Gorbachev’s fate was a lesson for Deng Xiaoping but not for Xi Jinping – The Hill


Just as Chinese President Xi Jinping is readying to further consolidating his power by obtaining another five-year term at China’s upcoming 20th Party Congress, former Soviet prime minister Mikhail Gorbachev’s posthumous return to media headlines evokes glasnost, an open political system that is the antithesis of Xi’s rule. Moreover, the memory of Gorbachev’s advocacy of perestroika, the termination of central planning and the opening up of markets, poses an even greater headache for the Chinese leader, since Xi has done the very opposite. 
In the aftermath of the collapse of the Soviet Union, Chinese leaders, academics and think tankers all studied what had happened in the USSR with intent to preserve the central role of the Chinese Communist Party and avoid the mistakes that led to that superpower’s implosion in 1991. Perhaps the most important conclusion that then-Chinese leader Deng Xiaoping drew was that China had to open up its economy in order to ensure the Communist Party’s continued authoritarian rule. 
Deng’s vision was the impetus for the country’s remarkable growth during the last decade of the 20th century and the first dozen years of the 21st. From 1991 to 1997, China’s gross domestic product never fell below 9.2 percent and in four of those years it exceeded double digits. China’s GDP returned to double digits in 2003 and never fell below 9.4 percent until 2012. By then, Deng was long gone and the second of his two successors as supreme Chinese leader, president Hu Jintao, would retire the following year, to be succeeded by Xi. China has never achieved 9 percent GDP growth at any time during Xi’s rule. 
In contrast to Deng’s economic vision, which was meant to ensure that the basic thrust of perestroika would never overflow into glasnost, Xi’s policies have restricted free economic activity, while supporting inefficient state-owned enterprises. In line with his regression to centralized state economic management, Xi has supported major works projects, many of which are nothing more than white elephants. All of those policies have compounded the weaknesses of an economy that is riddled with corruption, has an ongoing real estate crisis, and maintains a banking system whose real estate-based assets are, as a consequence, highly questionable. 
Beijing’s harsh and unrelenting response to the COVID pandemic — ordering lockdowns of major cities affecting the movement of millions of people — has further undermined Chinese growth. Indeed, the International Monetary Fund estimates that Chinese GDP will grow by only 3.3 percent in 2022, while private estimates are even lower. Goldman Sachs now projects Chinese GDP to grow by only 3 percent in 2022, and Nomura Securities is even more pessimistic, lowering its GDP projection to 2.8 percent. Chinese industrial production has slowed, as have retail sales. Such declines threaten the fundamental balance of economic growth and rising standards of living, coupled with tight political control that was Deng’s compact with China’s citizens. The result could well be the very instability that Xi and his circle fear could threaten their rule. 
In recent weeks, Xi has begun to speak of the need to reset the economy, which in practice would require him to undo the damage that he has inflicted upon it. Perhaps he has come to recognize that while his belligerent harassment of Taiwan might stir up popular jingoism, it will not substitute for the economic growth that has improved the lives of hundreds of millions of Chinese since 1991. Indeed, Deng Xiaoping drew more than economic lessons from the fall of the Soviet Union under Gorbachev’s leadership. He not only called for a more open economy to prevent internal discontent, but also advocated a restrained foreign policy to entice the West in general and the United States in particular to assist China’s development. 
China’s current economic travails can be remedied only if Xi recognizes the wisdom of Deng’s economic policies and his studied avoidance of regional and international tensions, which contributed to saving Communist China from the fate of the Soviet Union. Thus far, however, Xi has shown no indication that he is prepared to restore Deng’s policies, which would lead him to reverse the backward economic course that he has pursued for a decade and to dial back his militaristic pressure on not only Taiwan but all his East and Southeast Asian neighbors. 
The prospects that he will do so anytime soon remain dim, at best, to the detriment of both a stable region and a healthy Chinese economy.   
Dov S. Zakheim is a senior adviser at the Center for Strategic and International Studies and vice chairman of the board for the Foreign Policy Research Institute. He was under secretary of Defense (comptroller) and chief financial officer for the Department of Defense from 2001 to 2004 and a deputy under secretary of Defense from 1985 to 1987.
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