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Is It Time for a China Model?

As China’s economy grows, scholars struggle to define a clear system of thought. Can China make its own model?

By NewsChina Updated Feb.1

There is no alternative” – a favorite slogan of late British Prime Minister Margaret Thatcher in the 1980s – epitomized the “Iron Lady’s” belief that radical capitalism was the only path for any nation’s continued development. The idea was built on by Francis Fukuyama, a Japanese-American politics professor from Harvard University, in 1989 when he published his book The End of History and the Last Man, in which he concluded that capitalism had completely beaten socialism and therefore brought to an end the history of ideological battles. 
His idea was popularized by the 1991 dissolution of the Soviet Union and the civil war that led to the break-up of Yugoslavia. At the same time, China was undergoing its own sweeping, nationwide campaign of Reform and Opening-up. Its dazzling economic achievements certainly caught the eyes of the international community – China’s official data shows that GDP grew by an average of 9.6 percent year-on-year from 1978 to 2016, and 790 million escaped extreme poverty from 1981 to 2016, making up 71.8 percent of the world’s total poverty reduction. 
Many analysts worldwide described these achievements as remarkable and believed it did not happen by chance. They, including Fukuyama, began to rethink their old ideas on China and tried to explore the “China Model” or the “Chinese Path.” Among them, a group of Chinese academics who witnessed and experienced China’s enormous change went further – turning the field of study into a theoretical system. 
Those academics are labeled the “Chinese School” domestically. They attribute China’s success to its opening a new road that fits the country’s status quo, as well as being able to guide China’s future development, and they even claim the model can be applied to other developing nations. Although their ideas have been vehemently challenged by many other academics, both at home and abroad, Chinese School academics are trying to make their voices louder and more influential by delivering speeches and publishing books.  

From ‘Western’ to ‘Chinese’ 

When the Great Way Prevails: the Communist Party of China and Chinese Socialism is one such book. Authored by five Chinese School academics, the book has been popular since it was published in 2015.
The key to its popularity lies in its attempt to dispel the impact of Western theories and interpret China’s situation from a Chinese angle. It clearly analyzes the features of the China Model and their roles in China’s decades of Reform and Opening-up. While responding to some mainstream opposition against the China Model, the book also lists an array of problems that the academics think their country should quickly solve to make the China Model more convincing. 
“Shifting from a ‘Western angle’ to a Chinese one is one of the features of the Chinese School,” said Yan Yilong, one of the authors of When the Great Way Prevails and a researcher at the Institute for Contemporary China Studies, Tsinghua University. “The historical task of the Chinese School is to form a knowledge system that embodies Chinese characteristics and is able to address the problems China faces, and also to provide some ‘Chinese’ solutions for the development of humanity,” he told NewsChina.
“The Chinese School is not limited to one discipline, but covers all sorts of fields, including philosophy, history, economics, politics, laws, socialism and ethnonymics. It is essentially a radical ‘thought revolution,’” he added.
His idea is shared by Pan Wei, director of the Center for Chinese & Global Affairs, at Peking University. He told NewsChina that there were two premises on forming the Chinese School: to understand foreign countries and their systems of knowledge, and then, to use it to learn how China is different from the West. 
That explains why most Chinese School academics, such as the five authors of When the Great Way Prevails have work or study experience in the West, with some having stayed abroad for a very long time.
“It is the experience of studying and working abroad that has broadened those academics’ horizons and confirmed their determination to study China based on China’s status quo,” Pan explained.  

A Road of China’s Own 

The Chinese School, Pan said, was formed when more analysts and academics found it hard to explain China’s fast economic growth by using Western theories or ideas. 
“Along with China’s rocketing economic growth, China underwent enormous changes in many aspects that Western theories or knowledge systems could not explain or interpret,” He Jianyu, another author of When the Great Way Prevails, told NewsChina. 

After graduating from the mechanical engineering department at Tsinghua University, He became immersed in Western sociology as an undergraduate which drove him to shift to liberal arts for his postgraduate study. He still remembers how amazed he was by the ideas of Paul Samuelson, a Nobel prize-winning American economist. Such admiration, however, ended at the Chinese University of Hong Kong where he studied comparative politics at the postdoctoral level. “The theoretical system I learned was based on the experience of Western countries, but they couldn’t explain China’s situation. They always labeled it as an ‘exception,’” he said. 
Such troubling thoughts were shared by other Chinese School academics. “The West-oriented thought system has been challenged since some non-Western countries like China are rising, and the Chinese School emerged against this backdrop,” Yan told NewsChina. 
Truth be told, the leaders of the Communist Party of China (CPC) realized that no Western model fit China long ago. As early as 1956, Chairman Mao Zedong proposed in his report On the Ten Major Relationships exploring a path of socialist construction that suited China’s situation. It was considered the first attempt by Mao and the CPC to break through the Soviet Model they had followed for years. 
Former Chinese leader Deng Xiaoping, the architect of China’s Reform and Opening-up policy, is held as the major initiator of the China Model. At the 12th National Congress of the CPC in 1982, Deng clearly claimed that China should not copy any other country’s development model and must walk on a “socialist road of Chinese characteristics.” 
However, such ideas and concepts seem to have remained at the top-leadership level until China shocked the world with its record-breaking economic growth. In 2004, Joshua Cooper Ramo, a renowned American expert on China issues, triggered heated debate about the China Model after publishing a paper called “The Beijing Consensus,” in which he claimed that the Beijing Consensus would be an alternative to the well-known “Washington Consensus” characterized by the free market, free trade and loose government control. Initiated in 1989 by John Williamson from the Institute for International Economics, the Washington Consensus aimed to pull Latin American countries out of their heavy debt and aid their shift to capitalist modernity, but it actually undermined them, according to Ramo.
Yet China’s path, Ramo said, speaks for itself. “Tactically speaking, the Beijing Consensus demands that ideas such as privatization and free trade be approached with incredible caution. It is defined by a ruthless willingness to innovate and experiment (see China’s special economic zones); a lively defense of national borders and interests (see Taiwan); and by the increasingly thoughtful accumulation of tools of asymmetric power (see the US$400 billion in currency reserves),” he explained.
“China’s peaceful rise strategy is not intended as a challenge to the US… it is the power of a model for global development that is attracting adherents at almost the same speed as the US model is repelling them,” he added.
The Beijing Consensus or China Model has attracted wider attention since the 2008 global financial crisis, in which China took the lead in tackling the problem, thanks to government assistance. At that time, even many Western academics and analysts began to rethink how governments can react to market vicissitudes, especially when the latter is depressed, an idea that goes against free market theory which believes that the market and the government are always in opposition. 
According to He Jianyu, the discussion about the China Model was a precursor to the Chinese School, which is a much deeper and more specific theory. Now, although Chinese School academics still have differences on what exactly the China Model is, they have reached a consensus on the general idea. The China Model, they say, is a “socialist road of Chinese characteristics” which economically insists on keeping a public-owned economy and supports government market regulations, and politically, upholds the leadership of the CPC which believes in socialism and adopts so-called “democratic centralism,” a ruling model which the Chinese School believes is more “scientific” than Western democracy with multi-party systems.
“We intend to tell young [Chinese] people that our political system is very cool and pioneering in governance; Socialism is a modern cause and is the tide of the times around us,” Yan Yilong told NewsChina.  


However, the China Model came under fire from the start – Many analysts argued that China’s rapid economic growth is largely a result of its huge population, which means a cheap labor force and a huge market. They also point to its shift to a market economy from the old planned economy, once regarded as a feature of socialism before Deng’s era. 
Skeptics especially oppose “government regulation” which they would rather describe as “government interference.” The Chinese School academics often point to the government’s four trillion yuan (US$586b) stimulus plan in the 2008 financial crisis as one of the advantages of the China Model. Opponents blamed the government for ignoring the long-term impact of the plan, such as high debt ratios in State-owned enterprises (SOEs) and overcapacity in some industries.
In 2010, China surpassed Japan to become the world’s second-largest economy, triggering a new round of discussion around the China Model. As the Chinese School academics deemed the rise as more proof of victory for the China Model, many other academics warned that it was too early to define what China has done as a “model.”
Renowned economist Xu Xiaonian, for example, is one such naysayer. At an economic forum held by Hong Kong-based news portal ifeng.com in 2010, Xu attributed China’s economic success to less government interference. “The Chinese economy always goes well when the government does less. Compared to other developed countries, I don’t think there is a unique China Model. Even if there were, the model would be loosening control and further freeing the market to encourage the development of private enterprises. This is the key to China’s success,” he said. 
His ideas are not accepted by the Chinese School who emphasize that the China Model is characterized and advantaged by socialism which could help control – or to put it more accurately – “socialize” capital. 
During an interview with Maya X. Guo, a well-known Chinese politics professor who supports the China Model ideas and wrote the popular book The Chinese Path and the Chinese School: Interviews with Leading Chinese Academics in 2015 which contains her interviews with nine Chinese school academics, Hu Angang, director of the Institute for Contemporary China Studies, Tsinghua University, explained that the government has to join in the market distribution to narrow the income gap and to finally realize common prosperity – a key feature of socialism that Chinese School academics believe is one of China’s major tasks in the years to come. 
When The Great Way Prevails echoed this assertion. “Socialism cannot succeed without the power of capital, but without socialism’s control, capital will become a dreadful monster. Capital is like a good horse which will promote socialism, but we have to fasten the ‘horse’ with the ‘halter of public interests,’” the book said. “The government can use the public-owned economy to guide blind capital and to buffer the selfishness of capital.”  

Of course, Western nations enact regulations during times of financial crisis, and also put or guide capital into sectors of public interest. The core of the dispute actually lies in how and by how much to regulate, or how to define the relationship between government and the market. While Chinese School academics like Justin Yifu Lin support active government that plays a proper role in the market, complaints about the Chinese government’s excessive interference are rising. 
Shen Jianguang, a Chinese economist and also a columnist for the Chinese website of the Financial Times, for example, wrote an article on the Chinese government’s 2008 stimulus plan, claiming that the stimulus itself was not a mistake, but the problem lay in improper regulation. He pointed out that the negative impact of the 2008 stimulus plan was partly due to China’s lack of control of local government’s financial moves – many local officials did not use the money in needed fields, and because of the banks’ lack of autonomy – they were pressured to give loans to enterprises that actually did not have the ability to repay their debts. 
At the same economics forum that Xu Xiaonian attended, another Chinese academic, Xiao Gongqin, warned that excessive government interference in the market had created a “rich State with poor people” and facilitated SOEs to form monopolies. In fact, complaints that local governments have imposed too many deliberate, and even illegal restrictions on private enterprises have never ceased in China. 
 Chinese School academics did not deny the problems. When The Great Way Prevails, for example, lists “clearly defining the relationship between the market and the government” as a leading problem that the China Model should solve. But they meanwhile emphasized that such problems do not mean that the Chinese economy does not need government regulation and public-owned sectors.  

Political Disputes 

According to the Chinese School academics, the core of socializing capital is to insist on the leadership of the CPC, since unlike Western political parties, which have to solicit donations from capitalists to win elections and somewhat have to speak for them, the CPC represents no capital and thus has a “public heart.”
However, this is another point that opponents vehemently challenge. Chinese School academics believe that this type of rule is good to implement long-term programs and easy to focus on big or urgent issues like post-disaster reconstruction, opponents argue that it is more open to issues like corruption due to poor public supervision. 
In 2010, Yao Yang, then deputy dean of the National School of Development at Peking University, published in Foreign Affairs an article titled “The End of the Beijing Consensus,” in which he claimed that a “disinterested” or “neutral” government does not mean it is “devoid of self-interest.” Instead, the government might often be “predatory toward citizens” regardless of their identities and social status.
During an interview with Chinese news portal NetEase in 2011, Yao’s ideas had slightly changed. He admitted that China’s past economic growth benefited from a “neutral” government, but he also warned that economic growth will be obstructed if the government allies with interest groups. Unlike Western countries, where the democratic system will help balance different interest groups, China’s alliance between officials and capital will be very hard to break. To this extent, he believes that it is easier for Western democratic governments to be neutral.
For decades, the CPC has been constantly criticized by the West for not being “democratic,” while Chinese School academics argued that Western democracy does not equal “good democracy” and that democracy should not be judged by its form, say, whether or not a government is formed by a general election, but by the result of the governance. 
The Chinese Path and the Chinese School by Maya X. Guo cited academic Wang Shaoguang as saying that Chinese-style democracy focuses on how government governs and administrates the State, or more specifically, how well the government responds to the demands of the public. From this “Chinese angle,” Wang believes that socialism is more democratic, since it cares more about the poor and aims to realize common prosperity. 

But China today seems far from achieving common prosperity. Rather it is caught in wide income gap – data from China’s National Bureau of Statistics shows that China’s Gini coefficient – a measure of the income gap which is in direct proportion to economic inequality – was 0.465 in 2016, the same level as that of the US. Meanwhile, as Yao Yang warned, collusion between government and businesses has been increasingly exposed by the media, leading many people to doubt whether China is able to deepen its reform to break vested interests, as the CPC has pledged.  

Struggle to Stand 

The biggest fear of the Chinese School academics is that in the face of so many problems, many Chinese people seem to have lost confidence in the China Model and hope for a turn to the Western model. 
“If you look at a tree too closely, you can only see the insect holes on its leaves, but if you step back further and watch again, you will see a tree that stands green and flourishing. China is that tree, and the other trees, including that of the US, the European countries and Japan, all have holes too,” Wang Shaoguang once said. He warned that China still remains weak in speaking out about its ideology, and compared to the West, China lacks a widely-acknowledged value system that can compete with that of the West and be shared with the world.
His words were echoed by Zhang Weiwei, a Chinese politics professor from the Shanghai-based Fudan University. In an interview with Maya X. Guo, he said that China keeps consuming the knowledge produced by the West and China’s theoretical resources depend on Western theories so much that Chinese people lack the confidence to set up a system of their own. “Chinese academics should feel an urgency and a responsibility to study Chinese theories. A nation will not truly rise without a rise in the theoretical system,” he warned. 
It is a strong reason for Chinese School academics to try hard to popularize and work on their ideas and theories. However, as Western theories still dominate Chinese academic circles, and as China is still riddled with all sorts of problems that tear the public away from the Party, such as corruption, increasingly hard-to-break social stratum and unbalanced regional development, many people refuse to buy the Chinese School ideas, with some even accusing the academics of fawning on the government. 

“If the Chinese School merely stays at the discussion level and remains unsupported by serious research, it might subside into just a temporary concept and soon disappear into the annals of history,” He Jianyu told NewsChina.