Inspired by the speeches of other professors, I want to talk about the Chinese model and a revolution.
First, I want to stress the importance of economic model. If you have a look at China’s economic developments in the past 30-40 years, you can see that Deng Xiaoping did only one thing: to change the model. We call it reform, from plan economy to market economy, with no change surely in the political system. Second, Deng Xiaoping gave people some rights, human rights like the freedom to move and the freedom to choose employment. There were also some changes in individual innovation and property rights.
The loosening of rights brought about ownership changes in the system. But one fundamental thing has not been changed: the centralization of power, whether the legitimacy of power shall come from above or below. There are no checks or balances between power groups. This is China’s model today. I can describe it in one phrase: controlled market economy under a dictatorship.
What is an economic model? An economic model shall have four components or systems of activities. First, a commitment of value, the government must have a commitment to its citizens in terms of value. Second, the government must have a definition of its system. Third, how GDP shall be created? Fourth, allocation of resources or GDP. Let’s have a look at them one by one.
If you look at our government’s commitment to its people “We serve the people”, there is no difference between China and the west. The CCP government even claims to have done better than the west in making this commitment. This is the first point.
The second point, human rights or property rights. Do the Chinese enjoy equal rights? Does the government protect individual rights? We must be very clear about this.
The third point, restriction of power. Where is CCP’s power legitimacy from? From its top leadership or from the ordinary citizens?
The fourth point, should the central power be restricted or balanced?
These are the four points we need to be very clear about, as the creation and allocation of wealth depends on clear definition of these points.
Let’s look at the situations today. First there are privileges in China, no equal rights, and the lines are not clear. Second, there is no clear definition of property rights, and no protection of those rights. Third, the power comes from above. Fourth, there is no supervision on government power.
The creation of wealth in China comes mainly from three sources: investment, foreign trade and urbanization.
By levying heavy taxes, the government collects most of the wealth from the public so that it has the money for planned-investment. The government willfully sets the rates and charges, without supervision or restriction in legal terms.
In the past thirty years, foreign trade has contributed a lot to China’s development. But our workers have been exploited by low wages and bad working environment. They don’t even have the right to protest. With this “advantage”, the Chinese government is in a good position to compete with the west.
Urbanization helps build the country’s GDP growth by demolishing the farmers’ land and houses. There are lots of human rights or property rights violations there. Without these violations, GDP growth by urbanization was never possible.
Let’s look again at the allocation of wealth. The government takes 24% of GDP for investment; its system of bureaucracy takes 31%. Together with other expenses, the government takes over 60% of the national wealth, leaving only less than 40% for the people. With this 40%, corrupt officials and private entrepreneurs take the most part. What’s left for ordinary people is very limited.
Dictatorship or controlled economy by Central powers causes many problems. Before any product or resources are put into the market, they must have approval from the centralized government or power groups. This causes corruption, and trading power for money has become norm in the country.
Under this system, only corrupt officials and crafty businessmen make the most money. We can say that state capitalism is now shifted to power capitalism. With this, corruption has become the only motive for development.
This causes many social problems: low wages for working people, no protection for private assets, low social security, deteriorating environment or living conditions, air pollution, drinking water contaminated, food safety problems, health care problems….everything has proved that this economic model cannot go on. The people won’t allow it to go on; and it must be stopped.
What shall we do? Reform! We must admit that economic reform has brought about great changes, to liberate the productivity, and to enliven innovation. But the factors behind the development are terrifying. It is a corruption-motivated and power-controlled economy. Without corruption, no officials will have the motives to contribute to the economy. This model will not work for long term.
What shall we do? Give the power back to the people. Without the rights returned to the people, there will be no social advancement or place for the people. Otherwise, revolution is the only way out.
If we don’t take the road to return the rights to the people, there must be a revolution from the people.
This is the only way out! And this ends my speech.
By Wang Jianguo
Translation by staff editor