Historian Frank Dikötter of the University of Hong Kong argues there is more continuity than change … [+]
Did you know that living standards in China by 1978 were lower than what they were in 1949? Are you aware that the percentage of foreign residents in China today is lower than that of North Korea? These are some of the surprising facts touched upon in my conversation with Frank Dikötter, drawing insights from his recent book China After Mao: The Rise of a Superpower.
Frank Dikötter is Chair Professor of Humanities at the University of Hong Kong and senior fellow at the Hoover Institution. Before moving to Asia in 2006, he was professor of modern history of China at the School of Oriental and African Studies (SOAS), University of London. He researches and writes on modern Chinese history and has published a dozen books that have changed the way we look at different historical periods in China. Mao’s Great Famine: The History of China’s Most Devastating Catastrophe, 1958-1962 won the 2011 BBC Samuel Johnson Prize for Non-Fiction, Britain’s most prestigious book award for non-fiction.
We started our discussion with how Frank views Deng Xiaoping, the key political figure after Mao who architected the “reform and opening” era. He challenges the common perception of Deng as an open-minded and friendly leader and argues that we misunderstand what happened throughout the 1980s. Frank notes for instance that Deng never intended to undermine the People’s Communes in 1979and the Tian’anmen Square protests and massacre in 1989 was a watershed that further allowed Deng to preserve Maoist structural features, that as Frank discusses were never abandoned.
As Frank puts it, there is more continuity than change in Chinese politics after Mao, and that this continues to influence China’s economic situation. From the 1982 revision of the constitution to the recent announcement of the Dual Circulation economic policy, the state has held a firm grip on the means of production. Once this point becomes clear, it is easier to understand how these longstanding structural features create challenges and constraints to addressing current issues such as debt and unemployment in China’s contemporary economy and society. How can China deal with its aging population? If the government’s approach to encouraging birth fails, what is the solution to China’s demographic issues? How should we interpret the tightening of control on private enterprises and more so on foreign businesses? And ultimately, how do we understand China’s economic reforms amid globalization and deglobalization trends?
Christopher Marquis: I really enjoyed reading the book. My work on China has also looked a lot at how some of Mao’s ideas and the political structures he created continue to last in ways that I think the West may not particularly appreciate or acknowledge. My first question is, in regard to the title, China After Mao. Most of the book is obviously focused on Dèng Xiǎopíng邓小平.My experience is that in the West, Deng’s image is as a folksy guy wearing a cowboy hat and promoting reform and opening. And one of the things that I appreciated about your book is you in a more detailed way, go into some of the influences of Mao, or how maybe the post 1976 or 1978 period may not have been as dramatic of a change as the West may think. So can you just say a little bit about how you see Deng and his leadership in the post-Mao period?
Frank Dikötter: Yes, I can. I think that Mao was by far the cleverest of that bunch. And one great decision he made was to keep Deng, even though he was purged on several occasions. I think the reason for that is that he knew all too well that Deng was a committed Marxist Leninist. Deng, in 1956, had opposed the whole idea of a Hundred Flowers (1956-1957) – let people speak. He was the one put in charge by Mao in 1957, when so many of those who did speak out were sent to labor camps. Deng’s unwavering commitment to the tenets of Marxism-Leninism is one reason why to this day you still have the portrait of Mao over the Forbidden City.
I also think that we tend to forget that Deng and a great many of the other leaders were not really looking forward in 1976. They were looking backwards. They were committed Marxists, and they want to have a Socialist economy, but one that actually worked. In other words not the chaos of the Cultural Revolution (1966-1976), and not the disaster of the Great Leap Forward (1958-1962), but preferably something quite thoroughly Stalinist, as was the case up to 1956, the point when Mao, in their view, started to lose the plot with the Hundred Flowers. So they are committed tothe Marxist principle of state ownership of the means of production.
Thanks to Deng, the four cardinal principles were inscribed into the Constitution in 1982. If you read them carefully, you’ll find out these four principles actually boil down to a mere two. I won’t repeat all four of them. One is “uphold the leadership of the party,” which is the Leninist principle of a monopoly over power, the other is “keep to the Socialist road”, which refers to the Marxist principle of state ownership of the means of production. So Marxism when it comes to the economy, and Leninism as far as power is concerned. I think that is pretty much what he tried to do.
This is why I think we misunderstand what happened throughout the 1980s, not least if we talk about a so-called ‘transition’ towards the market economy. It was more an attempt to revive the socialist economy while temporarily giving the market some leeway, very much like the New Economic Policy under Lenin.
One example is the contract system that Deng introduced in the countryside in 1979. He never intended to undermine the People’s Communes, quite the opposite. There was one campaign after the other, in 1980 and again in 1981, to prevent the villagers from dividing the land and to remind them that the collective economy was the backbone of agriculture.
The contracts were meant to reinforce the People’s Communes, not undermine them. But commune leaders handed these contracts down to the villages, and village leaders handed them over to individual households: soon enough people everywhere in the countryside deserted work in the communes to operate on their own. The communes collapsed by 1982. We tend to think that Deng freed the villagers from the constraints of the People’s Communes, but that is not at all what happened. The people in the countryside liberated themselves, and by so doing they also doubled their income.
I think something else worthwhile mentioning is that Deng was not always as firmly in charge as we like to imagine. On the one hand, he was the one who appealed to a great number of senior cadres by undertaking a massive programme of rehabilitation of those falsely accused and imprisoned during the Cultural Revolution. But the very leaders he rehabilitates become the ones who constrain his power, not least the so-called Eight Elders who are just as impatient as Deng to play a role. Throughout the 1980s he has to constantly seek the advice of these elderly party members and reach compromises, swerving from one direction to the other, as one effort at ‘opening up’ is followed by yet another crackdown on ‘spiritual pollution’ or ‘bourgeois liberalism’.
On the other hand, you will remember that the book starts with Tiananmen Square, not 1989 but 1976, when people marked the death of Zhōu Ēnlái’s 周恩来in a movement perceived by the leadership to be ‘counter-revolutionary’. One member of the Gang of Four banged the table and proclaimed that the police sent out to suppress the movement would not be armed with anything else but truncheons. Compare that to 1989, when some 200 tanks and 100,000 soldiers were used to crush the democracy movement. As one foreign military observer put it, it was a display of ‘total military incompetence’. Here too, Deng wavered, pulled from one side to the other, failing to exploit several chances of almost bloodless victory.
Christopher Marquis: You describe the period of 1989-1991 as a watershed, and you discuss the changing perceptions around the Tiananmen protests. Can you say why this juncture is so important to really understanding what came after?
Frank Dikötter: From 1989 to 1991 it almost looked as if China was going to revert to its Maoist past, cutting off links with foreign countries. At one point where Lǐ Péng李鹏 even tried to re-collectivize the countryside. To this day, in fact, a few leaders regret that the People’s Communes collapsed and villagers obtained a measure of economic freedom.
These are bleak years for both the regime and the population at large. It is a watershed because the regime becomes so much more entrenched. Take Li Peng, who directed the suppression of any kind of dissent over the phone: ‘shoot the bird that takes the lead’. The idea was, and still is to this day, that the slightest incident must be nipped in the bud, since it could spread at great speed and undermine social stability with the covert help of foreign hostile forces.
One egregious example after 1989 that comes to mind is the case of two grandmothers aged 77 and 79, detained during the Olympics in 2008 for trying to enter a ‘special zone’ set up specifically to allow people to express themselves freely, following promises made by the regime to the International Olympic Committee. These years are also a watershed because Jiāng Zémín 江泽民, immediately in the summer of 1989, makes the fight against ‘peaceful evolution’, in other words the alleged attempt by the ‘imperialism camp’ to undermine socialism without striking a blow, one of the regime’s top priorities. It still is today.
Christopher Marquis: You’ve talked about how with Deng, some of the Maoist structural features that were retained which many observers in the West may not have really appreciated. When looking at China’s contemporary problems, it seems many of these long-standing structural issues may be the cause, or at least impeding reform. For example you write about how debt and unemployment, significant issues today, have long roots. So dealing with them is a more significant challenge than many realize because of these structural issues such as CCP monopoly over power, control the means production and others. Can you say a little bit about how some of these longstanding structural features act as a real challenge or constraint to deal with issues today.
Frank Dikötter: Again, it goes back to the four cardinal principles. When a regime is openly committed to a Leninist monopoly over power, there can be no separation of powers, a system based on checks and balances, an independent judiciary, a free and independent press. In other words meaningful political reform within a Leninist system is a contradiction in terms. One result of the absence of the separation of powers is that the party must discipline itself, since there is no outside institution that can discipline the party. The party tends to do so through campaigns against corruption. Since corruption flourished where power is undivided, the campaigns against corruption never end.
We tend to talk about ‘economic reform’ simply because that is the term the party has been using ever since the death of Mao. But the term means something very different than it does in the west. It most definitely does not entail, as so many of us believe, a transition from the plan towards the market, or from socialism towards ‘capitalism’. As I have already said, ‘economic reform’ means tinkering with the Socialist economy to make it more efficient without abandoning state control over the means of production.
What the leaders had in mind in 1976, and to a great extent to this very day, is the Stalinist model of development. After 1929, for instance, the Soviets collectivised the country the better to drain it of grain, meat and milk, which was sold on the international market in exchange for foreign currency. The foreign currency was used to buy the industrial equipment required to industralise at great speed. Mao tried it with the Great Leap Forward in 1958. Deng and his acolytes tried it in 1978, calling for a ‘new Leap Forward’. In short improve exports and use the hard currency to build up capacity. Forty years ago it was heavy industry, today it is chips and artificial intelligence.
The key point is that the State always remains in control. What does the Marxist principle of state control of the means of production mean? It means that the land belongs to the State, raw materials are controlled by the State, energy is sold by the State, and capital is deposited in State banks. Needless to say, commitment to state ownership comes with a great number of constraints, not to mention long-term structural issues.
It was relatively easy to allow farmers to make basic decisions about what they should plant and where they could trade, not least since the land continued to belong to the State. It was also relatively easy to allow small private enterprises, which, by the way, continued to exist all the way through the Maoist era, to get on with their business, not least since the state continued to control the banks, energy and raw materials. But it is much harder to move away from state control over the means of production with a party and a constitution fully committed to ‘keeping to the Socialist road’.
Christopher Marquis: Fast forwarding again to the contemporary period and international trade. It’s really interesting to hear how you’re going back to how the Stalinist model gets used in both the pre- and post- Cultural Revolution periods, i.e. using resources from the countryside to modernize via investment in foreign technology.
How about over the past 20 plus years.Following admission to the WTO, a lot of the focus is investments from foreign companies and at the same time, China has also very much promoted urbanization. Many people have moved from rural areas into the urban environments. And as long as I’ve been spending time in China, there’s been this huge push to rebalance the economy from one oriented around state investment to more of a focus on individual consumption. Although economic statistics mostly suggest this effort to rebalance the economy has failed.
You see these ideas too in the more recent Dual Circulation strategy where the government wants to promote an internal cycle of producing domestically, consuming domestically, and then the other cycle of international investments around funds and technology, which also can help drive this internal cycle. I’m curious about your sense of how the more recent focus on consumption and urban environments and Dual Circulation represent a change to the basic model you describe or not.
Frank Dikötter: It fits into the existing framework I described above. So first of all, when it comes to investment, one should give Deng some credit. He’s the one who came up with the idea of development zones in 1992. The plan was quite simple: loan the land to foreigners in exchange for capital, use capital to build up infrastructure, and use infrastructure to export more. With more exports comes the foreign currency required to modernise. Deng called it ‘Capitalist Tools in Socialist Hands’, meaning that foreign investment was nothing to worry about, since the party continued to control both the land and the banks.
Another typical Socialist feature (Stalinist, one should say), is that high growth and state building requires low consumption. In a nutshell, whether under Stalin, Mao, Deng or Xi, the bulk of GDP goes to the Socialist state. To put it slightly differently, ordinary people in the People’s Republic get one of the lowest shares of the national output in the history of the modern world.
You remember what I said in the beginning: living standards in 1978 were lower than what they were in 1949. It is not that the economy did not grow after 1949, it is that most of the benefits of the growth went to the State, not to the people. Under Mao, what the State took in was invested back into the economy, relentlessly seeking high growth. That very principle barely changed after Mao’s death. Deng and others emphasised high growth to catch up with or surpass certain ‘capitalist countries’ in a short, predetermined period of time.
The point is that consumption is low, and cannot be anything but low, since anything else would imply a massive redistribution of wealth from the State towards ordinary people. I cannot see that happening any time soon. If anything, the situation has become more entrenched since COVID. I think the evidence, circumstantial as it may be, indicates that it is no longer just hard-working, ordinary people who are extremely concerned about their future and keen to save rather than consume. It is also those who one might describe as quite well off, the people who drive nice cars and invest in apartments. If they worry, you should too.
Christopher Marquis: Yes, while earnings are quite low, savings rates are very high. And despite a lot of government discourse about consumption, it is just that people just don’t trust the future in many ways. When you have uncertainty, you’re not going to be buying a lot of things; you’re going to be saving for potentially challenging times ahead.
I don’t know if this is exactly an analog, but one of the things that also stuck out to me from your book that relates to this dynamic as well was your discussion of birth control policies. The One Child policy is well known and more recently there’s been tremendous efforts to promote two kids, and now three kids, which are not working at all.
The regime was effective in being able to stop people from having children, but like consumption, it is actually very hard to promote people to have children. Based on your historical understanding, what’s your assessment of China’s dealing with current demographic issues and encouraging births?
Frank Dikötter: Well, I’m not a demographer. But surely you can’t just turn around a long-term trend from one day to the next. You can, of course, reverse the COVID policy from one day to the next. That’s a whole different issue. But I would say that if you want an example of a quite successful one-Party state, you should look at Singapore. Yet even Singapore has not quite managed the issue of a falling birth rate. So good luck to the People’s Republic of China.
The solution, of course, is immigration. People tend to forget that the number of foreign residents in the People’s Republic today is around 600,000. I believe it was roughly 850,000 in 2020, meaning less than 0.05% of the population. It’s lower than North Korea, a country which doesn’t strike me as particularly liberal. It is probably the lowest on planet Earth. As a matter of fact, in 1919 there were about 300,000 foreigners in the Republic of China, which was a much larger proportion overall than today, and the proportion kept increasing until 1949. While immigration might offer a solution, it is not likely to happen any time soon. A regime that does its utmost to keep the world at bay and lives in fear of ‘peaceful evolution’ is not about to throw open the gates. Like consumption, it would be a major political decision that would jar with the vision that leaders have been pursuing since 1949.
Christopher Marquis: I very much agree, and part of the issue is being more open to foreigners, but the other is being appealing to them to want to be there. I have spent a number of years in China in the past which I loved, but my interest in spending time there in the coming years is not the same as it once was.
Frank Dikötter: If you look at the civil war between the KMT and the CCP from 1945 to 1949, you will not find a single example of refugees going towards a Communist occupied territory. Refugees move to KMT areas. It may be a very distant example, but I am simply not very sure that there are a great many people keen to emigrate to the People’s Republic of China if given the chance.
Christopher Marquis: One of the areas that I focus a lot on is companies, be they state owned, private enterprises, multinationals and how the CCP may or may not be changing perspectives towards those different types of entities over time. You have a descriptive metaphor of “leaning back in the cool shade of a big tree,” describing private enterprise’s relations with SOEs and the state.
Through the early 2000s until Xi’s second term, for a lot of private enterprises, things appeared to be relatively open or more open than in the past. There’s was really a market at least by some people’s estimation, and the rise of many innovative private firms. But more recently, there has been a number of crackdowns, be they tech, education, introduction of golden shares that increase State control in tech firms, increasing party branches in the firms. Can you say a little bit about this, particularly as it relates to the history of how private enterprise in China has evolved?
Frank Dikötter: The quotation is very interesting and illustrates a very simple fact, namely that in the 1980s a private enterprise could not survive without the protection of a state enterprise. The one had to lean on the other, simply because the state discriminated so much against the private sector, however minuscule it was.
The 1980s seem like a long time ago, but again there are continuities all the way till now. Whether it is Deng or Jiang or Hu or Xi, all are committed Marxists. They are not Marxists in the sense that they spend many evenings carefully studying the works of Friedrich Engels and Karl Marx. They are Marxists in the sense that they are fully committed to the state ownership of the means of production. They are profoundly suspicious of what they refer to as ‘capitalists’ and the private sector. They may be willing, like Lenin, to give it some leeway in order to assist the state sector. But the moment the leadership believes the private sector has too much clout, it will whittle it down once again.
Yet there is a key moment of change, namely in 2000 when Jiang Zemin’s decided to impose party committees on every private enterprise, whether large or small. As the drive to build party cells in private enterprises unfolded, by 2010 they were powerful enough to block the renewal of a license for a law firm considered to be troublesome. In other words, party cells could close down the very enterprises into which they were inserted. In my view, it means that the distinction between private and state-owned, which was important before 2000, has been eroded to the point where it has become meaningless. Nothing outside the State, nothing against the State, in other words.
Christopher Marquis: One thing that I frequently tell investors or business people, who can’t understand the more recent hardline approach and crackdowns on companies they have developed tremendous respect for like Alibaba or Didi, that I think is consistent with what you’re saying is that in 2020, the State Council formally designed data as a factor of production joining more traditional factors land, labor, capital, and technology.
And so the fundamental commitment to maintaining control over factors of production thus elevates those industries to essentially need to be state controlled. The state owned firms of the past were the traditional factors of production, in energy, finance, communications, etc. And now data as a factor of production means that actually, the state control and oversight has actually had a step change and now concerns tech companies too.
My last question relates to what’s next. You’ve finished this trilogy and I see that there’s beautifully done set of the three books that the publisher is selling. So this in some ways perhaps closes a research chapter for yourself. And so I am curious as to what is next? What are you working on?
Frank Dikötter: China after Mao is a sequel. Now I’m working on the prequel. In other words, how do 12 chaps in a room in 1921 manage to conquer a quarter of humanity in 1949? Of course a great number of books have been written on the topic. But as far as I’m concerned, they follow Edgar Snow’s Red Star over China a bit too closely. If you actually start looking at the evidence, you find that the story unfolds quite differently.
Here is one example: the 1929 Sino-Soviet War. Imagine the Ukraine, with hundreds of thousands of troops on the ground, airplanes, gunboats, entire towns flattened. Apparently, nobody in China has ever heard of it. It is not mentioned in most textbooks. When Michael Walker, a historian of the Soviet Union, published a book on the topic in 2017 called The 1929 Sino-Soviet War, he added a subtitle: The War Nobody Knew. What else have we missed? A great deal, and it’s fascinating.
Christopher Marquis: Yes, that does sound fascinating and like a well needed corrective to prior accounts. I very much look forward to reading that in the future.
