Based on my experiences in China over the years, I saw a growing shift toward practicality, but today we see another reversal — to the reestablishment of 体 as primary. Along with that reversal, foreigners’ role in China’s development is also changing. 

Living in Nanjing in the Early 1980s

In 1982, I was one of the early international students to go to China to do research. Graduate students from several countries had already been allowed to study there, and the U.S. followed a few years after normalizing relations in 1979. I was the second or third cohort from the U.S. to be sponsored by the Committee on Scholarly Communications with the PRC.² My project was to analyze Jiangsu Province as a case study of the effect of central policies on local development. Since reforms were so new, I first researched the Mao decades and later extended my analysis to the reform period. 

Data was essential to my project, but it was also problematic. The government classified economic data as a state secret. Some scholars had been detained for having data. A conundrum, indeed. At least I had the U.S. government behind me in this endeavor. My strategy was to create tables with the headings of the information I wanted to collect and have the respective offices fill in the blanks. In hindsight, it was perhaps wishful thinking that this approach would succeed. As it turns out, there was a major effort across China, at all levels of administration, to put together data yearbooks. Because of this, officials did, in fact, fill in (at least some) of my data tables.

Since my focus was Jiangsu Province, I applied to do my research at Nanjing University (Nanda) in Nanjing, the provincial capital. I lived in the university’s foreign compound with about 150 other students and faculty from around the world, some of whom had Chinese roommates. We had heat and hot water several hours a day, and food that was substantially better than the regular university canteens, but life was quite harsh relative to what we were used to.

The Economics Department was technically my host, but they did not invite me to meet with them or any students studying economics at any time throughout the two years I was there. However, I could audit courses, which I did. In the last semester of my stay, I finally met one of the professors. Professor Zhu was responsible for helping me make contact with the officials I wanted to interview in Nanjing and several other cities in the province. Professor Zhu spoke English, as he had worked in international trade, while most other professors did not. I was learning Chinese but needed help with translation during the interview process.

In 1982, western foreigners studying or doing business in China was a new development, allowed to support the leadership’s economic reform efforts. We were treated hospitably and with respect. But there was an underlying tension, perhaps suspicion, that foreigners could contribute to China’s reforms and development, but may also be dangerous. The university administrators were responsible for our well-being and so were careful to keep a close eye on us. Anyone who wanted to visit us had to register and show ID. Our mail was read. Our boxes were opened. If we wanted to travel outside the city limits, we needed to apply to the university and the local police station for permission. Just riding our bikes within Nanjing, we would find signs at the boundaries of the city that said foreigners could not go further.

Daily life was challenging, and our environment was restricted and monitored, but we felt there was a good chance that society would move toward more openness. Unfortunately, the opposite is true today. While daily life in China is quite comfortable for most by now, the signs are that the society is closing again. For example, the universities are under pressure to use textbooks by Chinese scholars, and not those written by foreigners. Authorities monitor classrooms with video cameras, and professors can quickly get into trouble for saying something that questions or counters the Party’s line.

Change and Backlash³

Two incidents occurred while I was in Nanjing that reflected the tensions and disagreements about the changes afoot in those early days: first, the “Spiritual Pollution” campaign and second, a demonstration at Nanda. People desired change, but not surprisingly, they also wanted to choose the reforms that benefited them the most. And China’s age-old dance between importing foreign ideas (用) and finding a Chinese solution (体) was also at work.

The Spiritual Pollution Campaign

The Spiritual Pollution campaign in the early 1980s was a backlash against the dangers of China opening too fast and of adopting ideas that went against the strategy of maintaining stability by the political elites. Today, the pressures on professors, students, and citizens to conform to the leadership’s view of China’s path is reminiscent of these early years. The difference is a new looking back rather than looking forward.

The Spiritual Pollution campaign’s main message was that socialism could not be criticized. Intellectuals were discussing the existence of alienation under a socialist system. Markets may be possible under socialism, but alienation is not. Thus “dangerous” ideas, such as those of Sartre, were to be criticized if discussed at all. People who had written pieces favorable to Sartre, or discussed alienation, were asked to write their ideas anew. Specifically, at Nanda, one professor was criticized for an article he had written on Hu Shih, a well-known Chinese academic who had studied and promoted pragmatism.⁴

While targeted primarily at harmful ideas in intellectual circles, the campaign also touched on areas of laxity and unethical behavior. For example, Party spokespeople and written editorials criticized books and magazines for printing stories about love affairs and other situations deemed “indecent.” Also suspect was long hair, facial hair, and revealing attire. One rumor was that all city workers in Beijing were subject to hair and dress regulations.

It was understood, of course, that a main source of these bad influences was foreigners and their decadent societies. Reforms had meant China had much more contact with the international community, and some of this contact was deemed harmful. Being a foreigner in China, then, raised interesting contradictions. Our dress and culture were indecent (even if desired), but our technology and markets were necessary to modernize China. Ironically, this situation is back in spades in China today.

The most immediate problem for us at that moment was judging whether this campaign was severe enough to cause trouble for the Chinese with whom we associated. Our experience was that the Chinese were not worried—aside from the few targeted intellectuals—and that the campaign did not involve us in their minds. People said that indecency was not desirable in books, magazines, and films, but nonetheless, everyone was informed of the details of the latest “indecent” story. But Chinese friends did not stop seeing us, and on the surface, at least, only the amount of gossip changed.

At the university, however, there were required meetings for students, faculty, and administrators to discuss the message of the campaign. These meetings were reminiscent of the numerous campaigns before. In October 1983, the Foreign Affairs Office asked us if we would like to discuss “spiritual pollution.” We agreed, thinking we could ask what this meant for us and if the restrictions on our contact with Chinese people would increase. Instead, the meeting consisted of a two-hour speech on the question of alienation delivered by a university official in perfect line with recent People’s Daily editorials. By December, after going through the motions, we all — Chinese and foreigners – had forgotten that “pollution” had been a problem.

The Nanda Incident

Another reaction to China’s reforms occurred during three days in May 1984. This event began on campus but eventually involved the provincial government, a central investigation, and the international news media. The catalyst for this incident was the status of Nanjing University, but the key issues were the students’ right to demonstrate and factionalism on campus. Earlier in May, the Ministry of Education chose 10 institutions to receive more autonomy and an extra 100 million yuan each to help them quickly implement their educational reform and improve programs. To the dismay of the university community, Nanda was not among this privileged group.⁵

On May 28, posters appeared on campus criticizing the university leadership for lack of concern for intellectuals and the overall quality of the university. The former university president, Guang Yaming, had been transferred and not replaced, leaving Zhang De, the Party Secretary, in charge. The Party Committee was powerful within Nanda’s administration, and removing Guang gave the dominant party group free rein. One of the confrontations between Guang and the Party Committee had been over the status of intellectuals. To improve the situation of professors in line with current reform policy and compensate them for poor treatment during the Cultural Revolution, Guang wanted to add their years spent in school to their work time to increase the years counted in seniority. Since seniority determined access to housing and other perks, this change would mean professors would benefit at the expense of other university employees. This change was not in the interests of the Party Committee, and they succeeded in getting Guang transferred.

After Guang left, three separate elections failed to fill the position. The students accused Zhang of being instrumental in preventing the election of a permanent, reform-oriented president, and they demanded the return of Guang. According to one account in the Hong Kong paper, Pai Hsing, the Party Committee tried to appease the students by agreeing to meet with them to discuss their proposals, but the students rejected this.⁶ The paper also implied that the students decided overtly to demonstrate their displeasure when the Party Committee asked the Nanjing Armed Police to patrol the campus.

From the beginning, in addition to the university’s status, a key issue was the rights of students to disagree with, and try to influence, the university administration. This aspect of the conflict was reminiscent of the Cultural Revolution, i.e., when the bureaucracy blocks established methods of change, then challenged the bureaucracy. The students drew on China’s Constitution to support their right to demonstrate. The university also drew on the Constitution to argue that the demands for reform were correct but that the students’ method of dissent was disruptive and illegal. The students were to meet formally with university officials and not write posters or demonstrate. This position was repeatedly read over the loudspeaker in the evenings when people would gather. Besides this action, however, the university did nothing directly to stop the activities. The students ignored the instructions and put up many large and small-character posters. The lights on the outdoor bulletin board were left on all night so people could read and discuss them.

By the second day, the criticisms in the posters had moved from generalizations about poor leadership to criticizing Zhang by name, pointing to the influences of “leftism.” The activity and excitement on campus then built quickly. Students wrote more posters and discussed the issues late into the night, and people crowded the streets in the evenings. During these events, international students mingled freely among the crowds.

On the third day, a rumor spread that there was to be a demonstration involving a march from campus to the provincial government buildings about two miles away. The students felt they had met a dead end in dealing with the university and decided to take their complaints to provincial leaders. That evening the number of people on the campus streets swelled to make quite an event. Peddlers were selling spiced eggs and ice cream; people brought their children; and the loudspeaker was repeating its message, apparently to non-listening ears.

Eventually, we heard that people had gathered just outside the gate and began to walk, picking up people as they went. I and a few others rode our bicycles to catch them, but not knowing their route, we went straight to the provincial government buildings and waited. The atmosphere was tense, but no one said anything to us. Minutes later, the marchers arrived. The group was orderly and quiet but was large by then, with well over a thousand people. For a few moments, it seemed there would be a confrontation. Public security was blocking the major intersection, but the group did not slow its pace. Then, just before the group reached the blockade, the police moved aside.

For the next hour, little happened. I was standing in the back on a cement wall overlooking the square. The gates to the government complex opened and closed several times. I heard later that the provincial officials asked the students to send representatives inside, but people were reluctant to volunteer. Eventually, several people volunteered to negotiate, and a meeting between the students and the government was set for the next day. After some time, the crowd thinned out and the demonstration ended.

We never knew whether that meeting took place or not. However, the next day the university abruptly ended all activities relating to dissent on campus. The bulletin boards were now kept unlighted, posters were forbidden, security checked IDs at the university gate, and university officials questioned the student leaders. The incident was over.

Two other things of importance related to the Nanda incident happened. First, during the first two days of activity on campus, the situation was reported by Voice of America; and second, Beijing sent an investigation committee shortly after the demonstration, which further curtailed discussion and increased rule enforcement on campus. Perhaps if the international press had not reported news of the event, Beijing would not have become so directly involved in provincial and university affairs.

On the one hand, foreigners’ knowledge of what is going on may increase the impact of a protest by adding pressure to resolve the issues. On the other hand, officials may fear how foreigners will interpret and report the incident and, therefore, may react by quickly ending the dissent and punishing the Chinese people involved. Another aspect of the position of foreigners in China is that we are all under suspicion of being spies. During this incident, a rumor that Voice of America had reported it during the first two days did not allay these suspicions. Even the foreign community was surprised at how quickly this incident became known beyond the university. As this experience suggests, our presence alone may cause problems of which we are unaware.

We had no way of knowing at the time that student protests would put such monumental pressure on the Communist Party and Chinese government. Early protests like this were precursors to events that led to the violent Tiananmen Square crackdown in 1989. Such protests are difficult to imagine in Xi Jinping’s China today.

A New Day

Over the period I lived in Nanjing, the restrictions eased slowly, and people were more relaxed about talking with us. More cities were opened to foreign investors and travel, although only certain hotels could host foreign visitors. Over time, China continued to relax restrictions across society. In contrast to the lack of contact with peers at Nanda in the early 1980s, I developed deep friendships over the years and fruitful academic exchanges and collaboration. I traveled alone, with my husband, with friends, and with student groups, visiting every province and region in China. We were free to explore and learn by talking with whom we wanted.

Now, under the leadership of President Xi Jinping, China’s trend toward opening is reversing – abandoning 用 for a new type of 体. Covid-19 is the most apparent reason for restricting society, but it also provides a convenient excuse. Behind the currently closed borders is a growing narrative that China no longer needs foreign ideas, skills, or capital. Western values are critiqued and rejected, replaced by a mix of Confucian and modern Chinese thought. The term “spiritual pollution” has returned to conversation. The leadership harshly critiques any expression of alienation, such as the “lying flat” trend of young people who talk about doing as little as possible to get by since success, as customarily defined, is so elusive.⁷ Even English is being downplayed after a spectacularly successful push to teach it across the Chinese education system. Moreover, authorities expect Chinese academics to conduct research in support of China’s policies and do it with decreasing collaboration with western scholars.

While economic development continues apace, the range of allowed debate is narrowing, along with individual freedoms as the CCP returns to its Marxist, socialist roots. President Xi talks of pushing China into the next stage of socialism with “common prosperity.” In the past, we heard Chinese people sometimes say the CCP stood for the Chinese Community Party – a reference to a gentler party leading social progress. Today, the Party is returning to sticks over carrots and is increasingly feared. One can only guess that President Xi sees taking the socialist mantel as his way of maintaining his and the CCP’s power for years to come.

The post Deja Vu: China’s Relations with the West appeared first on China Research Center.

Given this likelihood, I ask whether rich democracies, in particular the United States, adequately prepared for a Chinese superpower – especially as its likelihood increased along with China’s economic and technological development. I take a neutral stance as to whether China’s rise should be seen as an opportunity for a more peaceful and prosperous global future or a threat to the global status quo, the Washington consensus, liberal democracy, or the United States in particular, or somewhere in between. I take this neutral stance because a lack of preparation for China’s rise should be concerning for Panda Huggers and Dragon Slayers alike. Dragon Slayers, hawks who want to work to contain, challenge, or even fight China, could find that the U.S. has not done enough to prepare for a – hopefully – preventable conflict with China, or to check its growing influence. Panda Huggers, doves who would prefer to engage China, might conclude that we have failed to develop expertise and put far too little emphasis on peaceful efforts to cooperate as well as compete economically with China.

There is no checklist to prepare for a rising superpower. Yet, this article will provide a survey of some of the efforts, made and unmade, to prepare for a China-dominant world. Specifically, it will consider military, economic, and educational readiness for a China Century.

Military

China’s rise and the modernization and professionalization of its military have proceeded apace since national defense was included as one of Deng Xiaoping’s Four Modernizations in 1977. While the U.S. military was considering its role as a world policeman in the 1990s and a counterinsurgency force in the 2000s, China was focused on projecting power where it mattered to the PRC, near its borders and surrounding seas, particularly toward Taiwan. In 1996 when the United States and China almost clashed over Taiwan, General John Shalikashvili, then chairman of the U.S. Joint Chiefs of Staff, dismissed the PRC’s ability to invade Taiwan, concluding that “China simply lacked the sealift resources, especially amphibious ships.”¹ China’s threat was dismissed as the “million man swim,” a term that is now frequently cited in articles explaining how much the realities of a Chinese invasion of Taiwan have changed since the 1990s.

The U.S. military’s focus, tactics, and doctrine in the decade after the 9/11 attacks were fundamentally mismatched to containing, dissuading, or confronting China. As China forged ahead with its aircraft carrier program, the U.S. Navy contemplated reducing its aircraft carrier groups. Military experts concerned with China argue for the need for weapons and strategies that can block China’s anti-access/area-denial capabilities (A2/AD). Since 2009, the Pentagon has been pushing just such priorities in the form of the Joint Concept for Access and Maneuver in the Global Commons. Yet, according to Michael Beckley, “[T]he U.S. defense establishment has been slow to adopt this [China] strategy and instead wastes resources on obsolete forces and nonvital missions.”²  While the U.S. has not created a unified strategic vision for how to prepare for China’s rise, it’s not for lack of trying. There have been several proposed Joint Concepts, Strategic Concepts, Expeditionary Warfighting Concepts, and other schemes. Implementation of such grand strategies is expensive, difficult, and time-consuming, and shifts in politics have complicated it further, as have wars in Iraq and Afghanistan.

Whether its preparation for dealing specifically with China has been as effective or efficient as it could be, the U.S. military enjoys such substantial advantages that it is hard to conclude that this is an area where rich democracies have failed to prepare. Three factors stand out. First, the United States spends almost four times as much on its military as China. Second, aside from Russia, every other major military spender is a close U.S. ally. Third, the Chinese military’s lack of war-fighting experience contrasts sharply with that of the United States, which has, for better or worse, been involved in numerous conventional and unconventional conflicts in recent decades. While we hope the question of whether the U.S. and its allies can handle China militarily will never need to be answered, it seems clear that it is the field in which preparations for China’s rise have been least insufficient.

Economics

For those, like this author, who believe it best not to consider China primarily as a military threat and that prophecies about coming conflicts are self-fulfilling, a lack of preparation and investment in non-military areas is more distressing. Headline figures on balance of trade have their place, but do not reflect complex realities such as the U.S. earning a much greater share of the profits than China for every iPhone assembled in the PRC. Direct efforts to “get tough on China” on trade have proved dismal failures; from Obama’s early attempts to Trump’s more recent ones, they have generally hurt the U.S. more than China. Far more problematic than today’s headlines about trade imbalances, therefore, is a reluctance to invest in the research, infrastructure, and education that would help make rich democracies economically competitive with a rising China in the coming decades.

Much of China’s economic success was the result of scrappy small and medium enterprises organized in industrial clusters. Foreign companies and consumers were some of the biggest beneficiaries of that economic success. Yet, the Chinese state has also invested heavily in making China internationally competitive. From 2000 to 2017, Chinese R&D spending increased 17 percent a year compared to 4.3 percent in the U.S. China eclipsed U.S. science spending in 2019.³ The Chinese state also invests in, supports, and protects Chinese companies. As the Wall Street Journal’s Chuin-Wei Yap wrote, “Huawei had access to as much as $75 billion in state support as it grew from a little-known vendor of phone switches to the world’s largest telecom-equipment company.”⁴ Rich democracies could have maintained an economically productive relationship with China while still preparing for its rise by spending on R&D. Yet until recently, they did not even attempt to keep up. As late as 2020, the U.S. Senate introduced a bill that offered a mere $1 billion for the development of 5G alternatives to Huawei.⁵

The United States also failed to invest in other areas that could help keep it competitive with China, especially in infrastructure and education. China opened approximately 24,000 miles of high-speed rail between 2008 and 2021 and now accounts for around two-thirds of the world’s total high-speed rail. Europe has less than 6,000 miles and the United States only 34. While U.S. bridges have begun collapsing, China has built around a quarter-of-a-million new bridges since 2010.⁶ China went from graduating half as many STEM (Science, Technology Engineering, and Math) Ph.Ds. as the United States in 2000 to 50 percent more in 2019.⁷ Taken together, it seems that China has surpassed the rich democratic world in almost every aspect of investment, that this trend was clear for decades, and that little was done to address it.

There are signs that the momentum is beginning to shift in the space of only a year or two. In December of 2021, the European Union announced its €300 billion Global Gateway scheme (designed to compete with the Belt and Road Initiative). In February of 2022, a dozen former U.S. national security officials from both parties called for the U.S. to pass the $250 billion dollar China competitiveness bill.⁸ It might appear that rich democracies may have finally woken up to the scale of resources necessary to keep up with China economically both at home and abroad, but there is still reason to be skeptical. The Global Gateway scheme was in part a repackaging of existing investment and aid, and neither the China competitiveness bill nor Biden’s $1 trillion infrastructure bill have yet to pass. Time will tell if these efforts succeed, but for now it appears that the momentum has at last begun to shift and that rich democracies are starting to assess the potential influence of China realistically, if a decade or two late.

Education

Nowhere is the gap between China and rich democracies as evident as in the sphere of education. In 2012, one of the founders of Blackstone private equity group set up the Schwarzman Scholars program to send top U.S. students to study at Beijing’s Tsinghua University, explaining that “China is no longer an elective course, it’s core curriculum.” Yet in most rich democracies, China is not even in the course catalogue. From kindergarten to graduate school, Europe and North America are failing to prepare their students to work and prosper in a century that will be Asia- and China-centric.

Graph 1: K-16 Language Learning in the U.S. 2014-5

Source:  The National K-16 Foreign Language Enrollment Survey Report

Language education is where preparation for a China-dominant world should begin and where it is most lacking. In 2015, Obama announced the launch of “1 Million Strong,” an initiative aimed at increasing U.S. learners of Chinese to one million by the year 2020. “If our countries are going to do more together around the world,” said Obama, “then speaking each other’s languages, truly understanding each other, is a good place to start.”⁹ Yet, Chinese language education has not seen the investment and interest that would allow for anything like this goal to be reached. The most recent comprehensive data from a 2017 National K-12 Foreign Language Enrollment Survey Report (Graph 1), shows that less than seven percent of high schools in the U.S. offered Chinese and that it came in as the fourth most-studied language, barely beating out Latin. In higher education the numbers are worse, with Chinese the seventh most-studied language (Graph 2).

Graph 2: Higher Education Enrollment in Modern Languages

Source:  The National K-16 Foreign Language Enrollment Survey Report

Nor are failures in Chinese language education limited to the United States. Two years after the first Mandarin immersion school attempted to open in Germany, difficulty with state regulation forced them to settle for Chinese three times a week, despite immersion schools already existing in French, English, Spanish, Italian, Turkish, and Russian. By contrast, China is learning English at a prodigious rate and hundreds of thousands of Chinese students flock to the U.S., UK, Canada, Australia, and other rich democracies for everything from high school diplomas to doctorates. While the number of U.S. students studying in China rose steeply in the early 2000s, in line with the Obama administration’s goals, the numbers then plateaued and began to decline in the mid 2010s. By 2019, more U.S. students studied in Ireland than in China (Graph 3).

Graph 3: U.S. Students Study Abroad Destinations 1999-2019

Source: Open Doors – Institute of International Education

Across a variety of departments, most universities do not have the expertise and faculty necessary to provide sufficient offerings related to China or Asia more generally. Beyond language, a trend away from area studies exacerbated a lack of expertise in China. One might expect political science, economics, business, history, and other departments to stock up on China experts as they did on Soviet specialists during the Cold War. But most seem satisfied with a single expert on East Asia (many of whom are actually Korea and/or Japan specialists). There appear to be fewer China-focused jobs in U.S. political science departments every year. In 2021, only a handful of U.S.-based China-focused jobs were advertised in political science, and these were primarily focused on security.

What makes this failure to invest in Chinese language education look even worse is the rejection of one of the few low-cost resources for education in Chinese, Confucius Institutes. CIs have been forced out of U.S. universities even though a bipartisan congressional commission determined that there is “no evidence that these [Confucius] institutes are a center for Chinese espionage efforts or any other illegal activity.”¹⁰ China spent more than $158 million on U.S. Confucius Institutes from 2006 to 2019, but after peaking at 103 in 2017, universities began to reject them and by the end of 2021, and only 31 remained. If China was really such a concern that the CIs had to go, then surely the lost investment in language training should be replaced, many times over, by funding from other sources.

Failing to build a robust Asia curriculum is inexcusable, even in tough budgetary times, because developing substantial infrastructure and profound expertise takes decades. From intelligence gathering to business, children well-versed in the languages and cultures of China and its neighbors are the best hope for rich democracies to compete with and relate to a rising China, but these are investments that will take decades to reap rewards. If rich democracies invest heavily in education programs related to Asia starting today, they will begin to see the results in a decade or two.

Yet, unlike the categories considered above, education seems to be an area in which rich democracies are not even slowing the pace at which they are falling behind. In part this is due to increasingly negative attitudes about China. While this may be understandable given increasingly negative rhetoric about China in the media as well as PRC policies such as the repression of Muslims, it seems to be self-defeating. If China is important enough to attract widespread suspicion, then it ought to be worth learning about. Students who hear ominous things about China could choose to study in Taiwan or Singapore or even Korea or Japan.

Conclusion

Considering the three areas – military, economics, and education – the U.S. and its rich democratic allies have largely, though not completely, failed to prepare for a world in which China is a, if not the, superpower. But preparations have been uneven and some of the areas demonstrate more foresight and investment than others. It is difficult to know whether the United States and its allies are prepared to deal with the rise of China militarily, but in line with generally substantial U.S. military spending and investment it seems clear that this is where preparations have been the most thorough, or perhaps the least neglected. Economically, both at home in the form of R&D support and abroad in terms of offering alternatives to China’s investment, there are clear signs of inadequate preparation and a shift in momentum. In the field of education, there are not even signs of concern as rich democracies fall further and further behind. In the next piece I will consider why, despite the relative predictability of China’s rise, rich democracies seem to have been caught so flat-footed.

The post Is the World Ready for China Risen? appeared first on China Research Center.

A similar episode occurred in China in 2021.  A writer named Li Guangman, formerly editor of a trade publication for an electric power company and columnist for a website that no longer exists, posted a long commentary called “Everyone Can Sense that a Profound Transformation is Underway!” to his WeChat account in late August.  Several media outlets immediately republished his essay, among them People’s Daily and Xinhua — two of the leading central-level news platforms in the country.

The tone and content of Li’s post echoed the militant rhetoric of the Cultural Revolution.  After a lengthy diatribe against a few pop culture celebrities who had been canceled over tax evasion and offenses against traditional cultural values, Li noted other recent regime moves including the suspension of the IPO by Alibaba’s digital finance spin-off Ant Group, the new emphasis on the theme of “common prosperity,” and the grand celebrations of the Party’s centenary.  All these actions, he claimed, signaled the coming of a “profound revolution” that would sweep away “capitalist cliques” and bring the “people” back to the forefront of society.  In dramatic Maoist fashion, he celebrated “the return of red, the return to heroes, the return of blood” (hongse huigui, yingxiong huigui, xiexing huigui).”   Like Mao and the Gang of Four, Li demanded thorough going cultural change. “We need to control all the cultural chaos and build a lively, healthy, masculine, strong, and people-oriented culture” (“women xuyao zhili yiqie wenhua luan xiang, jianshe xian huo, jiankang, yanggang, quianghan, yi renmin wei de wenhua”), Li said.^[3]

Four days later, the editor of the aggressively pro-regime, anti-Western publication, Global Times, Hu Xijin, published a rebuttal of Li’s post.^[4] Calling Li’s article misleading and inaccurate, Hu declared that China’s leaders had been following an orderly course of measures aimed at preserving the “reform and opening up” mixed economy model — which did not at all amount to a revolution.  Hu particularly objected to the rhetorical tone, which he said “would evoke some historic memories and trigger chaos in minds and panic among people.”^[5]  Rather than publishing it in Global Times, however, he posted it to his personal blog.  Then the censors ordered that the post was not to be shared on Weibo or WeChat.  Several hours later, the ban was lifted, and the post could be shared again. Reports from media sources indicate that the regulators issued oral instructions to media editors acknowledging that Li’s post had a wider impact than they had anticipated.  Rather than demanding that they rescind or refute it, however, they asked editors to balance it with less inflammatory content.^[6]  After that, the controversy subsided.  Li Guangman continued to post content, but less heated. The leadership made it clear that they would continue to intensify restrictions against Western influences and press the common prosperity theme, but not shutter all large private businesses or enact draconian redistributive policies.

Like the Nina Andreeva affair, the Li Guangman episode revealed two things about the current state of Chinese policymaking.  Most obvious is the ambiguity in policy about how much the state intends to balance market activity and private capital ownership with state control.  Second, at a deeper level, that ambiguity indicates divergence in the positions of key players in the policymaking process over basic economic policy choices.  There is a basic tension between Xi Jinping’s need for supreme leadership and the fact that the regime rests on a series of tacit understandings among powerful bureaucratic and business interests.  A good indication of this is the incoherence intrinsic to the “common prosperity” slogan.  There is a widespread expert consensus around concern over high inequality and the need to build a middle-class society, one where the middle-income strata are the dominant force in society. One recent commentary notes that China’s society is about 30 percent middle class and argues that China can improve economic and social stability by raising that proportion to two-thirds.^[7]  However, the leadership has consistently avoided acknowledging the extreme concentration of income at the upper end.  Instead, it has consistently asserted the need to raise low-end incomes through measures such as a higher minimum wage and more effective social assistance programs.  Despite the conspicuous assaults on a few visible tycoons and celebrities, even in the most recent phase, the leaders have been cautious about arguing for an effective progressive income tax system, an estate tax, or surtaxes on high incomes.  The regime is moving extremely cautiously in introducing a property tax, for instance, authorizing only small-scale local experiments.

An example of current mainstream thinking on the issue of inequality is an essay co-authored by the prominent economist and expert on inequality, Li Shi, dean of the Institute on Sharing and Development (gong xiang yu fazhan), at Zhejiang University and an associate at the institute, Yang Yixin.^[8]   The essay discusses Zhejiang Province’s pilot program to build “common prosperity.” While using the standard image of an “olive-shaped society” — the model of a social structure that is thickest in the middle and thinner at the two ends — the essay is anything but radical.  It does propose taxes on wealth, such as estates and real estate, but only in the course of time.  The authors do not argue for a progressive income tax.  They call for “high-quality development” that expands incomes in the middle, but their only concrete prescriptions promise more “digitalization” and the “sharing economy.”  They want to build middle class wealth by making sophisticated new financial products more widely available, assuming that more financial sophistication would spur economic growth.  They want to reduce the incomes at the top by encouraging more charitable donations (i.e. “tertiary distribution”) but do not propose using the tax code to create incentives for that purpose.  They call for extending social rights to migrant workers, but only gradually, and without hukoureform.  They call for the use of “collective consultation” (xie shang) rather than collective bargaining between organized labor and employers over wages.^[9]  Most of the calls for improved workers’ wages, in fact, have to do with incentive pay rather than base pay.  Are these as far as the writers can go?  Or are these progressive-minded economists so fearful of the Maoists that they think they must guard against any serious shifts in social or fiscal policy?  Substantively, the essay reveals policy experts’ reluctance to discuss the many forms of rent extraction that a state-dominated, cronyistic economy permits, the ways in which income rents support the Party’s political monopoly, and the forms of privilege that prevent real mobility of capital or labor across sectors and regions.  They bind the regime’s political elites with businesspeople, state and private, who generate the rents the Party uses to maintain its power.  Little wonder that serious reform-minded economists stop well short of analyzing the political economy of the regime.

At present, policymakers are working to deflect the “common prosperity” initiative into politically policy concepts.^[10]  A visible example is the idea of “tertiary distribution.”^[11]  In Chinese parlance, primary distribution is the result of the marketplace, where contributions to production determine the returns to labor and capital.  Secondary distribution occurs through redistributive mechanisms, specifically taxes, social insurance contributions and benefits, and social transfers.  Tertiary distribution — the channel that the current policy emphasizes as the way to achieve “common prosperity” — is voluntary donations of money and time to the nonprofit sector.  Experts are calling for a reform of the tax code to provide material incentives through tax deductions for such contributions.  However, given the current political climate, many wealthy individuals have found it expedient to make sizable and well-publicized donations to worthy causes.  Lacking in the current debate is a reconsideration of more basic economic and political institutions that have fostered cronyistic and corrupt exchanges of benefits between wealthy entrepreneurs and political officials.

Therefore, when we interpret Xi’s gestures against Westernized entertainment industry stars, the private tutoring industry, and —selectively — against big digital platform companies as a broad “crackdown on everything,”^[12] we overlook the fact that this is a highly selective and politically motivated campaign.  Because regionalism, cronyism, and corruption are so deeply interconnected, enabling tycoons to amass wealth and power by cultivating mutually beneficial ties with local officials, it makes political sense for Xi to single out Jack Ma’s Zhijiang-based business empire and the regional officials who were closely tied to him: the campaign strikes at all three problems at the same time.^[13]

The calls for “common prosperity” therefore reveal the limits on policy choices available to Xi.  These are grounded in the multiple compromises his regime must make to retain power, between the monopoly of an ideologically driven communist party and its dependence on an economy dominated by politically favored state and private companies that feed the regime with taxes, kickbacks and privileged ownership shares.  The leaders seek to respond to rising awareness of the extreme economic inequality in the country by taking measures to curb the excesses associated with particular firms and sectors, and by reaffirming Communist values.  At the same time, they dare not move too far toward policies that would seriously harm the interests of the richest strata of entrepreneurs and managers who have locked in their advantageous positions by cultivating the favor of politicians at the local and national levels.  Little wonder that new leftists are seizing on the opportunity to press for a radical turn away from the partial reform economy back toward Maoism, or that establishment party leaders and experts find it necessary to warn against any substantial steps toward a more far-reaching redistribution of wealth.  In a polity where ideology and power are intertwined, the deepening of contradictions between the avowed doctrines of the regime and the actual institutions and practices its power rests on results in a gulf no amount of central control can bridge.

^[1] Nina Andreeva, “Ne mogu postupit’sia princtsipami,” [I cannot violate my principles] [https://diletant.media/articles/34848945/]

^[2] Thomas F. Remington, “A Socialist Pluralism of Opinions: Glasnost and Policy-Making under Gorbachev”, The Russian Review 48: 3 (1989), pp. 271-304.

^[3] [http://www.xinhuanet.com/politics/2021-08/29/c_1127807097.htm]  The reference to masculine cultural imagery alludes to the frequent complaint that the prominence of androgynous styles of self-presentation (sometimes called “sissy-boy” styles [jingzhunan or simply jingnan, ie refined pig boys or refined boys] on the part of some male entertainment industry figures.  This fad became the target of heated cultural criticism in recent years for its violation of traditional gender role stereotypes.  Under the current crackdown, commercial ads and television programs may not use such images.

^[4] https://www.scmp.com/news/china/politics/article/3147548/viral-blogger-hailed-chinas-profound-revolution-state-may; https://www.wsj.com/articles/chinese-essayist-revives-worries-about-a-new-cultural-revolution-11630670154;

^[5] https://www.scmp.com/news/china/politics/article/3147548/viral-blogger-hailed-chinas-profound-revolution-state-may; https://www.wsj.com/articles/chinese-essayist-revives-worries-about-a-new-cultural-revolution-11630670154.

^[6] https://www.scmp.com/news/china/politics/article/3147548/viral-blogger-hailed-chinas-profound-revolution-state-may.

^[7] Zhang Jun, “Gong fu hui xiaochu shouru chabie, dan ke baozhang diceng timian shenghuo,”  [https://fddi.fudan.edu.cn/15/20/c18965a398624/page.htm#:~:text=8%E6%9C%8817%E6%97%A5%E5%8F%AC%E5%BC%80,%E7%9A%84%E6%A9%84%E6%A6%84%E5%9E%8B%E5%88%86%E9%85%8D%E7%BB%93%E6%9E%84%E3%80%82&text=%E5%85%B1%E5%90%8C%E5%AF%8C%E8%A3%95%E6%98%AF%E5%90%A6%E5%B0%B1%E6%98%AF%E6%B6%88%E9%99%A4%E6%94%B6%E5%85%A5%E5%B7%AE%E5%88%AB%EF%BC%9F]

^[8] Li Shi and Yang Yixin, “Jianshe shouru fenpei zhidu gaige shiyan qu zhu tui gongtong fuyu” [“Establish reform of the income distribution system by a pilot zone for common prosperity”][http://www.ce.cn/xwzx/gnsz/gdxw/202108/19/t20210819_36821588.shtml] August 19, 2021

^[9] On this distinction, see Thomas F. Remington and Cui Xiaowen, “The Impact of the 2008 Labor Contract Law on Labor Disputes in China,” Journal of East Asian Studies 15:2 (2015), p. 280.

^[10] For example, see the spate of articles in Caixin Global explaining that “common prosperity” does not mean “robbing the rich to give to the poor” and that it is an encouragement to more “tertiary distribution.”  For example, Cai Xuejiao, “’Robbing the Rich’ Is Not Part of China’s Plan for ‘Common Prosperity,’ Official Says,” Caixin Global, August 26, 2021; Wang Tao, “What Does ‘Common Prosperity’ Mean for China’s Policies and Economy?” Caixin Global, August 27, 2021.

^[11] Eg. Kevin Guo, “CX Daily: What’s Standing in the Way of ‘Common Prosperity’?” Caixin Global, September 10, 2021 [https://www.caixinglobal.com/2021-09-10/cx-daily-whats-standing-in-the-way-of-common-prosperity-101771292.html]; Caixin Global, “Editorial: Releasing the Potential of Tertiary Distribution,” Caixin Global, August 23, 2021 [https://advance-lexis-com.ezp-prod1.hul.harvard.edu/document/?pdmfid=1516831&crid=3b2d80b9-253e-4bf0-a656-90ef416dd531&pddocfullpath=%2Fshared%2Fdocument%2Fnews%2Furn%3AcontentItem%3A63F7-M2R1-DY28-G00P-00000-00&pdcontentcomponentid=468180&pdteaserkey=sr9&pditab=allpods&ecomp=nzvnk&earg=sr9&prid=3c59210a-fdc4-4d3a-95cb-a8fd4011aafc]

^[12] Lily Kuo, “Xi Jinping’s Crackdown on Everything Is Remaking Chinese Society,” Washington Post, September 10, 2021.

^[13] Lizzi C. Lee, “Xi Jinping’s Graft Busters Are Probing Jack Ma’s Home City, and a Rising Star of Xi’s Zhejiang Clan,” SupChina, August 31, 2021 [https://supchina.com/2021/08/31/xi-jinpings-graft-busters-are-probing-jack-mas-home-city-and-a-rising-star-of-xis-zhejiang-clan/]

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Book Review: Desmond Shum, Red Roulette (Scribner, 2021); 310 pp. hardback

Billed as a “tell-all” about the scandals of the Chinese Communist Party as it led China’s re-entry into the global system, this tale is a page-turner of policy shifts and intrigue, including the mysterious disappearance of the author’s wife.  Shum’s main takeaway is that the CCP only cares about its power and protecting the top cadres’ children, who will carry on and protect the current leaders in their retirement.  At the core of what Shum calls the “red aristocracy” are the original cadres who fought along with Mao Zedong, and the “princelings,” their offspring. China’s economic success, Shum argues, was achieved by connecting entrepreneurs to these political elites, an arrangement that served the interests of both.  In Shum’s view, that arrangement has run its course, as President Xi, one of the princelings, pushes Chinese socialist values while condemning western ones.

Shum was born in Shanghai in 1968 but moved with his family to Hong Kong, which was not easy to arrange, especially because Shum’s father did not come from a “good” background — people who supported the CCP once they won the civil war in 1949.  Shum’s grandfather had been a lawyer in Shanghai, which made him a capitalist and therefore a bad element.  His father ended up in a low position teaching Chinese at a Shanghai teachers’ training school and met his mother there.  But his mother had relatives in Hong Kong who helped her get to the British colony. But it took years of cajoling authorities to let his father join her in Hong Kong. 

Ironically, once China began to reform, Shum’s mother and father willingly moved back to Shanghai to make fortunes.  Shum’s father had a successful stint with TysonFoods in Hong Kong, and the company sent him to Shanghai to build its China market. Shum moved back to China as his company’s representative in Beijing in 1997.  He lived as an expat gaining business experience but without much success.

Shum’ business career took off when he met Whitney Duan (Duan Zong) in 2001. They became business partners, eventually married and later had a son.  The book opens with the fact that Whitney disappeared in 2017, and that Shum had not heard from her or received any news about her since.

Whitney, who was born in Shandong Province in 1966, started a company called Great Ocean.  As a Christian, she vowed never to get ahead by being corrupt.  However, she was adept at cultivating relationships with people at the highest levels of the Chinese leadership.  She became especially close to Auntie Zhang (Zhang Beili), who was the wife of Wen Jiabao.  Wen rose in the political ranks to become Premier from 2003 to 2012.

Through their tirelessly cultivated connections, Shum and Whitney were able to obtain valuable pieces of land and permission to build major projects, including the cargo area of the Beijing Airport and a large office-condo complex nearby.  Through their development company and access to other sure-bet investments, they were able to make hundreds of millions of dollars over the years.

Three aspects of Shum’s story are especially intriguing.

First, he provides a clear description of how connections, guanxi, work and offer rewards in China. In the Chinese context, guanxi — like networking in the West — does not mean corruption, but Shum argues that to do any business in China one must curry favor with the Communist Party.

Second, one can see how business changed as reforms advanced and the business environment evolved due to new regulations, infrastructure buildout, rising incomes, and interaction with global markets.

Third, Shum’s description of the changing environment matches nicely with a recent article explaining the man behind the big ideas of the top leadership in the CCP: Wang Huning (https://palladiummag.com/2021/10/11/the-triumph-and-terror-of-wang-huning/).

Shum describes the capitalist experiment as alive and well in the early 2000s, but he saw the backlash against liberalism picking up steam in the mid-2000s. In the early 2000s, state-owned enterprises were being listed on the New York Stock Exchange, private companies had some access to bank loans, the housing market had taken off, and the middle class was growing and spending. People like Wang Qishan, a reformer, had risen to power. Wang was vice premier in 2008 under Wen Jiabaon and a close friend of Whitney’s. 

By 2006, however, there were signs that capitalism was not going to work in China after all, which only accelerated with the global financial crisis in 2008. Changes that followed made it harder to do business, such as requiring private and joint venture firms to have Party committees, and regulations that gave state enterprises advantages over private firms. About that time civil society also began to feel increasing pressure to conform to Party demands.

Overall, Shum argues that despite the seemingly capitalist “experiment,” the leaders never intended to end the Communist system.  For example, listing state enterprises on stock exchanges was not a move to privatize them, but rather a way to strengthen these companies to compete globally with the private sector.  The shift to reassert Party control over the economy and society had begun.  The Party leadership ladder changed too — less moving up the local ranks (as these people were difficult to manage) and instead bringing in loyalists from other regions.

Shum suggests that he and his business friends did not want to overthrow the Party. They did want a more open system.  He and others willingly donated some of their vast wealth to support education and other social improvements. But Shum increasingly saw private companies and entrepreneurs being used by the Party, and that long-term, private investment was not a realistic option.  Get in, make money, and sell out as fast as you can — that became the goal.

China’s successful economic growth and the improvement of the state sector meant the Party did not need the private sector as it did before. Hence it was no longer essential to have lax Party control over business. Shum argues that repression and control are the foundations of the Party, and this has not changed with the modernization of China under reforms.  In 2012, Document No. 9 titled “Briefing on the Current Situation in the Ideological Realm” appeared. It warned of dangerous western values such as free speech.  The situation has continued to worsen since then.

Just before the publication of Red Roulette, Shum received a call from Whitney. As described in a segment of Australian 60 Minutes on September 26, 2021 (https://www.youtube.com/watch?v=bOtVMFPjNUA), she had been at least temporarily released from detention, where she had been cut off from all news of her family, China, and the world.  She asked Shum not to publish the book and said if he did, he and their son would be in serious danger.  She called a second time as well, but Shum chose to tell their story to help the world understand the challenges of the business environment in China and the political realities behind it. Not everyone deals with such extremes of corruption and power in China as described by Shum, especially if they are located outside of Beijing. But this story helps put into perspective some of the current policies in China today, such as the anti-corruption campaign and President Xi’s move toward reestablishing socialism as the Party’s most salient goal. The bottom line is that the Party, led by President Xi, is trying to ensure that it stays in power for the long haul.

The post Book Review: Red Roulette by Desmond Shum appeared first on China Research Center.

Xu was born and raised in the FAW. His father, Xu Zuoren, was a founding member and deputy director of the company. Xu Jianyi was born in 1953, the same year that FAW was founded. His father named him Jian (build) Yi (first) after the First Automotive Works. As a “second-generation FAW,” he got promoted quickly through the ranks after starting to work at the company in 1975. Xu spent at FAW for 36 years, his entire working life except for four years when he worked as a mayor in local government. From 2010 to 2015, he was the president and party secretary of the FAW Group. Instead of receiving compliments on Hongqi’s success in the new era, the man who was born to rule FAW was placed under Party detention and investigation in March 2015. He must have wondered where it all went wrong.

The story of Xu Jianji and the automobile maker he helped build is more than an epic tale of rise and fall and personal sacrifice. It is a window into how state-owned enterprises have evolved through the historic upheavals that have marked China from the founding of the People’s Republic until now. This essay then offers a brief introduction to the history of Hongqi from Mao to Xi.

Former chief Hongqi designer Chen Zheng also was swept away by stormy political winds. Inspired by fashionable Italian cars, Chen made the 1962 Hongqi CA72 model slimmer, flatter, and sportier by virtue of exterior design changes. The new look, however, only brought him misfortune. His father, Cheng Ke, had been mayor of Tianjin before 1949.  Cheng Zheng was a car enthusiast and an artist who bought a secondhand motorbike and rode around the countryside, finding inspiration. But his family background helped earn him a conviction for designing a “flat belly car” that was “a vicious attack and mockery of the Great Leap Forward movement and the great famine.” He was also criminalized for being a “hypocritical person living the Western lifestyle.” He and his sample car were paraded through the FAW and subject to public criticism. His wife very publicly divorced him because of the political pressure, and he was sent to the assembly line as a cleaner.

Consecration: Hongqi and FAW from 1956 to 1984

The First Automobile Works was the first major state-owned automotive manufacturing company in China. Its purpose was to manufacture military and industrial trucks. In July 1956, the first Jiefang (Liberation) truck rolled off the assembly lines. Chairman Mao was pleased after the presentation of the truck in Beijing and said, “It would be great if one day we could ride in our Chinese manufactured saloon car to attend meetings.” It was the beginning of the consecration of FAW and the Hongqi model.

In 1957, the Chinese central government ordered FAW to manufacture a saloon model for the national leaders. After collecting information on the most advanced modern luxury saloon cars available in the 1950s, FAW chose to reverse engineer the Simca Vedette and the Mercedes-Benz model 190. The result was China’s first indigenous saloon car; the Dongfeng CA71 manufactured in 1958. The model was named Dongfeng (East Wind) based on the quote from Mao’s speech in Moscow: “The east wind prevails over the west wind.” Initially, the Dongfeng’s nameplate used the Roman alphabet, but Beijing urged FAW to change it to Chinese characters handwritten by Mao and add a company logo to the side of the car written by Mao. In 1958, FAW top managers Rao Bin, Shi Ruji, and Li Lanqing took the Dongfeng CA71 to Beijing to present it outside Huairen Hall, Mao’s residence. All national leaders were summoned to view the car.

During the presentation, Premier Zhou Enlai opened the hood and asked, “I heard this engine is copied from Mercedes-Benz model 190, right?” Shi Ruji answered, “Yes.” Zhou said, “All major automotive brands copy from each other. But we need to do it cleverly, and we have to make some changes; if we copy the engine exactly, they would be unhappy. For example, we can change the shape of the valve chamber cover.”

This was the moment of consecration of FAW and service to Mao directly. The marriage made FAW – and later the Hongqi model – sacred, a political symbol of the state-owned economy. FAW managers, engineers, and workers were not only manufacturing cars, but they are the direct servants of Mao. These were not mere cosmetic honors but actual political assets that had brought personal advancements and tragedies to FAW managers and engineers.

From 1953 to 1956, FAW sent around 500 engineers to the Soviet Union. Many of these engineers were promoted to important positions later on. Two eventually became top party leaders. Li Lanqing served as Vice Premier of China from 1998 to 2003. Jiang Zemin became the Party General Secretary and the President of China from 1989 to 2003. During Jiang’s 15-year presidency, he paid official visits to FAW three times. He often called himself  “an FAW man.” He took countless official photos in the same spot beside Chairman Mao’s handwritten inscription stone of FAW.

Only 30 Dongfeng CA71 model cars were ever manufactured. As a vehicle for Mao himself, the model used the best possible material, such as silk brocade seats, velvet ceilings, wool carpeting, lacquer-wood control panels, carved ivory switches, and cloisonné smoking utensils. However, it was not a reliable car. It broke down frequently. The reverse engineering methods used to make it were crude, reflecting China’s lack of technological and manufacturing knowledge. But the Dongfeng laid the foundation for the development of the Hongqi model. At the height of the Great Leap Forward movement in 1958, FAW announced a plan to build a more luxurious saloon car 90 days after the first Dongfeng CA71 model was manufactured. The idea was to produce a completely new model with better performance and reliability within a month. FAW engineers based the design of Hongqi model on a 1955 Chrysler Imperial bought from the Yugoslav Embassy in China and borrowed from the Jilin Institute of Technology. The most challenging part of making the Hongqi model was reverse-engineering the V8 engine.

Soviet experts had told FAW engineers to give up on the V8 engine design because even the USSR could not produce an eight-cylinder engine in 1958. This inspired FAW managers and engineers, and they set out to prove they could do what the mighty Soviet Union could not. The plan: hand-cast 100 engine blanks based on the Chrysler engine, choose the three best ones and assign each to a team of engineers and craft workers, who labored day and night for two weeks to hammer out a prototype. The best one was picked to put in the experimental CA72-1E model. In August 1958, after 33 days of intense work, the first Hongqi model was manufactured. It was named Hongqi (Red Banner), meaning the car was designed and built “holding the great red banner of Chairman Mao’s Thoughts up high.” Within two months, FAW produced a convertible version of the CA72 model for the 10th national day military parade. These were abnormal model development time frames with unusual methods of production. It was a lavish sacrifice to support Mao’s Great Leap Forward movement.

Engineers at FAW had spent a year testing and upgrading the design of the CA72 based on two other advanced saloon models, the Cadillac Fleetwood and Lincoln Continental. The finalized version was manufactured in August 1959. The design of the CA72 model was classic with strong Chinese elements. The design was a mixture of imperial residuals and Communist political symbols, such as the fan-shaped grille and the Chinese royal lantern-shaped taillight. There were five little red flags representing worker, farmer, merchant, student, and solider on the side of the car. In 1960, FAW designed a three-row CA72 model that carried three little red flags representing the General Path, Great Leap Forward, and People’s Commune, representing Chairman Mao’s three key political philosophies in 1960.

In September 1964, the Hongqi model was declared China’s “National Car.” It became the official vehicle for national events, diplomatic missions, and national leaders. However, the Cultural Revolution severely curtailed the production of Model CA72. Only 206 units were ever produced. In 1965, a new Hongqi CA770 model was designed by Jia Yanliang, who was just 25 years old. It contained a redesigned exterior and engine. The new engine was based on Cadillac V8 engines with two-speed automatic transmissions. Party leaders directly participated in the design of the car to add more luxury features. In 1966, the first 52 units of the Hongqi CA770 model were transported to Beijing and distributed to national leaders with interior colors of their choosing. In 1969, the first Hongqi CA772 bulletproof model was manufactured. The development team was led by Mao Weizhong, from the Central Security Guard Bureau of national leaders. Other team members included military experts in bulletproof armor. The model contained 6mm bulletproof armor, 65mm bulletproof windows, and tires that could run 100 miles after bullet penetration. The car weighed 4.92 tons and was regarded as the safest car in the world in its time. The Hongqi CA772 model earned an infamous part in Chinese history as Chairman Mao’s appointed successor, General Lin Biao, fled in it to the airport in 1971. Bullets fired by guards only scratched the surface of the armor.

It was the height of glory for Hongqi. However, just like CA72 and its designer Cheng Zheng, the sacred status of Hongqi also brought tragedies to its designers. The initial design had three red flags on the side of the CA770 model representing “Mao’s General Line, Great Leap Forward and People’s Commune.” Beijing Mayor Peng Zhen suggested that FAW change it to one big flag representing “Mao Zedong Thought.” During the Cultural Revolution, the single-flag design became the basis for one of Peng Zhen’s criminal charges and evidence that he had attacked “Great Leap Forward and People’s Commune.” Hu Yuyong, the general manager of FAW, and Jia Yanliang himself were publicly criticized for cooperating with the criminal Peng Zhen. Jia was expelled from the position of chief designer of Hongqi until 1972.

The development of Hongqi CA773 model started in 1968. However, the FAW saloon car development team was abolished during the Cultural Revolution, and all engineers were sent to work in the factory as assembly workers. Workers on the assembly line took over the job to develop the Hongqi CA773 model. These barefoot doctors of the factory floor demonstrated the foolishness of favoring “red” over “expert.” The Hongqi CA773 model was in production from 1969 to 1976, but due to various design faults and quality issues, only 291 units were produced in seven years.

Hongqi development resumed in 1972. FAW engineers began designing the CA774 model. The development team was led by Jia Yanliang, the designer of the CA770. The idea was to catch up and overtake the most advanced saloon car in the world. To achieve that, Jia designed four sample models in 1975 with bold changes from previous Hongqi models. The new design was advanced and modern and included the use of arc-shaped side windows to improve aerodynamics. The car body was made of high-strength steel sheets to reduce weight. It was the first time a Chinese automaker had used a modern monocoque body frame design. However, the design conflicted with some functions of the car. The aerodynamic shape was regarded by some officials as lacking in solemn status compared to the old square shape. There were safety concerns about the big, transparent car windows that overexposed passengers and officials rejected the most modern, bold Hongqi CA774 model. The attempt to upgrade the Hongqi failed. Its symbolic and sacred status as Mao’s car prevented its modernization. In 1976, FAW made an unsuccessful attempt to upgrade the Hongqi model by seeking joint development with Porsche. In 1976, Chairman Mao died. The central government ordered FAW to create a vehicle for the Chairman Mao Memorial Hall to carry the Chairman’s corpse in case of an emergency. It was the last Hongqi made for Mao.

The Weakened Hongqi in the 1980s

In 1979, FAW resumed the development of the CA774, with Cheng Zheng came back as the chief designer. After the Cultural Revolution, his design turned conservative, back to a non-bearing body system with reduced window size to comply with the government’s safety requirements. But the central government had lost interest in new Hongqi models, and Cheng’s design was never manufactured. As a highly politicalized symbol that was closely associated with Mao, the sacred status of Hongqi faded temporarily with Mao’s death.

With economic reforms undertaken by Deng Xiaoping, the technology gap between state-owned auto manufacturers and the international automotive industry became apparent. Top Party officials started to complain about the Hongqi. FAW was experiencing huge financial losses. The vehicle had high fuel consumption and poor reliability. There were moments of diplomatic embarrassment when cars broke down after picking up foreign leaders from the airport. The last straw was a serious accident caused by brake failure when the Romanian president was visiting the Great Wall. There were political reasons for Hongqi to fall out of favor, too. Modernization, the market economy, and westernization were the new trends in China. Hongqi was regarded as a symbol of conservative, bureaucratic debris that needed to be reformed. At the time, economic reform was the priority, and after Mao’s death, the glory surrounding the man was deflated.

In 1981, FAW President Rao Bin and the General Manager Li Gang were summoned to Beijing and told of the decision to cease Hongqi production. Rao argued with Premier Zhao Ziyang over the decision in the meeting, saying, “Four people carrying a palanquin is different from 12 people carrying a palanquin. (Palanquins were enclosed sedan chairs in which officials were transported by men holding long poles.) The car is bigger and heavier, so fuel consumption is higher. Fuel consumption of the Hongqi is not much higher and foreign luxury models. The unit production cost is ten times more than a Jiefang truck. The factory is suffering a loss on the Hongqi, but it is for our national leaders, and it is a way for FAW to express our patriotic hearts.” Zhao rudely interrupted him and said, “你别打肿脸充胖子了” (“Don’t slap your face until it’s swollen in an effort to look imposing.”). The harsh Chinese proverb means someone is bragging. Rao then asked, “What about the future of our indigenous saloon cars for leaders?” The one-word reply he received was “importation.” In May 1981, the People’s Daily announced the order to cease production of the Hongqi. It was perceived as a strong signal of economic reform. National leaders started to ride in imported cars. In 1984, China had imported a large number of Toyota Crown models from Japan as official vehicles and Mercedes S-Class for national leaders.

Once Party leaders, the only customers of the Hongqi, decided to abandon it, FAW had only two choices: let the Hongqi disappear or face the mass market. FAW chose the latter. But that required cooperation with major carmakers from around the world. Two years after ceasing production of the Hongqi, the first major automotive international joint venture, Beijing Jeep, was established between American Motors Corporation (AMC) and Beijing Automobile Works (BAW) in Beijing. The Chinese automotive industry had entered a new era.

The Rebuilding of FAW from 1985 to 1995

A strategy of 市场换技术 – “give market access in exchange for technology” – policy emerged in the 1980s. It was proposed by Rao Bin, who was promoted to be Chairman of the China Automotive Company in 1982. He had a clear vision about the future of the Chinese automotive industry:  change the Soviet industry structure and shift resources from heavy industrial/military vehicles to civil passenger cars. Rao wanted the automotive industry to become a pillar of the Chinese economy. As the founder of FAW and SAW, he recognized the technology gap, and encouraged state-owned enterprises to import technology and set up joint ventures with advanced carmakers. He was involved in all the major joint venture negotiations in the 1980s, including the deals for SAIC-VW to manufacture the VW Santana model, Beijing-Jeep-Chrysler to manufacture the Jeep model, and Nanjing Automotive Corporation Group-FIAT to manufacture NAVECO.

Although there was no Hongqi model in production from 1981 to 1996, the development of the Hongqi model never ceased in FAW. Building on the experience of a failed negotiation with Porsche, FAW’s strategy was to develop the model with foreign manufacturers jointly. The goal was to bring advanced foreign technologies to FAW as a foundation to build indigenous models. Lu Fuyuan was the chief negotiator for FAW. In 1982, the company started to hold talks with international carmakers, including Nissan, Ford, Chrysler, and Audi.

Meanwhile, FAW engineers were researching the most popular sedan models of these brands as foundations to build the new Hongqi model. However, the results were counterintuitive and chaotic, as FAW reimagined the Hongqi using reverse engineering methods of the past. In 1982, the model CA750 was patterned on the Nissan 280C, using engines, gearbox, and chassis from the 280C model. In 1984, FAW engineers had installed a Ford 5.8L V8 engine in the CA770 model and redesigned the interior based on Lincoln models. In 1986, FAW engineers developed a new Hongqi model based on the Dodge 600 with Chrysler 488 engines. These three models never went into production because FAW could not reach an agreement with the car companies. Chrysler promised to sell its Dodge 600 production line to FAW in 1987 after FAW bought the Chrysler 488 engine production line. However, the American company increased the price of the Dodge production line, and FAW did not pursue the purchase. FAW was left with a Chrysler engine production line without a means to manufacture a car with it. With no international partners, some engineers in the FAW resumed the effort of redesign the Hongqi model independently. However, their efforts never resulted in production either. These chaotic efforts to build a new Hongqi model reflect the state of FAW of the time. It had lost its totem and was desperately trying to adapt to the new structure of the “profit and efficiency first” world.

FAW managers learned that it was challenging to purchase technologies from international car companies without further collaboration. In 1988, FAW established the FAW-VW with Audi and VW to produce the Audi 100 model through the help of an old comrade of FAW. Jiang Zemin worked at FAW from 1954 to 1962 in the power chain department as an engineer. Shen Yongyan, a close friend and colleague of Jiang, became the Deputy Chairman of FAW in the 1980s.

In 1986, FAW was facing financial difficulties. Geng Shaojie, the president of the company at the time, was discreetly preparing to produce saloon cars. FAW had negotiated with American and German carmakers and was ready for collaboration. Around that time, another Chinese state-owned automaker, SAIC in Shanghai, was working with the VW group to produce the VW Santana. In the summer of 1986, SAIC started to assemble an Audi model using SKD (knock-down kit) technology on the Santana production line. Geng Shaojie heard about this news and urgently ordered Shen Yongyan to go to Shanghai and meet with the then Mayor Jiang Zemin. They planned to negotiate with SAIC to help them meet the target of 65 percent domestic production rate of Santana parts in exchange for SAIC giving up on the production of the Audi model and letting FAW collaborate with Audi. They had the meeting at Jiang’s residence at night. The deputy mayor in charge of the Shanghai automotive industry was summoned by Jiang. Shen explained to Jiang that producing Santanas and Audis were two very different tasks. The factory needed new mold equipment. SAIC could assemble a few units using SKD, but it did not have the capacity to mass-produce Audis. In Germany, Santana and Audi were produced in two factories. FAW had a strong foundation with its rich experience of producing top-class saloon cars, even if the Hongqi production line was closed. If SAIC could leave the Audi production to FAW, FAW could help to manufacture Santana components domestically. This would be beneficial to SAIC and FAW. FAW could get the central government’s support to resume high-class saloon car production in China. Shen was trying to persuade Jiang and to test SAIC’s reaction. Jiang thought for a while and looked around the room and said, “That’s fine.” One year after the meeting, the central government announced FAW and Dongfeng would be the two major manufacturers of saloon cars, the critical task of SAIC was to localize the production of Santana parts. The central government would not approve any new saloon car manufacturers in China.

By the end of 1988, VW informed FAW about the availability of the Westmoreland plant south of Pittsburgh, Pennsylvania. The plant went into operation in April 1978 with an annual production capacity of 300,000 units of VW Golf models. The main plant covered 260,000 square meters and had three production lines, including body welding, painting, and assembly. These production lines and machinery represented advanced technology to FAW. Meanwhile, another Chinese state-owned car factory, SAW Dongfeng, had entered negotiations with other car companies on advanced saloon model production. FAW was in desperate need of securing these production lines from VW. To disguise its desperation, FAW chief negotiator Lu Fuyuan picked just one colleague, Li Guangrong, the deputy chief engineer of foreign relations, to form a modest two-man negotiation team to go to Germany.

Lu Fuyuan was born in a rural farming family. He self-studied English, Japanese, and Russian, as well as radio transmitter technology and computer science as a FAW worker. In his spare time, he translated instruction handbooks for imported machinery. With his excellent language skills and technological knowledge, he discovered faults in some imported machines that failed to perform to the standard in instruction handbooks. He was promoted by the FAW leadership to take charge of negotiations with suppliers and seek compensation. He was later sent by FAW to study computer programming design in Canada. In 1985, Lu was promoted to vice manager of FAW. He was put in charge of managing foreign partnerships, joint venture negotiations, and technology importation. He was constantly traveling between China, Europe, and America, and was called the “Kissinger of FAW,” and represented FAW in all major negotiations with international car companies in the 1980s. His diplomatic skills and persistent qualities were on display in lengthy negotiations, earning him a promotion to the deputy minister of the Ministry of Machine-Building Industry and later to Minister of Commerce in the 1990s.

The negotiations with VW to buy the production lines so they could be dismantled and shipped to China were difficult. Lu was given only $20 million from the central government for the deal, and Volkswagen’s asking price was $39 million. After 21 days of hard negotiations, the parties settled on $25 million. A VW representative told Lu, “We have already dropped our price from $39 million to $25 million. If we sell the factory below that price, it would be shameful for us. But we are still friends, so let’s have dinner before you leave.” During the farewell dinner, everyone relaxed, and Lu overheard two German managers chatting about their concerns about Audi. The company was losing money in Germany, and they were contemplating layoffs. Lu immediately proposed a deal. The Chinese government would import enough Audis to allow the company to break even.  In exchange, VW would give FAW the three production lines at the Westmoreland factory for free. The sides agreed, settling on China importing 14,500 Audi units for three years.

Lu made another clever move. During the celebration dinner after the contract-signing ceremony, he suddenly realized that dismantling the plant would create industrial waste. He convinced the VW representative that the German company should pay to dispose of the waste, and asked the VW representative to sign the terms on a napkin.

Lu then traveled from Germany to the U.S.  He urgently summoned all FAW trainees to guard the Westmoreland factory gate. He told the Americans on-site that, “Everything inside this factory belongs to FAW now.” After dismantling the production lines, VW representatives came to Lu to negotiate the waste charges. Lu showed them the napkin proving that VW had agreed to pay all costs related to the waste.

Lu insisted that VW representatives in Pennsylvania reopen the production lines to prove they still worked. But his real motive was to allow FAW workers to observe how the production lines worked and avoid paying VW hefty training fees. FAW had sent more than 100 Chinese engineers to the U.S. to dismantle the production lines so they could be put it back together in China. In the contract, Lu insisted on adding an unambiguous term that FAW would own “everything, except people” in the plant. When he first visited the factory, 12 cars were parked in the factory parking lot. Lu wanted to keep those cars, but the Americans on-site strongly objected. He showed the VW representatives the contract, and they finally agreed to split the 12 vehicles. The six cars that Lu secured played an important part in transporting equipment and machinery. A few of them were even transported back to FAW with the production line. Until 2009, the factory producing VW Jetta models for FAW was still using the 64 robots purchased from the Westmoreland plant. The three production lines from the Westmoreland plant became the foundation of FAW-VW.

Hongqi in the Joint Venture Era 1995 – 2005

The Hongqi model had finally resumed production in 1996, 10 years after production ceased. The initial design for the new CA7220 model was completed in 1988, based on the Audi 100 and Chrysler 488 engine. It took four years for FAW engineers to fit the Chrysler engine into the Audi 100 body. Engineers spent another four years ramping up manufacturing of Audi 100 components in FAW factories. In 1996, 90 percent of Audi 100 components were being produced domestically, and FAW could finally begin making the Hongqi CA7220. It became the most successful Hongqi model in history. FAW secured 6.6 billion RMB in profit on the model from 1996 to 2006. Its commercial success was partly based on the Hongqi brand value. The CA7220 was the first Hongqi model that regional governments, organizations, state-owned businesses, and even private individuals could buy. The model was seen as a cheaper version of the Audi 100. It was manufactured in the FAW-VW factory with the still strong status of the Hongqi name.

In 1998, the next Hongqi model CA7460 was established for the luxury car market. Developed jointly by FAW and Ford, the model was identical to the Lincoln Town Car. All components were imported from Ford USA. It was assembled in the FAW factory and powered by the Ford 4.6, V8 engine.

The model rolled out in 2000 and was a total market failure. FAW sold fewer than 100 units that year, and the model was taken out of the mass production plan and was made only for special orders. This was just the beginning of chaotic development for the Hongqi.

In 1998, FAW launched an updated model of the CA7220 named Hongqi Mingshi with more advanced features such as ABS, airbags, steering assistance, and central locking. The new CA7220 boasted of a FAW developed engine, the CA4GE, based on the Chrysler 488 engine. In 2004, the Hongqi Century Star model was launched, powered by an Audi 2.4L V6 engine. In 2005, a new Hongqi Mingshi was launched, powered by the Nissan QG18 engine. In 2005, the Hongqi HQ3 rolled out, based on the Toyota Crown Majesta. All of these models failed in the market. Customers were confused. The only connection among these models was the Hongqi badge. The market reputation of the Hongqi brand was tarnished.

From 1983 to 2005, FAW tried to keep the Hongqi afloat, but the company’s strategy had not changed since the 1950s. It was based on seeking direct technology importation from international car companies and reverse engineering existing models. With the failures in model design and inconsistencies in market positioning, the Hongqi brand lost identity and direction. FAW meanwhile was focusing management attention on establishing profitable joint ventures. During the period, FAW went from near bankruptcy to profitability and success, notwithstanding the drag the Hongqi placed on the company.

Hongqi 2005 – Present

Hongqi sales collapsed. In 2004, only 14,525 Hongqi units were sold. By 2008, the number dwindled to less than 500 units. The company kept trying, however. In 2008, FAW discontinued the Century Star and the Mingshi but developed a V12, CA12GV engine model for the Hongqi HQE. The company priced the car at eight million RMB in 2009. The exterior design was identical to the Rolls Royce Phantom, with a price tag even higher. The Chinese state media heavily criticized this staggering price. FAW also brought out a new HQ3 model for select orders only.

The company used the HQE’s engine design to develop V8 and V6 engine models and an automatic gearbox. But no Hongqi model was available for those engines. Hongqi’s myriad problems seemingly proved a famous statement in 2000, by FAW president Zhu Yanfeng about Chinese brands needing to endure loneliness for 20 years. Zhu led FAW to become a profitable, self-sufficient business based on forging joint ventures.

In 2010, Xu Jianyi returned to FAW to succeed Zhu as the president. He said FAW would develop indigenous models at all costs. The Hongqi models entered a new era.

From 2010 to 2015, FAW spent around 32.84 billion RMB on R&D to develop just two FAW models, the Hongqi L5 and H7 – money deployed from profitable joint ventures. In 2011, FAW announced that a development team of 1,600 FAW employees was formed to develop Hongqi models. The new models were aimed at the government car market. The L5 model was priced at 5 million RMB for the private market. The safety features were designed to match the U.S. President’s Cadillac. The car had anti-rocket armor, chemical and biological weapons protection, and bulletproof tires. The V12 engine could enable the car to quickly escape any dangerous scenario. There also were Chinese elements, including a jade door handle. The headrests were fashioned to look like an emperor’s dragon chair. But only 21 units were sold from 2013. The Hongqi H7 was priced much lower: 450,000 RMB. However, with new Party leadership and revised government regulations, fewer than 5,000 units of the H7 were sold in 2015.

The L5 served a diplomatic purpose. In 2013, the car was used to transport French President Francois Hollande during a state visit to China. The deployment of the car symbolically harkened back to the 1960s, when the Hongqi’s first official use to carry the visiting president of France. In 2014, the L5 was the state car for the 22nd APEC meeting.

Hongqi’s more recent fortunes have very much reflected Xi Jinping’s anti-corruption campaigns. In 2012, FAW invested 24 million RMB to build a 600-square meter flagship dealership called the “Red House” in Beijing next to the dealerships of Rolls Royce, Bentley, and Aston Martin. From 2012 to 2014, Hongqi opened luxury dealerships in nine major cities in China. In 2014, Zhang Xiaojun, CEO of the FAW passenger car sales department, told the press that only when Hongqi is successful in the private car market will FAW consider itself a real success. Not only did Hongqi flop in the market, in 2015, Zhang was arrested on corruption charges. From 2013 to 2015, a total of 80 FAW managers were arrested on corruption charges.

In 2017 Xu Liuping, the president of the state-owned China South Industries Group Corporation, a core national-defense group, was named president of FAW. He made Hongqi his top mission of reviving FAW. The result of his effort is yet to be seen.

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The history of Shanghai and of its Jewish community, in particular, are among the most exhaustively researched topics in modern Chinese and modern Jewish history, with a vast amount of literature in Chinese, Hebrew, Yiddish, Japanese, Russian, German, English, and other languages. The late Hebrew University Sinologist Irene Eber, New York’s David Kranzler, Illinois College’s Steve Hochstadt, and many other scholars have made Shanghai Jewry a major research focus. Is there anything left to be said? Do any major historical questions remain unanswered?  I would suggest there are at least four such questions. They concern Jewish participation in the China opium trade, the perception of Shanghai Jews as Communists, the predicament of many Russian Jews left in China after 1949, and the history of Chinese-Jewish mixed marriages and miscegenation. I will consider these questions in roughly chronological order.

The economics of the trade have been extensively analyzed by Carl Trocki. We are left with the unresolved question of how Jewish opium traders reconciled their business ethics with broader criticisms of the day.  An anti-opium movement coincided with popular agitation against slavery, which, like opium, was an immoral but wholly legal activity in most parts of the world.  How did Jews respond to criticism of their participation in this physically and socially destructive business?  Did they remain silent and conduct business as usual? Contemporary Jewry needs to come to grips with its associations with the China opium trade much in the way the contemporary United States is in the process of reconciling its historical associations with slavery.

While Jews as a whole did not generally assimilate into Chinese society, some Jews did intermarry, produce mixed-race offspring, and/or adopt ethnically Chinese children. There are some well-known examples.  Israeli Aluf (Vice Admiral) Eliezer (Eli) Marom (“Chayni”) (Hebrew: אליעזר “אלי” מרום “צ’ייני”), was the Commander of the Israeli Navy in the years 2007–2011. As of 2015 he served as the head of the Israel Airports Authority. His brother Moshe Marom was also a senior officer, a rear admiral, in the Israeli Navy. Their father Erik was a German-born Jew and their mother Leah (originally Chai Li) was born in China, the daughter of a Russian-Jewish woman and a Chinese man who had converted to Judaism. Their parents met when their father escaped to China as a refugee from Europe during World War II. Lev Shickman was twice married to Chinese women and had three mixed-race offspring. But what about the history of lesser-known mixed-race offspring?

Impoverished Jewish prostitutes in Shanghai were available to Chinese men, and vice-versa, and there presumably were mixed-race offspring from these liaisons. Bitter poverty must have driven these women to prostitution, as well as the fact that this profession was so prominent and public in Shanghai. George Sokolsky broke a social taboo by marrying a woman of mixed Caribbean-Chinese blood. The Baghdadi Jewish immigrant Silas Hardoon had a Chinese wife and several adopted ethnic Chinese as well as Jewish children. Israel Epstein and his Caucasian wife Elsie Fairfax-Cholmeley (1905-84) adopted two ethnically Chinese children. After Elsie’s death, Epstein, like Sokolsky, Hardoon, and the American-born Jew and Chinese immigrant Sidney Shapiro, married ethnically Chinese women.

The Jewish immigrant to China and his or her Eurasian offspring or adopted children, while a vital part of the Jewish experience, are beyond the scope of extant literature, with two exceptions. There is a single vignette in Yiddish by Joseph Fiszman, a Polish immigrant active in Der Algemeyner Yidisher Arbeter Bund in Lite, Poyln, un Rusland, commonly referred to as “The Bund.” The German play Fremde Erde (foreign soil), deals with a German refugee woman’s relations with a Chinese man. Beyond these two accounts, what was the history of Chinese-Jewish marriages and liaisons and that of their mixed-race offspring and adoptees?

By way of conclusion, I am not suggesting that these are the only unresolved questions that emerge from a century-and-a-half of Shanghai Jewish history and historical writing.  I am only proposing items for a future research agenda, alongside other issues suggested by other historians. By considering these questions, we will not be wasting valuable time, effort, and resources attacking problems that have already been resolved. We will thereby avoid the pitfall of reinventing the wheel.

Editor’s note: This is the text of a lecture prepared for delivery at the international symposium sponsored by the Shanghai Jewish Refugees Museum, October 23, 2019.

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To consider these and many other questions about China, the Qatari-based Al Jazeera Network spent months in a number of countries interviewing scholars, practitioners, and commentators. In the end, AJE produced a 90-minute documentary titled “The China Complex” as part of the network’s signature TV documentary series “The Big Picture.”

Professor Fei-ling Wang of Georgia Institute of Technology, a China Research Center associate, was one of the scholars who appears prominently in the film. In addition to being interviewed, he took part in roundtable debate in AJE’s London studio, portions of which are featured extensively in the documentary. 

The film was broadcast in over 130 countries in December 2019 and it now available online in two episodes:

Part I:

Part II:

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The Fall of a Great Power

During the reign of Zhu Di, who became Yongle, the third emperor of the Ming Dynasty in 1402, the sphere of Chinese culture and influence expanded far beyond its traditional territories.  Although Zhu Di’s tactics were often ruthless, his reign is considered one of the most brilliant in Chinese history.  He moved the capital permanently to Beijing from Nanjing, reconstructing the 2,000-mile Grand Canal to transport grain from the fertile Yangtze River valley in the south to Beijing and building the majestic monuments known to most tourists visiting China today, including the imperial palace of the Forbidden City, the Temple of Heaven, and the palatial Ming Tombs.  Zhu Di personally led five successful military campaigns north of the Great Wall against the Mongols, who had ruled China for the century preceding Ming rule under the Yuan Dynasty beginning under Kublai Khan.  He fought the Mongols his entire life as they continued to be the greatest threat to Ming rule.

One of the premier achievements of his reign was the expansion of the Ming naval fleet under admiral Zheng He and the historic maritime empire created through Zheng’s expeditions.  Ironically, Zheng He was the son of a devout Muslim of Mongol extraction who was killed in battle while fighting with Mongol rebels against the Ming army. The Ming soldiers captured the 10-year-old Zheng, castrated him, and gave him as a servant to Zhu Di, a prince and prominent young army officer at the time.  Although eunuchs had not often been trusted with political or military assignments during the reigns of Zhu Di’s predecessors, Zheng became a valued confidante to Zhu throughout his military campaigns, including the rebellion Zhu led to take the throne from his nephew not long after the death of Zhu Di’s father, emperor Hong Wu.  Shortly after becoming emperor, Zhu Di placed Zheng in charge of the Chinese naval fleet.

Chinese vessels and sea charts had led the world for several centuries, but Zheng He expanded the capacity and reach of China’s navy exponentially.  His lead vessels, called “treasure ships,” were enormous for the age (at least five times the size of the vessels sailed by Christopher Columbus 90 years later). Each of these ships, which numbered more than 60 on the first voyage, carried at least 500 sailors and treasures of Chinese porcelain, silk goods, iron implements, and silver coins. The entire fleet of more than 300 assorted ships carried horses, weaponry, grain, and a crew of around 28,000 men.

From 1405 to 1433, Zheng led seven voyages, lasting two years each, to more than 30 countries throughout Asia, the Middle East, and Africa.  His plan under Zhu Di’s direction was to chart the entire world carrying thousands of tons of treasure and a military force to promote the power and influence of the Ming dynasty and build a great empire through gifts, trade, and foreign domination.  Using his military and diplomatic skills, Zheng founded numerous colonies during these voyages and brought many of the kingdoms he visited within the Chinese tribute system.  Zheng spread Chinese culture and influence throughout the regions he traveled, which can be traced centuries after his expeditions ended, as temples were constructed in his honor.

After Zhu Di died in 1424, the imperial power and influence of the Chinese navy soon ended.  Much like President Trump’s abandonment of the international trading system created and maintained by his predecessors for seven decades since the Second World War, the emperors who succeeded Zhu Di failed to see value in maintaining alliances beyond its borders.

Subsequent Ming ruler allowed its ocean going vessels to deteriorate and withdrew behind the Great Wall in the grand sanctity of the “Middle Kingdom.”  In an ancient version of “China First” policies, the kingdom closed its ports to foreign ships, which succeeding rulers believed only carried barbarians, in their xenophobic view of the outside world.  This policy continued into the Qing dynasty and ultimately led to disastrous, humiliating consequences in the last century of the empire.  In the nineteenth century, the Opium Wars, the territorial concessions taken by the Western powers, and the ravaging abuses inflicted by Japanese militarism have all instilled a lasting national resentment that plays a significant role in Chinese policy to this day.

A Great Rejuvenation

The current leader of the Chinese Communist Party, Xi Jinping, who has become the most powerful Chinese ruler at least since Deng Xiaoping (and likely will become the most powerful since Mao Zedong now that Xi’s term is unlimited), invoked the slogan, the “Chinese Dream,” as the guiding creed for his regime soon after he became president of the People’s Republic of China in 2012.  At first, many observers likened the phrase to a meaning similar to the “American dream” of individual economic prosperity, especially in view of the rising wealth of China as much of its population emerged from poverty under the economic reforms implemented during Deng’s rule.  But Xi’s use of the slogan offered a much broader theme: the dream he proposed was a nationalistic call for “a great rejuvenation of the Chinese nation.” Frankly, the message could be made into an American baseball cap with the slogan, “Make China Great Again.”  But unlike the Trump slogan, Xi’s includes a well-crafted strategy of revival and a true reference point to a time when China actually fell from a pedestal as the single most powerful nation on Earth.

President Xi cited the Chinese dream for a national rejuvenation in a speech given at the National Museum of China commending an exhibition called “Road to Revival,” which juxtaposed the achievements of ancient imperial China in the permanent exhibit against the spectacle of national humiliation that followed the penetration of European imperialists into the isolated Middle Kingdom and ended with what the Chinese call the “Second Sino-Japanese War” from 1931 to 1945. The exhibition presented a sanitized version of the progress made since the Communist “liberation” of China in 1949 on the road to the current “socialist market economy,” or what Deng Xiaoping called “socialism with Chinese characteristics.”  Of course, the exhibits gave no hint of the 1989 massacre that occurred in front of the museum on Tiananmen Square, downplayed the chaotic destruction of the Cultural Revolution, and largely ignored China’s other self-inflicted disasters occurring during the rule of the charismatic Mao Zedong.  It was against this backdrop that Xi urged national unity in the effort to revive the pride and greatness of China.

The memory of Zheng’s powerful navy was revived in the early twentieth century as the new Chinese republic began building a navy to defend against the imperial Japanese incursions.  More recently in the current century his diplomatic successes are being honored by recalling his exploits as a national hero and by imitation, especially in the use of soft power to extend Chinese influence.  As China has risen to become the second largest economy in the world behind the United States, President Xi has taken modern version of treasure ships abroad to welcoming countries and invested in infrastructure and established trade relationships.

While fulfilling the “Chinese dream of a great rejuvenation of the Chinese nation,” Xi’s plans include the construction of a land-based Silk Road Economic Belt and the Maritime Silk Road tying Asia to Europe, the Middle East, and Africa (known in a characteristically Chinese expression as “One Belt, One Road”) running along the path of the historic Silk Road and the maritime voyages of admiral Zheng He in the early fifteenth century. The One Belt, One Road project is not just a transportation project. China says it is committing more than $1 trillion for infrastructure projects in over 60 countries, spreading its soft power to win friends and expand its orbit of influence, presumably to “Make China Great Again.”

On November 15, 2016, a week after the U.S. presidential election, the Chinese government’s English language newspaper, China Daily USA, ran a large editorial cartoon depicting President Barrack Obama diving off the bow of a large container ship, named “TPP” (for Obama’s 11-nation trade agreement initiative, the Trans-Pacific Partnership), depicted stuck in the desert surrounded by cacti, sand dunes, and cattle skulls.  A long editorial described Beijing’s relief that “TPP is looking ever less likely to materialize by the day. After all, the trade grouping has been essentially . . . meant to counter China’s economic influence in the Asia-Pacific.”  The piece described Chinese President Xi Jinping and President Trump’s phone call exchanging good wishes for the “Trump era.”

Strategically, President Trump’s withdrawal from the TPP three days after his inauguration was a major win for President Xi in reaching his goal to make China great again.  As President Trump withdraws the United States from world leadership roles built over the last century (including his expressed desire to abandon the World Trade Organization), he gives an assist to President Xi as China attempts to transform into a global leader based on a strong economy, transformational infrastructure projects, a strong defense, and extensive international application of soft power projects.

Trump Retreats to Mercantilism and Trade Wars

Like the Ming emperors who withdrew behind the Great Wall and let their great ships rot in the docks to keep barbarians from entering the Middle Kingdom, President Trump is trying to build tariff walls (not to mention the campaign border wall) to withstand intrusion by foreign barbarians while withdrawing from world leadership under the illusion of America First economic nationalism. Three days before the Trump inauguration, President Xi appeared for the first time to reach out to the global elites with a free-trade message at the World Economic Forum in Davos, Switzerland, as if to offer himself in a debut role as the unlikely new champion of the liberal world economic order.

From the outset of his entry in public affairs, President Trump has revealed a dangerous degree of naiveté, to put it kindly, on international trade policy.  He thinks, for example, that unilaterally raising tariffs to trade war levels will force China to protect U.S. intellectual property rights and eliminate the trade deficit.  Before taking office, Trump’s ignorance of the U.S.-China bilateral history seriously undermined the relationship, as he threatened to terminate the all-important “One China” policy and proposed to give U.S. debt obligations to China a “haircut,” as if these debts deserved no more respect than a fee owed to one of his obsequious lawyers.  Now in his second year in office, the president has begun a full out trade war with China, America’s single largest trading partner, using Art of the Deal bully tactics, apparently thinking that he has leverage to bluff his way to victory.  It is a war he wages in the face of opposition from a majority of the American business community, at least a plurality of Congress, and growing public sentiment.  To date, the Chinese are not only refusing to capitulate, they are refusing to come back to the table.

With its large import market, the United States has some economic leverage, but China’s exports to the United States represent only four percent of its GDP, which continues to grow at six-point-six percent per year.  President Xi, who is trying to convert the Chinese economy away from being export driven now has an unlimited term of office, may be putting more stock in his political leverage, as he strives for a return to the greatness of China.  Meanwhile, President Trump’s political stock is down.

This trade war will likely have no winners in the short run, but may determine which leader’s slogan prevails in the long run.  President Xi has the obvious edge.

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This interview is based on a discussion in person and by email between Dr. Penelope Prime, the managing editor of China Currents, and Dr. Davis. The text has been edited for length and clarity.

Dr. Davis, welcome to Atlanta.  We are delighted to have you here and to learn from your expertise. We want to know how a sociologist sees what is going on in China today. The topic of urbanization runs throughout your work. What drew you to this topic and what have been the big takeaways?

I like cities, and I like living in cities. Perhaps if I had grown up on a farm, I would have the same emotional attachment to rural as to urban living; but in my case, cities draw me in. My first job after I graduated from Wellesley was at the Chinese University of Hong Kong and after two years, I became even more attached to high-density living and the cultural variety of urban, public life.  Subsequently at Harvard’s East Asian master’s program, I organized a reading group led by Alex Woodside to explore varieties of city life in East and Southeast Asia. In the mid-1970s when Americans couldn’t live in China, I interviewed PRC migrants in Hong Kong for my doctoral thesis. As a family of three we lived in a tiny 100 square meter apartment overlooking a busy street, and we thrived on the energy and diversity of the city. When I finally could do fieldwork in China in 1979, the Chinese government so severely restricted our geographic movements that we couldn’t even exit the final stop on the Beijing subway. One result was to turn my attention to analyzing the spaces and everyday life in the urban core.

Then after these early restrictions were lifted and Chinese and American scholars developed ongoing partnerships, professional and personal networks reinforced my initial focus on densely settled cities, and in particular on Shanghai. I first went to Shanghai in 1981 and then returned almost every summer between 1984 and 1995, following 125 households whom I first interviewed in 1986 and 1988. Over these 10 years, China took the first steps toward a rapid expansion of the urban population that by 2010 had created 160 cities with more than one million residents.

You have also studied marriage. Is that urban marriage or just marriage generally?

In my first book “Long Lives,” the core question was how the Communist revolution had impacted the elderly and their relations to their families in both rural and urban China. Previously many had assumed that collectivization of the economy and political campaigns against ancestor veneration had destroyed family solidarity.  Drawing on documents and household interviews, I argued that the economic, legal, and health initiatives of the CCP between 1950 and 1976 had actually strengthened family connections because they promoted higher levels of marriage among all social classes, and more sustained interdependence between elders and their surviving sons and daughters than had been the norm during the three decades of war and dislocation before 1949.

What are the big takeaways that you have found over these decades of studying marriage and cities and family relations?

First, I would stress that as a fieldworker focused as often on dynamics of daily life as on broad demographic and structural trends, I rarely can muster big takeaways. That is not to say I never generalize, but the level of generalization tends to be modest and contingent. For example, over the past decade I have focused on how the one-child policy, commodification of property relations, and enforcement of a new marriage law that reduced barriers to divorce have “privatized” the institution of marriage. But simultaneously, I have used focus groups and extended family interviews to probe the refined moral logics by which siblings and divorcing spouses divide domestic property as the party-state has granted individuals more privacy in how they conduct their intimate relationships. By listening to individual voices and placing these conversations within larger institutional spaces, sociologists work to understand both social process and personal agency.

Do you have any observation of youth in China these days?

As you know, currently I’m a visiting professor at Fudan University, and this year I will return for my third faculty appointment at Schwarzman College at Tsinghua University in Beijing.  In these two university settings, as well as in interactions with newly arrived PRC students in the U.S., I get a glimpse into the ambitions and fears of those in their late teens and early 20s. Fifteen years ago, acceptance to university guaranteed a good job upon graduation.  Now after rapid expansion of the tertiary sector, 30 percent of 18- year-old men and women continue their education beyond senior high school. Consequently, the value of a bachelor’s degree has fallen and competition to enter specific majors in elite colleges has greatly intensified. China not only has the largest number of college and university students in the world, but it also has one of the highest percentages of secondary school graduates continuing to tertiary education.  Higher education has become highly stratified, and the pressure on teens and their families is far more intense than for those only 15 years their senior. Therefore, the first thing I would say about “youth” in China today is that most teens in urban centers live in a pressure cooker, and the sorting process begins in the last years of primary school. Those who succeed in these academic competitions and whom I have taught at Fudan, Tsinghua, and Yale are extremely accomplished and ambitious; but even they worry intensely about their future. However, I would also stress that talent stretches across the whole country, and it is not concentrated in one or two megacities. China has no single metropole.

But that is a good thing.

Yes, overall such drive and ambition are good for this cohort and good for China and there is not a single province where one cannot find talent and drive.

You have done a lot of research on the ground over these years.  How have those opportunities and methodologies changed, or not?

Indeed.  When I first went to China in 1979 Chinese officials had no experience with foreign social scientists. Working with the U.N., the government had committed to making the 1982 census meet global standards, but virtually no officials who supervised foreign visitors championed random samples. As a result, until well into the 1980s, sociologists did a kind of “piecework” or what we more formally term “triangulation.” We gathered every shard of evidence from as many sources and angles as possible, operationalized variables in multiple ways, and when the results aligned into a coherent pattern, confirmed or rejected our hypotheses. Today, we still need to “triangulate,” but the methodologies in the study of Chinese society closely resemble those in the study of American society.

I drew my first random sample in 1986, when the Shanghai City Union sponsored me to write about the family life of newly retired textile workers. This project was negotiated at the local level. They had never heard of a random sample, but they wanted scientific methods. Over the next 18 years I went back eight times to that research site. Many of the original respondents had died or moved away. Yet in 2004 I was able to contact family members in 70% of the original 125 households.

The years between 1996 and 2016 represented a golden age. Excellent census data was publicly available, digitized statistical materials were accessible via the internet, and most importantly, many PRC born sociologists were leading research teams. The Chinese census is one of the best in the world and almost every Chinese academic journal can be searched online.  In one day, scholars working from the United States can gather trend data and run regressions that 20 years ago would have taken months to complete.  For example, in 2005 when I wanted to discuss how the government had understood and used the role of consumers after 1949, I spent a few hours with keyword searches of People’s Daily to create the numerical trend and then a week to read all the articles in which the word “consumer” had been linked to discussion of “waste” between 1949 and 2003. To complete such an analysis 10 years earlier, I would have needed to travel to the rare library with a complete run of People’s Daily, lifted every bound set, and spent hours to identify every article which discussed both consumption and waste. It would have taken months and would not have produced results that were as accurate.

What advice would you give to young scholars these days who are interested in studying China?

I am not one to easily give advice, but I would note that the support and recognition for scholarship of contemporary China varies by discipline. Not so very long ago, donors to Yale had raised money to hire an economist who worked on the Chinese economy. Nevertheless, the economics department did not launch a search because most faculty believed that there was no suitable data on China to support frontier research in economics. Clearly, we no longer face the same data restrictions today, but some disciplines still provide more opportunities than others.

So what is your next project?

Currently my primary research focus is a multi-year study of how rapid growth of megacities and the inclusion of 400 million rural residents into urban settlements have impacted family life. I also will extend a 2015-2016 project that studied wedding ritual to understand changing urban kinship ties.

Congratulations! So from your vantage point, just to wrap up our discussion of this wonderful career that you’ve had, what is your sense of U.S.-China relations today?

We are challenged. Short statement.  We are challenged.  But we’ve been challenged before, and I think that the talent and the diverse players on both sides of the Pacific who are committed to the long term give me confidence that the future will be brighter.

So you are overall optimistic?

You have to be. What’s the alternative?  There are many reasons to be pessimistic but there is too much at stake, too many shared interests, to see only the dark side.

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The rise of China, or more specifically the empowerment of the People’s Republic of China (PRC) state, is presenting the world with such a double-barreled, historic situation: a shifting power distribution and a profound choice about how the nations are ordered in the system. The systemic change implied by the new Chinese power is poised to surpass that associated with the long Cold War. On the one hand, the rapidly ascending power of the PRC state promises a great power redistribution that will make Beijing an alternative (even exclusive) power center for the region and then the whole world. Chinese leaders have already openly claimed that they are leading a revolutionary change in the world order, upending the Westphalia Peace established “more than four hundred years ago.” On the other hand, and more profoundly, as I argue in my new book (The China Order: Centralia, World Empire, and the Nature of Chinese Power, Albany, NY: SUNY Press, 2017), rising Chinese power presents the world with a choice about the ordering principle of world politics. Therefore, it is no exaggeration to say that the future and fortune of human civilization rests heavily on how the rise of China is managed.

Despite significant scholarship on the subject, the nature and the meaning of the rise of China remain tentative, uncertain, and disputed. I contend that a key problem is that our existing understanding of the Chinese worldview and the nature of the rising Chinese power is insufficient, often inaccurate, and even misleading. I then propose that a careful rereading of the Chinese history in fact offers a rather straightforward, simple, and clear picture about the implications of the rising Chinese power, which may actually disappoint many “overly complicated analyses and overzealous advocates that frequently misinform and misguide.” (The China Order p. 5)

My rereading of the Chinese history has yielded evidence suggesting a holistic answer to questions about the nature of the rising Chinese power through analyzing the China Order—an ideation and tradition of governance and world order that give China and the PRC their key characters. “The China Order, the Chinese world empire order, is based on a Confucian-Legalism imperial state, the Qin-Han (秦汉) polity, authoritarian often totalitarian in nature, that justifies and defends its rule with the Mandate of Heaven to unite, order, and govern the whole known world, the tianxia (天下 all under heaven). It denotes a worldwide Qin-Han polity, a Qin-Han world order.” (The China Order p. 5)

Unlike many other world empires or attempted world empires (from the Egyptian pharaohs, the Inca, to the world Fascist and Communist movements), the China Order was practiced effectively for many centuries and united the whole known world in Eastern Eurasia from the third century B.C. to the mid-nineteenth century, albeit with frequent pretentions of unity and several, impermanent intervals of disunion. There was only one major pause of the China Order in the Chinese World: the Song Era (10^th through 13^th centuries), with rich, significant but underexplored lessons. The Qin-Han world empire political system of the China Order has also rejuvenated itself a number of times in the Chinese world. It has been highly attractive and even addictive to the ruling elites (Han Chinese or Non-Han Chinese alike) inside and even outside of the PRC as a deeply internalized part of the millennia-old Chinese culture and worldview. To many in China, the China Order is not just a viable, but also a superior world order, an ideology and a political system representing peculiar socioeconomic norms and culture values. The China Order has fundamentally shaped the Chinese World distinct from that in the post-Rome Mediterranean–European World under a de facto and later de jure world order of divided world polity with international competition — the Westphalia System. It explains the great West-East divergence between Europe and China. The China Order is a world order that is structurally and normatively incompatible with the Westphalia world system.

Since 1949, the Chinese Communist Party (CCP) has reincarnated the Qin-Han polity in the PRC and has sought political legitimacy and security through reordering the world in its image, like the previous imperial rulers. After some pauses and withdrawals after Mao Zedong’s fiascoes, including an attempt to launch world revolution, today’s CCP has been selectively accepting the Westphalia system with the aim to return to the China Order another day. As the CCP becomes ever more wealthy and confident, there is a significant revival of the China Order ideas in the PRC under the general banner of “the China Dream” and the mission “to construct a human community of common destiny.” The rise of the PRC, therefore, “with a modified but tenacious Qin-Han polity in charge that predictably seeks a new tianxia world order, represents a clear and consequential choice about political governance and world order for the humankind.” (The China Order p. 4)

Historically and comparatively, the Qin-Han polity and the China Order underperform for the Chinese people. The record of the Qin-Han polity has been the same in the PRC, which has been a suboptimal giant with inferior governance and barely average record of socioeconomic development. Yet, today, “the PRC has an increasingly unobstructed and selectively unilateral access to foreign markets, resources, and especially technology so it enriches and strengthens rapidly without being itself efficient and innovative. An inherently suboptimal giant plagued by an inferior governance, the PRC state nonetheless still rises to be very formidable and competitive in international relations.” (The China Order p. 216) Thanks to its extraordinarily strong extraction capability, the PRC state is already a rich and mighty player—“moving in to the center of the world stage,” claimed Beijing officially. The rise of the PRC is thus ushering in a new round of power redistribution in the international system on a massive scale, together with its ideal of reordering the nations.

To the peoples of Eastern Eurasia, the Qin-Han polity was grossly suboptimal and even disastrous in its record of governance, economic development, and technological innovation. The best of the glorious Chinese civilization was the periods when there was an absence of the China Order: the pre-Qin Era, the Song Era, and the time since the late-19^th century, contrary to the much-distorted official Chinese narratives and claims. To the peoples of the world, a revival of the China Order would mean largely the same fate the peoples had in the Chinese World after the third century BCE.

As the logic of the China Order would predict, rising Chinese power will not stop short of reordering the world unless and until the very Qin-Han polity is transformed and/or the ever richer and more powerful PRC is checked. How to manage the rising Chinese power and how to make the grand choice for the world order will determine the future and fortune of the United States, the world, and for the Chinese people themselves.

The window for an effective, peaceful choice is still open, and there is evidence to trust the Chinese people to make the right choice together with the other nations, provided that they are given the full information and freedom to reread their history and to choose. The great people of China are fully capable of controlling their destiny and steering a great course in history that is different from the China Order, and in so doing make the world and China a better place. Hopefully, the effort to analyze the China Order through rereading the Chinese history may just be a small step in that direction.

Fei-Ling Wang, The China Order: Centralia, World Empire, and the Nature of Chinese Power, Albany, NY: SUNY Press, 2017. www.sunypress.edu/p-6460-the-china-order.aspx. Available also on Amazon: www.amazon.com/China-Order-Centralia-Empire-Chinese/dp/1438467494/ref=asap_bc?ie=UTF8

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