China: reform economists who sought the road not taken

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Deng Yingtao, who in the 1990s called on China to reject the western-oriented industrial development model, was neither a dissident nor an environmentalist. As a senior economist at the Chinese Academy of Social Sciences, he first made his mark in the late 1970s, in debates about reforming agriculture. (See MAIN ARTICLE about Deng’s work here.)

Deng’s father, Deng Liqun, was high up in the Chinese Communist party. He joined it in 1936, and served as a military leader, both before the revolution of 1949 and in the suppression of revolts in western China in the 1950s.

In the 1970s, during the cultural revolution, Deng senior, like many leading and middle-ranking Communists, was sent to the countryside. He worked in Henan province. There his son Deng Yingtao

Farmer with buffalo, 2007. Photo: Andy Siitonen / Creative commons

met Chen Yizi: their discussions about how the collective farm system obstructed the development of agriculture started a long collaboration.

Mao Zedong’s death in 1976, the purge of the Maoist “gang of four” that followed, and Deng Xiaoping’s emergence as the undisputed party leader in 1978, marked a big political turning-point. The cultural revolution was repudiated.

A “Beijing spring” was declared, allowing open political discussion that had been impossible under Mao. The “four modernisations” (economy, agriculture, science and defence) reform policy was adopted; the use of market mechanisms and some opening-up to capitalism were key elements.

At the top of the party, Deng Xiaoping sidelined Hua Guofeng, Mao’s obvious successor. In the ranks, intellectuals and officials who had been sent to the countryside returned to Beijing – including Deng Yingtao and Chen Yizi.[1] Along with Wang Xiaoqiang, Deng and Chen became central figures in a group of reform economists who in 1979 began to meet on weekends in parks and empty offices in Beijing’s universities – and then, as their numbers grew, moved into lecture theatres. In 1981 they would constitute themselves formally as the Rural Development Group, affiliated to the Chinese Academy of Social Sciences.

These young reformers began by discussing the move away from collectivisation in agriculture, but moved on to consider larger issues of strategy to guide China’s economic development. Crucially,

Zhao Ziyang, removed after refusing to support the post-Tiananmen crackdown

they had senior party members who encouraged and protected them – not only Deng Yingtao’s father Deng Liqun, but also Hu Yaobang (who would become party general secretary in 1982-87), Zhao Ziyang (premier in 1982-87 and general secretary 1987-89) and Du Runsheng, a senior agricultural administrator.

“The young generation of intellectuals were sent up to the mountains and to the countryside during the cultural revolution”, wrote Isabella Weber, a historian of Chinese economic debates. They “identified with China’s peasant majority and their struggle for material well being” – and formed an “unusual alliance” with senior party leaders including Zhao.[2]

The first big issue in the economic reform debates was about how to increase agricultural output. Against the collective farm model, the young reformers championed the “household responsibility system”, which was pioneered from 1977 in the Anhui province. Land was contracted to households, who took responsibility for production; private plots were permitted. In 1979, party officials from Anhui who arrived in Beijing to report on the results met with some of the young reformers, including Chen Yizi and Deng Yingtao.

The party leadership sanctioned the Anhui system and it was implemented nationally. In many areas, grain output doubled. Other reforms followed, including the the de facto end of grain rationing and

Chen Yizi. Photo: Standoffattianenmen.com

evolution of grain markets. Rural township and village enterprises were permitted, and given increasing freedom to allocate resources. In 1987, the Communist party congress clarified that the private sector should be “permitted to exist”.[3]

The upheaval in agriculture freed up labour in the villages, and by the late 1980s stimulated the flow of migrants from the countryside to China’s coastal cities. Here was cheap labour for the industrial boom that would gather pace in the 1990s.

In the mid 1980s, the economic reform debates focused on whether, and how rapidly, to liberalise fixed prices, and on how to manage macroeconomic policy. Deng Yingtao and Wang Xiaoqiang were prominent in these discussions.

Wang, in particular, cautioned against the sort of “big bang” price reform that would be implemented so disastrously in post-Soviet Russia in 1992. An attempt at something similar in China, in 1988, ended with panic buying of goods and riots in some places; the policy was rapidly abandoned.[4]

During these debates – and before the Tiananmen Square protests of 1989, and the repression that followed, which drastically narrowed space for public discussion – Deng Yingtao began to integrate an understanding of natural resources issues into his work as an economist.

Deng said in an interview, given shortly before his death in 2012,[5] that he had started thinking about these issues in 1984. Wang Xiaoqing, who conducted the interview, said to Deng:

In China, we used to talk about “overtaking the UK and catching up with America” [in terms of economic growth]. But there you were, insisting that there is no “overtaking”, no “catching up”. […] You were a very lonely voice amid all the hype of the reforms.

Deng responded that he started focusing on natural resources issues when thinking about the targets set by the Communist party, to eradicate absolute poverty by 2000 and “fully modernise” by 2050.

He realised that the USA, UK, France, Germany and Japan – whose total population added together was still less than China’s – were “consuming 60-70% of the world’s energy”. If China, with its huge population, went the same way, “world energy consumption would more than double”.

Neither could China follow the “Asian tigers” [South Korea, Hong Kong, Singapore and Taiwan]. “All of China can’t be an export-processing zone”, Deng told Wang (although, of course, much of it now is). And he continued:

At the time, everyone was very excited by the prospect of growth. all the local governments were hoping for quick technical fixes that would catapult them into modernity overnight. Perhaps in reaction to that, I became rather sceptical. […]

I thought, developing a system for full modernisation is a long-term project. It will take years to work out a programme for modernising industry and lifestyles, so there’s no rush.

Deng considered natural resources issues in an economics framework, which he set out in two of the opening chapters of A New Development Model.[6] He argued:

The tendency to over-exploitation [of non-renewable resources] is quite clear. The pollution of [renewable but limited] resources […] such as air and fresh water, in the course of over-exploitation of non-renewable resources, is equally startling and happens by means of exactly the same mechanisms. Damage to the ozone layer caused by air pollution even means that the last plentiful resource we have – the sun – is being adversely affected.

The conclusion? “The crux of the problem with the ‘classic’ development model is over-exploitation” – that is, large-scale consumption of non-renewable resources, and great damage inflicted on renewable resources. The mechanism for over-exploitation is “a combination of private enterprise and the market”. And further on:

Humankind may be said to face ten major environmental problems: desertification, deforestation, the crisis in water resources, species going extinct, pollution by acid rain, the greenhouse effect, damage to the ozone layer, soil erosion, pollution by toxic chemicals and a waste disposal crisis. Without exception, all these problems have been gifted to humankind by the “classic” development model. This really is a final settling of accounts by Mother Nature.[7]

I do not know whether Deng Yingtao was influenced by China’s environmentalist movement in the 1980s. But it is hard to believe that protests, such as those over construction of the Three Gorges Dam, deforestation, and air and water pollution, passed him by.

In 1988, shock waves went through the Chinese intelligentsia with the publication of China On The Edge: the crisis of ecology and development by He Bochuan, a philosophy lecturer from Guangdong. The book, which presented a grim, Malthusian view of China’s mounting ecological crises, sold nearly half a million copies before printing was halted after the Tiananmen clampdown.[8]

Deng Yingtao operated in a sphere far removed from those who organised the Three Gorges protests. Although he never sought a career in business or politics, he was part of an elite that included government ministers and powerful businessmen.

After Tiananmen, even these most privileged circles were affected by the clampdown.

Zhao Ziyang, who as Communist party general secretary had opened a dialogue with the students at Tiananmen, and refused to sanction the military attack on them, was removed. He spent the rest of his life under house arrest.

The reform economists, who had counted Zhao among their protectors, went their separate ways. Chen Yizi and Wang Xiaoqiang left China; Wang returned in the 1990s. Deng Yingtao remained.

Deng was perhaps the highest-profile member of the Chinese elite to state the case against western-style industrial development. But he was by no means the only one.

In the run-up to the Rio Earth Summit in 1992, where the first international agreement on climate change was signed, debate raged in Chinese government about the stance it should adopt.

The dominant position, which ultimately guided China’s delegation at the Summit, was backed by the state planning commission, and the energy and foreign affairs ministries: China ought to make a

Deng Liqun, Deng Yingtao’s father. I could not find any photos of Deng Yingtao himself. Photo: Wikipedia

contribution to fighting climate change, primarily because it might itself be adversely affected; no such action should restrict China’s economic development; a big increase in China’s energy consumption was inevitable; and proposals on issues such as reforestation and energy efficiency should be framed in terms of the advanced countries’ debts to developing countries.[9]

Officials at the National Environmental Protection Agency, the State Science & Technology Commission and agriculture ministry saw things differently. They were influenced in part by some serious thinking at the Centre for Eco-Environmental Research of the Chinese Academy of Sciences.

One group of researchers called for China to reject both the “traditional”, agricultural path of development taken by countries in the global south, and the “modernising way” taken by rich western countries. A new approach to development, “ecological construction”, was needed, they wrote.[10]

Two other academics argued that “China neither has the condition to follow the traditional path of high consumption of resources and high living expenses as in industrialised countries, nor should [it] follow the same old disastrous road of ‘consider the control after forming pollution’ as in industrialised countries.”

Presciently, they advocated development of “resource-economising technologies”, “control of the use of fossil fuels”, and an increase in the proportion of “clean energy” used.[11]

These arguments made as little impression on China’s climate policy as Deng Yingtao’s did on economic policy. Some officials interviewed by Elizabeth Economy, an American researcher of Chinese climate policy, “evinced amazement […] that such views were being openly published”.[12]

By the time the Chinese delegation arrived at the Second World Climate Conference in Geneva in 1990 – a key meeting in the build-up to the Rio summit – the government’s stance had been decided. Economic development, along the lines laid down by the big capitalist powers many decades before, would be the priority and the climate talks would be used as a forum to squeeze monetary compensation out of those powers.

As for Deng’s work on the need for a new development model, most of it had already been published in articles, before Tiananmen. In 1991, two years after the students’ protest was crushed, CITIC Press, a government-backed publisher, asked Deng to collect these articles together as a book, which was published with the title A New Development Model and China’s Future.[13] The English translation appeared in 2014. GL, 30 April 2020.

Download this article (and the linked one) as a PDF

See main article – China’s coal-fired boom: the man who cried “stop”  

[1] This account of the young reformers’ work is based on: Isabella Weber, China’s Escape from the “Big Bang”: The 1980s Price Reform Debate in Historical Perspective (PhD, University of Cambridge, 2017)

[2] Weber, China’s Escape from the “Big Bang”, p. 120

[3] See: Peter Nolan, Transforming China: globalisation, transition and development (Anthem Press, 2004), chapter 1; Peter Nolan, China’s Rise, Russia’s Fall (Palgrave Macmillan, 1995); and Joseph Fewsmith, Dilemmas of Reform in China: political conflict and economic debate (Routledge, 1994), chapter 1.

[4] Weber, China’s Escape from the “Big Bang”, pp. 171-176

[5] See the Afterword in Deng Yingtao, A New Development Model and China’s Future (Routledge, 2014), pp. 191-256

[6] Deng Yingtao, A New Development Model, Chapter 3, “The breakdown of natural resources” and Chapter 4, “The economy of waste”

[7] Deng Yingtao, A New Development Model, pp. 66-67

[8] He Bochuan, China on the Edge: the crisis of ecology and development (China Books, 1991). See the sleeve notes

[9] Elizabeth Economy, Negotiating the terrain of global climate change policy in the Soviet Union and China: Linking international and domestic decision-making pathways (PhD, University of Michigan, 1994), pp 166-173. This source gives an account of the policy discussions that led up to the Rio summit

[10] Wang Rusong, Ouyang Zhiyun and Zhao Qintao, “Ecological construction – an alternative developing way for developing countries”, Journal of Environmental Sciences (China), 2:3 (1990), pp. 1-12

[11] Hu Angang and Wang Yi, “Current Status, Causes and Remedial Strategies of China’s Ecology and Environment”, Chinese Geographical Science 1:2 (1991), pp. 97-108

[12] E. Economy, Negotiating the terrain of global climate change policy, p. 168.

[13] See Deng Yingtao, A New Development Model, pp. 194-195

One Response to China: reform economists who sought the road not taken

  1. […] Some key sections of Deng’s book are reproduced her. And I have written a separate article about his life as a Communist party member and scholar, and the group of reform e… […]

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