China’s 60th Birthday: The Road to Prosperity

Tragically, Mao’s belief in restoring China’s greatness and achieving
modernity was inextricably intertwined with his ideological desire to
transform China into a socialist and revolutionary society. Mao’s
social engineering continually convulsed China in unrelenting political
campaigns. These movements disrupted productivity and caused horrific
loss of life. Yet, despite the chaos, the People’s Republic embarked on
industrialization and stood up. By many measures, 60 years on, China
has achieved significant progress toward becoming a major and global
power. Mao may recognize it, but he would not be wholly happy with it.

As the People’s Republic of China commemorates its 60th anniversary,
it seemingly has much to celebrate. China is the world’s most populous
and industrious nation, is the world’s third largest economy and
trading nation, has become a global innovator in science and
technology, and is building a world-class university system. It has an
increasingly modern military and commands diplomatic respect. It is at
peace with its neighbors and all major powers. Its hybrid model of
quasi-state capitalism and semidemocratic authoritarianism — sometimes
dubbed the "Beijing Consensus" — has attracted attention across the
developing world.

This growing soft power of China was strengthened by the 2008
Olympics extravaganza, and the Shanghai Expo next year will similarly
dazzle. The 60th anniversary celebration in Beijing on Oct. 1 will
impress, if not frighten, the world with an arresting display of
military hardware and goose-stepping soldiers. Less visible is the fact
that China is the first major economy to recover from the global
recession and, indeed, is leading the world out of it.
(Read "Mission Accomplished. Now What?")

China is on a roll, particularly when viewed over time. Visiting or
living in China every year over the past three decades, I have had the
personal opportunity to witness dramatic transformations. When I first
went to China in 1979, vestiges of the Cultural Revolution were still
evident: revolutionary slogans painted on walls and pockmarks on
university buildings from bullets and howitzer shells shot by dueling
Red Guards. Camouflaged, but just as evident, were the personal scars
borne by intellectuals and officials whom I met at the time. I heard
stories of beatings and humiliations, confiscations of personal
possessions and loss of living quarters, and forced hard labor.

I then witnessed the dramatic blossoming of personal freedoms and
economic growth in the 1980s, punctuated by periodic countercampaigns
launched by neo-Maoists in the leadership. One could literally feel and
see Chinese society come alive after its long Maoist trauma, only to
have people quickly recoil when the conservatives in the leadership
reasserted themselves. This seesaw pattern persisted throughout the
decade, culminating in the dramatic Tiananmen demonstrations and their
suppression in June 1989.

In the early 1990s, I again experienced China as a society
traumatized, this time by the aftermath of Tiananmen. But by mid-decade
Deng Xiaoping had reignited domestic economic reforms and China had
normalized its place in the world after its post-Tiananmen isolation.
Politics, however, remained frozen and the heavy hand of the state
remained evident. Only during the present decade, in the waning years
of Jiang Zemin’s rule and under Hu Jintao, has the Communist Party
begun to experiment with very limited political reforms. My discussions
with those party officials involved with crafting the "democratic"
reforms makes clear that there are strict boundaries to how far they
will proceed.

Thus, when considering the totality of six decades, the record of
the PRC is decidedly mixed. While its achievements have been momentous,
so are the contrasts and contradictions exposed by those very same
achievements. In many sectors, each reform breeds new problems and
challenges. China has come a long way, but it still has a long way to
go.

Much of this dynamic growth has been export-driven, benefiting the low-
and medium-technology sectors of the economy. But China is beginning to
move up the technological ladder and is becoming more innovative in
certain sectors such as electronics and biotechnology. The country has
become a manufacturing superpower and the workshop of the world,
producing two-thirds of all photocopiers, microwaves and shoes; 60% of
cell phones; 55% of DVDs; over half of all digital cameras; 30% of
personal computers; and 75% of children’s toys, plus a wide variety of
other goods.

But the economic explosion has come at a high environmental cost.
China’s air and water are among the most polluted on earth and it is
the leading emitter of greenhouse gases. The environmental nightmare is
hurting public health. Malignant cancer now accounts for 28.5% of
deaths while respiratory diseases account for 13.1%, according to the
2008 China Statistical Yearbook. China’s growth has been dynamic, but it is also double-edged.

Reinventing a Nation

Mao spent his lifetime trying to transform Chinese society in his
utopian, socialist and revolutionary vision. He tried to create a "new
socialist man" and an equitable society. His regime succeeded in
providing the world’s largest population with food to eat, housing and
basic services. Social vices were eliminated, literacy was expanded,
life expectancy increased and infant mortality decreased. These were no
small achievements. But Mao’s efforts to impose socialism had a
deadening effect on urban and rural society alike, as political
movements repeatedly harassed different groups of people.

By the time Deng and his compatriots came to power in 1978, China
was traumatized, tired and alienated by 30 years of Maoist experiments
and totalitarian controls. Deng’s wisdom was to recognize that the
state needed to retreat from society and the economy if the creative
and entrepreneurial spirits of ordinary Chinese were to be unleashed.

Three decades later, Chinese society has fully blossomed. Chinese
today experience a wide variety of personal freedoms in daily life that
they and their ancestors had never known. Chinese state and society
have also reconnected with the past, emphasizing Confucian and Buddhist
values. More than 200 million people have been lifted out of poverty
and the members of a growing middle class with disposable income travel
abroad, invest in the stock market, dine out and decorate their stylish
apartments with furniture purchased from stores like Ikea. Access to
education has become far more widespread. Some 21 million students
attend university today, while an estimated 300,000 study abroad every
year. Approximately 206 million Chinese children attend primary and
secondary schools. Basic literacy is almost universal in China today,
while it was roughly 20% in 1949. Still, China remains a poor country
by global standards: some 207 million people still live below World
Bank poverty levels on less than $1.25 per day.

While China has made much progress, it still has many blemishes.
Treatment of ethnic minorities — particularly Tibetans and Uighurs — is
the Achilles’ heel of the regime, as violent riots last year and in
recent months have clearly demonstrated. Crime and corruption remain
serious problems, while cities struggle to provide basic services to
the huge "floating population" of 100 million or so migrants. Income
disparities (as measured by the Gini coefficient) are now approaching
the highest in the world. China has again become a stratified society —
just what Mao sought to eliminate. Still, given the unprecedented scale
and nature of China’s socioeconomic change over the past 30 years, the
country’s relative stability is commendable.

Politics Not as Usual

At first glance, China’s political system has not changed much since
1949. It is still a Leninist system, dominated by the CCP and an
oligarchy of its self-selected leaders, which tolerates no opposition.
The Party’s powerful Organization Department oversees all major
appointments in the country, and one must really be a party member to
get ahead professionally. Party and government organs remain
essentially as they were six decades ago, copied from the Soviet Union.

But while much of the structure and essential nature of the system
remains largely the same, the substance and process of politics has
changed quite a lot. The leadership and the 76 million party members
are better educated and their recruitment and promotion is much more
meritocratic. Competence is now rewarded. In the past, there existed
only two exit paths from officialdom: purges and death. Now mandatory
retirement is firmly implemented. Instead of being a totalitarian party
dominated by a single leader, the CCP today is an authoritarian party
with a collective leadership. The leaders themselves — at least those I
have witnessed — are now remarkably self-assured and relatively
sophisticated. Marxist-Leninist ideology plays little, if any, role in
their decision-making. The policy process is more consultative,
although still lacking in transparency. Much emphasis is put on
governance and officials at all levels undergo required training in
public administration.

On the whole, the Communist Party has proven itself to be remarkably
adaptable and open to borrowing elements from different countries and
political systems. As a result it is becoming a hybrid party with
elements of East Asian neo-authoritarianism, Latin American corporatism
and European social democracy all grafted to Confucianist-Leninist
roots. The uprising in Tiananmen and across China in 1989 and the
subsequent collapse of communist systems in Europe and the Soviet Union
were instructive experiences for the CCP. Many lessons were drawn, but
the principal one was to remain flexible and adaptable, not dogmatic
and rigid.
(Read "Beijing Clamps Down After Call for Democracy.")

Will the Party’s adaptability and the nation’s continuing economic
growth be sufficient to sustain it in power indefinitely? Perhaps. The
CCP’s sustenance to date has certainly surprised many leading China
watchers. But, going forward, the major challenge to the Party will
likely be its ability to deliver adequate "public goods" to the
population: health care, education, environmental protection and other
social services. Providing stability and ever increasing personal
wealth will not be enough to guarantee the Party indefinite legitimacy
— it must continuously improve the quality of life of its citizens.
This is China’s new revolution: the revolution of rising expectations.

Taking On the World

Any consideration of China’s transformation since 1949 must
recognize the dramatic improvement in China’s global posture. Sixty
years ago the new People’s Republic was cut off from the world, having
diplomatic recognition only from a relatively small number of nations.
It was excluded from the U.N. It soon became embroiled in the Korean
War and the Cold War, which brought further isolation. Despite some
marginal trade with Western Europe following the 1954 Geneva Conference
on Indochina, China was cut off from international trade, finance and
aid. As a result, its economy stagnated.

In the field of arms control, China used to be a serious proliferator
of missiles and missile components, and a significant seller of
conventional arms. But, over time, China has signed or ratified the
Nuclear Non-Proliferation Treaty, the Comprehensive Test Ban Treaty and
the Biological and Conventional Weapons Convention, has joined the
Nuclear Suppliers Group and has essentially adhered to the Missile
Technology Control Regime (although it is not a member). This is not
the China that the world used to know: a "revisionist" destabilizing
power that sought to overturn the international order. Today, the
People’s Republic of China is deeply involved across the globe and is
increasingly an upholder of, and contributor to, the existing
international order. China has been a considerable beneficiary of the
post – Cold War order, which has allowed Beijing to establish a
presence in regions and international institutions that was not
previously possible.

China’s strategic posture is also changing. Its military
modernization program has made giant strides in recent years — and they
will be on display in the massive military parade in central Beijing on
Oct. 1. In many categories China’s military is the best in Asia and in
some sectors is approaching NATO standards. The People’s Liberation
Army still has no global strike capacity, however, other than its
intercontinental ballistic missiles and cyberwarfare capabilities.

Still, many countries worry about China’s rise and global expansion,
even though it has, to date, been outwardly peaceful. Public opinion
polls in Europe and the U.S. regularly reflect a negative image of
China, while concerns over economic competition and job losses are
growing in Europe, Africa and Latin America. Substantial strains remain
in Beijing’s ties with three of China’s most important neighbors:
Australia, India and Japan. Even relations with Russia, which have
achieved historic highs since the collapse of the Soviet Union, have
run into obstacles. This is unsurprising. As Beijing expands its
influence and begins to flex its new muscle on the world stage, it’s to
be expected that China will engender occasional discord with other
nations.
(Read "The China-India Rivalry: Watching the Border.")

Future Shock?

Some historians of China think they see the telltale signs of
dynastic decline: government corruption, social discontent (especially
in the countryside), autocratic rulers and a militarizing state. Some
contemporary China experts also voice their doubts — proclaiming the
regime fragile and the political system ossified — while economists
question how long the dynamic growth can continue.

While the system and country have weaknesses and challenges, the
Sinological landscape is littered with its naysayers and critics. The
People’s Republic of China has endured for six decades and has overcome
a wide variety of serious domestic crises, border wars and
international isolation. Its strengths and adaptability have repeatedly
been underestimated by outside observers. One thing is certain: China
will remain a country of complexity and contradictions — which will
keep China watchers and Chinese alike guessing about its future
indefinitely.

(Shambaugh is professor and director of the China Policy Program at
George Washington University in Washington, D.C., nonresident senior
fellow at the Brookings Institution, and currently a visiting scholar
at the China Academy of Social Sciences in Beijing. His latest book is China’s Communist Party: Atrophy and Adaptation)