Millennium Post

Is China burying Chairman Mao?

China is on the cusp of something new. Major initiatives including a relaxation of the one-child policy, the elimination of the repressive ‘re-education through labour’ camps, and a number of reforms, including that on taxation structures and state-owned enterprise systems, have been brought in. A four-day session of the Third Plenum of the Chinese Communist Party’s 18th Congress brought on a blizzard of targeted reform pledges, that answer a number of questions raised earlier by economy and policy watchers. President Xi Jinping and premier Li Keqiang have together, it would seem, ushered China into a new era of political and economic advancements, setting aside the older, insular approach and embracing a more open attitude towards the global community at large.

President Xi and his six colleagues on the Politburo standing committee have laid bare a thorough understanding of China’s structural economic and social problems. They have shown political muscle to push reforms, leaving behind the fetters of big state-owned enterprises (SOEs), as well as government and other interest groups who, in the past, had staunchly refused to embrace change.
However, the 60-point policy reform that was ushered in this past November, proposes sweeping changes and an ‘ambitious agenda to restructure the roles of the government and the market.’

China is well on its way to become, from the earlier investment-led growth model, to an economy that is driven by conspicuous consumption, somewhat in the lines of the other Western capitalist countries, although still not limiting its government’s role as much as in several other global powers.


One of the 60 reform measures likely to have immense socio-cultural impact and meaning is the relaxation of the 1979 policy of allowing couples to have just one child. This controversial ruling contributed to falling birth rates in the country, obviously an effort towards controlling the bulging population growth, but resulted in a skewed demographic ratio tilted unfavourably against its youth. With the ageing population increasing and workforce going down, China, under Xi, decided to adapt the norm and allow having more than one child to prop up the demographic balance.


Xi’s first year in office has been a relentless flurry of activities to redefine China in the light of current economic realities.  Xi unleashed a bold anti-corruption campaign, and that along with the reform programme, catapults him to the level of a visionary, who’s directly challenging the legacy of Chairman Mao. Evidently, Xi is a bolder and more experimental leader than his predecessor Hu Jintao, since he aims to redefine the basic functions of market and government. Xi is already looking at carving a historic role for himself, and despite being a ‘princeling’ who had spent his youth years in the labour camps, the current president has abolished them. Clearly, Xi sees himself as China’s most significant leader since Deng Xiaoping, who is reconfiguring the bureaucratic machinery and bringing about systemic changes.

China is still at a stage where economic development is the main objective and the government is working to orchestrate a perfect balance between allowing market forces to function and giving them a say in deciding on resource allocations. This partial withdrawal means that the Xi government would now focus on ‘macroeconomic management, market regulation, public service delivery, supervision of society and environmental protection.’

Although over the last two decades China has brought in radical changes, deregulating most of its product markets, which has led to huge economic expansion, it had hitherto kept crucial resources under its thumb. Capital, energy and land had been the government’s pet areas, especially in deciding who should get those inputs and at what price, thereby benefitting the state-owned enterprises far more over other private players and eliminating significant competition.


China, however, has also ensured a wider ambit of rights for its enormous farming community, granting its rights to ‘posses, use, benefit from and transfer their contracted land as well as the right to use their land ownership as collateral or a guarantee.’ Since the Chinese government is the present owner of all land, with the farmers having merely having the permission to work the soil in their area, this ruling is likely to impact millions of dispossessed agricultural labourers, who have been living a life of grueling hardship. The Xi government is encouraging urbanisation in its bid to drive the consumption-led economy which it is currently engineering. Hence, the land reform that the government has brought in will prop up the sagging housing sector in the country, with private ownership now a significant part of the new economic model.


Surely Xi’s is an expansive and ambitious project, but can he succeed in his grand design? Can he overcome the systemic oppositions from SOEs, smaller governmental units, mega public business houses and the tycoons who control the current state-driven capitalist system in China? The old system is still entrenched and it will take time for the president to adequately implement the reforms, since the interest groups have become more powerful in the absence of strong central governance during the Hu Jinatao era, when turf battles between different ministries, and interference by security forces under a powerful and conservative boss, Zhou Yongkang had collectively been eating up the system. Xi, however, has quashed that echelon of squabbling self-serving ministers and is cleansing the corrupt bureaucracy, thereby consolidating a much cleaner and transparent government than it used to be even five years from now.

Perhaps Xi has both the political will and the economic vision to make this 60-point reform an absolute reality, but, nevertheless, Xi must not, in his zeal to walk in step with the American and Western economies, give a free rein to market fundamentalists and neoconservatives, particularly the transnational conglomerates that want to control global resources. Xi must also slowly walk towards a democratic set up and perhaps do something to move beyond the entrenched one-party system. Although, some commentators have expressed that China is still a long way from establishing a true democracy, with enshrined rights and freedoms of its people. However, the dream is on and the country is moving away from the benighted years of Mao’s Cultural Revolution.
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