Strong leader as miracle worker: Deng Xiaoping drilled down

It’s that time of year again and net gladiators are jousting on the red clay of the French Open (non-tennis buffs may skip this opener). One match in the round of sixteen kept me glued.
Six-foot-seven giant South African Anderson was beating the hell out of diminutive 5’7” Argentine Schwartzman 6-1, 6-2 in the first two sets in a best of five. Raw power and aggression in full display.
But the little guy hung in there, futilely it seemed, especially when he faced the big guy serving for the match at 5-4 in the third. Surely, his misery ends here!
But, against all odds, he broke Anderson to level and even won the third set. In the fourth, he once again faced Anderson serving for the match at 5-4. Surely now the reprieve ends. Again, Schwartzman, instantiating that the lightning may strike twice, broke to level and won the tie breaker! His win in the fifth to win the match seemed anti-climactic. It was his first foray into the hallowed ground of a Grand Slam quarters and his first comeback from 0-2 down.
In tennis as in life, raw power is never enough; it has to be suborned to nobler vision.
At McDonald’s that week, I was puzzling over how strongman Deng Xiaoping engendered the economic miracle of China while other strongmen — Mao Zedong, Somoza of Nicaragua, Marcos of the Philippines, Chavez of Venezuela, and Idi Amin of Uganda — produced disasters.
Zhao Ziyang’s memoir (Prisoner of the State, 2009, courtesy of Men Sta. Ana) served as my window to reality. Premier Zhao Ziyang, together with Hu Yaobang, were the true believers and implementors of Deng’s vision.
How did Deng justify the considerable power he inherited from Mao? Deng placed power unequivocally behind the vision of economic transformation. Hugo Chavez’s Bolivarian Revolution zealously pursued an incorrect vision centered on redistribution which, like Mao Zedong’s redistribution-first vision, produced a bounty harvest of inclusive poverty. For Dengists that was decisive disproof of vision.
Modern evidence supports the Dengists: Forbes (2000) and Banerjee and Duflo (2003) gave evidence that mandated redistribution hurts income growth.
In the early 1980s, the battle for the hearts and minds of China was raging between the Deng Xiaoping partisans who shared his vision of a market and an open economy and the Chen Yun partisans who clung to a planned and closed economy. Chen Yun’s doctrine, “Planned economy as primary, market adjustments as auxiliary,” drew the battle lines. Self-sufficiency (especially in grains) was the index of success. Chen Yun partisans parlayed the fear of foreign domination and of imports. Better empty stomachs than the loss of China soul! The whole market and open-door policy hang in balance. The Yangpu affair was especially informative.
The Yangpu region was a barren stretch of land in Hainan Island. Local officials had gotten a Japanese company Kumagai Gumi to commit to an investment of several billion yuan if a lease could be arranged. The attack led by the Chen Yun was withering. The objectors harnessed sovereignty as the issue with slogans: “loss of dignity” and “betrayal of sovereignty.”
Even Deng fed with wrong information vacillated; but after getting better information, Deng decided to “proceed with enthusiasm.”
The same stubborn opposition faced the policy for “Special Economic Zones” (SEZ) to host foreign investment and proposed by Deng himself. SEZs which in time became the workhorses of the PRC miracle were attacked as beachheads of neo-imperialism — an easy sell in PRC where V. Lenin’s On Imperialism was still dogma.
An American car venture in Guangdong Province to produce 300,000 cars a year with 30-40 Chinese parts factories in its supply chain was scrapped in favor of an indigenous domestic auto industry. One thing was clear to both sides: if investors don’t show up, the project was dead. PRC’s future was shaping to be North Korea today.
But Deng was not for turning. He did not persecute opponents but neither did he waver from his vision.
In 1987, the Politburo, over much objection, was prevailed upon to approve the radical development strategy proposed by Premier Zhao Ziyang to integrate the coastal region to the global economy. This was the make-or-break project.
By 1988, Taiwan-owned Foxconn (Hon Hai), now the second largest private employer (1.3 million) in the world, had placed its bet on China. Others took courage and followed. By 1992, the wisdom of the coastal strategy was established and Deng could tour the southern provinces in exceeding peace.
Why was Deng so willing to pay whatever the price? Because he owned, and was in turn owned by, the vision. Margaret Thatcher of the “This lady is not for turning!” fame had this quality. Fidel Ramos had some of it. For most other strongmen, political goals and fattened bank accounts are what justify power. They would readily turn from the vision. Dictator Marcos was of this genre.
Not Deng. Despite deafening opposition, his message remained steadfast: “Proceed with enthusiasm.” But he set the hard boundary of one no-go zone: don’t conflate economic transformation with political transformation.
When prime apostle, General Secretary Zhao Ziyang, appeared to break ranks on politics by joining students at Tiannanmen Square, he was banished. Economic transformation was and is hard enough; changing political horses along the way sows only uncertainty which dims the economic vision based on investment.
And DU30? Leaving the fate of the embattled TRAIN law in the hands of Congress suggests an unwillingness to pay the price of the imbedded economic vision — suggests, that is, that ownership of that vision is skin deep. The Endo EO suggests a willingness to turn investors away from the vision. The insistence on changing political horses now suggests that economic transformation is secondary to political goals. Unanchored on economic transformation, power becomes self-absorbed and even cannibalistic. Recall Mao’s cultural revolution. Will more power in hands of DU30 self-justify?
 
Raul V. Fabella is a retired professor of the UP School of Economics and a member of the National Academy of Science and Technology. He gets his dopamine fix from hitting tennis balls with wife Teena and bicycling.