China Since Mao

1. China Since Mao Rise of a Superpower

2. Assignment 4: Deng Xiaoping’s Reforms Turning China into an Economic Superpower in Just 10 Easy Steps!

3. Disclaimer… Although China is still controlled by its Communist party, it has pretty much completely abandoned all principles communists or socialists are supposed to support. The Chinese kindly request that you not point out this discrepancy. To get around the inconvenient fact that “Communist” China has in many ways more of a free-market economy than the USA, the Chinese call their new, successful economic system “Socialism with Chinese Characteristics”. Whatever.

4. Step #1: Free the Peasants Like both Qui Shihuangdi and the Communists before the Great Leap Forward, Deng Xiaoping gave land back to the peasants. He broke up the collective farms and allowed each family to farm for itself. (Technically, the government still owns the land and the peasants “lease” it.) Peasants could now sell their crops rather than have them redistributed by the government.

5. Step #2: Open the Market By: allowing the price of food to rise, letting the peasants sell their goods on the open market, allowing the peasants to choose what crops to grow, farming was suddenly profitable and agricultural output skyrocketed 48%.

6. Step #3: Allow Peasants to Do More Peasants became free to take the risk of opening small businesses such as repair shops and restaurants. No longer forced to farm, the peasants showed China’s Communist Party that they could be productive without strict government control, and that freedom would not cause chaos.

7. Step #4: Allow Innovation Under Deng, since few Chinese had the ability to open a factory from scratch, the Communists allowed existing state-owned enterprises (SOEs) such as factories, schools, and army bases to branch out and start making other products than what they were instructed to do by the government. Lo and behold, the quality and costs of the for-profit goods improved.

8. Step #5: Try It in the Cities…Slowly The government created “Special Economic Zones” (SEZs) in a few coastal cities in which Chinese people (usually well-connected to the Party) were allowed to start businesses and build privately-owned factories. The plan was to create a sort of “capitalism in a zoo” where the Party could watch free-market economics develop, and stop the experiment if it went wrong or if it did not like the results.

9. Step #6: Attract Foreign Investment The Party seemed to forget its fear of foreigners as it allowed foreign companies and foreigners’ money to invest in the SEZs. Foreign companies based in Taiwan and Hong Kong quickly made use of China’s low wages and lack of benefits for workers (the “Iron Rice Bowl” applied only to government-owned businesses—the SOEs). The USA and other Western countries quickly joined the game.

10. Step #7: Allow Freedom of Movement While China’s Communist Party allows little free speech or a free press, it has relaxed restrictions on the movement of people. This has allowed people to leave their villages to fill the new factory jobs, and has brought wealth to the villages as—in the Confucian tradition– former peasants send some of their wages home to help their parents.

11. Step #8: Dismantle the Iron Rice Bowl As many Chinese have found jobs in privately-owned factories that do not offer any benefits for workers, China has saved money by slowly taking away the many free workers’ benefits such as paid vacations and free health care that made the Maoist Era tolerable. With that said, the government still offers such benefits as basic education, basic health care, and affordable public transportation.

12. Step #9: Lose Money to buy Peace China has been smart enough to keep money-losing SOEs open even if they will never be profitable and hurt the economy as a whole. The government is afraid that if too many people in one city or region lose their jobs or their “iron rice bowl”, anger at the government could spin out of control.

13. Step #10: Seek Profit above All Else To keep the foreign investment rolling in, China has become infamous for allowing terribly low wages and long working hours, disregarding the factories’ effects on the environment, and not caring about workplace safety. How can American and European workers compete with that?

14. Assignment 5:Not So Fast… Issues in Modern China

15. Dictatorship Lest we forget, China is a still a one-party dictatorship with little regard for basic freedoms. While the government has the “Mandate of Heaven”, there has not been much of an effort to change it, but the passive nature of the Chinese might not hold if conditions ever worsen.

16. Tiananmen Square, 1989 The “Goddess of Liberty” in Tiananmen Square (A hastily- Created statue Made by art students in Beijing) In 1989, as new political freedoms were given in the Soviet Union and Communist countries controlled by the Soviets such as Hungary and Poland were challenging Soviet power, a huge multi-week demonstration for similar freedoms broke out in Beijing. Although their demands were never clear, he demonstration’s leaders demanded greater freedoms and more ability to participate in government.

17. Dictatorship: The Standoff For a couple of weeks thousands of young Chinese camped out in Beijing’s biggest public space (Tiananmen Square) and vowed not to leave until major reforms were made. Remember, this was 1989—just as Deng’s reforms were starting. Not much had changed by that time.

18. Dictatorship: The Resolution Video: http://www.youtube.com/watch?v=XJBnHMpHGRY On the night of June 4, 1989 Deng ordered the army into the square to open fire on the students occupying it. That was the end of the demonstrations, at the cost of an estimated 1,000-4,000 lives—the Chinese government refuses to admit more than 200 people died that night.

19. Dictatorship: The Reasoning Deng’s government sent the clear message that although great economic changes were beginning, there would be no challenges to the rule of the Communist Party, and that no new freedoms would be as long as granted. Deng had a plan to fix China, and would not allow “the people” to influence it. Since then, nearly all Chinese seem content with the deal—they would not challenge the dictatorship as long as their lives improved.

20. The Internet While the Chinese government uses censorship to restrict freedom of the press, doing so is becoming much more difficult in the Internet Age. Still, the government employs thousands to search the Internet to find and disable access to Twitter, criticisms of the government, or anything that suggests Taiwan might be independent. This Internet censorship is jokingly called the “Great Firewall of China”.

21. Environment: The Air Simply put, China is facing a public-health catastrophe. All of those factories and new cars are making China’s air unbreathable. It is estimated that 1/3 of the air pollution in Los Angeles comes from China.

22. Environment: The Quality of Water With factories dumping waste everywhere, China’s waterways are becoming so polluted that birth defects are on the rise, and nearly 30% of its freshwater is too polluted to be used in farming. Fresh drinking water is becoming unavailable for tens of millions of people.

23. Environment: The Quantity of Water China, Like the rest of the world, is running out of water as a whole. Rivers are drying up, and the water table in Beijing (the point at which one hits water when digging) has dropped 1,000 feet since the 1970s. Video: http://www.youtube.com/watch?v=unTo81gArlw

24. Environment: Desertification Adding to the misery, China’s deserts are expanding due to natural wind patterns, human activity, and global warming. Dust storms in northern cities including Beijing are becoming common, and farmland is being lost or rendered less productive.

25. Economy: Dependence While it’s hard to find fault with China’s massive economic boom – especially as America’s economy is struggling– China’s economy is based on manufacturing goods for export. Should the rest of the world stop buying or be unable to buy Chinese-made goods, massive unemployment would occur.

26. Economy: Inequality While the rising tide of China’s economy has lifted all boats and made practically everyone live better, the gap between rich and poor continues to widen much faster than in the US. Unhappy people left out of opportunities for wealth has been the root cause of many Chinese rebellions in the past.

27. Economy: Labor Perhaps the greatest immediate danger to China’s economic boom is the possibility of crippling labor strikes. So far, China’s migrants from country village to city (the largest migration in human history) have been willing to “eat bitter” and put up with low wages, overcrowded factory dorms, long hours, unsafe working conditions, and poor treatment by managers. If that changes, so will China.