1958 – 1976

Fearful of Mao’s punitive actions, Chinese bureaucrats fudged data in order to placate him. What seemed like a political maneuver to gain favor within the government, would later turn out to be a disaster for the people living in the countryside. China’s Great Leap Forward experiment was initially marketed as the program to take China to the next level of economic development. The Great Leap Forward was a concerted effort to collectivize the Chinese economy and hand over the commanding heights to the Chinese state. Private property and a market-based price system were cast aside, while the Chinese central planners tried to play god.

But playing god with the economy comes with a massive price to pay. Even the best central planners are unable to break the laws of economics. Such heavy-handed interventions in the economy destroyed China’s agricultural sector. In turn, the decimation of Chinese agriculture created famine conditions, which led to the deaths of an estimated range of 20 million to 45 million people. The casualties suffered during the Great Leap Forward made China another tragic case of democide, as the country became another casualty of central planning. Consequently, Mao Zedong saw his political image tarnished after this failed socialist experiment, which called into question the validity of his political ideology. But the man-made disaster did not deter him from pursuing other ambitious political programs. Mao was intent on leaving his political mark in China.

The Cultural Revolution of 1966 to 1976 was Mao’s final attempt to impose a top-down program on the Chinese populace. This ambitious political venture sought to re-assert proletarian values and rid Chinese society of subversive bourgeois elements. However, this social program turned into a wide-scale political purge that hamstrung economic growth and undermined the civil liberties of millions in China. Like the Great Leap Forward, the Cultural Revolution proved that Mao was too ambitious in socially engineering society according to his grandiose political vision. With two controversial efforts led by the Chinese state to radically transform the nation’s society, China’s political class started to become restless. Even the Communist Party knew that Mao took things too far. It was becoming clear that China was on the verge of falling into political chaos. A new course would need to be taken for the country to advance, lest it become another victim of its well established Dynastic Cycle. Several leaders in the Chinese Communist Party were ready to step up to the plate.

1977 – 1988

The Cultural Revolution ended with chairman Mao Zedong’s death in 1976 and the arrest of the Gang of Four. That movement, spearheaded by Mao, caused severe damage to the country’s initially diverse economic and social fabric. The country was mired in poverty as economic production slowed or came to a halt. Political ideology was paramount in the lives of ordinary people as well as the inner workings of the party itself.

In September 1977, Deng Xiaoping proposed the idea of Boluan Fanzheng (“bringing order out of chaos”) to correct the mistakes of the Cultural Revolution. At the Third Plenum of the 11th Central Committee, in December 1978, Deng emerged as China’s de facto leader. He launched a comprehensive program to reform the Chinese economy (Reforms and Opening-up). Within several years, the country’s focus on ideological purity was replaced by a concerted attempt to achieve material prosperity.

To oversee his reform agenda, Deng promoted his allies to top government and party posts. Zhao Ziyang was named Premier, the head of government, in September 1980, and Hu Yaobang became CCP General Secretary in 1982.

Deng’s reforms aimed to decrease the state’s role in the economy and gradually allow private production in agriculture and industry. By 1981, roughly 73% of rural farms had been de-collectivized, and 80% of state-owned enterprises were permitted to retain their profits. Within a few years, production increased, and poverty was substantially reduced.
While the reforms were generally well received by the public, concerns grew over a series of social problems which the changes brought about, including corruption and nepotism on the part of elite party bureaucrats. The state-mandated pricing system, in place since the 1950s, had long kept prices fixed at low levels. The initial reforms created a two-tier system where some prices were fixed while others were allowed to fluctuate. In a market with chronic shortages, price fluctuation allowed people with powerful connections to buy goods at low prices and sell at market prices. Party bureaucrats in charge of economic management had enormous incentives to engage in such arbitrage. Discontent over corruption reached a fever pitch with the public; and many, particularly intellectuals, began to believe that only democratic reform and the rule of law could cure the country’s ills.

Following the 1988 meeting at their summer retreat of Beidaihe,  the party leadership under Deng agreed to implement a transition to a market-based pricing system. News of the relaxation of price controls triggered waves of cash withdrawals, buying, and hoarding all over China. The government panicked and rescinded the price reforms in less than two weeks, but there was a pronounced impact for much longer. Inflation soared: official indices reported that the Consumer Price Index increased by 30% in Beijing between 1987 and 1988, leading to panic among salaried workers that they could no longer afford staple goods. Moreover, in the new market economy, unprofitable state-owned enterprises were pressured to cut costs. This threatened a vast proportion of the population that relied on the “iron rice bowl”, i.e. social benefits such as job security, medical care, and subsidized housing.

The party’s nominally socialist ideology faced a legitimacy crisis as it gradually adopted capitalist practices. Private enterprise gave rise to profiteers who took advantage of lax regulations and who often flaunted their wealth in front of those who were less well off. Popular discontent was brewing over unfair wealth distribution. Greed, not skill, appeared to be the most crucial factor in success. There was widespread public disillusionment concerning the country’s future. People wanted change, yet the power to define “the correct path” continued to rest solely in the unelected government’s hands.

The comprehensive and wide-ranging reforms created political differences over the pace of marketization and the control over the ideology that came with it, opening a deep chasm within the central leadership. The reformers (“the right”, led by Hu Yaobang) favored political liberalization and a plurality of ideas as a channel to voice popular discontent and pressed for further reforms. The conservatives (“the left”, led by Chen Yun) said that the reforms had gone too far and advocated a return to greater state control to ensure social stability and to better align with the party’s socialist ideology. Both sides needed the backing of paramount leader Deng Xiaoping to carry out important policy decisions.

1978 – 1989

For China’s political reforms during the 1980s, Deng Xiaoping was the crucial factor. From the late 1970s, Deng gradually established his own power with the Party. While not possessing the absolute power of Mao Zedong, Deng’s power grew with the successful implementation of reform and opening up. But even then, there was a conservative faction that tried to reverse Deng’s reforms. Within the Party, there were two main political factions: the pro-reform camp was represented by Hu Yaobang and Zhao Ziyang and the conservative camp led by Chen Yun, Li Xiannian, Li Peng, and Yao Yilin. And Deng himself, who championed reform and opening even while insisting on the “Four Cardinal Principles,” became the deciding voice between the two groups.

Most of the time, Deng’s reformist views were exactly opposed to the opinions of the conservative camp, but that didn’t prevent him from standing with the conservatives on the issue of how to handle the 1989 democracy protests. On the question of preserving one-party rule, their opinions were exactly aligned.

On the surface, Zhao, as the general secretary of the CCP’s Central Committee, had the power to lead reforms, but in actuality, his position vis-a-vis the top leadership was quite weak. That meant that Zhao had a hard time getting like-minded associates appointed to positions of power within the various Chinese bureaucracies. The Organization Department, which handles promotions and assignments for Party members, was led by Song Ping, a member of the conservative faction.

To push forward any major changes, Zhao would need the support of Deng Xiaoping first. In the early 1980s, Zhao and Deng had a strong rapport. With Deng’s support, Zhao’s economic reforms succeeded. After the 13th Party Congress in 1987, though Zhao was officially the general secretary, he would still need Deng’s support to enact the desired political reforms. Up until early 1989, Zhao had this backing.

From the 1970s through the 80s, from Sichuan to Beijing, Zhao relied on Deng’s trust and support – too much so, as it turned out. Zhao thought that he understood (and was understood by) Deng. Although he knew that there was a limit to Deng’s support, the events of 1989 showed that Zhao had miscalculated the extent of Deng’s trust and his own control over the Central Committee. In truth, Deng did not support Zhao personally, but rather supported him because he would firmly carry out Deng’s own vision for economic and political reform.

On the question of political reform, though, Deng and Zhao were not entirely in sync. Deng hoped to reform the existing system, making it more efficient without entirely overturning it. Zhao, meanwhile, who was the true leader of the political reform movement, sought to change the way the Party wielded power, with the end goal of establishing a democracy. Under the aegis of Deng’s vision, Zhao conducted a bold experiment — trying to transform China’s highly centralized political system into a modern constitutional democracy.
The differences in Deng and Zhao’s goals eventually led Deng to stop supporting Zhao and throw his weight in with the conservatives to kill political reform. In the early summer of 1989, Deng believed that Zhao was seeking to use the democracy protests to push for more political reform, endangering one-party rule in China.
In May 1989, when the situation threatened Deng’s bottom line, his support for Zhao evaporated. Deng suppressed the student movement and stopped the political reforms cold. When Zhao opposed martial law and the use of force to end the protests, he was deposed by Deng.
Even when he had Deng’s support, Zhao faced steep opposition from the conservatives. The conservative faction had already seen their hand strengthened at the 13th Party Congress in 1987, when two ultraconservatives (Li Peng and Yao Yilin) made it on the five-member Politburo Standing Committee. The conservatives now had the ability to interfere with and influence Zhao’s work.
More seriously, the conservatives knew that if they wanted to change the direction of China’s reforms, they needed to remove Zhao from power. Beginning in April 1989, Li and Yao used Deng’s fear of the democracy movement to accuse Zhao of “supporting chaos,” leading to the final decision to use force to suppress the movement. In the end, the conservatives used Deng’s strength to get rid of Zhao.

Official deviance and corruption have taken place at both the individual and unit level since the founding of the PRC. Initially the practices had much to do with the danwei (literally, “unit”) system, an outgrowth of communist wartime organs. In the PRC the reforms of Deng Xiaoping were much criticized for making corruption the price of economic development.

Emergence of the private sector inside the state economy in post-Mao China has tempted CCP members to misuse their power in government posts; the powerful economic levers in the hands of the elite has propelled the sons of some party officials to the most profitable positions. For this, the CCP has been called the “princelings’ party”, a reference to nepotistic corruption in some periods of Imperial China. The relatives of several prominent political leaders are reported to have generated large personal wealth in business, including relatives of former Premier Wen Jiabao, current CCP general secretary Xi Jinping, and former Chongqing party secretary Bo Xilai. Attacking corruption in the CCP was one of the forces behind the 1989 Tiananmen Square protests and massacre.

The politically unchallenged regime in China creates opportunities for cadres to exploit and control the rapid growth of economic opportunities; and while incentives to corruption grow, effective countervailing forces are absent.

Both structural and non-structural corruption has been prevalent in China. Non-structural corruption exists around the world, and refers to all activities that can be clearly defined as “illegal” or “criminal,” mainly including different forms of graft: embezzlement, extortion, bribery etc. Structural corruption arises from particular economic and political structures; this form is difficult to root out without a change of the broader system.

Weak state institutions are blamed for worsening corruption in reform-era China. Corruption in China results from the Party-State’s inability to maintain a disciplined and effective administrative corps. The Chinese reform-era state has also been an enabling factor, since state agencies have been granted regulatory power without institutional constraints, allowing them to tap into new opportunities to seek profits from the rapid growth in businesses and the economy. This takes place at both the departmental and individual level. Corruption here is part of the dilemma faced by any reforming socialist state, where the state needs to play an active role in creating and regulating markets, while at the same time its own intervention places extra burdens on administrative budgets. Instead of being able to reduce the size of its bureaucratic machinery (and therefore opportunities for corruption), it is instead pressed to expand further. Officials then cash in on the regulatory power by “seeking rents.”

In 1989, the main claims of the pro-democracy movement included asking the government to conduct political reform, to curb corruption and privileges enjoyed by the children of top leaders, to publicize the income of the governmental officials, and to stop media censorship.

While the economic reforms brought rapid changes in Chinese society, political reforms did not follow suit. Many had expected “political opening up” to follow the economy: yet the CCP was very much divided over this issue. Hardliners wanted strict state control whereas more progressive wings of the party hoped for greater democracy. The CCP faced a crisis of identity: on one hand, it had taken the direction to lead China to a full-blown market economy, on the other, as a communist party, it continued to derive its legitimacy from principles of socialism.

Further, China’s nascent market economy was a breeding ground for corruption and sycophancy. It benefitted some people far more than it benefitted others. Nepotism was common during hiring in private companies. There was growing inflation. While China had opened up new universities and educational institutions, it faced a major manpower crunch in various sectors of its economy as the effects of the Cultural Revolution continued to be felt.

Expectations post the reforms were high but there was also increasing discontent. By the mid-1980s, there were protests in many places. Protestors called for greater freedom of speech, removal of censorship, and overall democratization of the Chinese polity. They also expressed frustration over corruption and nepotism in the government and private enterprises.

These protests were often led by students and the youth. College campuses became hotbeds of dissident activities. The first generation of students who had gone abroad to study would often return with new ideas on freedom, governance, and society.

The spring of 1989 saw protests grow in the immediate aftermath of the death of Hu Yaobang. Hu was a popular leader and the former General Secretary of the CCP. Known for his “liberal opinions”, he was a key player in formulating and executing various reforms that were taking place in China in the 1980s. As protests grew in the mid-1980s, party hardliners blamed Hu’s “bourgeois liberalism.” Hu would speak about major problems with communist economics, human rights, and problems with China’s one-party system. For party hardliners, Hu was a source of much concern. In 1987, he was forced to resign due to his refusal to act against three young communist leaders who openly spoke about the need for political reform in China. His resignation made him very popular among Chinese protestors and liberal intellectuals. He was seen as a martyr of sorts, maintaining the force of his convictions amidst the immense backlash from the CCP.

The protests of the 1980s would come to a climax in 1989 with the Tiananmen Square protests and the subsequent repression by the Chinese State.