China and CCP: Debt, Social Reforms, Deng Xiaoping and the Next Stage

China and CCP: Debt, Social Reforms, Deng Xiaoping and the Next Stage

Shuchun Zhang and Noriko Watanabe

Modern Tokyo Times

The government of China is faced with a balancing act of preserving high economic growth, containing internal social problems, maintaining the flow of accessible loans, focusing on the huge economic gap between the countryside and mega-cities – and other issues related to Tibet and Xinjiang. At the same time, issues related to transparency, patent laws, internal corruption, bad debt, working conditions, the exploitation of labor, the legal system and shadow banking are all major problems for the government of China. After all, the one-party-state of the Chinese Communist Party (CCP) is focused on maintaining high economic growth in order to prop-up the political system from major social ills. Therefore, economic growth is the parameter in relation to social stability in this nation state.

Indeed, the duality of economic growth and petty nationalism are areas where the CCP can escape from the stresses of a future Tiananmen Square uprising. This reality means that the legacy of economic growth based on the late Deng Xiaoping (1904-1997) is the continuing mantra in modern day China. Deng Xiaoping in many ways was the “real revolutionary” when it came to focusing heavily on economic growth and opening-up China within certain constraints.

Deng Xiaoping was a pragmatist in China during the difficult period of the Cultural Revolution. He stated bravely“it doesn’t matter if a cat is black or white, so long as it catches mice.” 

Lee Jay Walker at Modern Tokyo Times says: “This one powerful political leader paid a heavy price for his pragmatism. However, true to Deng Xiaoping he understood the need to help the people of China alongside preserving all the positives of the CCP that had enabled China to survive during a very traumatic period of history. This applies to Western colonial powers ravaging China like a pack of hounds during the late nineteenth and early twentieth century, Japanese Imperialism and other brutal realities that impinged heavily on the people of China prior to breaking free from outside control.  Deng Xiaoping knew all this too well because he lived during such a traumatic period. Yet, the uniqueness of Deng Xiaoping is that he also fully understood the pitfalls of many areas within the CCP that were holding China back from progressing in the fields of economics, science, modernization and other important areas.”

Of course, Deng Xiaoping wanted to preserve the power and influence of the CCP but he wanted this done with a human face and whereby the people of China could progress and enjoy the fruits of their labor. It is all too easy to judge Deng Xiaoping within the negativity of the CCP in relation to the Cultural Revolution and other areas whereby freedom was crushed. Yet Deng Xiaoping had to work within the prevailing system of China during the excesses of the Cultural Revolution and other periods of major power abuses. Despite this, he still believed that China would one day open up in order to move to the next stage of developing China under a new and vibrant CCP.

Deng Xiaoping during the Tiananmen Square crisis in 1989 showed clearly that he put the survival of the CCP before all else because in his worldview the modernization of China could only develop under this political organization. Also, for Deng Xiaoping, then individuals must remember that he witnessed the ravages of international imperialism humiliating China, the Japanese Imperial era, the brutality of World War Two, the untold suffering during the Cultural Revolution – and other important areas in relation to suffering. However, he believed wholeheartedly that if the CCP lost power then China would go backwards and be threatened by the intrigues of outside powers. Therefore, irrespective of how people perceive the Tiananmen Square crisis, it would appear inconceivable today that China would be the number two economic power in the world if the CCP had been overthrown in the late 1980s.

Indeed, the remarkable nature of Deng Xiaoping comes into play during this delicate period of history. After all, the events of 1989 merely convinced him even more to focus on economic prosperity, opening-up regionally, restructuring on excesses in relation to power concentration – and other important areas in relation to modernizing China. Deng Xiaoping stated “the next three to five years will be extremely difficult for our Party and our country, extremely important. If we collapse, China’s history will regress for several tens of years, even a hundred years.”

Barry Naughton, So Kwanlok Chair of Chinese International Affairs at the University of California, stated during the lifetime of Deng Xiaoping that “Deng was able to listen to good advice, and willing to let go of control over economic matters. He has been willing to allow specialists in economic policy-making to make economic decisions without much interference on his part. In 1978-79, the crucial innovations in economic policy were made by Li Xiannian and Chen Yun, with Deng serving rather to orchestrate the overall political conditions that made these changes possible…During the 1980s, Deng directly or indirectly promoted a large group of qualified and effective managers and local officials to replace the former Party hacks. This leadership turnover contributed substantially to China’s improved performance in the 1980s.” (Page 96-97 of Deng Xiaoping, Portrait of a Chinese Statesman – Edited by David Shambaugh)

Lee Jay Walker says: “Since Deng Xiaoping passed away in 1997 his legacy continues today in modern China because he turned the corner for this nation in the area of economic growth, opening up internationally, scientific projects and modernization. The political convulsions of Tiananmen Square in 1989 clearly remain within the psyche of the CCP in modern day China. Therefore, economic growth and opening up internally and externally – within certain political restraints – have been the backbone of China since the “real revolution” which took place under Deng Xiaoping. However, issues related to social reforms are equally essential alongside maintaining economic growth because the CCP knows full well that preserving this duality is essential for the long-term future of the Party and the people of China. Of course, issues related to political reforms will rise-up again but unlike the late 1980s then the gulf between backwardness and modernization no longer exists to any real extent – similarly, many dreams are being fulfilled within the current political system unlike the late 1980s whereby many individuals still felt distant from the ongoing reforms of the day.”

“The final stage in the evolution of China applies to political reforms and how the CCP and civil society can move to the final transitional period, whereby the ruling party can openly compete with other political parties on a level playing ground based on natural progression. Nobody knows when China will move from a one-party state. However, if economic progress continues alongside social reforms then the CCP can face this day with strength unlike the former Soviet Union and Eastern Europe which collapsed based on economic, political and other areas of weakness. Therefore, economic growth and social reforms for the CCP are essential when the next stage takes place and this reality means that issues related to bad debt, income disparity and maintaining economic growth are all equally essential.”

It is therefore imperative that China maintains high economic growth, restructures from investment-led to consumption based on domestic demand, to reign in bad loans, solve the issue of shadow banking, open-up important areas of the economy to outside competition and focus on other important issues related to social policy. After all, the gap between rich and poor along with the rights of workers must take priority. If not, the CCP will lose its power mechanisms and leverages within the grass roots of China when the final stage takes place in relation to political reforms.

Deng Xiaoping laid the foundation stone for modern day China to develop in the area of economics. Yet now all the “negative areas” must be reigned in and this applies to corruption, enormous economic disparity, rampant capitalism based on the exploitation of labor, propping up inefficient areas by enabling easy loans and providing genuine rights for the workers of China. These areas – and other important areas within modern day China will decide the future of this nation.

Of course, for Deng Xiaoping economic growth and modernization would ultimately lead to re-socialization. Either way, the final stage based on political reforms and open democracy whereby the CCP can compete based on strength will be determined by tackling these negative areas within China. The Communist Parties in the Soviet Union and Eastern Europe collapsed because of major weaknesses. However, Deng Xiaoping was focused on strengthening the state based on economic progress and modernization – given the mass unemployment of many nations throughout the European Union and many ills that beset America – then clearly no model is perfect.  Therefore, it is essential that the CCP becomes focused on resolving internal negative forces, in order to gain from positive areas in relation to economic growth and modernization.

If this happens then the world order of the late 1980s and early 1990s when communist states were collapsing may be turned on its head? After all, China isn’t reliant on America for economic support. On the contrary, China keeps on holding more of America’s debt and sucking in many multinationals based on the enormous size of the economy and the huge potential of China. In other words, a new shaker in the world may unfold in the future based on a political movement that appeared to have bitten the dust but being based within the changing times of modernity.

Lee Jay Walker gave guidance and support to both main writers