Why is China Booming?

Providence, R.I.  – China is now celebrating the 30th anniversary of the period officially known as “reform and opening.” Labeling time in this way echoes China’s imperial history. During moments of political transition – a military victory, for example – the emperor might designate a special “era name” to help celebrate the good news. Or the court might test out a new era name after a political debacle, in an effort to wipe the slate clean. The last emperor of the Tang Dynasty proclaimed seven era names in fourteen years, as he sought in vain to “re-brand” his reign and avoid his regime’s demise.

Deng Xiaoping began to champion “reform and opening” in 1978. “Reform” suggested a loosening of central controls on economic life, undertaken in a spirit of pragmatism and gradualism, as an antidote to Mao Zedong’s ideology of “revolution.” Similarly, “opening” heralded the PRC’s integration into the world community – especially the capitalist West. Deng’s principles still guide policy today.

One must go back to the Qing Dynasty (1644-1912) and its 60-year era of “heavenly flourishing” ( Qianlong ) in the eighteenth century to find a comparable period of coherent political and economic policy. The era of “reform and opening” has outlived its “emperor” by more than a decade, and has been the common thread running through transfers of political authority from Deng to Jiang Zemin and Hu Jintao. Even the largest popular challenge the Chinese Communist Party ever faced, the demonstrations of 1989, now looks like a blip that helped Deng consolidate support for his model of development.

If one factor undergirds China’s commitment to “reform and opening,” it is the extraordinary macroeconomic changes of the past 30 years. In China, people call it fazhan , or “development,” but in much of rest of the world, it is more commonly described simply as the “China Boom,” or the “China Miracle.”