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The Political Fragility of the Current Regime in China

Interview with Susan Shirk by Robert Boyer and Sébastien Lechevalier
Susan Shirk, Robert Boyer and Sébastien Lechevalier

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1Susan Shirk is the Chair of the 21st Century China Center and Research Professor at the School of Global Policy and Strategy at the University of California - San Diego. She is also director emeritus of the University of California’s Institute on Global Conflict and Cooperation (IGCC). Susan Shirk first visited China in 1971 and has been teaching, researching and engaging China diplomatically ever since. 

2From 1997-2000, Shirk served as Deputy Assistant Secretary of State in the Bureau of East Asia and Pacific Affairs, with responsibility for China, Taiwan, Hong Kong and Mongolia. Most recently, Shirk co-chaired a bipartisan Task Force on US-China Policy that made recommendations for a China strategy for the new administration http://china.ucsd.edu/​_files/​02072017_US_China_task-force_report.pdf Her article, “Getting to Yes With Beijing,” (Foreign Affairs, March/April 2017) argues that “the United States must figure out how to channel [China’s] ambition in a positive direction while respecting China’s nationalist pride and protecting the United States’ own interests.”

3Shirk's prior publications include her books, China: Fragile Superpower; How China Opened Its Door: The Political Success of the PRC's Foreign Trade and Investment Reforms; The Political Logic of Economic Reform in China; Competitive Comrades: Career Incentives and Student Strategies in China; and her edited book Changing Media, Changing China. Her current research focuses on the evolution of Chinese leadership institutions and a comparison with those of North Korea and Vietnam.

4RR. Your book “China, fragile superpower” published in 2007 pointed out the internal political fragility associated to the emergence of China as an economic power. Then, how do you interpret the last decade?

5The political insecurity of China’s Communist Party leaders has only increased as they struggle to maintain power in a society with a growing urban middle class and an economy that is increasingly marketized and open to the world. The CCP leaders invest heavily in what they call “stability maintenance,” i.e. policing social life, censoring the media and Internet, and punishing lawyers and other activists who defend human rights. But in fact the biggest risk to continued CCP rule probably comes from potential splits within the political elite not a mass movement from below.

6Have you up-dated your theoretical framework or does it cope with the fast response to the 2008 world crisis?

7I originally focused on how an insecure CCP leadership is pressured by a nationalist public better informed by the commercial media and Internet. I explained that Chinese policies toward Japan and Taiwan were tougher and more rigid than most Chinese foreign policies toward other countries because these issues were the focal points of nationalist public opinion. But when China began using its ships and planes to assert its maritime sovereignty claims in the South China Sea around 2008-09, I had to search for another explanation because the South China Sea had up until then not been a focal point of popular nationalism. I concluded that China’s rapid recovery from the global financial crisis in 2008 had created new mass and elite demands for a muscular foreign policy. An additional factor was that the foreign policy process under Hu Jintao was very disjointed with various bureaucratic interests going off on their own with little coordination or restraint from above. A number of different maritime interests like marine surveillance, fisheries, local governments, and the PLA Navy started highly-publicized sovereignty enforcement activities designed to augment their budgets and influence, and before long, the South China Sea had become a hot button issue of popular nationalism. So I started to see that there were a number of features of the Chinese political system, not just the media and nationalist public opinion that were making it hard for it to sustain a peaceful rise.

8RR. In retrospect, how do you analyze the reason of the success of the economic reforms at the origin of the fast productive modernization of China?

9China’s economic take-off was sparked by decentralization, i.e. the decollectivization of agriculture, opening to the world economy, and the devolution of economic management and incentives to local governments and firms who competed with one another. Deng Xiaoping, Hu Yaobang and Zhao Ziyang got around the opposition of the vested interests of the heavy industrial ministries and central planners by “playing to the provinces” who were an important bloc in the CCP Central Committee, as I argued in my book, The Political Logic of Economic Reform in China. Nowadays people mistakenly attribute the success of the market reforms to Deng Xiaoping’s strong centralized leadership, but in fact, it was due more to bottom up experimentation and decentralized decision-making.

10RR. What is your interpretation of the uncertain economic policies followed since 2015?

11China’s market reforms have been stalled out for more than a decade. The trend of restoring Communist Party control over the economy actually began soon after the 1989 Tiananmen Crisis which some Party leaders blamed on the Party’s delegation of too much authority to the government and to society. Then in the second half of the 1990s, Zhu Rongji’s fiscal recentralization and state owned enterprise reforms strengthened the center’s hand over the market and enhanced the monopoly power of the large state owned enterprises that many Party leaders see as the economic base of Communist Party rule.

12RR. Is President Xi Jinping overcoming the conflict between alternative long term strategies about economic reforms?

13Xi Jinping laid out an ambitious economic reform agenda in the 2013 CCP 3rd Plenum document, but he has not shown any political will or devised any political strategy to carry it out. The top-down approach hasn’t created any constituencies with an interest in reforms.

14RR. Nowadays, in your opinion what are the main sources of a major political crisis that would imply a rupture with the strategy inaugurated in 1978?

15China has reached the Lewis demographic turning point when economic growth normally slows. Shortages of working age population raise the cost of labor and increase the burden of welfare for older people and children. Yet CCP leaders have artificially sustained high rates of economic growth beyond this turning point by pumping massive amounts of investment into the economy through banks, local government trust companies, non-bank gray market financing, and the state owned enterprises themselves. This strategy has worked well to maintain a buoyant economy and popular confidence in the CCP in the short term, but the accumulation of debt is likely to spark a financial crisis sooner or later. The CCP may be able to survive a financial crisis, especially if it occurs gradually like Japan’s instead of suddenly like America’s, but a financial panic could turn into a regime crisis.

16Another form a political crisis could take is a split in the leadership caused by elite resistance against Xi Jinping’s concentration of the spoils of power. The elite’s expectations about power sharing in an institutionalized collective leadership are being disappointed. And Xi’s use of the anti-corruption and Party discipline campaigns against potential critics or rivals has created a climate of fear among the elite. Most leading officials are bandwagoning on Xi’s power in order to advance and protect themselves. But as Xi Jinping himself has noted, there were a number of examples of coup-like “anti-Party activity” during the 2002-12 Hu Jintao era, and there is no reason to expect that maintaining elite unity will be any easier in the Xi era.

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References

Electronic reference

Susan Shirk, Robert Boyer and Sébastien Lechevalier, « The Political Fragility of the Current Regime in China », Revue de la régulation [Online], 21 | 1er semestre / Spring 2017, Online since 20 June 2017, connection on 22 September 2017. URL : http://regulation.revues.org/12329

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About the authors

Susan Shirk

Robert Boyer

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Sébastien Lechevalier

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