CIAO DATE: 06/02

Sustainable Development and the Open-Door Policy in China

James K. Galbraith and Jaiging Lu

Council on Foreign Relations
Working Group on Development, Trade, and International Finance

May 2000

Introduction

How can one best explain China's remarkable economic growth during twenty-one years and its rise from autarky to world economic power? The exercise requires chutzpah; it demands simplification; it cries out for the trained capacity to present a unifying theme with a weighty set of policy implications.

Fortunately the academic establishment possesses these traits in abundance. Examples range broadly from the socialist romantics to the capitalist romantics; the former believing that China has developed its own and specifically noncapitalist path, the latter that it is transforming itself into a free-market system. The two camps hurl paper missiles at each other in a satisfying postlude to the Cold War.

But this battle is not, alas, about China. At least, it is not about China specifically. It is about economics, the economics profession, the indoctrination of students and policy analysts, and the politically and academically correct set of beliefs for those who practice development. As a result, it bears an eerie resemblance to the long history of policy discussions in China itself, which similarly are not about the actual problems of the country. Rather, they focus on the correct line and the ascendancy of adherents of one line over the adherents of another.

"We must stick unflinchingly to the socialist road. The road is tortuous and the struggle intense. But the future is undoubtedly bright."

To get beyond this point, it helps to adopt an analytical framework that is rooted in the tortured history of China and of the People's Republic itself. We do not claim that what follows presents a definitive view. It is, rather, an attempt to point to the main features of the scene, and to place some of the otherwise perplexing developments since 1978, and recent choices, in their own context. Our thesis is that while political discourse in China reflects the larger intellectual conflicts familiar in the West, most decisions of policy are rooted in conditions and struggles inside China, and reflect both continuity and change in internal institutions of very long standing, rather than the importation of models from the outside.

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