The CPC's journey to reinvigorate China

A tourist dressed as a Communist Red Army soldier poses for photos in front of a communist leader Mao Zedong's poster at an old Communist Party base in Yan'an, in northwestern China's Shaanxi province. Yan'an is celebrated as the birthplace of China's communist revolution.   | Photo Credit: Alexander F. Yuan

What started as a humble group of over 50 idealistic Chinese has swollen into an 80-million-strong political party, ruling over the world’s most populous country.

The first National Congress of the Communist Party of China (CPC) was held in Shanghai in July 1921. Thirteen delegates, including Mao Zedong, representing over 50 Party members nationwide, attended the meeting, which marked the founding of the CPC.

After nine decades, China has become the world’s second-largest economy under CPC leadership. With foreign exchange reserves totalling 3 trillion U.S. dollars, China has become the largest creditor of the United States. China also boasts the world’s largest banking, petroleum and telecommunications companies by market value.

The Communist Party of China has brought this country with a civilization of over 5,000 years back to the centre of the international arena. In the meantime, nevertheless, the country is facing challenges. For instance, the per capita GDP is still around the world’s 100th. Corruption still runs rampant in some areas.

Where will the Communist Party of China (CPC) lead China to and what are the implications of China’s development to the world? The questions have grabbed a great deal of attention and have been the subjects of much debate. Sometimes history and what is happening presently indicate the future.

Solid organizational construction

In September 1927, Mao Zedong decreed that every company in the revolutionary army should have a Party branch, with a commissar to give political instruction to the company. This military rearrangement gave the CPC absolute control over its military forces and is considered to have had a profound impact upon the Chinese revolution.

Today, such Party branches are not only established in the Party’s strongholds, like army, governments, universities and state-owned enterprises, but private enterprises and foreign-owned enterprises. The Roche R&D Center China (RRDCC), located in Shanghai’s Zhangjiang High-Tech Park, established its own Party branch in 2007. The branch currently has over 20 Party members, most of whom are researchers with postgraduate or doctorate degrees.

“We notify all of our staff through the company’s intranet when the Party branch organizes activities or meetings. Our foreign boss even attends sometimes,” said Hong Di, the company’s Party branch secretary.

The RRDCC believes that the Party members who work for the company have helped it to develop and grow.

An increasing number of foreign-owned enterprises in China’s economically prosperous coastal cities are also forming their own Party branches. For instance, Suzhou, a city in east China’s Jiangsu Province, is home to more than 6,000 foreign-owned enterprises, over 1,000 of which have established their own Party branches.

Private enterprises are creating their own branches as well. In east China’s Zhejiang Province, where private businesses have flourished, about 66,000 private enterprises have established their own Party branches. The Party constitution stipulates that “primary Party organizations may be formed in enterprises, rural areas, government organs, schools, research institutes, communities, social organizations, companies of the People’s Liberation Army and other basic units where there are at least three full Party members.” By the end of 2010, the CPC had had over 3.892 million grassroots Party organizations, through which the CPC fulfils effective leadership to the country.

Prof. Zheng Yongnian, director of East Asia Institute of the National University of Singapore, said that “the successful ruling of the CPC lies in its strong mobilization mechanism.” For instance, China’s success in holding Beijing Olympic Games and the Shanghai World Expo, as well as the efficient reconstruction in earthquake-affected areas could be attributed to the Party’s strong mobilization mechanism and its solid organizational system,” said Mr. Zheng.

Sinicization of Marxism

The salvoes of the October Revolution in Russia in 1917 brought the theory of Marxism-Leninism to China.

Starting from the May 4th Movement in 1919, the Chinese working class began to cut a striking figure as an advanced social force in the country. In 1921, the CPC emerged just as the times called in the process of applying Marxism-Leninism in the Chinese workers’ movement.

Before the 90th anniversary of the CPC’s founding, about 1 million copies of a new book on the history of the Communist Party of China (1949-1978) have been sold since being published on Jan. 11.

The book, focusing on the 1949-1978 period, came 20 years after the first book, which documented the history from the birth of the CPC in 1921 to the founding of the People’s Republic of China in 1949.

The first book was reprinted at the same time and had sold about 766,000 copies as of this May.

“The most essential experience we have drawn from the Party’s history is to always persist in integrating the fundamental principles of Marxism-Leninism with the specific situation in China, and unswervingly follow our own development road,” said Qin Gang, professor with the Department of Marxism Theory of the Party School of the CPC Central Committee.

The first generation of the collective leadership of the CPC Central Committee with Mao Zedong at the core and the second generation of the collective leadership of the CPC Central Committee with Deng Xiaoping at the core led the Party in persisting in closely combining the basic principles of Marxism-Leninism with China’s concrete practice, resulting in the formation of Mao Zedong Thought and Deng Xiaoping Theory.

To strengthen the Party building, Jiang Zemin proposed the important theory of “Three Represents” — the Party should represent the development trend of China’s advanced productive forces, the orientation of China’s advanced culture, and the fundamental interests of the overwhelming majority of the people in China.

Along with the rapid economic and social development, the development mode, featuring “high investment, high consumption, high pollution with low efficiency”, challenged the country’s ecological environment and sustainable development, therefore General Secretary of the CPC Central Committee Hu Jintao proposed “Scientific Outlook on Development,” which puts people first and calls for comprehensive, balanced and sustainable development.

This year, a book, translated as “Why and How the CPC works in China,” compiled by Xie Chuntao, professor with the Party School of the CPC Central Committee, is becoming a bestseller. The book tries to seek an answer for why the CPC can maintain vitality 90 years after its founding and more than 60 years after it came to power.

One chapter of the book explains why the Communist Parties in the former Soviet Union and East European countries lost their ruling status, while China has not and will not.

Four reasons are given by the book with “CPC always exploring its own development road” topping the list.

Other three reasons include: it is reform and opening-up that have been changing the country’s fate; the Party and the country put reform, development and stability into overall consideration; and the CPC always attaches great importance to the Party building.

Poverty alleviation

Unlike other political powers, the CPC has never sought external expansion during its development and rise, preferring to focus on improving the country’s domestic situation.

To that end, one of the CPC’s greatest successes has been its alleviation of poverty. The CPC has eliminated hunger for many people in China, ensuring the Party’s long-term support from the Chinese people.

Yan Hongchang, a 63-year-old farmer from the village of Xiaogang in east China’s Anhui Province, said he was told by villagers of his parents’ generation that life in the region was miserable in the 1920s because of the scourge of warlords and bandits.

Without proper water control facilities, floods on the nearby Huaihe River plagued the village for many years. Many people were forced to leave their homes, turning to a life of begging.

During the War of Liberation, the villagers, who were then under the regime of the Kuomintang, were eagerly expecting a victory for the CPC, which had promised to give the peasants land and provide them with food.

The villagers of Xiaogang were right to expect a win from the CPC. They, like most poor peasants across the country, were given land in 1949.

Their lives continued to improve until the Cultural Revolution (1966-1976), a time of turbulence during which many Chinese suffered extraordinary hardships. “Without enough food to go around, everyone in my family had to go out to dig up edible wild herbs,” Yan said. In 1978, Yan and other villagers in Xiaogang signed a contract to secretly distribute the village’s farmland among all of the village’s households, which was illegal at the time.

The secret plan proved to be effective. In 1983, Yan’s family harvested more than 10 tonnes of grain from 2 hectares of farmland, allaying their fears of starvation. Yan did not expect that their adventurous move would later lead to the creation of a household contract responsibility system in rural China, which greatly emancipated productive forces in rural areas.

China had 26.88 million people living below the country’s poverty line in 2010, compared with 250 million living in absolute poverty in 1978.

It is a great success, considering that 925 million people in the world still suffer from hunger.

However, the Party now faces the challenge of ensuring that the country’s citizens live relatively comfortable lives and achieve common prosperity.

Socialist market economy

Shen Pengfei, a 29-year-old resident of Shangrao County in east China’s Jiangxi Province, is used to seeing supermarket shelves spilling over with merchandise. As a young person accustomed to carrying around cash, he can barely comprehend the way goods used to be purchased in China.

His mother Chen Guolan, now 56 years old, bitterly recalls the grain and clothing coupons that she and her countrymen had to use in the old days.

Ms. Chen, a retired saleswoman, said that coupons were part of daily life in the years of China’s planned economy, when shortages of goods made life difficult. China imposed a state monopoly on the purchase and sale of goods during the shortages; everybody had to use a combination of cash and coupons to purchase daily necessities. Long lines in front of stores were commonplace.

“In the old days, there were food coupons to buy beans, salt and meat; clothing coupons to buy fabric and cotton, and other coupons for soap, matches, coal and gas,” said Ms. Chen, who still keeps hundreds of the coupons.

Integration into the world

Foreign big names in politics, business and academia are no stranger to podiums at cadre schools of the CPC, but as the country grows interdependent with the outside world, their previously occasional lectures have become a compulsory course in the curriculum. In June, David O. Beim, professor of the Columbia Business School, held a course on global financial crisis at the China Executive Leadership Academy Pudong, a national cadre school in Shanghai. The course, “China’s Economic Future under a Global

Perspective,” was the longest one in a three-week financial training program for 50 middle-level officials from China’s financial regulators, financial institutions, and state-owned enterprises under the central government. The course resonated with programme members so well that questions were raised one after another and discussions went over class time. Some of the members even asked the professor to continue the course at night. The reason for employing foreign expertise is straightforward, as acting vice president of the academy Feng Jun put it, “In a globalized world, a globalized outlook is essential for competent cadres of the CPC.” CPC cadres are also going abroad for studies. It has become common for cadres in coastal areas to go on foreign study trips and many of the recently promoted cadres in provinces in the Yangtze River and Zhujiang River deltas have at least a half year of foreign study experience. In the country’s western regions like Chongqing and Gansu, more officials are being sent abroad for advanced studies of subjects that are important to local development, such as public administration, environmental protection and tourism administration. Throughout this year, about 300 Shanghai government officials and corporate executives will receive tailor-made training programmes from the Harvard Business School, the Wharton School of the University of Pennsylvania, and business and education schools of the Columbia University. CPC is a “learning-minded” party that encourages its members to expand their knowledge in all fields, including science, economics and culture. By stressing its learning-minded ethos, the CPC exemplifies a contemporary ruling party, said Robert Lawrence Kuhn, an international investment banker and the author of How China’s Leaders Think: The Inside Story of China’s Past, Current and Future Leaders.

The year 2011 not only marks the 90th anniversary of the CPC’s founding, but the 10th anniversary for China’s entry into the World Trade Organization (WTO).

Over the past decade since its accession to the WTO, China has fully honoured its commitments by abolishing all domestic laws and regulations incompatible with WTO rules and giving foreign companies national treatment.

Just as Minister of Commerce Chen Deming said, at a forum to mark the 10th WTO entry anniversary in January, the WTO entry was a “courageous and tough choice,” but was “the right choice” and a landmark event in China’s reform and opening up.

China’s foreign trade soared after the WTO entry, providing momentum for its economic development. Presently, China is the world’s largest exporter and second largest importer.

Globalization is an irreversible trend. China felt the pinch of the global financial crisis as well in year 2008. To address its impact and maintain the steady and relatively fast growth of the economy, China quickly adjusted its macroeconomic policies, put in place a package plan to boost domestic demand and stimulate economic growth.

As a result, China’s economy in 2009 and 2010 maintained steady and relatively fast growth and contributed to the economic recovery of the region and the world. “China, under the leadership of the CPC, has provided its own political and economic model to the world. It is an important contribution to the international community,” said Prof. Zheng Yongnian.

China is now facing challenges as well, such as transforming the economic development mode, bridging the yawning income gap, maintaining the social stability and harmony. That will be new contributions to the world, if the challenges are overcome, said Mr. Zheng.

From Mao Zedong proposed “to clean the room thoroughly before inviting guests” in 1949 to China’s current solemn commitment of following the path of peaceful development, China’s foreign policies always attract a great deal attention from the outside world.

“It can be expected that China will reiterate the themes of peace, development and cooperation in its foreign relations. Simultaneously, it will also prefer other countries to be more sensitive to handling issues that China considers to be its core interests,” said Mr. Zheng.

“Development is the absolute principle.” Deng Xiaoping said so during his famous inspection tour of south China in 1992. The motto has been working and will still work. It is expected that under the leadership of CPC, China in future will seek more balanced development, or say scientific development in domestic issues, while continuing to seek peaceful development in international affairs.

The country’s planned economy worked for some time, but its flaws created obstacles for China’s development. The mixed functions of government and enterprises, egalitarianism in distribution, and other problems resulted in low industrial efficiency, low agricultural output and stagnant living standards.

China officially abolished grain coupons in 1993, a milestone in its shift from being a planned economy to being a market economy.

“Considering the situation at that time, going with a market-oriented economic system was necessary to reform the economic system,” said Ma Zhihui, head of the economics research institute of the Jiangxi Provincial Academy of Social Sciences.

The CPC explicitly stated that it would create a socialist market economy at its 14th National Congress in October 1992. Observers believe this reflected the CPC’s flexibility and innovation at the time.

In dogmatic views of communism, market economies are considered to be specific to capitalism. Even discussing market economics was taboo at one time.

However, when late Chinese leader Deng Xiaoping conducted an inspection tour of south China in 1992, he said “planned economies are not equivalent to socialism, because there is also planning under capitalism. Market economies are not equivalent to capitalism, because there are markets under socialism as well. Planning and marketing are both economic means.” Mr. Deng, who is widely regarded as the chief architect of China’s period of reform and opening-up, greatly boosted efforts for the reformation of China’s economic system with his remarks. However, the creation of a market economy under China’s existing socialist structure was an arduous task.

“There were no examples to follow. The CPC was learning and exploring during the process. It combined foreign experiences that were absorbed in the early days with China’s condition at the time. Through continuous reforms and improvement, it found a path suited to China’s national condition and development,” said Ding Yuanzhu, deputy director of the Department of Policy-Making Consultation of the Chinese Academy of Governance.

A main feature of the country’s socialist market economy is the joint impact of the government and the market itself. In socialist market economies, the government uses macro-level control mechanisms to restrain the spontaneity and blindness of the market. This feature allowed China to withstand the 1997 Asian financial crisis and the 2008 global financial crisis, Mr. Ding said.

“The facts have shown that it is a path of success,” said Zhang Liqun, a research fellow specializing macro-economics at the Development Research Center of the State Council, China’s Cabinet.

The creation of a socialist market economy had an incredible effect on the country’s development. China’s GDP ballooned from 2.4 trillion yuan in 1992 to 39.8 trillion yuan in 2010. China’s international status and the living standard of its people improved accordingly.

However, some economic experts have said that market-oriented reforms in some key areas have yet to be completed. They say that the CPC needs greater wisdom and a broader vision in order to allow the country to continue to develop in the face of complicated international situations.

“The root cause of some of the problems that China now faces is the inadequacy of market-based reforms, which has left systemic problems unsolved. It is important to improve the way these reforms are designed, including market system reforms,” Mr. Ding said.

In the past, various social and economic systems in China were reformed from bottom to top. However, today’s grassroots-level governments might lack the momentum to make reforms in this fashion, Mr. Zhang Liqun said.

He said that reforms in taxation, income distribution and the relationship between the government and the market can only come from the top. Mr. Zhang is also concerned about the success of the transformation of China’s economic development pattern. “If the transformation fails, China’s development will slow down. Social conflicts will sharpen, creating less room for development,” he said.

Chang Xiuze, a researcher at the Macroeconomics Institute of the National Development and Reform Commission, said the transformation of China’s development will depend on the reform of its economic system and mechanisms. After three decades of experience in reform, Chinese authorities are aware of the defects of traditional economic systems and how to reform them. Recently proposed reforms will penetrate deeper and become institutionalized as the CPC vows to push forward reform in all areas with “greater resolution and courage” over the next five years.

Experts believe that the CPC has the ability to draw on collective wisdom in the face of challenges, adapt to changes and implement its decisions with efficiency. Despite the challenges facing it, the CPC will advance its reforms by using a practical, flexible and open-minded style of governance.

Mr. Zhang Liqun said the country’s socialist market economy is not a fixed mode pursued by the CPC. “It is a path of reform that is meant to keep pace with the times. Deep-rooted problems will be solved through reforms when the time comes,” Mr. Zhang said.

“The success of the socialist market economy is an important contribution to the world. It was made by the Chinese people under the CPC’s leadership,” said Prof. Xie Chuntao in the book Why and How the CPC Works in China. - Xinhua

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