Chinese leader Deng Xiaoping and U.S. President Jimmy Carter at the White House, January 1979
U.S. National Archives and Records Administration

Since Mao Zedong's death in 1976, and particularly since the rise of Deng Xiaoping in 1978, the post-Mao leaders of China have sought to develop a new strategy and new institutions for modernizing China. In the economy, they have sought a more decentralized, quasi-market socialist system better suited to Chinese conditions than the highly centralized, Soviet-type system they adopted in 1949. Perhaps the most significant step has been a de facto decollectivization of agriculture.

There has been a legalization of some private commerce and trade, and some private ownership, particularly in the service industries, together with a greater use of indirect mechanisms such as prices rather than output quotas and commands to influence the allocation of resources. And there has been an upgrading of light industry and the beginning of a striking "consumer revolution."

In the political sphere, the post-Mao leaders seek greater stability and reliability so that China never again has to go through the chaos of a Cultural Revolution. Younger, better educated and more professionally trained officials are slowly replacing the older generation in the Party, government and Army, and top-level Mao loyalists have been removed from power.

An ideological revolution is also under way, with Maoist egalitarianism being replaced by an emphasis on material incentives for hard work, and revolutionary zeal giving way to a pragmatic quest for efficiency and productivity. A dazzling number of new laws have been introduced and China, for the first time since 1949, is beginning to train a large number of lawyers. And there is a substantial new emphasis on developing education, particularly in science and technology; since 1978 tens of thousands of students have been sent to study abroad.

Greater cultural diversity is now tolerated within China; foreign films, plays and books which were once almost completely banned are much more readily available. There is a much greater respect for professionalism in China; intellectuals, once relegated to the bottom of Mao's revolutionary society, are being accorded a new prestige and new power.

Accompanying these internal reforms is an opening up of the system to foreign economic and cultural influences on an unprecedented scale—what the Chinese call the "open door" policy. This stands in sharp contrast to two and a half decades of Maoist insularity and "self-sufficiency."

The overall result has been a virtual dismantling of many Maoist institutions and practices and the beginning of a movement toward a more open society. The analogy is striking between China since 1978 and the Soviet Union of the 1920s, under the New Economic Policy (NEP). China today resembles the pre-Stalinist system in the Soviet Union rather than the Stalinist or post-Stalinist one.

Of course, these changes should be seen in context. In a period of only five years, not everything has changed and many aspects of the Maoist-Stalinist system in China remain. The scope of change has varied considerably from region to region within China. And just as the Soviet NEP was eventually replaced by Stalinism, so too the Chinese "NEP" may ultimately give way to a harsher system. Nevertheless, the changes that have occurred are significant and the direction of change, if it is sustained, is very encouraging, both for the welfare of China and for its external relations.

This article seeks first to examine the reasons why these far-reaching changes have come about, then to look at the scope and impact of the reforms and the obstacles to them, to speculate on the future, and, finally, to assess the implications of the reforms for China's relations with the West.

II

The catalyst for the reforms in post-Mao China was an economic and social crisis accompanied by a loss of popular confidence in the ruling Communist Party and its ideology. The catalytic event was, of course, the Cultural Revolution, which ran from about 1966 until shortly after Mao's death.

The situation his successors inherited was nothing short of calamitous. The economy was in serious difficulty. Industrial production was of low quality. Agricultural production was barely keeping abreast of population growth, and per capita food consumption had not improved since the 1950s: one Chinese leader conceded that 100 million Chinese peasants did not have sufficient food to eat. A Communist-controlled periodical in Hong Kong published an even bleaker picture in 1979: it said that 200 million peasants—one quarter of the rural population—were living in "a state of semi-starvation." Continual harassment of intellectuals had left behind an antiquated science and technology and an educational system in shambles. The society was embittered, exhausted and alienated.

During the Cultural Revolution, the best judgment is that close to a million people were killed or driven to suicide. Millions of others were sent to labor camps or to work in remote rural areas. By 1979, the very legitimacy of Communist Party rule was in question among large numbers of Chinese. Much of the younger generation was estranged not only from Mao's thoughts, but from Lenin's as well. There was a widespread popular desire among the young to free China from Soviet-style totalitarianism and to move it in a genuinely democratic direction. Respect for the Party and the socialist system was at an all-time low. And one of the most rigid and inefficient bureaucracies on earth seemed incapable of breathing new life into the system.

The picture was desperate enough so that even the Old Guard leaders in China recognized that political survival required drastic action, as a high-ranking official admitted to me on a recent trip to China. Thus the post-Mao leaders embarked on a series of radical reforms designed to raise the abysmally low standard of living, open safety valves for mass dissatisfaction, and gradually restore popular confidence in the ruling Party.

III

At the heart of the post-Mao reforms, under the leadership of Deng Xiaoping, are far-reaching changes in the economic system.[1] By far the most far-reaching has been the de facto decollectivization of agriculture. Since some 80 percent of the Chinese population are peasants, and China remains predominantly rural, this reform clearly affects the largest number of people. Land has not been returned to private ownership; it is still illegal to buy and sell it. But since 1979, most of the countryside has adopted one or another version of the so-called "household responsibility" system, with many individual families or households now assigned parts of the collective fields which they farm on contract with local officials. They are obligated to meet certain state quotas. After meeting these quotas, however, they are free to dispose of the agricultural surplus in any way they see fit, including selling it on the proliferating free markets. In some cases, the contracts signed by individual families are even inheritable.

Most significant of all, the length of contracts between families and the state has recently been extended from 1–3 to 15 years.[2] Many peasants had complained that although the new reforms were welcome, they had no assurance that the Party would not change its mind, as it had done so many times in the past. Deng's reform leadership responded with the 15-year contracts, to give the peasants a greater feeling of security and stability so that they would have incentives to work hard and to invest in the land that is now virtually their own.

Along with the "household responsibility" system, private plots have been greatly expanded. In many areas, these now constitute 15 percent of the total cultivated area of the collective fields, as compared with five to seven percent in the Maoist era. Restrictions on peasant sideline activities have also been substantially eased. For example, most restrictions on private pig-raising have been abolished, and in several provinces there are no restrictions on private raising of sheep and cattle. Within limits, peasants can also now hire laborers.

With these new opportunities has come an expansion of peasant marketing. Rural free markets have been expanded, and since early 1979 private markets for agricultural goods in urban areas have been made legal. Prices in these markets are determined by supply and demand; almost any produce from private plots or sideline activity can be sold in them. On a recent visit to Shanghai, I walked through one of these markets and found it bustling with activity; the stalls displayed a wide variety of fish, meat and vegetables, and the peasants were avidly hawking their wares.

More recently, new banks have been created to generate rural credit so that budding peasant entrepreneurs can invest in new seed, fertilizer and machinery. Another key element in the new agricultural reforms—perhaps the pivotal one—was the first increase in state procurement prices for major farm products in 12 years. One prominent authority on the Chinese economy sums up the new policies in the countryside as representing nothing less than a "fundamental change."[3]

Already these incentives are creating a new—albeit small—class of rich peasants in the countryside. In the Chinese press one reads today of individual peasants who earn more than 10,000 yuan a year, an income at least 20 or 30 times the national average. Moreover, the Chinese leaders make no bones about what others might call a "Bukharinite" intention to encourage the peasants to become rich. "After the peasants become rich," Party Secretary General Hu Yaobang recently said, "we must guide them to invest . . . in development projects" in the countryside.[4] And Deng himself has written that it is now ideologically correct "to make some people rich first so as to lead all the people to wealth." It is a Chinese version of trickle-down theory.

This stunning variety of new rural incentives is having a dramatic impact on agricultural efficiency. Agricultural output per capita, according to one American estimate, rose from $166 in 1978 to $226 in 1983, a gain of about 36 percent in five years.[5] Even in 1983, a year of very bad weather, China's decollectivized agriculture continued to grow rapidly; grain production reached 368 million tons, a record and the second in two years. Production of cash crops was also generally good.

An American anthropologist who has been visiting the Chinese countryside in Guangdong province for some years recently wrote:

When I first visited the Zenbu brigade there in 1979, there was virtually nothing in the market. When I went back in 1981, things had started to pick up. But when I returned this summer [1983] I couldn't believe what I saw. There were hundreds of people selling things. There were tanks of live fish, and piles of fruit and vegetables heaped up everywhere. Loads of pigs were being slaughtered for meat—something you rarely would have seen in the past. You could buy Coca-Cola, Budweiser beer, and foreign cigarettes at private shops. The prosperity was impressive.[6]

Of course, in a Leninist, one-party political system, it is always possible for the Party leaders to reverse policy and go back to the commune system. But such a step would, at a minimum, face serious resistance and have a disastrous impact on productivity, in a country still struggling to keep food production ahead of population growth. Even with the draconian measures to limit population growth that the Chinese leaders are now taking, they will face an increasingly difficult food problem. China has one of the most unfavorable man-land ratios of any country in the world; while its population grew by two thirds between 1952 and the late 1970s, the quantity of arable land available per capita actually shrank.[7]

Facing such a serious land constraint, the Chinese leaders will have great incentives to keep on increasing peasant productivity. Thus, even the Old Guard elements in the Chinese leadership would be hard put to make a convincing argument to go back to the old system.

A second important change in China is that the old "Stalinist" priorities—on heavy industry, defense and rapid accumulation—have been replaced by new priorities on light industry, consumer goods, agriculture and raising people's living standards. Since 1978, heavy industry's share of industrial output has fallen, many defense factories have been partly or wholly converted to producing consumer goods, and consumer goods production has expanded rapidly. There is also a rash of new housing being constructed; almost everywhere in Beijing one sees new apartment buildings going up.

In effect, a consumer revolution is under way in China, particularly in the urban areas. The growing Chinese middle class is snapping up television sets and tape recorders that cost a year's salary. They are buying refrigerators and living room suites that would have provoked a scandal just a few years ago. And some ate dressing in Western-style trench coats, turtleneck sweaters and track suits.[8] Some 90 percent of the Chinese population now has access to television, and the official China Daily says that for every 100 families in Beijing, 55 now have electric fans, 16 have washing machines, 2 have refrigerators and 25 have tape recorders. In 1979 few Beijing families had any of these luxuries.

As part of the consumer revolution, the Chinese authorities are now allowing installment buying and billboard advertising—two "capitalist" techniques for stimulating consumption that would have been unthinkable before. Also now allowed are tourist trips to Hong Kong, where the mainland residents can savor the latest in consumer goods of all types.

Coming as it does after two and a half decades of Maoist austerity, this consumer revolution will not be easy to reverse. China is still a very poor country in terms of individual living standards. Now that the elite has unleashed consumer demand, it will be under great pressure to meet growing expectations of higher living standards.

In a third area, the industrial reforms have not been as sweeping as those in agriculture. There has still been no basic reform of the irrational price structure; factories still largely follow orders sent down by the central planners rather than responding to signals in the market place. To most Chinese factory managers, the market remains an abstraction. Still, a number of significant changes are beginning to take place.

Since 1979, enterprises in China have been permitted to retain a certain percentage of their profits for use in any way they see fit, provided they meet certain State guidelines. These excess profits may go into worker bonuses, new technology, new plant, marketing, etc. Another promising experiment is the willingness to let factories sell some of their products directly to the market instead of to the State. "This is beginning to force producers to take a serious look at what the market wants, as opposed to what the planners want," says one expert.[9] One enterprise in Beijing now maintains a marketing staff of nearly 30 individuals (all with technical backgrounds) headed by the plant's former chief engineer.[10]

Perhaps even more significant, the Chinese are now demonstrating a very un-Marxist willingness to close down inefficient enterprises. Normally in Soviet-style centrally planned economies the very thought of laying off workers or closing down enterprises is alien to central planners.[11] To be sure, complete plant shutdown is still used only as a last resort; the preferred solution is to amalgamate inefficient plants into more specialized plants. Still, the discussion in the Chinese press today of how to deal with workers in closed enterprises indicates that plant shutdowns are being carried out; several hundred factories were apparently closed in 1983. And, quite recently, the head of the State Economic Commission made the extraordinary announcement that all subsidies to state enterprises failing to achieve a profit will soon be cut off. Every money-losing state enterprise in China will be given a deadline to start making a profit or risk losing its subsidies.[12]

Another potentially dramatic industrial reform has to do with stimulating greater labor productivity and efficiency. Within the enterprise, the whole system of hiring, firing and promoting workers is being reexamined, with a new un-Maoist emphasis on skills and competence instead of political "purity"—again something that would have been unthinkable a few years ago. The old seniority system is under attack and in its place there is gradually appearing a "meritocratic" system in which workers are rewarded and promoted for better work; similarly the custom of children automatically inheriting jobs from retiring parents in factories or other institutions is being eroded.

As one observer has put it, "a new consensus seems to have emerged that a total overhaul of the employment system—not mere tinkering—is necessary"—moving away from guaranteed lifetime employment, the so-called "iron rice bowl," toward employment by merit.[13] In one trial system now under way in Beijing, job candidates have to submit to entrance exams, to serve probationary periods, to sign contracts agreeing to certain factory requirements, and to give employers the right to fire them if they are unruly or incompetent. And there is a change of leadership style within the factories. Party cadres assigned there are now instructed to stand aside and not interfere with the day-to-day activities of the production personnel.

A fourth set of reforms has to do with decentralization of much economic decision-making to local authorities. The post-Mao leaders have increased significantly the rates of budget revenue retained by local authorities, and given these local authorities greater freedom to adjust tax rates and even to determine how their retained revenue is to be spent. In 1982, on the average, some 80 percent of local revenues was reported to have been retained by the provinces.[14] Fiscal decentralization has gone so far that the central government now runs a huge budget deficit.

The provinces, special municipalities and special economic zones (to be discussed later) are also now able, within certain limits, to sign contracts with foreign companies without getting Beijing's approval. In most of the provinces, only very large foreign trade ventures now need the center's stamp of approval; in the case of Guangdong, Fujian and the special economic zones, there are no restrictions so long as the provinces do not ask Beijing for financial assistance, raw materials or other assistance.

These decentralizing reforms will be very difficult to reverse now that the provincial authorities have tasted their fruits. In 1981, when Beijing was forced to ask the provinces to lend it seven billion yuan or more to make up its budget deficit, some provinces refused, arguing that they had been promised that the reforms begun in 1980 would remain in force for five years. The central government is reluctant to confiscate provincial budgetary surpluses because if it does so, the provinces may be careful not to show surpluses, thus defeating the reformers' intentions. Some compromise is now in the works by which the center will get a certain percentage of provincial revenues. But the essence of the reform—to leave the provinces with greater economic decision-making authority—remains intact.

Still another of the new reforms designed to stimulate production has been the substantial expansion of out-and-out private enterprise. Farmers, for example, can now purchase their own trucks and engage in a variety of private enterprises. The Chinese press recently praised one enterprising farmer who bought his own truck and hauled coal from the mines to his collective farm's industry, working 12 hours a day, and earning a great deal of money. Other villagers, after finishing their work in the fields, are producing engine blocks for small tractors, making furniture, forming sewing cooperatives, and generally displaying a good deal of imagination in supplementing their farm incomes.

In the cities and towns, individuals and families can now open tailor shops, restaurants and other private enterprises provided they do not hire more than a certain number of people. Cooks, maids and nannies are now being hired in the households of some middle-income and wealthy professional families.[15] Entrepreneurs are even opening up small private inns for travelers. With the market now playing a much greater—albeit still secondary—role in the working of the economy, there is also now emerging a whole new group of "wheelers and dealers"—what Russians in the 1920s called "Nepmen"—middlemen ready to buy or sell anything for a profit.

At the macroeconomic level, there is growing use of indirect economic levers rather than administrative orders to influence the economy. Thus, a newly created Central Bank now seeks to manipulate the Chinese money supply and fine-tune the economy. Loans, interest rates and even prices are also being used, though still on a modest scale, to guide economic decision-making. Moreover, when the state planners raised prices for major farm products, they did so selectively. Prices for certain crops such as cotton, oil-bearing seed crops and soybeans were increased more than grain prices, partly to achieve desired changes in cropping patterns and partly to cushion basic food prices to the urban population.

This use of price incentives to influence the allocation of resources within the countryside—what the economists call indirect planning—represents an important distinction between the Chinese and the Soviet economic systems. As Nicholas Lardy points out, there has been a great deal more indirect planning in Chinese agriculture since 1978 than in the Soviet Union, where the agricultural system is still characterized by extensive reliance on output targets and even specification of particular farm practices.[16] In this respect, as in many others, the Chinese system today more closely resembles the Soviet system in the 1920s under the New Economic Policy than it resembles the Soviet system today.

IV

In their quest for a more successful modernizing strategy, the post-Mao leaders have opened up their economy and their society to the West in a host of new ways. One is the creation of special economic zones in order to encourage foreign investment in China, to absorb foreign technology and to learn Western techniques. In Shenzhen, a zone adjacent to Hong Kong's New Territories, a once sleepy group of villages is now sprouting modern factories, housing projects and holiday resorts; foreign firms now enjoy special privileges; and thousands of Chinese managers come each year to observe and learn Western techniques. Within the zones, which mainly produce goods for export, foreign-owned enterprises and joint ventures are managed exclusively by foreigners or overseas Chinese and their own boards of directors. The local Chinese governments do not interfere. The foreigners must, of course, abide by Chinese law and they do pay income taxes and property rents. But inside the zones a largely free-market system is being gradually established. Thus the zones are enclaves of capitalism within China, even though the official Chinese press denies this.

China is also luring foreign firms with new profit incentives. About 100 equity joint ventures were formed in 1983, compared with only 83 in the previous four years combined. In the past, foreign companies were justifiably unsure of either China's commitment or legal protection; now at least two dozen foreign investment laws passed in recent years have begun to allay such doubts. The Chinese will continue to have very strong incentives to attract foreign ventures because they are finding that such ventures are the best way to renovate their 400,000 old factories and to keep their technology up to date.

China has also begun a major effort to expand its trade with the United States, Japan and Western Europe. Chinese trade with the United States has gone from $1.1 billion in 1978 to $4.5 billion last year, and the prospects for further growth are good. A Chinese official recently stated that Beijing intends to sign some 1,000 contracts in 1984 to import $1-billion worth of advanced Western technology and equipment.[17]

Perhaps at least as important, the Chinese are sending thousands of research scientists and students abroad for advanced professional training. This is part of a significant renaissance of science and technology which, in turn, is part of an even broader effort to improve the working conditions of Chinese intellectuals. Since 1978, some 18,500 students have been sent to study in 54 countries; thousands of others are studying abroad at their own expense.[18] In the United States alone, there are now more than 10,000 Chinese students. Already, some 7,000 foreign-trained students have returned to China from abroad. Over time, they are almost certain to constitute a group which not only spreads new ideas but has a personal and professional interest in keeping China's door open to the outside world.

Within China, new universities are sprouting all over. There are now more than 50 universities and colleges in Shanghai, compared to about 16 ten years ago. In addition, many economic and political research centers have been established in China and almost all of them maintain close ties with comparable centers in the West. These too are bound to have a strong vested interest in maintaining the "open door" policy.

Even in the cultural realm, the number and variety of books, films, plays and operas now available—including many from foreign countries—is greater than at any time since 1949. There has been a revival of traditional dance and opera and at the same time greater willingness to import Western techniques in music and art—something that was outright heresy during the Cultural Revolution. Much greater religious freedom is now allowed, and Buddhist temples and Christian churches have been reopened in many parts of China.

In sum, since 1978, China has undertaken what amounts to nothing less than a socioeconomic revolution at home and a widespread opening up to the West. The pace of change is rapid, and it is difficult to believe that these developments will not have an impact for many years, and perhaps decades, to come.

V

There have been a series of substantial changes in the political and ideological spheres as well. At the very top of the leadership, Hua Guofeng and other key opponents of economic reform have been removed from the top decision-making bodies; they have been replaced by strong reform advocates such as Premier Zhao Ziyang and Party Secretary Hu Yaobang.

In the middle and lower ranks of the Party, where Deng's reform coalition has run into substantial resistance, a whole new generation of relatively young "experts" is gradually taking over and replacing the poorly educated cadres promoted during the Cultural Revolution. A careful study of the 12th Party Congress held in September 1982 concluded that "the transition to the post-revolutionary generation seems to be well on its way" and that the cadres promoted during the Cultural Revolution "are very much on the defensive."[19]

Government, too, is being trimmed and made more professional. Some 40 percent of the National People's Congress, the highest legislative organ, are now engineers and technicians. Of the ministers under the State Council, only two or three held the same job before the decisive third plenum in 1978 which marked Deng's comeback. The new ministers are generally better educated and more professionally competent than the older ones. Local government officials are also being replaced by younger and better educated cadres: during my December 1983 visit to China, American consular representatives in Shanghai reported a notable improvement in the caliber of the younger people now managing that city's affairs.

In the vast countryside, the old communes and the three-tiered system of commune, brigade and production team have virtually ceased to exist as a result of the devolution of economic decision-making to the family. The commune's administrative and political functions have been taken over by the township government—which means that millions of Party cadres at the commune and brigade level no longer have any real administrative responsibility.

In the People's Liberation Army, too, some of the older officers are being retired and replaced by younger, more professional officers; political work is being subordinated to military objectives and the role of the political commissars is being downgraded. There has been a sweeping change of regional and district commanders, and the new commanders all have professional rather than political backgrounds. Deng himself has taken over the crucial post of chairman of the Party's Military Control Commission; he has apparently been successful in placing the Army under the firm leadership of the Party and neutralizing anti-reform opposition which still emanates from some Mao loyalists.[20]

In sum, in the Party, government and Army, there has begun what one China specialist in the U.S. Embassy in Beijing described as the beginning of a "sea change" in the Chinese leadership. The old, semi-educated peasant revolutionaries who went through the Long March and were Mao's most trusted cadres for two and a half decades are giving way to a new generation of younger, better educated, more technically competent leaders. The attitudes and perspectives of the new generation are bound to be quite different from the generation of leaders they have succeeded. Their primary goal will be modernization and development. And they are bound to be more sophisticated and cosmopolitan in their techniques.

In the critical realm of ideology, the post-Mao leaders now strongly denounce Maoist egalitarianism. In the words of an official Chinese publication, "experience proves that egalitarianism is a disaster to the socialist cause, a throttle on enthusiasm for labor and a corrosive agent to the social productive forces."[21]

Even the Maoist emphasis on "class struggle" has been ended. Class labels such as "landlord," "rightist," or "reactionary" are being removed from millions of Chinese and the government has promised to restore these people or their survivors to their previous positions. This implies a halt to the internal turmoil produced by Mao's endless search for class "enemies."

While still insisting on the four unchallengeable principles—Marxism-Leninism-Mao Zedong Thought, the dictatorship of the proletariat, pursuit of socialism, and leadership by the Chinese Communist Party (CCP)—China's new leaders are interpreting this ideology in a much more pragmatic fashion than was the case during the reign of Mao. Deng consistently emphasizes the need to "seek truth from facts," to use "practice" as the sole criterion for truth, and to emancipate the mind from dogma. And the able technocratic prime minister, Zhao Ziyang, has warned that the Chinese must not "bind ourselves as silkworms do in cocoons."

Another important ideological reform is the change in the "faster the better" approach of the Maoists. The pronouncements of all the post-Mao leaders are marked by a sober realism that was unfashionable in the days of the Chairman. Party Secretary General Hu Yaobang characteristically acknowledges that China's economy and culture still lag far behind the most advanced nations and that it could take 50 or more years before China can even approach these nations. Deng warns that the "theory of speeding up" and of setting targets too high was one of the worst mistakes of the Maoist era and led to such disasters as The Great Leap Forward. Indeed, it is common now for Chinese leaders to concede that China missed its capitalist stage of development and that its earlier efforts to plunge directly from "feudalism" into socialism were mistaken. The clear implication is that China must now undergo a slow and historic quasi-capitalist transformation, under the guidance of the Chinese Communist Party, before it can be ready for socialism.

Post-Mao China is also undergoing a legal revolution. Since 1979, an extraordinary number of new laws have appeared; even Western legal specialists have a hard time keeping up with them. A dozen legal journals are now being published and the number of lawyers is growing. Some 1,800 law students are already studying in Beijing University's Law School and more than 20 Chinese law professors are studying in the United States. Prime Minister Zhao has recently called on officials to supervise economic activities by legal means rather than by administrative fiat. The leaders of the People's Republic have denounced the terror unleashed during the Cultural Revolution and begun to lay the bases for a stable legal system.

Of course, the impact of all of these political changes should not be exaggerated. There are no free elections at any level of the political system. Civil liberties in the Western sense are not recognized. Political indoctrination is still a major element of education at all levels. The media are controlled, though more loosely than before. Birth control measures are extraordinarily strict, including forced abortion. The major instruments of totalitarian rule, while weakened, have not been eliminated. Labor camps for political prisoners still exist, and many of the "democratic activists" who were encouraged to dissident action by the loosening of controls in 1978-79 have been jailed. Recently there were showcase executions of substantial numbers accused of various crimes. A conservative Old Guard remains entrenched within the ruling Party and it is fearful that the reform effort may weaken Party control. The experience of Eastern Europe and the Soviet Union cautions that genuine and lasting reform of Leninist systems is extremely difficult because any real relaxation of decision-making authority challenges the vested interests of the ruling Party.

Still, the changes now in progress in China are very great, they have strong popular support, and they go further than many Western observers realize. As Christopher Wren has written: "In four years, Mr. Deng has brought China around to virtually a mixed market economy and opened its doors to Western investment. One official likened his country to a great ship in a storm. It was trying to change course, he said, but it could not do so all at once or the ship might capsize."[22]

VI

Might this happen? While the pace of reform has been impressive, substantial obstacles remain.

First among these is the resistance of much of the bureaucracy. The impetus for the reforms comes largely from the very top leadership. Yet it is the middle and lower levels of the bureaucracy that are responsible for carrying them out.

By decentralizing power and turning it over to professionals and experts, by virtually decollectivizing agriculture, by purging the Party, and by opening up other avenues of reward such as wealth, Deng's reforms threaten the power and prestige of the traditional Party apparatchiks. Much of the resistance within the Party undoubtedly comes from some 15 million of its 40 million members—those who were recruited during the Cultural Revolution in a totally different atmosphere from that prevailing today. They came into the Party as "revolutionary purists," not as overseers of technocratic reform.

There are many indications of bureaucratic resistance. Liu Shaoqi's 1962 essay on Party life has been widely republished and publicized. Much of it warns against lower level Party officials who "don't respect or implement the decisions of the Party's Central Committee" and who "go against the Party Central Committee's policies." When the October 1983 plenum of the Central Committee decided to go ahead with a purge of the Party, it was conceded in the official documents that many Party members resist the new policies and that others feign compliance while covertly opposing the Party line. Others openly refuse to carry them out.[23] How successful that purge has been cannot yet be judged.

A key problem is what happens after the 79-year-old Deng Xiaoping passes from the scene. It is unlikely that either the prime minister, Zhao Ziyang, or the Party secretary, Hu Yaobang, can command the confidence of the Army in the manner that Deng has been able to. Among the higher ranks of the armed forces there must be a heavy industry and defense lobby that will not indefinitely tolerate a consumer revolution that pushes defense to the bottom of the nation's priority list.

If Deng were to die in the near future, it is conceivable that a power struggle might develop, thus introducing a new note of instability into the picture. Already there are noticeable differences in emphasis in the speeches of Party and government leaders. One perceptive observer noted that Hu's speech at the 12th Congress of the CCP in September 1982 was a reassertion of "China's orthodox commitment to promoting communist morality and eventually achieving communist goals at home and abroad," whereas Zhao's speeches typically called for the "pragmatic development of good relations with all countries for the sake of diversifying economic ties."[24] It could be an important factor in Hu's favor that he is one of the few remaining members of the still-prestigious Long March generation.

In a post-Deng succession struggle, there could figure not only Hu and Zhao and the heavy industry/defense lobby, but some of the Old Guard veterans in the Party who yearn for a more streamlined but still highly centralized system. What would be the attitude of the Old Guard in this post-Deng struggle? Would it throw its weight behind the reformers or would it try to put a brake on the reforms or even to reverse some of them? No one can be certain of the answer.

For such reasons, it is possible to understand Milton Friedman's pessimism after a recent visit to China:

I am pessimistic that the progress will be long continued. Opening up the system involves dispersing power and responsibility and that will produce threats to the security of the centralized political apparatus. It is likely to respond by closing down again.[25]

Such pessimism could be reinforced by any observer of reform efforts in other communist systems.[26]

Much then depends on whether Deng Xiaoping holds on. If—and it is obviously a big if—he remains in effective control for another few years, the reform process is likely to be more institutionalized than it is now and therefore more difficult to reverse. By then, too, Deng's self-appointed successors, Zhao Ziyang and Hu Yaobang, should have been able to consolidate their power, especially given Hu's significant grip on the Party's levers of power. Hu is busy moving younger men into positions of authority in the Party. (One of the rising stars is Hu Qili, an articulate protege of Hu and the head of the Central Committee's powerful General Affairs Department.)

On the other hand, if Deng were to die or fail physically in the immediate future, a struggle over the present ideological direction and for power could well erupt, and the fate of the reformers would be much more uncertain.

VII

Apart from the leadership situation, there are other reasons to be cautious about the future. First, while the changes so far constitute a thoroughgoing de-Maoization of the system, it is still not clear how far the reform coalition intends to depart from the orthodox Soviet economic model. The true tests lie ahead. Will the Chinese move further in the direction of trying to create a market socialist economy of the Hungarian or Yugoslav variety, or will they tightly restrict the market forces they are beginning to unleash? There is still no coherent strategy for combining Plan and market and the problems of running a mixed system are bound to be enormous.

Indeed, the present situation is unstable. China's economic system is just beginning to experiment with market forces. At some point a decision will have to be made whether to go forward or backward. To go forward on this road, it will be necessary to have a real price reform so that prices are a true indication of market value. One almost inevitable step would be the removal of many of the subsidies that now protect urban workers from higher prices for relatively scarce commodities. This in itself could have serious consequences, along with added unemployment stemming from the closing of enterprises now preserved by the arbitrary price structure. Price reform is also bound to lead to inflation—in a country where the old generation still remembers the wild inflation of 1948 which contributed to the downfall of Chiang Kai-shek.

The new reforms are bringing with them a host of serious social problems. In the countryside, the agricultural decollectivization risks polarizing a new class of richer peasants and the great majority of poor peasants. Already there are reports of rural gangs stealing the crops of richer peasants before they are fully ripe, so that they can be sold on the free market. There could also be growing unemployment in the countryside. More than a hundred million of China's 800 million peasants are considered by many experts to be surplus laborers who were, in fact, subsidized by the old "iron rice bowl" of the commune system. Many of these poor peasants, now without sufficient productive assets to exploit the new opportunities, could flock to the cities and become a source of serious political unrest. Such migration is already visible and the government has had to enforce ever stricter regulations to arrest it.

Regional tensions may likewise grow. The provinces and regions most likely to benefit from decentralizing reforms will be pitted against those least likely to benefit. The latter will call for more centralization or other forms of support. These interregional disputes will inevitably be translated into competing priorities at the higher levels of the Party.

The Party's stringent efforts to limit families to only one child are also likely to fuel discontent, particularly in the countryside where more children traditionally mean more work hands and more income.

Tensions are also growing between some of the more affluent rural areas adjacent to urban centers and nearby urban workers and intellectuals who feel they are not keeping up with recent increases in peasant income. Rich peasants are, for example, now coming to Shanghai as tourists and arousing the resentment of urban workers who have yet to benefit as much from the reforms.

Economic progress has been highly uneven: in particular, the industrial reforms have been much more disappointing than those in agriculture. With a few notable exceptions, labor productivity has yet to show much improvement. Indeed, it actually declined in 10 of 15 industries in 1981.[27]

There are many reasons for this. Efforts to tie pay to performance have been vigorously resisted by Chinese workers who for years have been accustomed to a relaxed pace of work. All work standards were abolished during the Cultural Revolution, and the prolonged austerity of the Maoist years took a terrible toll on workers' motivation. Managers do not want to antagonize workers and so distribute bonuses more or less evenly regardless of individual output.

If labor productivity within the enterprise has not shown much improvement, neither has enterprise efficiency. Large numbers of state enterprises continue to lose money and the Chinese media increasingly voice their concern over such losing enterprises. According to one recent article in the Chinese press, enterprises engaged in handling meat, eggs and vegetables throughout the country lost 1.1 billion yuan in the first half of 1983.[28] According to another, the number of enterprises suffering losses in 1983 increased by 200 in a single province.[29]

A basic reason, to repeat, is the irrational price structure. Because prices in China do not reflect supply and demand, but are set arbitrarily by the State, profits in industry result more from accidents of the pricing system than from good or bad business practices.[30]

Accordingly, some Chinese economists are now calling for more thorough reform of the price structure, and modest steps in this direction have already been taken. But the official line on this point remains very cautious: "At present a high level of concentration of the power of price administration is necessary to ensure basic balance in finance and credit. And basic stability of commodity prices is necessary in order to overcome the temporary difficult situation in finances and the economy. But when the situation basically changes for the better, when the hidden danger is eliminated, power should be appropriately decentralized."[31]

In sum, there are many uncertainties about the future of reform—ranging from the unpredictability of the leadership situation after Deng, to the powerful new social tensions that are being generated by the reforms, to the vested interests in China that are harmed by reform.

VIII

Despite these uncertainties, I believe that it is possible to be cautiously optimistic about the future of reform.[32] First, as Barry Naughton has put the case:

What is most significant is that the reform movement has been sustained for five years, and the response of the regime to succeeding waves of new problems has not been to abandon the reform process. Instead, important new roles for market forces have been found, a major financial decentralization has occurred, and steps towards a more appropriate price system have been taken. If the Chinese are able to build upon these achievements and accelerate the pace of reform, we may begin to see fundamental changes in the behavior of China's managers and workers.[33]

Second, the post-Mao leaders introduced such drastic reforms not so much because they were ideologically committed to reform as such, as because the system was an economic failure and they wanted to restore popular faith in the Communist Party's ability to modernize China. The whole reform process must be regarded as a response to a perceived crisis of stagnation which, sooner or later, would have undermined the very basis of Communist power.

The conditions which gave rise to the need for reform in China will not quickly disappear. With a per capita income of $250 per year, China remains one of the poorest countries in the world. At the same time, the Chinese people have access to mass communications and are therefore increasingly aware of the much higher living standards outside China—especially in Hong Kong, Taiwan and Southeast Asia, where millions of overseas Chinese live. Unless this growing "political awakening" on the mainland is accompanied by sustained material progress during the coming decade or more, the consequences for the Party could be ominous. Time and again, when I asked Chinese officials on my recent trip just what would prevent a sharp reversal of the reforms, they responded that the population itself would not tolerate it.

Another reason for cautious optimism is the mounting evidence that the present leadership in China is committed to making the reforms irreversible. Perhaps the best recent indication of this is the lengthening to 15 years of the peasants' contracts under the responsibility system. This long-term commitment to de facto decollectivization will be especially difficult for any future leadership to reverse.

This and other reforms have already developed a momentum of their own, so that they could not be undone without risking major instability. The reform process itself has already created many vested interests of its own, from peasants to provincial Party leaders to reform economists.

Moreover, the cost of pulling back grows with every passing year. A good example of the difficulties of retreat is the recent fate of the "spiritual pollution" campaign, designed to check corrupting foreign influences. Quite possibly that campaign was designed to appeal to leftover Cultural Revolution adherents and old-line conservatives—even as the Party purge got under way directed against just such elements. But, after inaugurating this campaign in October 1983, the leadership was soon forced to keep it out of the countryside, then to issue rules confining the campaign to certain abuses such as pornography, and finally, to eliminate it. The quick demise of the "spiritual pollution" campaign was probably forced on the elite by the fear that if it was not brought under control it would interfere with economic development. In the Maoist era, or even a few years ago, such a campaign could have been continued indefinitely. But in an era where the leaders are committed to raising living standards and improving the economy, such campaigns soon turn out to be counterproductive.

Then, too, it is difficult to imagine the circumstances which might precipitate a wholesale reversal of the reforms. Certainly a threat to Party power would lead to such a radical reversal. But the Party quickly stamped out the activists who wanted a genuine democratization of the political system in 1979-80; it is unlikely that dissidents will be able to mount an effective challenge to Party rule in China at any time in the foreseeable future.

Still another reason for cautious optimism is that the reforms are producing results and seem likely to lead to further economic growth. Vice Premier Yao Yi Lin recently announced that the economic situation in 1983 was the best since 1978. If the reforms continue to be accompanied by substantial and sustained growth, it will be very difficult for reform opponents to quarrel with success.

It is also possible to exaggerate the degree of resistance to the reform effort from the Party. The Party itself is not a monolithic entity. At the top, there are many people committed to the reform effort. Even among the so-called Old Guard, there are probably many leaders who want reform so long as it strengthens the economy and does not drastically weaken Party rule. Some of the provincial Party leaders from richer provinces must favor the reforms. So too must some of the enormous numbers of Party cadres in the rural areas, many of whom will now be able to become relatively wealthy farmers. Indeed, they are in an excellent position to become affluent simply by cooperating with, and guiding, the reform effort.

Within the Army, too, there is a group that is evidently committed to Deng's idea that the Army cannot be modernized until the economy itself is modernized and that this must therefore take first priority. Some Army leaders are therefore in favor of developing a Chinese electronics industry, and of developing exports in order to pay for imported foreign technology.

One day, too, the Chinese will reap the huge benefits to be extracted from their impressive oil and coal reserves. The oil and gas prospects on China's continental shelf are very promising and a number of foreign oil companies, including several American companies, are now exploring these reserves. Although some of the hopes and guesstimates of a few years back have turned out to be exaggerated, six large basins with oil and gas deposits have already been discovered and foreign petroleum experts now estimate that China's oil reserves total 30 to 100 billion tons.

China is rich in coal reserves. The construction of new mines, also with foreign assistance, is now at the level where coal production could soon reach more than 700 million tons per year and thereby outstrip the annual coal production both of the United States and of the Soviet Union. The Chinese intend to use coal as their main domestic energy source while exporting most of the petroleum in order to finance future imports and technology.

The Chinese will also profit from strong foreign exchange reserves and a super-cautious borrowing policy. Unlike many less-developed countries which are heavily in debt to foreign banks, the Chinese have lined up some $13 billion in commercial credits over the past few years but have used less than ten percent of this total. Thus, in the future, China will be an excellent candidate for loans from foreign banks and world financial organizations at medium or low interest rates. This is why China joined both the International Monetary Fund and the World Bank several years ago.

The present international context is also conducive to reform in China. The Chinese have begun to reduce tensions with the Soviet Union and there is every reason to believe that this limited détente with Moscow will continue through the 1980s, even if it is unlikely to lead to a fundamental rapprochement.[34] A large-scale renewal of fighting with Vietnam is unlikely. And China's relations with the West in general are now better than they have been for three decades.

In their efforts at reform, moreover, the Chinese will be able to learn from, and interact with, what one observer calls a number of "external reference economies"—which, it should be noted, are not culturally threatening to China in the same way that Western Europe was, and is, culturally threatening to the Russians.[35] The Chinese will be able to benefit from the development experience of Japan, Taiwan, Hong Kong and the other Pacific "success stories." And, increasingly, China can turn to a large overseas Chinese community with modern skills and capital that can be made available to assist mainland development. Already some 80 or 90 percent of the investment in the special economic zones comes from overseas Chinese.

By contrast, there is no deep loyalty to the orthodox Soviet economic model. It has been undermined by the heritage of Russian imperialism against China and the progressive discrediting of Leninism as an economic development strategy.

An accurate reading of Chinese history during the past century and a half might also lead to optimism. The key Chinese concern, as John Fairbank noted over a generation ago, has been a search for the proper route to a Chinese modernity in response to the Western challenge and to powerful indigenous forces demanding change.

One group of China specialists has identified four camps in this century-old struggle: the militant fundamentalists who seek strict isolation from alien influences; the radical conservatives who seek to preserve the essence of China but with selective borrowing of Western technology; the eclectic modernizers who are somewhat more tolerant of a Western presence in China; and the Westernized Chinese who seek to pursue national greatness by seeking alliance with, and dependency upon, a Western country that is to be emulated.[36]

As of the mid-1980s, the militant fundamentalists as represented by Mao and the Cultural Revolutionaries have been thoroughly discredited. The strategy of emulating either the United States or the Soviet Union, or of allying with either, likewise seems to have been conclusively rejected. It is therefore likely that the future belongs to some balance between "radical conservatives" and "eclectic modernizers," groups that differ in degree but are broadly prepared to accept a certain degree of liberalization and a significant Western presence in China, while seeking a path of modernization compatible with Chinese values.

In expressing cautious optimism about the future of reform in China, I do not mean to suggest that there will be a straight path ahead toward greater liberalization. On the contrary, there has been some recentralization of economic decision-making in the past year or two and the future path of reform is more likely to be checkered than consistent. There is, after all, no magic formula which can, in the short space of five years, cure an economic organism ruined by several decades of Maoist totalitarianism.

Nor is it realistic to believe that a largely peasant country with a long semi-feudal, hierarchic, bureaucratic and Leninist tradition is going to blossom into a more open society without a great deal of resistance. My expression of cautious optimism simply means that I do not believe that the reforms adopted so far are likely to be reversed. What is more problematic is whether the reforms will be steadily expanded over the long haul.

There is, however, no realistic alternative to some reform and to keeping the door open to the West, so that China can benefit from infusions of Western technology. Any other course of action—a return to Maoism self-sufficiency or an increase in greater repression of a "Stalinist" variety—would almost certainly have a disastrous impact on economic productivity.

The post-Mao Chinese leaders are therefore likely to continue cautiously on the path of reform in an effort to achieve economic modernization, while trying in a variety of ways to limit the unwanted political and social side effects of reform.

IX

Finally, what is the significance of the Chinese reform effort for the West?

Of course, the West should not delude itself about the likely consequences of these reforms. A modernizing China under a Communist Party—no matter how far it goes down the path of reform—will be independent in world affairs and not a Western ally; it will remain highly authoritarian; and its interests and values will conflict with those of the West in many areas.

Still, the present trends in China are very hopeful. What has happened in China during the past five years would have been considered unimaginable if it had been predicted a decade ago when China was in the throes of the Cultural Revolution. Already the post-Mao leaders have demonstrated in five years a much greater flexibility in tampering with their Leninist system than the post-Stalin leaders in the Soviet Union have shown in three decades.

China is now in the process of becoming a more open society. Decentralizing, quasi-market reforms, if they continue, are bound to produce a more liberal political and social climate in China, as they have already done in Hungary, the most liberal of all the East European Communist bloc nations. Such reforms inevitably alter the balance between state and society in favor of the latter. The intellectual and legal revolutions, as well as the "open door" policy, will also stimulate a more liberal trend within China.

A China committed to reform will also continue to be a China with a strong interest in peace and stability abroad—because a reforming China needs a peaceful and stable international climate. Such a China is also more likely to be less xenophobic and therefore more pragmatic on some of the currently most sensitive national issues such as the future of Taiwan and of Hong Kong.

A reformist China will also want to continue its "open door" policy and to develop substantial new trade and cultural ties with the West. Such a China will want also to be increasingly drawn into the new Pacific Community that is emerging in the Far East. All of these developments will increase China's incentives for a long-term relationship with the West and diminish the incentives for any fundamental rapprochement with the Soviet Union.

The West now has a unique opportunity to try to inject ideas into the continuing Chinese dialogue on what is the proper model for China to follow. During the past decade, the deep ideological—as well as economic and political—crisis in China has affected the elite, the bureaucracy and the whole population. As a result, China is looking abroad for new ideas and models to a much greater extent than ever before in recent Chinese history. Many East European reform economists have been invited to China to discuss Eastern Europe's experience with quasi-market, socialist systems. A number of Western economists have participated in a variety of discussions with their Chinese colleagues. The Chinese are eagerly studying Western management techniques. And Party Secretary Hu Yaobang is reported to have read widely about the Meiji reforms in Japan during the middle of the nineteenth century.

Finally, if the Chinese reforms do prove to be successful over a longer period of time, they could have a significant impact on some future generation of Soviet leaders. This is more likely to be the case if reformist China and reformist Hungary develop more rapidly than the more orthodox Soviet and East European communist systems.

For all of these reasons, therefore, it is in the West's interest to help China along its present path of modernization.

It is also important for the West to view what is now happening in China in historical perspective. When Premier Zhao Ziyang recently arrived in the United States for conversations with President Reagan, a number of commentators observed that this Chinese Communist leader was cut from a different cloth than many of the Chinese leaders with whom Americans had been familiar in the past. Zhao was the consummate technocrat, a capable administrator, a man with a graceful style and enough worldliness to shed the gray Mao uniform for a Western coat and tie.

What went unremarked was what Zhao symbolizes. China is still in the throes of a historic transition that first began in the middle of the nineteenth century when it was shaken by the incursions of Western imperialism. The early Republican, the Kuomintang and the Maoist effort to modernize China all failed. China is now setting out on a new course. For the first time since 1949, the revolutionaries are being replaced by the modernizers. And to modernize, China now requires a long period of external peace and internal stability.

For the West, one key to good long-term relations with China can be found in a common strategic interest in opposing Soviet expansion. But, in addition to this strong negative bond between China and the West, there is now opening up an equally strong positive bond—a liberal trend within China and China's need for much greater Western participation in its modernization program. This was the principal message delivered by Zhao Ziyang when he visited the United States in January. A positive U.S. response to this hope should be in the message that President Reagan carries with him to China in April.

Taken together, these two bonds between China and the West—one negative, the other positive—offer the hope of building a partnership strong enough to absorb the basic differences over Taiwan. Properly nurtured on both sides, it could carry into the twenty-first century, when China is almost certain to take its place among the major world powers.

[1] On the economic reforms, a particularly useful recent treatment is a series of articles under the heading "China Rethinks its Economic System," The China Business Review, November-December 1983, especially the essay by Robert F. Dernberger, "The Chinese Search for the Path of Self-Sustained Growth in the 1980s: An Assessment," pp. 19-77. A detailed and objective assessment as of 1982 was done by the Joint Economic Committee of the Congress, China Under the Four Modernizations, Washington, D.C.: U.S. Government Printing Office, August 13, 1982, Part 1. On agriculture, the most complete and authoritative recent treatment is Nicholas R. Lardy, Agriculture in China's Modern Economic Development, New York: Cambridge University Press, 1983.

[2] See "Party Document on Rural Work," Beijing Review, February 20, 1984, p. 6.

[3] Lardy, op. cit., pp. 88-89.

[4] See The Wall Street Journal, May 16, 1983, p. 31. It is worth noting that Stephen Cohen's classic work, Bukharin and the Bolshevik Revolution (New York: Vintage Books, 1975), has been translated into Chinese.

[5] Wharton Economic Forecasting Associates, as cited in The China Business Review, loc. cit., p. 13.

[6] Cited in Orville Schell, "A Reporter At Large," The New Yorker, January 23, 1984, p. 67.

[7] Lardy, op. cit., pp. 3-5. 

[8] The Wall Street Journal, October 26, 1983, p. 1.

[9] See Barry Naughton, "Industrial Management," The China Business Reviewloc. cit., pp. 14-18.

[10] See William A. Fischer, "R & D in China," The China Business Reviewloc. cit., pp. 30-34.

[11] Dernberger, loc. cit.

[12] The China Business Review, loc. cit., p. 4.

[13] Michael Weisskopf, "China Cracks the Iron Rice Bowl," The Washington Post, December 31, 1982.

[14] Audrey Donnithorne, "Fiscal Relations," The China Business Reviewloc. cit., pp. 25-27.

[15] Schell, loc. cit., p. 45.

[16] Lardy, op. cit., p. 41.

[17] The New York Times, January 29, 1984, p. 1.

[18] It is worth noting that in the 11 years of the Sino-Soviet Alliance, from 1950 to 1961, only some 8,000 Chinese students studied in Moscow. Almost none went elsewhere.

[19] On the political changes, two particularly good sources are William deB. Mills, "Generational Change in China," Problems of Communism, November-December 1983, pp. 16-35, and Kenneth Lieberthal, "Reform Politics," The China Business Reviewloc. cit. footnote 1, pp. 10-12. For a skeptical view of China's political situation, stressing particularly the continued strength of the Old Guard, see Chalmers Johnson, "East Asia: Another Year of Living Dangerously," Foreign Affairs, America and the World 1983, pp. 731-38.

[20] Ellis Joffe, "Party and Military in China: Professionalism in Command?" Problems of Communism, September-October 1983, pp. 48-63.

[21] Yan Ling, "The Necessity, Possibility and Realization of Socialist Transformation of China's Agriculture," Social Science in China, Vol. III, no. 1, p. 116. (This is published by the Chinese Academy of Social Sciences, with which the author is associated.)

[22] Quoted in Wren, "Given a Choice, Chinese Prefer Cabbage to Ideology," The New York Times, September 20, 1982, p. 2.

[23] Amanda Bennett, "China Party Plans Drive to Purge 'Unfit' Members," The Asian Wall Street Journal, October 17, 1983.

[24] Carol Hamrin, "China Reassesses the Superpowers," Pacific Affairs, Summer 1983, p. 228.

[25] Cited by Dernberger, loc. cit.

[26] A recent conference in Milan of experts on the Eastern Bloc reached the conclusion that most attempts at reform in Eastern Europe over the past two decades had failed, except in Hungary. An important factor was the Party's fear of the political cost of economic and social reform. See Keven Devlin, "Are the East Bloc Regimes Reformable? Italian Leftists Ask," New York: Radio Free Europe Research Report, November 11, 1983.

[27] Andrew Walder, "Rice Bowl Reforms," The China Business Reviewloc. cit., pp. 18-21.

[28] Beijing Renmin Ribao (People's Daily), in Foreign Broadcast Information Service, Daily Report, China, November 23, 1983, p. K 11.

[29] Fujian Ribao, FBIS, Daily Report, China, November 1, 1983, p. O 3.

[30] Steven B. Butler, "China Needs Broad Price Reforms," The Asian Wall Street Journal, December 19, 1983, p. 10.

[31] Cheng Yao, "An Inquiry into the Reform of the Price System," People's Daily, in FBIS, Daily Report, China, November 10, 1983, p. K 18.

[32] There are some writers who are optimistic about China no matter what course China takes. I was not among those who were optimistic about Maoist China, as is indicated by an article I wrote nearly 10 years ago, "China By Daylight," Dissent, Spring 1975.

[33] Naughton, loc. cit.

[34] Donald S. Zagoria, "The Moscow-Beijing Détente," Foreign Affairs, Spring 1983, pp. 853-873.

[35] Chalmers Johnson, "What's Wrong with Chinese Political Studies?" Asian Survey, October 1982, pp. 919-933.

[36] Michel Oksenberg and Steven Goldstein, "The Chinese Political Spectrum," Problems of Communism, March-April 1974, pp. 1-13.

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  • Donald S. Zagoria is Professor of Government at Hunter College and at the Graduate Center of the City University of New York. He is also a Research Fellow at the Research Institute on International Change, Columbia University. He has visited China three times since 1972, most recently in December 1983. The author is grateful for conversations with many China specialists in the diplomatic and journalistic communities inside China, and to a number of China specialists in the United States for criticisms of drafts of this article. The author, of course, remains responsible for his interpretations and views.
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