Platt Perspective on Business and Technology

Perceiving China – East and West 7

Posted in in the News, macroeconomics by Timothy Platt on June 28, 2012

This is my seventh installment in a series in which I discuss China as that country is perceived, and both from within and by the outside world (see Macroeconomics and Business, postings 78 and scattered following for Postings 1-6.) And I begin this by citing two conversations that I had late this past week. One was with a marketing guru who lives in Shanghai and whose professional activities cover China and also extend into Japan. The other is a television executive with a programming production company that focuses on the Chinese community, and who is himself from China.

We met and talked at a meeting on the Chinese marketplace and on what drives the consumer and the consuming public in the People’s Republic. And in the course of our post-meeting conversations I was able to ask both of these China experts two telling questions, and I was able to do so separately so they answered without hearing each other’s responses.

• One of the underlying themes of this meeting was on how modern China is firmly rooted in its history and in its culture as extending back centuries and even thousands of years. And the advent of the internet and of greatly increased capability and opportunity to reach out and connect was discussed for the most part in how this New fits into that ongoing pattern and the continuing momentum of Old. And in that context I asked what overall impact cell phones and the internet will have on China and its governance.
• My second question was one of the ongoing and long-term stability and even viability of the one Party system that governs all in China today. In that, Party dominates over Government. Party dominates over business, and for both government owned and private sector enterprises, with parallel chains of command in every business enterprise – privately and government owned alike and with Party leaders always holding authority over business leaders and even over business owners. Party dominates over local communities, and over peoples’ private lives as well as their public lives. My question was one of whether this can simply continue unchanged and exactly as-is, moving forward.

My marketing guru colleague, a senior executive with a large multi-national, argued the case that the internet is no passing phase, but that it will adapt and accommodate more than the culture or systems that make up China of today will. The internet will not in and of itself bring about change, or at least fundamental change. My television colleague argued the perspective that the internet and particularly the ubiquitously connected interactive internet will by its very nature force change in everything – and that this is already happening. That, I add, is my opinion on this question too.

But tellingly, both took the exact same position with regard to my second question. They both simply assume that Party will always prevail, dominating all in China and at all levels. In this, Party and Party leadership have simply reframed Emperor and Dynasty and Imperial Government, and while I did not ask them this, I am fairly certain that both would have stated that Mao Zedong specifically and explicitly fit the mold of Emperor, complete with cult of personality and of office. And I found myself thinking of the approaching cliff-edge challenges that China faces if it simply tries to continue as-is, and of the evolving statements concerning this made by one of its current supreme leaders: Wen Jiabao, their soon to retire Prime Minister and the second most powerful member of their Politburo Standing Committee.

• When Wen first assumed Premiership he stated “the socialist system will continue in China for the next 100 years”.
• But as he more fully took on the responsibilities of this office his views changed, and in August 2010 at the National People’s Congress he stated that “without political reform, China may lose what it has already achieved through economic restructuring.”
• And at the 2012 National People’s Congress he further stated that China must “press ahead with both economic structural reforms and political structural reforms, in particular reforms on the leadership system of the Party and the country.”

Most of this has been censored from the public record as directly shared by the government with China’ own people and through official news channels. But it is clear that even, and perhaps especially at the top of China’s Party and Governmental leadership, there is a growing and acute awareness of a need for change. And the rampant, blatant, rotting-from-within corruption of Party and Government and particularly at lower, more local levels (as simply highlighted by the Bo Xilai scandals), only drives home what was already becoming an unavoidable truth.

But as my Chinese television colleague noted, the only reason why Deng Xiaoping was able to effect the levels and types of reform that he pushed through was that he had the active support of China’s military – the same military I add that more recently elevated Mao’s grandson, General Mao Xinyu to a position of spokesperson and public face visibility, in promotion of system and practices as usual. Will China’s new and emerging leaders hold such authority and influence as Deng had over the People’s Liberation Army and its vast industrial and socioeconomic reach?

Something has to give. The only question I have is one of how much change China’s new leadership will have the vision to see, and the capability to enact in its attempts to control this and prevent the types of societal disruptions and failures that Wen Jiabao and others have warned of.

China is no longer Communist in the way that Mao envisioned and enforced even if it still adheres to the old names and terms, and to the framework of Party that he built. Even if change can only be carried through in the linguistic framework of old Party labels, real reform of Party is needed, and yes – the allowance and even encouragement of an open plurality of voices and of organization, and not just the clique and faction structure that exists now with its local cronyism and its opacity-protected corruptions.

In a brief span of months, the big changeover of leadership will take place with seven new faces joining the nine member Politburo Standing Committee and with further leadership changes extending out from there and throughout national and provincial level governments and into local governments too. Will they be allowed to institute greater transparency and accountability, and even just to the extent that they proactively reach out for them? Will my two colleagues prove correct in their assessments that Party will simply seek to continue as-is and without real change, and if so what will be the longer-term consequences? I am finishing this series for now but I will be coming back to discuss these and related issues in the coming months. You can find this and related postings at Macroeconomics and Business and also see Ubiquitous Computing and Communications – everywhere all the time.

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