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CHAPTER 1
THE HYBRID MACHINE
GOVERNANCE WITH CHINESE CHARACTERISTICS
I still remember how excited I was when World War II ended and the GIs handed out chocolate bars as part of the celebration. In the eyes of small children, the American soldiers were larger-than-life heroes. They were the freedom fighters. So it is not surprising that I chose to spend part of my formative years in America attending college and graduate school during the fifties and early sixties. Even today many families continue to send their children to America for higher education.
As a nation, having triumphed in World War II, America was beaming with confidence. Several of my fraternity brothers were living off the GI Bill. In the decade following the war, the most popular entertainment was cowboys-and-Indians movies starring John Wayne, Gary Cooper, and Alan Ladd—heroes in white hats carrying America into a shining future. By the sixties, a revolution in pop music formed a soundtrack for a generation inspired by John F. Kennedy’s charismatic leadership: “Ask not what your country can do for you—ask what you can do for your country.” I was witnessing a nation evolving into a civil society based on freedom of speech, gender and racial equality, individual rights, and a democratic political system. Along with similar changes happening in Europe, this seemed to represent the modern evolution of Western civilization. But perhaps we were mistaken.
Americans I have met over the years—both socially and through business—have generally been friendly, outgoing, and well-intentioned people. Yet the postwar generation, and those that followed it, grew up not knowing hardship—only an increasingly materialistic lifestyle based on easy credit. Most people bought houses, big cars, and appliances on credit. Enjoy now and pay later was the common attitude. It became a land of entitlement. Americans—known as “those rich people”—were the envy of most other nations around the world. As America became a global superpower, it began to dictate norms and standards for the world to follow. Double standards inevitably surfaced, because national and corporate interests were at stake. Free-market democracy became the only viable model for all nations to adopt, regardless of their stage of history and development.
Partly as a result of the Cold War between America and Russia (which was more about nuclear balance than economics), leaders in Washington during the late seventies and early eighties decided to support China’s economic reforms under the leadership of Deng Xiaoping after Mao’s death in 1976. America was intent on keeping China from falling further under Russia’s Communist influence, while China welcomed America as an ally that would lessen its dependence on Russia. This, in my view, was an important turning point; it led to increased globalization and today’s interdependency between China and America.
Opening up the U.S. market to Chinese exports helped kick-start the miraculous growth China enjoys today. It’s useful to remember that China was emerging from decades of humiliation from foreign invasion and occupation. Several generations of Chinese lived through extreme hardship and poverty under failed socialism. This was a period with an abundance of cheap labor and strong encouragement from Deng’s pragmatic leadership. (“It doesn’t matter if a cat is white or black; it’s a good one so long as it catches mice.” Or his other famous line: “To get rich is glorious.”) Local factories, as well as those owned by multinationals but employing local labor, began assembling goods to satisfy a voracious hunger on the part of Americans and Europeans for almost every kind of consumer product.
It is interesting to note a distinct difference between the two systems that exists to this day. The premise behind the Western form of democracy sounds good because citizens have the power to vote out a leader who underperforms. But this system, entwined as it is with capitalism, has gradually evolved to the point where wealth has become the fundamental power base. Private wealth, private investment, and private enterprise carry the day. Without the backing of enormous financial resources, the odds are against an individual ever winning an election.
Under the democratic political system, America’s ability to act, and react, is further complicated by multiparty politics. It is an adversarial system, so it has built-in constraints that prevent the ruling party’s leaders from responding to events quickly and decisively. To cite the most obvious example, the elected president in America must work with the House of Representatives and the Senate to pass major policies in an environment where fractious party politics often dominate. In addition, members of the House of Representatives face a new election every two years, which creates a built-in short-term focus. This is why their primary attention is always on getting reelected.
Here is a good example of these dilemmas in Western democracy. In August 2009, Orville Schell, director of the Center on U.S.-China relations at the Asia Society, revisited China for the sixtieth anniversary of the founding of the People’s Republic of China. Schell’s first trip had been in 1975, just three years after Richard Nixon became the first U.S. president to visit the PRC. (This occasion marked a historic shift for that era: the first steps toward normalizing relations between the two great nations.) Writing in the South China Morning Post, Schell reflected on President Barack Obama’s frustrating efforts to enact change. “The U.S. Congress became paralyzed by partisan politics. Seemingly lacking a central nervous system, it has become a dysfunctional creature with little capacity to recognize any common national, much less international, interest. Under such circumstances, even a brilliant leader, with an able staff and promising policies will be unable to pursue his agenda. . . . China is veritably humming with energy, money, plans, leadership and forward motion while the West seems paralyzed.”1
Schell went on to talk about his unique observations as he walked the streets of Beijing, “. . . the paradox that struck me was that the very system of democratic capitalism that the West has so ardently believed in and advocated now seems to be failing us. At the same time, the kind of authoritarianism and state-managed economics that we have long impugned now seems to be serving China well.” Schell even speculated about where the world was headed. “It is intellectually and politically unsettling to realize that, if the West cannot quickly straighten out its systems of government, only politically unreformed states like China will be able to make the decisions that a nation needs to survive in today’s high-speed, hi-tech, increasingly globalized world.”
Real Politics
On the surface, politics in China would appear to be hierarchical and authoritarian. In fact, it is increasingly complex, diffuse, and quite competitive. The political process has evolved over the years. Today it is also being influenced by a myriad of entities such as ministerial bureaucracies, provincial and municipal governments, an increasing number of research groups and think tanks, the academic community, the growing private business sectors, as well as a public that is better informed with the advent of the Internet.
According to the country’s constitution, the highest governing body is the National People’s Congress (NPC) with its some three thousand members, but in the past it has been more of a symbolic organization endorsing proposals previously debated and ironed out by the Communist Party leadership. The real policy and decision-making entity is, in fact, the party’s Politburo and its Standing Committee, comprising the two dozen or so most senior officials. It is, therefore, important to understand that despite a structural separation between the party and the state, the overlap of personnel creates a fused center of power. This makes it useful to look at the party structure and the state organs separately.
The Politburo is the most important political institution. The official head is the party’s general secretary. The size and membership are determined by the Party Congress, which meets every five years. Considerable struggles and horse-trading occur before the Congress convenes, especially between the two major factions—the “princeling elitists” and the “populists”—to fill these seats of power. Since Deng’s reforms, China has moved increasingly toward a collective leadership model. China’s central power rests with a team given a ten-year tenure (two five-year terms). Succession would appear to be well planned and seamless, although I suspect political infighting among various factions cannot be avoided.
As a result, China is a country with one-party rule, but it is absolutely not a dictatorship. In fact, as evidence of China’s evolving political system, the ruling party is no longer led by one strongman (such as Mao or Deng). Instead the Politburo and its Standing Committee are run collectively by two informal coalitions. President Hu Jintao, for example, is not a protégé of the former president, Jiang Zemin; they belonged to competing factions. This demonstrates how politics in China is no longer a zero-sum game in which a single winner takes all.
During the seventeenth Party Congress, held in 2007, four senior Politburo members (born before 1940) retired, indicating the party’s adherence to agreements made for mandatory retirement at the age of sixty-eight for Politburo membership. The Standing Committee within the Politburo—a smaller group of at present nine members—is the entity that wields much of the political power. The nine people who emerged from the 2007 Congress were five returning members, including President Hu and Premier Wen, and four new faces. Two of this latter group—Xi Jinping and Li Keqiang—have now been tipped to succeed President Hu and Premier Wen respectively. Both of them were born after 1950—making them the first of the “fifth generation” of China’s leadership and the only two young enough to remain in the Politburo after the upcoming Party Congress in 2012. All others will have to retire. This is why there is currently a considerable amount of political juggling between factions within the Party to fill these slots. It should also be noted that the party’s secretariat is under the leadership of Vice President Xi Jinping. While it has no decision-making power, it is nevertheless the administrative arm overseeing the daily operation of the party and implementing decisions made by the Politburo and its Standing Committee.
At this point I should clarify that the Party Congress meets every five years and the National People’s Congress meets every year. The Party Congress is convened primarily to determine changes in the party’s leadership. In addition, it reviews and makes changes, where necessary, to the party’s constitution. It also selects the party’s Central Committee of some 370 members. The Central Committee does not exercise authority as a corporate body in the same way that a legislature would. It is, however, important in that its membership is composed of leading figures of the party, the state, and the military. The Party Congress tends to be ceremonial, whereas the Central Committee meetings have often been arenas for real debate and decisions on party policy. The National People’s Congress, in theory, is the highest governing body. It has, however, been more of a rubber-stamp organization, although in the recent past it appears to have become more of a forum for mediating policy differences between different parts of the party and the government.
In terms of the state or the government, the State Council is the chief authority of the country. It is appointed by the NPC, chaired by the premier, and includes the heads of each governmental department and agency. It has about fifty members, and it directly oversees all the subordinate government entities in provinces and municipalities. In practice, it maintains an interlocking membership with the top levels of the party—thus creating, as mentioned previously, a fused center of power.
Another example on this fusion of power is the Central Military Commission (CMC), which is the leading military organ and the supreme military command and decision-making body through which the Communist Party (CCP) leads the country’s armed forces: the People’s Liberation Army (PLA), the People’s Armed Police (PAP), and the reserve forces. It basically serves both the State and the Party systems. The chairman of the CMC is elected during the Party Congress, and the post has always been held by the Party secretary-general and the country’s president. Normally there are two or three vice chairmen who are uniformed officers in charge of running the CMC. It also has had a “first vice chairman” who functions as the de facto head in the daily running of the CMC. One of the vice chairmen also serves as the defense minister in the State government. In 2010, Vice President Xi Jinping, widely regarded as the next leader of China, was appointed vice chairman of the CMC—normally a signal that he is the front-runner to become the next president of the country. (For the current lineup of key leaders, please refer to Appendix A, “China’s Current Leadership.”)
The notion of a party controlling the government, especially when the same party effectively is the government, is something difficult for many in the West to accept. In China, the government and other state organs on the surface behave very much like they do in other countries. However, it is really the backstage where party forums are held and where the real politics is transacted. Under the Politburo there exists a largely secretive system that controls the entire public sector, including the military and the lives of officials who work in the various levels of government. Government ministries and agencies are staffed through an elaborate and opaque appointments system. Through behind-the-scenes committees, policy instructions are then disseminated via a government network, which guides officials in their political posture and in making public statements.
Here it is also worth looking at the process of becoming a government employee, which is very rigorous in China. Officials in public institutions are trained and retrained through approximately three thousand party schools before they are eligible for promotion. Any misconduct is first investigated by the party before being turned over to the civilian justice system. The tentacles of the state and thus the party go well beyond the government. For example, each province and each city has a party secretary who is the highest-ranking official. In terms of seniority, this official is then followed by a governor at the provincial level and a mayor at the city level. (If a party secretary shows up at a banquet together with a city mayor, for example, one must remember to toast the party secretary first.) The PLA, which is the military arm of the Communist Party of China, completes the tripartite power structure of politics, civil service, and military.
Key People
It is certainly worth examining the background of the two future leaders. They share little in terms of family background or policy orientation. Xi came from the elitist faction, which is dominated by “princelings”—the children of former high-ranking officials who grew up in the richer coastal regions and pursued careers in finance, trade, technology, and foreign affairs. His strong military ties may also serve the regime well. His connections come from two sources. His late father, Xi Zhongxun, served as the political commissar of the First Field Army on the northwestern front when the Communist forces were fighting against the KMT. His Second Field Army counterpart was none other than Deng Xiaoping, who fought in the Southwest. Later, Deng also sent him south, where he was very successful in establishing Shenzhen as the first development zone, which set the pace for China’s eventual economic miracle.
The other source of connections is his own service record. He spent more than half of his working career in the coastal area facing the Taiwan Strait—from vice mayor in Xiamen to governor of the Fujian Province to governor and then party secretary of Zhejiang Province, before he was transferred to Shanghai in 2007. These local administrations all fall under the same military regime—the Nanjing regional command. Among the current leaders in CMC, many came from that command and shared a working relationship with Xi at one time or another. Well known in the international business community, he is a keen supporter of market liberalization and the continued development of the private sector. Xi will likely focus on macroeconomics and serve as China’s face to the world, continuing national efforts to make the economy more efficient and global in orientation.
In contrast, Li comes from the populist faction, the members of which served in local and rural provinces and share expertise in organizational skills, propaganda, and legal affairs. His focus will be on managing social stability on the domestic front: issues such as affordable housing and health care, especially in the rural areas, as well as the plight of the country’s millions of registered unemployed. Reducing disparities is more important to him than improving efficiencies in the economy.
But Xi and Li do have something important in common. They were both born after the founding of the People’s Republic of China. Just teenagers when the Cultural Revolution broke out in 1966, they were sent to work as farmers: Xi in Yanan in Shaanxi Province and Li in some of the poorest rural areas in Anhui and Jiangsu Provinces. These humbling and arduous experiences helped shape their character. Today they are seen as adaptable and foresighted leaders armed with both endurance and humility. (Xi recently told the Chinese media that his time in Yanan was a turning point in his life.)
Two factions existing side by side within the one-party system is a significant shift in China’s political landscape, and it is certainly a healthy one. As leaders, Xi and Li will stand united to the public. Together they will provide a balance between economic growth and social justice. We can expect to see consensus building and compromise from this new generation of leaders who will assume power in 2012. This is what...
