Asia Europe Journal (2003) 1: 305–309

ASIA EUROPE JOURNAL Ó Springer-Verlag 2003

Book Review China – Eine Weltmacht kehrt zurueck, by Konrad Seitz (Berlin: Siedler Verlag, 3rd rev ed, 2001, ISBN 3-88680-646-4); 445 pages, Euro 25 Seitz has written an interesting and impressive book, capturing the essentials of China’s civilisation and her historical evolution, and in analyzing in great detail the power structure, the achievements and the disasters of Communist rule and the current reform decades. While not holding back critical assessments about current shortcomings in public and economic governance, he concludes with a qualified prediction of China as a future economic world power. The book is well written and well informed throughout. In spite of covering a vast time span and wide range of suspects it never turns platitudinous or shallow. It is indeed laudable that the author, a former German ambassador to China (1995–99), has found it worthwhile to share his valuable insights with the educated public rather than with only the usual half dozen readers of diplomatic reports in the Foreign Ministry. Seitz starts his historical tour d’horizon with the peak of China’s civilisation and external influence in the early 15th century when her tributary kingdoms stretched from Ceylon and Southern India to Korea. Her sudden withdrawal from overseas navigation in 1435 then left South Asia open to European – initially Portuguese – influence, with China seeking shelter from foreign influence behind the Great Wall, cultivating her feeling of superiority towards her barbaric neighbours for the next centuries, which led to enduring, albeit imperceptible decline. In his historical narrative, Seitz compares interestingly the achievements of the Han Empire and the Roman Empire, who without knowing of each other coexisted at the same time. During the European middle ages, China then advanced with key inventions in printing, papermaking, navigation, iron production, explosives and agricultural technologies. In spite of a monetarized economy, a highly developed artisan division of labour, a prosperous rural economy and a nationwide canal system, an industrial revolution did not happen in China. It was blocked by Confucian officialdom, which (similar to the rural gentry in Europe centuries later) felt its rule threatened by the rise of the despised merchant class. European perceptions of China changed considerably over time. It started with the fabulous riches, which Marco Polo reported from his stay at the court of the Great Khan (1275–92) and with 18th century accounts of Peking based

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Jesuits of an enlightened absolute monarchy ruling through a meritocratic gentry. This notion held great appeal to European intellectuals at the time. As China, unable to reform herself, stagnated, the West later rather saw ‘‘Oriental despotism’’ at power (a notion prominent with Karl Max and other 19th century writers), which lent an air of respectability to the foreign interventions of that century, including the two opium wars (1839–42 and 1856–60). They made the East India Company, Jardine Matheson, the American Astor dynasty and the British Chancellor of the Exchequer rich, but with some 10% users and 5% addicts ruined the physical and economic health of the Chinese. With the loss of Manchuria (1860) to Russia, of Vietnam (1864) to France, of Okinawa (1879), Korea and Taiwan (1895) to Japan, and foreign concessions along the coast, the legitimacy of Manchu rule and the sinocentric world view of the ruling classes collapsed. After a series of devastating uprisings, like Taiping (1850–64) and the Boxer (1900), rebellions imperial rule collapsed in 1912. It was followed by a decade of civil wars (1916–28) between warlords of varying degrees of despicability, from which Chiang Kai Chek in 1928 emerged victorious. Seitz observes an interesting pattern of regime change throughout China’s history (pp. 80–81). The ruling dynasty looses the mandate of heaven. It is overthrown by a peasant uprising or by a barbaric invasion from the North. A new rule is set up. The devastated country is rebuilt. Agricultural and artisan production grows again. Prosperity sets in and culture flourishes. However, population increases begin to eat up economic gains, and over the decades, if not centuries, a slow, imperceptible decline sets in (weak emperors, a poor administration, corruption, fiscal problems, famines, rural exploitation, and banditry). Natural catastrophes then indicated that the mandate of heaven was recalled. In such troubled times, chiliastic sects proliferated which promised the peasants an age of equality, justice and liberty. Often they managed to defeat the emperor’s badly maintained mercenary armies. The gentry then rallied with the victorious peasants or with the foreign invaders. With a new emperor, a new dynastic cycle set in. Chiang Kai Chek’s rule, as we know, was not to last. He managed to modernize China’s transport infrastructure and university education. But high costs of armaments, the fight against the Communist insurrection, the war against Japan (1937–45), and his corrupt and exploitative administration did little to alleviate rural poverty and underdevelopment, thus preparing the ground for the Maoist farmers uprising. In the ensuing Civil War (1945–49) after initial military successes, high inflation and corruption eroded the support of the gentry, the merchants and other middle classes for the KMT, whose rule in 1948/9 quickly imploded. In the 1950s, China was quickly rebuilt, as the People’s Army repaired the infrastructure. The drug trade, the triads and inflation were eliminated. But from the beginning an unending series of militant campaigns, with its cumulative death toll by far bypassing Stalin’s terror regime, prepared the ground for totalitarian rule. It started in 1949 with a militant land reform in which 1 million landlords were murdered. Then coinciding with the Korean War, mass terror was launched against ‘‘counter-revolutionaries’’, people associated with the old regime, with 800,000 being killed. The closure of the country followed (lasting until Nixon’s visit of 1972) with the expropriation and expulsion of most of the remaining foreigners. Then there were successive campaigns

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against bureaucrats, entrepreneurs and intellectuals until by 1952 a centralist totalitarian regime was established, which had successfully eliminated all possible pockets of resistance and set-up the world’s probably most total control through dan wei neighbourhood and work place committees. During 1953–57, the Soviet Union’s first 5-year plan (of 1927–32) was copied, pushing with Soviet technical aid for heavy industrialisation at the expense of the agricultural sector. In 1955/56, the collectivization of farms was forcefully enacted. In 1957 ‘‘Hundred Flowers’’ of free intellectual criticism of bureaucratic party rule were allowed to bloom for 100 days. Once critical opinions were outed, an anti-rightist campaign with 500,000 intellectuals killed and the party purged, silenced most of them forever. The worst political crime – perhaps of human history – was the Great Leap Forward of 1958/60 in which a forcible rural industrialisation led to a famine, which left up to 40 million farmers dead, whose meager harvests had been confiscated. The country had hardly recovered in the early 1960s, that Mao, whose deification had been instigated by Lin Biao at the time, launched a new campaign, the Cultural Revolution (1966/69) as a student and workers uprising against the party elite. A civil war ensued, with probably more than one million people being killed and countless cultural treasures destroyed in wanton ideological hooliganism. In 1969, the military put down the Red Guards and sent the survivors, betrayed by Mao, to wasted lives in the countryside. As a campaign the Cultural Revolution was intended not only to destroy the bureaucratized party elite and to re-establish revolutionary fervor, but also to destroy the last remnants of Confucianism: in pitting sons against their fathers and students against their teachers. The rule of Mao, who died in 1976, according to Seitz, had many similarities to Chinese imperial rule: – – – – –

the start with a peasants’ uprising, the exclusion of foreigners and the disregard of trade, the cadres in the countryside as equivalents to the old gentry, the absolutism of his rule, and the deification of the ruler.

But there were differences as well: Most notably the instigation of militant campaigns as permanent revolution, and the triple power structure consisting of party, army and government (all under Leninist control by the executive committee of the Politburo (pp.148)). The volontarism of the Great Leap Forward and other campaigns and of peasants replacing workers as the revolutionary subject were his largest disgressions from Marxist theory. Indeed during two-thirds of his rule, the officially ‘lost years’ of 1957–76, China made very little progress on any social or economic indicator (p. 207). Deng Xiaoping rectified this in liberating the Chinese productive energies by allowing them to work for themselves. In response to initiatives from farmers and rural cadres, he permitted the decollectivization of Chinese agriculture (1980–83), which liberated farmers from de facto slavery. Farmers markets, artisan industries and rural family enterprises sprung up everywhere, especially in the coastal regions. Rural party officials, who in the absence of legal safeguards lent political protection for the new properties (p.231),

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welcomed the new sources of public and private revenue. In the cities there was more resistance to reform (1984–88), as ministry planners, the local nomenklatura and the party secretaries in the companies felt their power threatened (p. 237). In 1978 China was opened for trade and since 1979 special economic zones were set up along the coast. They were first used by the Hong Kong Chinese to use low cost labour in neighbouring Guangdong for light industries in the Pearl River delta, by the Taiwanese to locate shoe industries and later PC and electronic components manufacturing to nearby Fujian, and by overseas Chinese to invest into their ancestral regions along the coast. Since 1992, foreign investment has moved from labour intensive small-scale operations towards large capital and technology intensive joint ventures of European, American, Japanese and Korean multinationals with state owned enterprises (SOE). 6,000 of them are located in the Pudung area of Shanghai alone. Shanghai itself, which in the 1930s had been a cosmopolitan city with 100,000 foreign residents and under Maoist rule was turned into a gray heavy industry town, was reborn again to its pre-war glory. Whether it will succeed to regain its status as a cultural and intellectual centre of Asia depends very much on the degree of political and intellectual freedom, yet to be achieved, Seitz rightly cautions (p. 256). First attempts at democratization were crushed in 1979. In the late 1980s, disproportionate gains from modernisation and nefarious effects of one party rule, like corruption, influence peddling of the princelings of the party elite and asset stripping by state managers, became ever more evident. Public discontent then led to workers joining the student protests at Tiananmen in the early summer of 1989. Once this was crushed by the 27th army, hardliners around Li Peng and Chen Yun tried to turn back the economic reforms as well (p. 279). They reforms were saved by the southern trip of Deng, who continued to insist on an (unspecified) mixture of plan and market. Deng justified his ‘‘Asian developmental dictatorship’’ (p. 291) with the need for effective decision making. During his increasingly informal rule, there were regular purges of party members and the rediscovery of Confucius. During 1978/97, rural poverty was reduced in absolute terms, but urban poverty had become more visible at the same time. After Deng’s death (1997), the time of ‘‘reform without losers’’ (p. 319) was definitely over. There had been a wild investment spree into ‘‘strategic’’ industries by the SOE, ministries, trade unions, the military and local authorities which was state financed with politically directed state bank credits. As a result, by late 1996, there were, for instance, 325 car manufacturers and 1,700 steelworks in China, which could survive only due to regional protectionism and continued credit flows. Unserved loans were simply rolled over after two years. Even according to official figures, 60% of all SOE were making losses. They had been sited as centers of the party’s power at strategic locations, irrespective of transportation costs. SOE managers foremost had to satisfy the local party chiefs, then look after their employees, with market demands becoming an afterthought only (p. 344). Like in Eastern Europe in the early transition stage, output was expanded irrespective of profitability and marketability. On top of that enterprises were frequently plundered by managers and public authorities alike (p. 346).

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Seitz reviews current attempts at SOE and banking reform and gives high marks for the construction of a modern infrastructure, the privatisation of public housing and WTO adjustment. He insists on the need of high growth just to absorb the 8 million annual new entrants into the job market. He enumerates the major risks facing China as overpopulation, unemployment, the environment (including the scarcity of clean water), the ‘‘powder keg’’ of regional and social inequality, moral decay, corruption (he denies however, that China will ‘‘become another Indonesia’’ (p. 329)), and political instability. Yet in sum, he rates the chances of failure as ‘‘no more than 10%’’ (p. 423). Political, regional and social tension were unlikely to explode ‘‘for the moment’’ (p. 422), as the opposition remains unorganised and repression effective. With 90% probability, China will evolve peacefully towards the rule of law and into a market economy with sustained growth for the next two decades, he concludes. By then, there would be two world powers: the US and China. They would be non-antagonistic as China’s role would be a regional one limited to Asia. This co-existence could be facilitated by Europe, which however, would still need to understand China’s rise in the first place. There are a couple of minor mistakes left in the book, which in a 3rd edition should have been eliminated: Japan’s economic bubble of asset inflation began to crash in 1992, not in 1990 (p. 322). The Paracel Islands were taken by force from the Vietnamese in 1974, not in 1944 (p. 436). The author, like Chang, also gets the larger picture of the Romanian revolution of 1989 wrong (p. 278). (*) In sum, however, Seitz book on China remains valuable and extremely interesting and stimulating to the general reader. Albrecht Rothacher

(*) For details see i.a. A. Rothacher. Im Wilden Osten. Hinter den Kulissen des Umbruchs in Osteuropa. Hamburg: Kraemer. 2002, pp. 451–2.