CHINA AFTER MAO: THE RISE OF A SUPERPOWER

By Frank Dikotter

Bloomsbury Publishing

ISBN: 9781639730513

RRP: $34.99 (pb)

Also: The Tragedy of Liberation, Mao’s Great famine and The Cultural Revolution (all published by Bloomsbury from 2010 to 2016).

Reviewed by Keith Harvey

 

Frank Dikotter is a remarkable historian of modern China. Dutch born, he travelled to China in 1985 for two years to study Mandarin, beginning a lifetime interest in communist controlled China. After an academic post in London, he took up the Chair of Professor of Humanities at the University of Hong Kong in 2006. Surprisingly, given his detailed work on the real history of the Communist Party’s brutal rule in China, he still lives in Hong Kong.

He has written numerous books on Chinese Communist Party history, notably the People’s Trilogy – three books (The Cultural Revolution 1962-1976 & The Tragedy of Liberation Mao’s Great Famine) dealing in turn with the tragic consequences of the “liberation” of China by Mao’s Communist party in 1949 and afterwards, the so-called Great Leap Forward (1958-1962), which Dikotter correctly calls “Mao’s Great Famine”, and on the so-called Cultural Revolution (1966-76).

In these books, Dikotter reveals that, despite the closed and secretive nature of the CCP’s totalitarian rule, he was able to gain a detailed picture of the devastating impact of these three periods on the ordinary people of China, by gaining access to regional and local government archives. National archives were, and still are, off-limits to foreign researchers but by looking at regional and local reports and documents, he has been able to piece together a national picture of these three human tragedies through a research program lasting a decade.

The scale of the terrible impact of Communist rule is quite simply shocking, no matter which period or event you consider. Arbitrary, extreme, even nonsensical policies and programs, brutally implemented, took a heavy toll on ordinary Chinese citizens, through famine, judicial and non-judicial murder, detention, “re-education” and denial of human rights generally. This continues right up to the present time.

The People’s Trilogy is sobering, shocking and simply difficult to read in places as Dikotter methodically counts the number of people whose lives have been destroyed by Communist Party rule. The number easily runs into the tens of millions of Chinese who died.

His latest book: China After Mao – the Rise of a Superpower – follows the story after the death of Mao in September 1976. This finally ended the Cultural Revolution but not the Chinese people’s trauma. The story continues until the rise of Xi Jinping in 2012 (when, incidentally, the archives began closing again) so the book is not, as such, a commentary on China today. However, it clearly has many implications with regard to today’s China.

In the Preface to this book, Dikotter quotes another China observer, James Palmer, who said: “Nobody knows anything about China: including the Chinese Government.” This apparently paradoxical statement is readily explained by the twin facts of the secrecy and opaqueness by which the Chinese Communist Party (CCP) and Government rules at the national level, but also because subsidiary governing bodies and State enterprises systematically lie and cover up their actual performance in reporting to their superiors.

Of course, it might be possible to say that if anyone knows what has going on in China it is Dikotter, but the point is taken. Lack of transparency in authoritarian regimes is a given, as is the ingenuity of lower-level officials in trying to survive an arbitrary and brutal regime with many policy and personnel swings. Telling the central authorities what they want to hear, not what is actually happening, is a well-used strategy in dictatorial systems.

But, in another respect, the message that flows strongly from Dikotter’s research and historical analysis is that, in many key respects, the Chinese Communist Party’s policy is obvious, transparent enough and unchanging. Despite the rapid transformation of China into an economic superpower (though with real questions about its underlying economic fundamentals), CCP policy has not changed since 1949 in its essential aspects.

These include: the permanency of CCP one-party rule, the determination of the Party to control all aspects of the State, the economy and society to the exclusion of all others, and the rejection of “Western ideas” such as the separation of political and judicial powers, free press, etc.

Straying into current times and leadership, Dikotter notes in the Preface that in 2018, current Party boss Xi Jinping said “China must never copy other countries” least of all the judicial independence and separation of powers of the West – a common position of his predecessors since 1949. A one-party regime is here to stay.

And the foreign policy goals are clear and consistent with regard to territorial control, whether it be with respect to Taiwan or the South China Sea. Dikotter says that in relation to the latter issue, China’s policy is simply a matter of “tonnage and timing” – the willingness to pursue these objectives as and when China has the capability to do so and the time is right.

As an example of China’s willingness to act forcibly, Dikotter notes that after the Paris Peace Accords in 1973 (which removed American forces from the Viet Nam war), the South Vietnamese government reduced its forces in the Paracels, an island group in the South China Sea. Fighting continued between the South and the North and the Chinese Government took the opportunity to capture all the Paracels from (South) Viet Nam. Saigon’s request for assistance from the US Seventh Fleet was ignored, Dikotter says and China “had used the appropriate tonnage at the appropriate time”.

Dikotter is rightly sceptical of those who claim that China’s opening to the West, for example by joining the WTO, will inevitably lead to a genuine move towards a free market and democratic reform. There is simply no evidence for this optimism, based on the historical evidence, he writes.

Following the death of Mao, Deng Xiaoping was rehabilitated and became “paramount leader” of China. While this was an initial improvement over Mao and the Gang of Four, Deng pursued essential policies and methods in many ways only a little different to Mao’s. Deng was, of course, leader at the time of the Tiananmen Square massacre in June 1989 when Soviet leader Mikhail Gorbachev’s was visiting China to heal the Sino-Soviet rift and at the same time as profound changes were taking place in Eastern Europe.

The “reformer” Deng used the same tactics as the “reformers” in the Soviet Union after the death of Stalin to put down the protests. The Soviet de-Stalinisers brutally repressed challenges to their rule in Hungary in 1956 and Czechoslovakia in 1968. Hard to spot the difference.

Despite the brutality of the suppression of the Tiananmen Square protestors in June 1989, Dikotter notes that within a little more than a year, China was again in receipt of Western loans including from the World Bank and from Japan. China, he notes, had learned the value of “hostage diplomacy” releasing two dissidents to the USA to repair relations with the West, while underlying policies stayed the same.

Western countries, and Western companies in particular, saw an immense opportunity to do business with and in China. Much of China after Mao deals with China’s rise as an economic superpower and Dikotter’s recounting of the gradual rise of China as an economic and financial powerhouse is detailed. The ins and outs of these policies are beyond the scope of a review, but anyone interested in investing in China, or simply faced with the opportunity to buy a product made in China or elsewhere, should read this book.

Dikotter’s analysis shows that the appearance of a private sector in China is deceptive. While large corporations now exist in China and their shares are listed and can be bought on overseas stock exchanges, majority ownership remains in Chinese government (meaning Party) hands. For example, China Telecom is the fifth largest telco in the world and listed on the Hong Kong and New York stock exchanges, but the company remains a subsidiary of the Chinese Ministry of Posts and Telecommunications.

Foreign companies have flocked to do business in and with China. Dikotter notes that by 2003, 20 years ago, 70 per cent of goods sold by giant US retailer WalMart were made in China. A walk around a major discount retailer in Australia would confirm or exceed this mark.

Doing business in China brings with it many risks: intellectual property theft on an industrial scale, environmental problems, poorly made or even dangerous products (which is why Australian-made infant formula is so popular in China) and lack of labour rights in China.

Many workers in Chinese factories are “migrant workers” from the countryside, who have no legal rights. The right to strike was removed from the Chinese Constitution as far back as in 1992. The “dictatorship of the proletariat” offers little, if any, protections to workers.

China has benefitted greatly from its membership of the WTO and from Free Trade Agreements with other countries, including Australia. Many thought that WTO membership would lead to an opening up to democratic reform, but there is no sign of this. Dikotter says that “free trade with an unfree country is a logical contradiction” and it is hard to conclude otherwise.

Dikotter looks in some considerable detail at the debt levels of Chinese companies and government bodies (at various levels of government). He is rightly concerned, not only with the absolute level of debt but with the obvious lack of transparency about this debt. Chinese authorities offer bonds on the international market and the size of this investment pool is now huge. It is now the second largest bond market in the world, after that of the USA.

While Dikotter does not deal with this, your reviewer is aware that the Australian government requires, in effect, that Australian superannuation funds (and therefore their members) invest in Chinese government bonds. How so, I hear you ask?

The performance test legislated by the previous Coalition government requires super fund regulators to measure the investment performance of super funds against a series of benchmarks. The benchmark for fixed interest or bonds is the Bloomberg Barclays Global Aggregate Index. Since 2019, this index has included Chinese RMB-denominated government and policy bank securities, now worth about six per cent of the index.

Since these bonds have been paying significantly above the going rate for fixed interest investments in other jurisdictions (in a low interest rate market), the failure of super funds to invest in Chinese government securities places them at risk of failing the performance test. Bloomberg has indexes which exclude Chinese bonds and one of these should have been chosen. Investing in government bonds in authoritarian countries runs all sort of risks, especially those related to social and governance issues. All investment in China lacks governance transparency due to the secretive role of the Communist Party. Are Australian super funds making investments in the government of Xinjiang province, for example?

China is still an unfree country: any organisation which appears to have even the potential to challenge the regime – such as Falun Gong – is suppressed. There is no tendency towards democracy and respect for human rights. Censorship and control of the internet has been tightened. Dikotter notes (even though this is outside his period) that there has been a crackdown on human rights activists and that Google, Facebook, Drop Box, YouTube Reddit and even Spotify as well as international news agencies have been blocked.

Few foreign correspondents remain in China. Two Australians are still in jail. Despite China’s membership of the WTO and a Free Trade Agreement with Australia, trade bans and limitations were implemented by China in the wake of questions about the origins of the Coronavirus.

Dikotter’s book makes a compelling argument that little fundamental change has occurred in China. As a result of its economic opening up and participation in the world economy, ordinary Chinese people have benefitted little. The State is wealthy, the people are poor. While China now has the second largest economy in the world behind the USA, its per capita income ranking is around 70th in the world as measured by the World Bank.

All Dikotter’s books on China are highly recommended to those who do want to understand what is going on. Unfortunately, there is little to be optimistic about in the foreseeable future.

Keith Harvey is a non-factional member of the ALP in Victoria. He was employed for many years in the trade union movement and is currently a director.