in elections.
By this I do not mean that the value of democracy has disappeared. The question is : what kind of democracy do we need and what form should it take? How can we ensure that democracy be more than just an empty form, that it have genuine contents?
The Chinese political system is also experiencing important changes, one of which is the change in the nature of the Party. In the 1980s, the goal of political reform was Party-government separation. After the 1990s, this is no longer a popular slogan, and in concrete practice and institutional arrangements, the unity of Party and government has become a more commonly seen phenomenon. I call this the staticization of the Party.
The origins of this trend are worth careful analysis. According to traditional political theory, a political party represents mass interests, and through struggles and debates in parliament, in other words through procedural democracy, this becomes the state common interest, the expression of sovereign public will. In China, the multi-party cooperative system led by the CCP[22] is also based on the representative nature of the parties. But under conditions of market society, when state organs directly participate in economic activities, different branches of the government wind up intermingled with special interests, and the “neutral state” of the early reform period is currently undergoing transformation.
Since the Party can keep a certain distance from economic activity, they can, from a relatively autonomous “neutral” position express the will of society. For example, anti-corruption activities mainly rely on Party mechanisms for efficient implementation. Since the 1990s, the national will has basically taken shape through the goals of the Party, as was the case with the “three represents,” “harmonious society” or “scientific development.” These slogans no longer directly express the particular representative nature of the Party, but instead directly plead for the interests of all of the people. In this sense, the Party has become the inner core of sovereignty.
Yet the staticization of the Party includes two challenges. First, if the frontier between Party and state disappears completely, what force or mechanism can guarantee that the Party will not—like the state—be captured by the interests of market society? In addition, the universal representativity of the traditional Party (including the neutral character of early socialist countries), was achieved through its clear political values, and if the Party is staticized then this means the weakening and the transformation of the Party’s political values.
If the construction of a “neutral country” is closely related to the political values of a political party, then under new conditions, what is the mechanism that will ensure that China can maintain its representativity? How will the voice of the common people find expression in the public realm? How to carry out adjustment of basic line and policies of the state and the Party through genuine freedom of expression, consultative mechanisms and constant exchange between officials and the people? How to broadly absorb domestic and international strength to create the broadest type of democracy? These are questions that cannot be avoided in discussions of the self-reform of the Party.
When reflecting on the question of political reform in China, we need to consider these questions so as to imagine China’s democratic path. Concretely speaking, I argue that there are three aspects to consider:
First, in the 20th century China went through a long and very deep revolution, and Chinese society’s demands for justice and social equality are very strong; how should this history and this tradition be transformed into democratic demands under current conditions? In other words, what is the mass line or mass democracy in the new era?
Second, the CCP is a vast political party that has gone through enormous changes, and is increasingly absorbing state mechanisms. How do we make this Party system more democratic? How, when the role of the Party is changing, do we guarantee that the state can represent universal interests? Third, how, on a social basis, can we create new political forms allowing mass society to achieve political capacity and defeat the “depoliticizing” trends emerging from neoliberal marketization?[23] China is an open society, but workers, peasants and ordinary citizens lack adequate space and guarantees for public participation. How should China allow the voice and demands of society to be expressed in the context of state policy and thus constrain the monopoly capacity and demands of capital—this is the crux of the issue. Freedom for capital or freedom for society; there’s a big difference.
These are all concrete questions, but contain the embryos of important theoretical questions, for example: “What is the direction of people’s China’s political reform under conditions of globalization and marketization? How under conditions of openness can we engineer Chinese society’s autonomy? Against the backdrop of the universal crisis of democracy, the universal importance of this exploration is obvious.
The Financial Crisis and the End of the 1990s
We will take China’s performance during the financial crisis as a way of observing the crises China faces. Chinese specialists hold a different view of the financial crises than do people in other societies. One debate among many is: In the final analysis, are we talking about a financial crisis or an economic crisis? Of course, the two have always been interlinked, but at a theoretical level distinctions are important.
After the eruption of the financial crisis, most media analysis focused on the American subprime mortage crisis and financial speculation, but there were also certain political economists, like Robert Brenner (b. 1943)[24], who pointed out that this was not an ordinary financial crisis or a question of financial derivatives, but instead traced its origins to an economic crisis brought about by overproduction. The relationship between financial crises and economic crises is worth studying. If it is simply a question of financial derivatives, then it is a question of excessive speculation and a lack of effective regulation. If it is an economic crisis, this means that it there is a structural crisis in capitalism, and not just a few people engaging in speculation; it is a crisis created by problems in the means of production.
In fact, the two are related. The financial crisis cannot be unrelated to the overall means of production. The Chinese situation differs from the American situation in that for the US, the crisis was concentrated in the real economy, since the economic structure is highly reliant on international markets. By contrast, in China consumption remains drastically insufficient, and although the state stimulus plan and tax reductions maintained economic growth, in the absence of structural economic reform, which would grow internal demand through increasing social security and social equality, there is a possibility of creating a new wave of overproduction.
As in the financial realm, the questions are intimately linked. For example, China’s large foreign currency reserves and the safety of the US government bonds purchased by China are a subject for concern, and the emergence of this problem, in addition to its connections to China’s economy’s high reliance on exports and the hegemonic position of the US dollar, another contributing factor is international speculators engaging in financial speculation on the future date of the rise in value of the Renminbi. The crisis in the real economy comes together with the financial crisis, and cannot be clearly divided.
Another debate is whether the current crisis is cyclical or structural. At the present moment, here again it looks as if the two are connected. A cyclical crisis is one that can return by itself to the situation prior to the crisis; if it is structural, it means that it will not without great difficulty be able to return to its past structure, and that there will be structural change. Looking at things now, the economic situation has improved, which might lead us to belief that the crisis was cyclical, but this doesn’t necessarily mean that the structure will revert to its past posture.
For example, can the financial system return to the model of the period of high neoliberalism? In the process of responding to the crisis, the financial structures of American and Europe were greatly nationalized, as governments in all countries intervened heavily in the economy and the financial sector, and even if governments have begun to adjust their stimulus plans and to remove themselves from the banks, the financial sector still is unlikely to return to its original model..
For another example, because of the environmental crisis, the problem of natural resources, and the need to restore the social relations destroyed in the earlier period of development, the high-speed economic growth created a pillaging style of development that will be hard to maintain, and we will inevitably have to greatly increase the social compensation of the average worker and gradually improve the ecology and environment. Recently, America has raised the questions of atmospheric warming and energy savings, and environmental questions have gradually become important topics in international politics, while in China some people have noted that this contains within it the question of neo-imperialism. Using environmental questions to pressure third world countries and allowing advanced countries to avoid their responsibilities is something that does indeed happen.
Yet we cannot deny the universal effects of climate change. Global warming is a serious problem and its effects are occurring rapidly, and problems such as the melting of the polar ice caps, the disappearance of wetlands, the desertification of certain areas, the serious pollution of rivers and lakes, the lack of water resources, mean that our current way of life cannot be sustained. In her essay, Wen Jiajun 文佳筠 [25], who has researched such issues for a long time, cited the examples of solar water heaters and rural bio-gas digesters to illustrate that China has done a great deal of work in energy conservation and environmental protection. In addition clean coal technology has recently gradually assumed a leading position, and wind energy is also developing quickly (although some have criticized this, saying that recent developments have seen unbridled efforts). But the problem is that developmentalism and consumerism still deeply influence China’s development model, which rapidly translates into environmental pressure.
From this perspective, the export-driven economy must change. First, to avoid long-term economic risks, and stimulate domestic demand so as to change our over-reliance on exports, it is necessary to induce structural change of the economy; second, under conditions of the global market, upgrading export commodities is also a way to respond to the new globalized structure of the economy, and a necessary choice to transform excessive depletion of domestic labor and natural resources; third, with the gradual decline of the position of the American economy, there must be, over a long period of time, an important transformation in global economic relations, a transformation that must be reflected in economic relations in China.
For example, changes in the value of the US dollar, and strengthening of the value of the RMB in international accounting, as well as its increasing importance in local commerce, etc., all will translate into changes in economic structures. Such changes may not be regular, cyclical changes, but rather global, structural changes. At present, China’s economy shows signs of recovering, but in the absence of structural adjustments, we may soon encounter another structural crisis, especially if renewed overcapacity creates instability via the financial system and other social problems. In response to the economic crisis, we must inevitably reconstruct the entirety of the social security system, raise the level of environmental projects, and encourage ongoing upgrading of the economy, rebuilding organic, peaceful relations between town and country, repairing and developing social relations damaged by blind developmentalism. None of these are short-term problems; all are long-term, structural problems.
From a historical perspective, following large-scale economic crises, social systems and social thought all experience corresponding changes. In addition to the new social policies created by economic crises, war, revolution and social movements are also byproducts of crises. The older model of large-scale social movements—like the peasant movement or the worker’s movement or class struggle—seems to have changed form, and while there are limited wars, there are no wars like the two world wars; the limited wars have not called forth the tumultuous revolutions of the 20th century, but rather new forms of resistance.
In China, conflicts caused by the reform of state-owned enterprises have dragged on for years, because of the lack of an effective solution to the problem. Some interest groups and lower-level governments pushed through privatization plans, which have led to recent social struggles and violence. Regional differences, divisions between city and countryside, and divisions between rich and poor have given rise to sharpening contradictions among the people, and blind social revenge has replaced the model of social movements of an earlier period.
From a political perspective, the relationship between economic crises and political change is unclear, for instance in the United States, President Obama’s plan to promote health insurance at least showed a leftist tendency regardless of his success or failure, but the final results leave little room for optimism. Politics in Europe is moving to the right, as the elections of Sarkozy, Merkel, and Berlusconi illustrate. The English Labor Party is in turmoil, beyond the fact that it can’t decide if it’s on the left or on the right. Recent incidents in North Korea and Iran signal the continuation of regional political problems. How to analyze important changes against this backdrop? The most important thing is not to change some top leader, because even if someone who looked progressive wound up on top, it is hard to say what kind of role they could play on the international front.
One positive change wrought by the economic crisis is the decline of neoliberalism from its dominant position. The hegemonic position of neoliberalism grew increasingly strong through the 1980s, reaching a pinnacle in 1990, but after the war in Kosovo and after 9-11, neoliberalism and neoliberal imperialism were challenged on the world stage, and in the face of that crisis, the hegemony of neoliberalism fell into dispute. With the arrival of the economic crisis, neoclassical economic theories no longer enjoyed absolute confidence in many societies. This does not mean that the influence of neoliberalism will quickly subside, nor that its unfortunate consequences will soon evaporate. In fact, the unfortunate consequences of neoliberalism will follow us for a long time, but its hegemonic position has been thoroughly shaken, and the search for a new developmental model has, to a certain extent, already become an objective of enlightened thinking and political values. Debates concerning basic values related to neoliberalism will continue, but these are debates that accompany the process of decline.
Another important change can be seen in regional relationships. Transformations in regional relationships and global power relationships are long-term processes, but the economic crisis was a signal event. From the perspective of the history of capitalism, all past important crises were followed by changes in power relationships. For example, America’s hegemonic position was gradually established after WWI, and the USSR’s after WWII. The Cold War structure was the result of the two competing hegemonies. With the rise of these two hegemonies, the old hegemonic system inevitably declined.
Today is no longer the era of simple imperialism or colonialism, and we must analyze the transformation of the new regional political relationships and power relations. For example, the financial crisis did not thoroughly shake the hegemony of the US dollar, but it was weakened, and its decline will be a long-term process. When Hilary Clinton visited China, Premier Wen Jiabao 温家宝 (b. 1942) honestly expressed “concern” for the security of China’s assets in the United States. The concerns of Chinese leadership are real, grounded in an economic relation of dependency. But looking from the outside, for the leader of a developing country to so directly express their concerns about the hegemony of the US dollar to an American leader was something that could not have happened ten years earlier. If China’s faith in the US dollar wavers, and China finds the gumption to change its dependent relationship with the United States, this will certainly have a long-term impact on the hegemonic position of the US.
Prior to the crisis, the reform of China’s financial system was tending toward neoliberalism, but during the crisis, China’s banks became the banks with the world’s highest market value, and the Chinese banking system also proved to be a relatively stable banking system. In other words, the economic-financial system directly centered on the United States and Europe is currently under challenge. Whether the Chinese economy has its own model is a topic that is hotly debated at present, but the debate is the result of doubts about old models and old hegemonies, and this is why enthusiasm for the Chinese model is often greater in places other than China.
Over the past few centuries, the center of world power has changed several times, while still remaining in the West. This time is different, for as Europe and America face strong challenges, Asia’s and particularly China’s positions have changed. The United States has been an important hegemon for a long period of time, but is no longer an absolute hegemon, and will continue a necessary decline. In the long run, this change will have a big influence on the world. What is worth noting is that changes are occurring not only in China; recently, the 2nd BRIC [26] conference and the Shanghai Six-Country[27] conference were held close together, and both expressed their vision of globalization. In discussions at the BRIC conference, debates and divisions were quite large, but the willingness to challenge the old order was clear. The percentage of China’s trade calculated in RMB is growing ever larger, and the significance of this is not limited to the two trading partners, but rather to the whole world, and is a challenge to existing hegemony.
Following the shift of the lion’s share of economic development to the Pacific region or to East Asia, world power relations are currently experiencing structural changes. Even under conditions of crisis, the speed of Chinese economic development experienced a slowdown, but in a world context remained high. This economic growth is a positive factor in the world economy, even if simple economic growth brings numerous problems to the structural adjustment of the Chinese economy. China’s rapid economic growth is not an isolated phenomenon; when compared with other regions, all of East Asia has been growing quickly, and the economic integration of the region is also rapid. China’s rise does not mean that China will replace the United States, but the rise of China and East Asia in the world economy as a whole will change the situation for the traditional third world, and will contribute to the creation of a multi-polar world. This financial crisis was a signal event, not a normal course correction, but a link in a larger structural transformation.
What is especially worth noting is that the former structure of world hegemonic power was not only a pure economic hegemony and an economic structure but was accompanied by a set of political and social relations and cultural values. At present, economic structural adjustments are underway, while cultural and political changes require more creative work. New models and social relations do not emerge naturally by themselves, but have to be created by people. If the structural transformations wrought by this crisis are only transformations of regional relations, then they will be nothing more than changes in hegemonic relations. The question that really needs to be discussed today is : what kind of international position does China have today? What kind of social relations does China want? What kind of political culture? In other words, we need to reflect on the economic crisis and its relationship to new politics and new culture. During WWI China experienced the new culture movement, which also prompted the creation of a new politics. In the same way, today we must question the relationship between the financial crisis and politics.
In the wake of China’s economic growth, China has sought broader international cooperation and markets. China’s presence in Africa and other regions has prompted a good deal of discussion and uneasiness in the West. One wonders whether China, as it deals with economic globalization, can not only create another path of development, but also avoid dealing with the rest of the world in the Western fashion?
This is an important challenge. China once had an internationalist tradition, and paid great attention to the fate of the third world, and China’s reputation in Africa and Latin America and the rest of the third world continues to benefit from that tradition. Can these traditions continue to be useful under conditions of marketization and globalization? Capitalism is by nature expansive; its needs for resources is expansive whether in a single country or on the world stage. For this reason I feel that China’s modern internationalist traditions should be brought out anew—not the internationalism that was meant to export revolution, but the one that genuinely cared for and respected the existence, development, and social rights of third world countries, and that sought a road to peace, democracy and common development in the world setting. If we abandon the analysis of the structure of world hegemony, it is impossible to make a profound and accurate analysis of China's global position.
Questions of international position are related to changes in domestic relations. What kind of commercial culture and political culture does China want to develop? How will China be different from American hegemony? China should be different from early capitalism. The market plays an important role in culture and politics, but we cannot allow market logic to become ruling logic. From the point of view of the economic structure, the position of the laborers should see an important rise, and the ecology and natural environment should be improved. Moving away from the emphasis on political and economic relations is something that is rarely discussed. The current structural crisis is a crisis in the old mainstream model, and now is the time to create a new model of politics.
The 1990s are over. The year 2008 was a signal. The post-1989 process has in the past few years shown signs of coming to an end, although the event has maintained a certain significance. But this process ended in 2008, as the crisis marked the fact that the neoliberal economic line encountered an important challenge throughout the world. In China, this process followed a series of events, from the riots in Tibet [which occurred in March 2008] through the Sichuan earthquake, the Beijing Olympics, and finally the financial crisis. Chinese society had its own, divergent reading of its own place in the global world, and China’s risk management mechanism expressed itself differently. In Western societies, discussions of China’s rise had been going on for some time already, but during the crisis, people suddenly realized that China was an economic player that had to be faced, that was second only to the United States, and that displayed a corresponding self-confidence that had developed more quickly than people had expected.
This change is dramatic, and to some degree the product of luck, but it is not fortuitous. The problem well may be that Chinese society has not yet adapted to its new status in international society; the accumulated contradictions experienced by Chinese society in the process of marketization and the risks faced in the process of globalization were similarly unprecedented. As a proposition, let’s say that the true meaning of the “end of the 1990s” is a search for a new kind of politics, a new path and a new direction.
Notes
[1] 汪晖, “中国崛起的经验及其面临的挑战,” 文化纵横 (Beijing Cultural Review), 2010.2: 24-35.
[2] See for example Wang Hui, China’s New World Order (Cambridge, MA : Harvard University Press, 2003); Wang Hui The End of Revolution : China and the Limits of Modernity (London : Verso, 2009); Wang Hui, The Politics of Imagining Asia, ed. Theodore Huters (Cambridge, MA : Harvard University Press, 2011); Wang Hui, China from Empire to Nation-State (Cambridge, MA : Harvard University Press, 2014); for more detail, see https://ccr.ubc.ca/wang-hui/ .
[3] “20世纪初期的文化冲突与鲁迅的文化哲学,”中国社会科学 1989年第2期.
[4] “关于<子夜>的几个问题,”中国现代文学研究丛刊，1989年第1期.
[5] “梁启超的科学观及其与道德, 宗教之关系,” 学人 第2辑，1992.
[6] “’赛先生’在中国的命运--中国现代思想中的科学概念及其运用,” 学人 第7辑，1992.
[7] “当代中国的思想界状况与现代性问题,” 天涯 1997年第５期.
[8] “亚洲想象的谱系,”视界 第８辑, 2002.
[9] “改制与中国工人阶级的历史命运,”天涯, 2006年第1 期; “去政治化的政治、霸权的多重构成与六十年代的消失,”台湾社会研究季刊2006年12月，第六十四期；开放时代2007年第2期.
[10] See Barmé, Geremie R. and Gloria Davies, “Have We Been Noticed Yet? Intellectual Contestation and the Chinese Web,” in Edward Gu and Merle Goldman, eds., Intellectuals Between State and Market. (New York: Routledge, 2004): 75-108.
[11] “The Rumor Machine: Wang Hui on the Dismissal of Bo Xilai,” London Review of Books, 34.9 (May 10, 2012): 13-14.
[12] For an example of Wang’s thoughts on Tiananmen in English, see here. Wang emphasizes the class dimensions of the conflict.
[13] Sun Yefang was a prominent Chinese economist who promoted market reforms long before the party finally implemented such reforms.
[14] Gu Zhun was a major figure in the development of the discipline of accounting in Republican-period China, who later coverted to Marxism and finally to economic liberalism when he was imprisoned for speaking his mind in the 1950s. The posthumous publication of his prison diaries in the 1990s, which illustrated his “re-invention” of the principles of a liberal economy, created quite a stir.
[15] By “developmentalism,” Wang Hui refers to a neoliberal view of economic growth that stresses development above all else.
[16] The new scientific development model was endorsed by CCP authorities in October, 2005, at the meeting of the fifth plenum of the 16th Central Committee, and was meant to be a corrective to “blind developmentalism.”
[17] On this theme, see Barry Naughton, “Chinese Institutional Innovation and Privatization from Below,” The American Economic Review 84.2 (May 1994): 266-270.
[18] “Chimerica” is a concept invented by the historian Niell Fergeson that refers to the symbiotic, codependent economic relationship between China and the United States. See Fergeson’s The Ascent of Money: A Financial History of the World (New York: Penguin, 2008).
[19] Land certificates are associated with the New Left, and are seen as means to compensate peasants for undesirable land, allowing them to migrate to the cities and allowing the state to restructure the rural sector. See Cui Zhiyuan, “Partial Intimations of the Coming Whole: The Chongqing Experiment in the Light of the Theories of Henry George, James Meade, and Antonio Gramsci,” Modern China 37.6 (2011): 646-660.
[20] This set of policies undertaken by the Hu-Wen regime signaled a renewed state interest in the basic livelihood of the people.
[21] Such as the Naxalite insurgency. More broadly, see Tilak P. Gupta, “Maoism in India: Ideology, Programme and Armed Struggle,” Economic and Political Weekly 41.29 (Jul. 22-28, 2006): 3172-3176.
[22] Although China is routinely labeled a “one-party state,” in fact there exist a number of smaller legal political parties, most of them holdovers from the Republican period. None of these parties possesses any real power, however.
[23] The “depoliticization” of politics is a theme Wang Hui has stressed for some time. It refers to the process by which technocratic rule replaces genuine political debate to the detriment of democracy and representation. See Wang Hui, “Depoliticized Politics, from East to West," New Left Review 41 (2006): 29-45.
[24] Robert Paul Brenner is an American professor emeritus of history who writes from a socialist perspective.
[25] Wen Jiajun (Dale Wen) was a research follow at the Chongyang Institute for Financial
Studies at the Renmin University in Beijing, and is an expert on issues of globalization and climate change. She currently lives and works in Germany.
[26] BRIC is an acronym for Brazil, Russia, India, and China, seen as rapidly developing second-tier economies in the early 2010s, as well as a platform allowing these countries to meet and discuss common concerns.
[27] The Shanghai Six was one stage in the development of what is now known as the Shanghai Cooperation Organization, a forum which regroups several Eurasian States to facilitate discussion of strategies and common concerns.
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