Читать книгу Weapons Of The Rich. Strategic Action Of Private Entrepreneurs In Contemporary China - Thomas Heberer - Страница 10

Introduction

China’s private sector economy is in transition, as is the Chinese economy as a whole. The success of the officially pursued objective to change from an export- and investment-driven growth model to a development strategy based on domestic consumption, underpinned by a parallel drive for technological innovation in China’s manufacturing and service industries, will not only decide about the future of the country’s economic trajectory but also of its political system. The ambitious goal of becoming a leading world power and modern economic entity by 2050 was announced at the 19th Party Congress of the Chinese Communist Party (CCP) in October 2017. To do so requires an innovative and flexible private sector. Structural change within the Chinese economy is of paramount importance to regime survival. This implies that the private sector will become increasingly important for sustaining growth, even though the central government under Xi Jinping has made it clear that it will protect and develop the state sector as well. China’s state-owned enterprises (SOEs), particularly those destined to become ‘national champions’, have already made considerable headway to become powerful players in the global economy. Despite this, the Chinese Communist Party (CCP) needs to support even a strong public sector to drive home the argument that China is (still) socialist.

Nevertheless, when Xi Jinping came to power in 2012 (and this project started), the party state embarked on a program of reform to strengthen the private sector economy. Private sector reform was not explicitly mentioned in the ‘Decision of the Central Committee of the Communist Party of China on Some Major Issues Concerning Comprehensively Deepening the Reform’, adopted at the 3rd Plenum of the 18th CCP Congress in November 2013,¹ the central policy document of the Xi Jinping era between the 18th and the 19th Party Congresses. However, in the immediate aftermath of the 3rd Plenum, three reform packages were introduced to strengthen the economic system: a program for streamlining local government finances by divorcing them from corporate ‘local government funding vehicles’; a program for institutionalizing transferable land management rights; and a program for new Pilot Free Trade Zones (shiyan ziyou maoyiqu) — initially set up in Tianjin, Shanghai, Guangdong, and Fujian — to spur high technology and service sector development (Naughton, 2015). When the central government introduced so-called ‘supply-side structural reforms’ in late 2015 — an attempt by the central government to streamline its policy approach to economic refurbishment — measures were brought on track to cut excess capacity in the industrial and real estate sectors, restructure public debt, reform the credit sector, and ‘reduce costs’ by lowering taxes and expenses for public services (Naughton, 2016a, 2016b). ‘Supply-side structural reforms’ have also been designed to boost state enterprise reform, since the curtailing of overcapacity and public-corporate debt is clearly linked to the further transformation of SOEs via ‘mixed ownership’ and ‘investment funds’, hence opening them up for more private capital. Each of these reforms is highly relevant to private sector development.² Moreover, on many occasions since the 3rd Plenum, the Chinese leadership has publicly reassured private entrepreneurs that it would further support the private sector, by expanding its position in the Chinese economy and improving its efficiency and international competitiveness.³ This confirms the fact that the future of ‘Socialism with Chinese characteristics’ depends on the economic success of China’s private entrepreneurs in domestic and global markets. Against this background, the quest for ensuring both cooperation and control of their private entrepreneurs forces China’s leaders to walk a tightrope, arguably making state–business relations politically more sensitive than they have been at any point in the last two decades of reform.

In his seminal book Weapons of the Weak, James C. Scott analyzes everyday forms of resistance by socially weak groups and argues that a history of the Weapons of the Rich remains to be written (1985: 172). With this book, we want to re-stimulate the debate on China’s private entrepreneurs⁴ by making the argument that they have sharpened their weapons over the last decade and become influential political players — we call them a ‘strategic group’ (see below) — within the Chinese polity. Hence, our study is about the political consequences of current structural and institutional change in the Chinese economy and polity for state–business relations, or more precisely, for relations between the state and China’s private entrepreneurs. As political scientists, we are interested in the question if, and to what extent, China’s rising dependence on a flourishing private sector translates into maneuvering space for private entrepreneurs to strategically safeguard and expand their interests vis-à-vis the party state and to trigger institutional change. While they do not openly challenge the current regime, their weapons have altered the power balance within the current regime coalition, which connects private entrepreneurs to the party state at all administrative levels. It is hard to predict what will come of this ‘hidden horizontalization’ of power relations within the coalition. Obviously, the specter of ‘crony capitalism’ looms already large in contemporary China (Pei, 2016), and entrepreneurial (mis)behavior has been put under close scrutiny by the government of Xi Jinping. At the same time, the future of ‘Socialism with Chinese characteristics in the new era’ depends on the sound development of the private economy and, therefore, the promotion of private entrepreneurship. It can thus be expected that entrepreneurial influence in the regime collation will rise, with inevitable consequences for regime legitimacy and stability.

Research on the political influence of China’s private entrepreneurs for regime survival has been conducted since the 1990s. However, by applying ‘strategic group’ analysis, we have chosen a different approach for tracing and investigating this evolving relationship compared to most of our colleagues who have written on this subject over the last two decades or so. Hence, we believe that our analysis, which draws on qualitative data gathered over several years (see below), offers a number of new insights and observations which will enrich the existing literature and state of knowledge in the field.

In the past, China scholars have consistently described private entrepreneurs as allies of the Communist Party. Allegedly satisfied with the regime’s promise to establish a ‘socialist market economy’ and its related private sector policies since the end of the Maoist era, private entrepreneurs have been found to be loyal and acquiescent supporters of the party state. Looking at their very different social backgrounds and limited ‘political voice’, China scholars described them as largely co-opted by the regime which successfully kept private entrepreneurs in a state of structural dependency, mostly via official control by the party state over the institutions and resources necessary to build and maintain a private enterprise. This book takes an analytical perspective that differs from this viewpoint, by which we hope to provide a more nuanced interpretation of the role and significance of private entrepreneurs in Chinese society and politics. Based on our empirical findings, we argue that far from being ‘domesticated’ and ‘atomized’ regime supporters who engage in corrupt behavior to secure political protection of their businesses, private entrepreneurs pursue manifold strategies to pursue their interests, which go far beyond parochial rent-seeking or individual protection by party state cadres. As their common ‘field position’, in Bourdieuan terms, produces similar lifestyles, a social group-awareness and identical political demands to strengthen the private sector (by regulatory measures, financial assistance or participation in economic policy-making), private entrepreneurs collectively strive for political recognition by the party state and for meaningful political influence in national and local policy-making.

Our core hypothesis is that private entrepreneurs are a ‘strategic group’ in China’s polity that display increasing political agency and influence within the party state. As we will show, private entrepreneurs employ an arsenal of strategies to protect their economic interests vis-à-vis both the party–state bureaucracies and state-owned enterprises across the country, though there is (as yet) not much coordinated action which would connect them geographically across space. Nevertheless, by working nationwide through multidimensional networks that crisscross different party state units, administrative tiers, formal institutions such as (local) parliamentary bodies — People’s Congresses (PCs) and People’s Political Consultative Conferences (PPCCs) — and business associations, both formal and informal — such as entrepreneurial networks — private entrepreneurs do indeed act collectively. At the same time, identical exposure to the party state’s control of major economic resources and to the institutional constraints of China’s political system — ‘positional closeness’, as we call it — produces identical complaints and demands on the part of private entrepreneurs directed at the party state all over China. This results in similar strategic action by private entrepreneurs which, as we hypothesize from our findings, increasingly strengthens their collective identity as a social group and collective political agency, hence further contributing to their formation of a ‘strategic group’. We also contend, and will show, that, as a strategic group, private entrepreneurs substantially influence policy-making and institutional change in contemporary China, though they do not (as yet) challenge the current regime.

This book particularly looks at the government–business nexus in China’s local state in order to understand the formation of private entrepreneurs as a ‘strategic group’. It is based on fieldwork conducted by the authors for 4–6 weeks each year between 2012 and 2017 in Beijing and different localities (cities and counties) in the provinces of Fujian, Guangdong, Hainan, Hubei, Jiangsu, Jilin, Shandong, Sichuan, Yunnan, and Zhejiang, with additional control interviews conducted in Fujian, Henan, Jiangsu, and Zhejiang in 2018. We talked to some 150 entrepreneurs operating middle-sized and large companies or conglomerates of both traditional and modern business sectors, including automobile components, furniture, lighting, houseware, sports apparel, biotechnology, chemical upstream products, solar cells, optical machinery, cosmetics, health care products, yacht manufacturing, real estate, private hospitals, nutrition, etc. We also interviewed entrepreneurs in the service sector, e.g. in the tourist and leisure industries. Our respondents were foremost the owners, board of directors or CEOs of these companies with 100 to several thousand employees, though there were also a number of respondents from small internet start-ups. Moreover, we interviewed numerous cadres at township, county, city, and provincial level responsible for private sector development, entrepreneurial chambers of commerce, industry and trade organizations, and members of entrepreneurial networks. Our interviews followed semi-standardized questionnaires and took between 1 and 2 hours each. We mostly visited our respondents in their companies and talked on-site, but in some cases met them in hotels or cafes on their request. Identification of respondents was supported by local scholars, who the authors knew from earlier research, and colleagues from two research centers affiliated to the Beijing-based Central Compilation & Translation Bureau under the Chinese Communist Party. Moreover, we had support from the Central Party School, from the College of Public Administration at Zhejiang University, and from befriended individual entrepreneurs. Each interview was either recorded and later transcribed or memorized by individual note-taking which we exchanged and compared after the interview was completed. Additionally, we have collected and analyzed countless Chinese media reports on private sector development and state–business relations which have complemented our understanding of the topic.

The book is structured as follows: We first give a brief overview of the history and current state of China’s private sector development (Chapter 1) before summarizing major insights of the scholarly literature on state–business relations and the significance of private entrepreneurs in the Chinese polity (Chapter 2). We then introduce our theoretical framework, which conceptualizes private entrepreneurs as a ‘strategic group’ (Chapter 3). Our empirical work employs ‘strategic group’ analysis to illustrate how private entrepreneurs engage in different forms of formal and informal strategic collective action (Chapters 4 and 5). Finally, we present our conclusions and probe an outlook into the nearer future of state–business relations in China.

References

Naughton, Barry. (2015). Is there a “Xi Model” of economic reform? Acceleration of economic reform since Fall 2014. China Leadership Monitor 46, 1–13.

Naughton, Barry. (2016a). Supply-side structural reform: Policy-makers look for a way out. China Leadership Monitor 49, 1–13.

Naughton, Barry. (2016b). Supply-side structural reform at mid-year: Compliance, initiative, and unintended consequences. China Leadership Monitor 51, 1–11.

Pei, Minxin. (2016). China’s Crony Capitalism: The Dynamics of Regime Decay. Harvard: Harvard University Press.

Scott, James C. (1985). Weapons of the Weak: Everyday Forms of Peasant Resistance. New Haven and London: Yale University Press.

¹Zhonggong zhongyang guanyu quanmian shenhua gaige ruogan wenti de jueding (Decision of the Chinese Communist Party and the Central Government on Some Issues Concerning Comprehensively Deepening Reforms: Chinese version), http://cpc.people.com.cn/n/2013/1115/c64094-23559163.html (accessed 3 January 2019).

²There have been more specific economic policies initiated by the central government after the 3rd Plenum which are highly relevant for the private sector, for example, VAT reform, the reform of the hukou-System and the promotion of microfinance, just to name a few.

³In early 2016, for instance, Xi Jinping expressed his strong support of private sector development in order to calm down growing apprehensions among Chinese entrepreneurs that private businesses might be more strictly constrained in the future. See http://finance.sina.com.cn/roll/2016-03-09/doc-ifxqafrm7345622.shtml (accessed 10 March 2016).

⁴In this study, we define ‘private entrepreneurs’ as the owners of large companies (including the presidents or CEOs of business conglomerates) and those of smaller and mediumsized firms to the exclusion of small-scale, self-employed business owners with only a few workers and staff members (getihu). Large entrepreneurs are those with an annual turnover of more than 100 million RMB, and medium-sized ones account for more than 30 million. According to a decree of the Chinese government from 2009, there is no general definition that applies to all types of private enterprises. Generally speaking, they are differentiated according to the number of employees, revenue and total assets, but the categorization varies across different business fields (Zhonghua Renmin Gongheguo Gongye He Xinxihua Bu, 2011).