Minxin Pei, a political scientist known in part for his book China’s Trapped Transition, writes in the Financial Times that the Chinese Communist Party’s efforts to maintain power are ultimately incompatible with economic reform.
One may be tempted to blame leadership failure for the premature demise of China’s reform. While this is certainly a cause, a far more critical factor is more responsible: the CCP’s political objective of reform is fundamentally incompatible with a market economy.
No one understood why China needed to reform its economy better than Deng himself. In 1992, as in 1978, He knew that only market-oriented reforms could save the CCP. Although Deng was sure about the political objective of his reforms, he never explicitly endorsed a capitalist market economy as the end goal. Here lies the fundamental flaw of China’s reform project: as long as pro-market reforms are used as a means to preserve the political monopoly of the CCP, such reforms are doomed to fail.
He argues that the party has low incentive to reform past the point that makes them rich: “The moment the CCP’s rule is more secure due to improved economic performance, its ruling elites would lose incentives for further reform.”
This brand of “crony capitalism,” he writes, is only possible “post-communist autocracy is in charge of a half-reformed economy.” Not an optimistic column for those who hope for reform.