Unifying and controlling China means first and foremost unifying the Han
and controlling the means of agricultural production and distribution. This has
played out as the establishment of a very strong, centralized regime at the
beginning of any given dynasty. This unifying power maintains tight control to
avoid allowing any challenge from local ethnic minorities or regional rivals.
But the geographic core of China is not entirely secure: The sedentary Chinese
agricultural society is surrounded to the west and north by vast plains and
plateaus easily traversed by enemies, and at the other end of these plains and
plateaus were skilled nomadic horsemen. Securing the Chinese core also meant
securing the routes of approach, in other words, conquering or at least
subduing the buffer states of Tibet, Xinjiang and Mongolia. And this required
the expansion of Chinese territory.
China’s vast territory meant that, for the most part, it had nearly all
the natural resources it needed. When China sought to move beyond subsistence
to economic growth, however, it required trade. Much of this trade
traditionally was carried out along the old Silk Road routes; the importance of
these routes can be seen in the various historical maps of Chinese dynasties.
Even when Chinese borders have receded back to the core, they often still
included nominal control over the long, thin paths through Xinjiang on to
Central Asia. Power and wealth grew along the trade routes, and the central
government had to be vigilant to avoid losing control. The isolated nature of
the land trade routes, however, also meant the center had to rely on local
authorities to provide security and collect taxes and fees. This created a
dual-reliance structure, where the central government was reliant on the local
authorities, but the local authorities had to be careful not to overstep their
bounds or find themselves countered administratively or militarily by the
center.
Things grew much more complex when industrialization shifted the
balance, and coastal trade became the key route for the accumulation of
national wealth. China had many troubles with the Silk Road route, but it did
manage to reinforce control through expansion of territory. The more powerful
navies of Europe (and eventually Japan and the United States) dominated coastal
trade, however. The Europeans outgunned the Chinese army and navy, and thus
outsiders set the terms for Chinese economic interaction with the outside
world. To increase national security and strength, the center needed to take
advantage of the new trading paradigm. But trading ports were concentrated in
the southeast, both for geographic reasons and to try to insulate the central
government from foreign encroachment.
This isolation of the central government meant several layers of
bureaucracy lay between the center and the foreign trading partners, which left
responsibility for dealing with foreigners to the bureaucracy and local
governments. Through this control of trade, the southeastern local governments
and elite eventually obtained more and more power. But they did not use this
power to rise against the center, as they still relied on the center to provide
other services, like national security. The center, meanwhile, relied on the
local elite for money to redistribute to the poorer but more populous interior.
The trade patterns created an economic imbalance, a regional competition
for wealth that the center was responsible for managing but unable to fully
control. Too much central pressure on the wealthy trading regions along the
coast could disrupt the flow of money desperately needed to quell social unrest
in the interior and to strengthen national defense against more industrialized
nations. The center found itself stuck between the rising dissatisfaction of a
poor but heavily populated interior being left behind economically and an increasingly
autonomous and self-serving coast that was the only source of revenue needed to
appease the interior.
The center became a hostage to geography and trade patterns. Its only
options were to cut trade and plunge China into poverty, though at least
unified poverty, or to accept the decentralization of power and hope that
things could be kept under control until the country could develop the
industrial capacity to counter its overdependence on trade and rectify its
geographic economic disparities. The power of the wealthy elite usually meant
the center chose the latter option, but this left the central government
weakened and susceptible to shock. As throughout Chinese history, in the late
19th and early 20th century, the devolution of power and strong disparity of
resources and wealth signaled the beginning of the end of a dynasty. External
forces could now overwhelm the fragile system, sending the country into
political chaos until a new strong central leadership could re-emerge, unify
and consolidate power — and begin the cycle all over again as the center began
relying on spreading bureaucracy to manage the diverse and dispersed
population.
This cycle thus has repeated itself in the modern era. The collapse of
the Qing Dynasty in the early 20th century reflected the steady degradation of
central power and control as the coastal provinces became more connected to the
needs of the merchants and their foreign trading partners than to the interests
of the inland peasants. The Nationalist government that briefly held power
(though it never exerted full control over China) was closely tied to the
business elite along the coast. Mao tried to rally these same elites to foment
his revolution, but failing that, moved to the interior. There, he raised an
army of peasants, exploited the clear sense of socio-economic imbalance, and
emerged victorious to found the People’s Republic of China (PRC) in 1949.
Like the beginnings of dynasties in the past, Communist China began with
tight centralized control, this time focusing on the interests of the
peasantry, the redistribution of wealth, and the reclamation of the buffer
territories in the west. Attention was also turned toward Taiwan in the east,
but any military attempts to finally quell the Nationalist forces that fled to
the island were sidelined by the outbreak of the Korean War. The balance of
power after the U.S. intervention left mainland China without any real
opportunity to seize Taiwan thereafter. Beijing recognized the need to maintain
power over the large nation, but wanted to avoid the pitfalls of a large-scale
bureaucracy. Instead, it focused on the commune system in a bid to exercise
administrative control without (at least in theory) an overly powerful
bureaucracy.
Once again, it became clear that China could be fairly secure and
isolated from global interactions (in this case the early moves of the Cold
War) only so long as it was willing to remain poor. But many among China’s
elite were not willing to be poor, and even Mao recognized the need to increase
the standard of living and spur production to keep China from falling too far
behind the rest of the world. The Great Leap Forward (GLF) represented an
attempt to kick-start economic growth without weakening central authority or
exposing China to the influences and intervention of the outside.
In the face of growing economic decentralization and political
competition, next Mao launched the Great Proletarian Cultural Revolution, or
simply the Cultural Revolution, which, beginning in 1966, harnessed students
and peasants to target anything deemed even remotely bourgeois or elite by
radical ideology.
The subsequent chaos, and the death of Mao, paved the way for Deng
Xiaoping’s massive reversal of China’s economic policies. The Economic Opening
and Reform program, beginning with a few select localities in 1978, threw
economic initiatives down to the provincial and local governments. It made
economic growth a top priority for political advancement. The idea was that
though some would get rich more quickly than others, the rising tide would
eventually lift all boats. By some measures, this was accurate, and both urban
and rural per capita gross regional product did rise. But rather than rising
across the board, the cities began rapidly outpacing the countryside, leaving
the peasants behind.
Once again, China was creating a polar system, with economic activity
and growth largely concentrated along the east and southeast coast, and the
interior left lagging far behind. Under former President Jiang Zemin and
current President Hu Jintao, different efforts were mounted to address this
imbalance. Jiang’s attempt at reallocation of resources by fiat, the so-called
“Go West” policy, saw little progress, due both to institutional resistance and
geographic realities. (While a factory may be able to make cheaper Christmas
ornaments in far inland China, the higher transportation costs eliminate that
advantage.)
Current President Hu, has sought to regain some control over the
economic devolution of power, targeting key industries like steel, coal and oil
(with limited success thus far). Hu has also pursued the “Harmonious Society”
initiative, which aims to address the socio-economic disparities that the
continued decentralization of economic control has exacerbated. This program
has been met with plenty of lip service, but little action when it comes to the
wealthier regions sacrificing their industry or revenues with less fortunate
regions.
The Decentralization Cycle and
its Impact Today
Reclaiming centralized economic control is not easy, despite central
recognition of the critical need to address the widening disparities across
economic regions and the attendant social instability such disparities can
stir. The devolution of power, which allowed rapid growth since the economic
opening three decades ago, has become an entrenched element of Chinese
administration. And as always in Chinese history, the interests of the local
officials do not always coincide with central interests. At the same time, the
center is unwilling or unable to take too strong a stand against the regional
leaders. Beijing fears such action could undermine China’s economy and links to
foreign investments and trade, trigger stronger local resistance or unrest, and
start to pull down central government officials, who have links through the
webs of power down to the regional and local levels. The pattern of bureaucracy
accumulating more power at the expense of the center thus continues.
Significantly, the current decentralization primarily relates to
economic power, not political power. The Communist Party of China (CPC) has
been the unchallenged central authority since the founding of the PRC in 1949.
The structure of government and political affairs ensures this. Party and
government functions are often highly intertwined, to the point of overlapping
roles (Hu is both president of China and general secretary of the CPC; he also
serves as chairman of both the government’s Central Military Commission and the
Party’s Central Military Commission, in reality, the same commission with two
different entities to which it must report). This means that while the local
leadership may resist economic dictates from the center if they are not
conducive to local interests, at the same time, they are not challenging the
central authority of the Party. In fact, they are all members of the same
party, or on occasion members of one of the smaller “democratic” parties that
are themselves in existence only so long as they support fully the central rule
of the CPC.
This Party-state system in the form of two-tier leadership reaches from
the top echelons all the way down to the local governments (and even into the
state-owned enterprises). Beginning at the provincial level, the party-government
dual administrative system is arranged hierarchically. A Party chief at each
level holds policymaking authority, while his administrative counterpart
(governors, mayors and the like) is responsible for implementing the policy and
coordinating the local budgets. In this manner, the Party secretary is often
more influential and important than the governor or mayor he serves beside. A
good example is Bo Xilai, Party secretary in
Chongqing, a city being used as a testing ground for new economic and social policies.
One rarely hears of Bo’s counterpart, Chongqing Mayor Wang Hongju.
In part this is because Bo himself is somewhat of a celebrity, but it is more
so because it is the Party secretary who is guiding policy, not the mayor.
In practice, government and Party officials at each level (from province
down through the township in most regions) are appointed by the level one step
higher. Such institutional arrangements mean local government and Party
officials are only responsible to the officials directly above them in the
hierarchy, and not to the people they govern. Local governments are rewarded
for their economic growth, and thus encouraged to develop their local
economies, but this development is rarely designed with any broader national
efficiencies or needs in mind. In short, local governments are unintentionally
induced to pursue overinvestment and duplication of industry on a national
level, because their policies are focused on local growth and personal
self-interest.
The lack of an effective accountability and supervision system in the
political structure further exacerbates this situation. Local officials
frequently hold near-absolute power within their jurisdiction, and the drive
for economic growth and the personal power relationships spawn rampant
corruption and nepotism. Distrust of the Party at the local level due to
corruption and lack of accountability threatens to weaken support for the Party
in general, a major concern for the central leadership.
Further complicating matters, personal relationship networks (guanxi)
are often as important as Party and government dictates and regulations in
determining policy promotion and application. These close webs of relationships
serve by default as a check to any major political reforms, or even to
initiatives to clean up corruption or try to regain centralized control. Just
as the lower-level officials rely on their performance reports and the good
graces of those above them, so too do the higher officials increase their own
relative power and influence if those in their network below them are seen to
perform well, particularly in regard to economic growth or quelling dissent.
These chains are not only vertical: Horizontal relations are built to
protect against possible factional fighting or purges. This further complicates
any bids at institutional reform, or even cracking down on local corruption (a
frequent trigger for localized social instability). This is because
investigations easily can move through the networks of relationships and come
back to strike at the initial instigators of the investigation, or at least
their close allies.
These interlinking networks of guanxi also insulate local officials from
stronger action by Beijing to implement more centralized economic controls.
Shutting down a steel mill in one city to rectify inefficiencies across the
whole sector may make sense from a macroeconomic viewpoint. But the personal
links from the local steel mill manager through his local party officers up
through the provinces and into the national level means there are many
potential individuals along the way with an interest in not undermining the
specific local economic interest, even if the local interest does not mesh with
a national initiative.
Central government macroeconomic policy pronouncements often fall on
deaf ears at the provincial or local levels (even within major state-owned
enterprises, like the oil companies). It is one thing to call for a
consolidation of the steel industry to make it more profitable; it is quite another
for a local official to agree to close the steel plant in his jurisdiction and
lose the profits and kickbacks as well as have to deal with the newly
unemployed workers. With population movement between provinces, and even
between cities within a province, still highly restrained by the household
registration system, it is not easy to shift populations to follow jobs.
Instead, jobs must be created and maintained for populations.
And this is a major dilemma for Beijing. To manage China, the center
must shift a fair amount of administrative and fiscal responsibility to the
regional and local level. But this leaves the local leadership more closely
tied to its own local interests than to those in other provinces. And at times,
this means a local government is more attuned to the interests of a foreign
investor or market than to other Chinese provinces, or even the central
government.
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