How China's Leaders Steer a Massive Nation

Are there lessons to be taken from the Communist Party's method of governance?

Sept. 2, 2012— -- There is no question that China is an authoritarian state. But Beijing's efforts to include experts and experiments in the way it governs also help to keep power in check. Once the government supports a project, it normally carries it out -- sometimes on a massive scale. Are there lessons to be taken from the Communist Party's method of governance?

When Duan Tingzhi dreams, he sees a future filled with fountains. He dreams of water shooting into the air throughout his new city, to the delight of its residents. According to the newspaper, one day there will be one thousand fountains in the Lanzhou New Area, a region north of the old city of Lanzhou.

For now, Duan sees only sheep, sheep with dirty coats, as gray as the skies above them. The sheep walk across Duan's wonderful, multi-lane, freshly asphalted street, and they're disruptive. They remind Duan, the man with the building authority, of just how far away the container terminals, the football stadiums, the sea and indeed the future still are from northwestern China, and how much work it will take to get there. Duan is so busy that he even sleeps in the New Area during the week, and he no longer has time for his family or for journalists.

And yet it isn't often that someone shows an interest in Gansu Province, a relatively poor province of mountains and deserts, and so Duan leans across the conference table and speaks as if he were trying to conjure up the future. The province has "great potential," he says, slicing through the air with the edge of his hand to punctuate his arguments. First, he says, everything is already there: airports, railways and highways. Second, there is "unlimited electricity." And third, the province has rich mineral resources, including coal, oil and nickel. Of course, he adds, it also has plenty of workers.

Duan's voice softens. He wants to attract international companies to the Lanzhou New Area. "Perhaps," he says, his voice becoming silky smooth, "you can help us convince Siemens to come here." The party official sitting next to him nods.

Then Duan has to go. It's a gloomy day, and the wind is howling through the shells of buildings. According to the plans, there will be 300,000 people living here in 2015, 600,000 by the year 2020 and eventually as many as a million.

But Duan is merely a local chief planner. The important chief planners are in Beijing and have one of the most difficult jobs in the world: governing a nation of 1.3 billion people. China's provinces are as populous as entire countries on other continents. Hunan has as many people as France, Hubei as many as Italy and Sichuan as many as Germany. China's powerful men have achieved much. While millions were still starving under Mao Zedong, China is now the world's second-largest economy.

Europe, immersed in both a debt crisis and a crisis of meaning, is not only mesmerized by Asia's rising powers, but is also asking itself how governing works in these countries. China's economic success also raises another, more outrageous question: Is it possible for an undemocratic government to be a good government? Beijing's Development Strategy

In China, good governance is primarily defined as the government satisfying the material needs of its people. The people along China's east coast, in particular, have been able to enjoy rapidly growing prosperity. Deng Xiaoping, the reformer, deliberately chose to develop the coastal regions first. Under Deng's policies, the losers were primarily in rural areas and in western China.

Nowadays, when Shanghai residents take a taxi they can learn about the best temperatures for wine by watching advertising clips on a screen in front of their seat. Meanwhile, some farmers in western China live in caves because they can't afford brick houses. The government's response is a policy Beijing calls the "Great Western Development Strategy."

The central government attaches great importance to the strategy, as evidenced by the fact that it has appointed a special "leadership group" headed by Premier Wen Jiabao, as well as a separate agency, to manage the program. The new strategy was adopted in 1999, under then President Jiang Zemin. Even though Jiang may have also been thinking about his legacy, China's "Go West" policy reveals a strength of Beijing's approach: Once something has been recognized as a national problem and defined as a national effort, it is addressed in a consistent and enduring way. A government that is not voted into office has no need to take voting blocs and elections into account. This is the economic advantage of an authoritarian system.

Ms. Li Yingming meets with us in a nondescript, gray concrete building in Beijing. She is the deputy director of the Department of Western Region Development, which is part of the National Development and Reform Commission (NDRC). Li is satisfied, at least to the extent that she can be today, in the second year of the 12th Chinese five-year plan. 'A Long Road'

Tens of thousands of kilometers of railways and highways have been developed, including the controversial rail line to Lhasa, built at a cost of about €3.3 billion ($4.06 billion), new hydroelectric power plants, airports, a gas pipeline and a fiber optic cable network. "The progress we have made in this area in the last 10 years is greater than the progress made in the last 50 years."

But when will the Chinese in the west and those in the east have the same standard of living?

"That's a long road," she says with a smile. It isn't the cities that she's concerned about. China also has the "Starbucks Index," which shows where the brand-conscious middle class can be found. In reality, there isn't a single Starbucks in remote Lanzhou, whereas Shanghai has almost 150. Li, however, is more interested in farmers and the illiteracy rate. In Gansu Province, for example, in 10 years, it has fallen from 14.3 percent to 8.7 percent in 2010. Nevertheless, it is still significantly higher than the 2-percent illiteracy rate in China's southern Guangdong Province.

"Talented people play the most important role in China's development," says Li. And then she talks about how schools and dormitories are being built, and how hundreds of cooperative efforts bring together the different parts of the country. Universities on the east coast support their counterparts in the west, and there are partnerships between eastern and western provinces. Besides, says Li, more than 10,000 university graduates voluntarily go to western China each year to teach subjects like English. Of course, she adds, this experience is useful to young people embarking on government careers, and some of the most sought-after positions are reserved for them. "But," says Li, "these graduates also have a very strong spirit of volunteerism. They want to make a contribution to society."

At the end of the meeting, as we are walking through the hallway, she says: "Our leaders have told us that this is a hundred-year project." And then she hurries past a tall floor vase to her next appointment. Her time is precious.

A New Quality of Life

Duan, the official in the west, is also in a hurry. Duan builds things, and he does so because he can. Lanzhou is not Stuttgart, where protests have held up a major rail development project. Chinese pragmatists don't have to worry about how their plans will affect endangered species like the hermit beetle.

The land already belongs to the state, and the migrant workers who are building this city are hardworking and happy to be earning about 2,500 Yuan, or roughly €300, a month. The people who are living there now can be relocated. A government brochure clearly outlines how they should feel about the whole thing. "The construction of the Lanzhou New Area is a splendid solution that was conceived by the city government and the party committee to implement the Great Western Development Strategy," the brochure reads. It also specifies, in tiny lettering, how much compensation the government will provide for specific items, such as 4,000 Yuan for a concrete well and 700 Yuan for a gravesite (per coffin).

There are indeed farmers in Lanzhou who support the New Area, even though they know that there will be a lake where their houses now stand. They hope that they will be able to work as drivers for business executives in the new city. And then there are people like the medical student who eventually wants to move to Beijing, because it's the best place to work. He says that his biggest dream in life is to own a Lamborghini.

They are the people for whom the government is doing all of this, so that it can offer them something, a new quality of life. It doesn't want the students to leave, because the brain drain is one of Lanzhou's biggest problems. It wants farmers to be motivated by hope instead of rage. And, of course, the mayor and the party secretary in Lanzhou are also thinking about their careers, given that economic growth is still the gauge of a local politician's success.

Meanwhile the city is growing rapidly, with a current population of 3.6 million. But Lanzhou, wedged between mountains, declared the world's most polluted city 14 years ago, has no room to expand. Officials even considered removing mountaintops, but then they opted for the flat, undeveloped land out near the airport instead.

There are also those in Lanzhou who would have preferred to invest in the old city instead. But they don't want to see their names in print. The Chinese efficiency praised by so many in the West comes at a price: the silence of critics. The government decides what is good for the people. And if something is deemed good for everyone, the individual must conform. How Five-Year Plans Keep Power in Check But the Lanzhou New Area is only one piece of the puzzle. There was always more at issue for Beijing in its development program for the west. Most of all, it wanted to bring the west closer to the rest of the country. This creates stability, and "stability" is the favorite buzzword of China's rulers. And so the "Go West" strategy was incorporated into the national five-year plan.

This plan is an idiosyncratic political instrument. Just writing it alone takes more than two years. First a subset of chief planners within a larger group of chief planners, that is, the Department of Development Planning of the NDRC, develops the initial proposals -- under the leadership of the Central Committee and the Politburo, of course.

Then city and provincial governments are brought into the mix with their proposals, as are ministries and experts from universities and think tanks. Countless drafts are evaluated, adjusted and reviewed by the Central Committee, until a new plan is born and a consensus is reached. A beneficial side effect is that planning alone holds the giant Chinese administrative machinery together. Besides, the same principle applies here as it does elsewhere in Chinese politics, where draft documents are constantly being circulated and conferences never end: Consensus creates obligation, and those who have agreed to something later bear some of the responsibility for it.

In the third year of a given five-year plan, there is an interim evaluation. The last time this happened, the NDRC even asked the World Bank for its opinion, which led to the bank publishing its own report on implementation of the 11th five-year plan in 2008. By the fourth year, preparations for the next plan are already underway.

Of course, China's five-year plans have changed since the first one was launched in 1953. Whereas the Chinese initially emulated the Soviet Union, today Beijing doesn't seek to supplant the market's role in guiding the economy, but rather to steer the economy according to market principles. The terminology has also changed, with officials now referring to the plan as a program. But it still involves planning.

Five-year plans have their own dynamics, because the beginning of a new plan generally does not coincide with a change in leadership. This means that a new leader will likely remain tied to an existing plan and its established goals, and thus cannot immediately implement a radical change of course. This may irritate the individual at the top, because it prevents him from boosting his profile, but the principle creates continuity in the larger political picture. The plan keeps power in check.

China Experiments with Dual Approach to Governing Ding Wenguang dreams of being part of the central government's next five-year plan. Ding, 48, is a short, clever man who knows what participation, one of the key elements of good governance, can look like in China -- to those with patience. He also knows that Beijing has recently been trying to combine two approaches to governing: from the top down and from the bottom up.

Ding also wants to fight poverty in the west, not only with investments but with an idea. He is the director of a non-governmental organization and a lecturer at the University of Lanzhou. When he came to the village of Qingshuiling in 2003, he witnessed a vicious cycle. Farmers were cutting down trees for heating, cooking and to sell the wood. This leads to erosion and landslides. But the more frequently nature punishes people, the poorer they become.

Ding wanted to create a "cycle of good" instead. Under his plan, the farmers would raise cattle, which meant that they had to plant grass, and the cow dung could be converted into biogas. To start the cycle, an aid organization donated cows to the poorest people in the village. In return, they were required to give the calves to the second-poorest residents, with the next generation of calves going to the richest of the poor. Today, the farmers live in brick houses, they have more tractors, mopeds and mobile phones, and everyone has a color TV set.

But how could Ding convince the government to apply his model on a large scale? How was he to explain to officials that everything has to be viewed as part of a bigger plan, one that incorporates both cow dung and disaster management? Ding began his lobbying effort.

If there is one thing that someone hoping to get his idea put into practice needs in China, it's trust. But a certain social status is needed to build trust. "I am a professor," says Ding. "If I were nothing, the officials wouldn't listen to me." It's also helpful to have received awards and official positions, such as being a representative in a people's congress. When close to 1,500 people died in landslides in Gansu Province, Ding was invited to conferences held by the provincial government. He is also a permanent advisor to the Ministry of Science and Technology in Beijing, for which he provides expert reports. Finally, Ding is a party member. That, he says with a smile, is important in China. The Politics of 'Guanxi'

At the time, however, the first thing he needed was a "partner" in the local government. Fortunately he had a contact in the provincial government, namely the father-in-law of one of his students. He ensured that local officials would show interest in Ding's project village.

Another element of the game is called "guanxi," or the relationship between a supplicant and a sponsor or protector. Guanxi is part of Chinese culture and, therefore, Chinese politics. Having things in common with others, such as having attended the same school or university or having served in the same military unit, are the prerequisite for the development of guanxi.

Ding once served in the provincial government for four years, where he worked in a poverty reduction program. His former coworkers put him in touch with their supervisors. It was also helpful that Ding had traveled through Europe with officials for the purpose of "group brainstorming." The most important thing of all, however, is that Ding will be participating in a research project at the Chinese Academy of Sciences in the future, which will involve frequent flights to the capital. "If you have guanxi," says Ding, "you have to spend less time on lobbying efforts."

Nevertheless, he still had to demonstrate that his proposed reforms were feasible and not too costly. He had learned that while it was important to have many meetings with officials, the reports had to be no longer than three pages and the restaurants had to be good. "Dinners can create an open and friendly atmosphere in which to champion your interests," says Ding. Guanxi thrives at such dinners, where participants are freed of the constraints of their respective roles. Banquets and politics are Siamese twins in China.

And because Ding kept bringing journalists to his project villages, and his ideas were even featured on a party website, he was successful. He believes that his model will become part of the provincial government's policy in 2014. He also expects 2016 to be a very big year for him, when his ideas will be incorporated into Beijing's next five-year plan.

Meanwhile, the Chinese government is asking for help in governing the country, for reasons Prime Minister Wen Jiabao has candidly admitted: "Given the complex and varied economic situation, it would be impractical to expect a few top leaders to always make the right decisions. Therefore, we need to seek advice from experts in order to make the decision-making process more scientific and democratic." Apparently Beijing also aspires to professional management, another dimension of good governance.

A Unique Think Tank Culture

One of the brains behind it all, the Chinese Academy of Social Sciences (CASS), is located in a light brown high-rise building. It is one of China's most important think tanks. However, unlike their counterparts in the West, whose credibility is enhanced by their independence from the government, influential Chinese think tanks tend to have close ties to the government.

Sometimes the State Council assigns certain tasks to the Academy. For example, professors working for CASS were asked to develop proposals for a new civil law. In another case, the Ministry of Railways wanted to know what would happen if passengers were required to provide identification when buying tickets. CASS also provides impetus for reforms that might, for example, involve the combining of government agencies. Of course, the premier also consults with CASS experts to obtain advice on economic policy. Sometimes CASS even publicly corrects elements of the administration. For instance, it has accused the National Bureau of Statistics of inaccuracies in calculating the rate of inflation.

The deference given to experts began with Deng Xiaoping, who sought to replace the emphasis on Mao and ideology with a focus on professionalism and knowledge. He wanted the intellectual to contribute to China's modernization. Today the University of Pennsylvania counts 425 think tanks in China, making it second only to the United States, where there are 1,815 think tanks.

In China, Experimentation Is the Norm Chinese policies always follow the same pattern: First ideas are considered and then they are simply tried out. The government has turned the concept of the experiment into the norm. It uses small, local testing laboratories to try out a pilot project, but only once a proposed reform has been shown to be successful and applicable in multiple locations does the government venture to implement it more broadly. This stands in contrast to the Western concept of the constitutional state, in which the law comes before implementation.

The Chinese version has its advantages. For instance, it makes it easier to assess the consequences of innovations. A successful real-life test also helps convince opponents to support a reform. Flexibility is assured through the development of competing models. Sinologist Sebastian Heilmann has called China a "learning authoritarian system."

The establishment of special economic zones in the 1980s was already part of this model. There were pilot projects in healthcare, pension reform and the system of registration. Everything was tested, from road tolls to smoking bans to travel requirements for Taiwan. Small Signs of Goodwill The government even experiments at the local level with those elements of good governance it would normally refuse to accept: transparency and giving citizens a say. The towns of Wenling and Baimiao became famous for publishing their budgets and listing their expenditures in detail. This prompted the state-controlled newspaper China Daily to print an article under the headline: "Transparent Budget, Happy People." It concluded that publishing budgets leads to fewer people complaining about the squandering of taxpayer money and puts an end to the private abuse of public funds.

These are small signals of good will that the authoritarian regime is sending to its people. One milestone was an environmental law which requires the solicitation of public input. The people are even asked to comment, via email, on the five-year plan.

China's leaders sense that they can no longer simply govern as they see fit, and they are feeling new pressures. China now sees up to 180,000 so-called mass incidents a year. The people are becoming adept at staging sit-ins and blocking streets to champion their interests. What was once a matter for the very few now triggers nationwide solidarity activities. The Internet has become established as a marketplace for opinions and innovations. For instance, the rumors about a coup in Beijing only gained as much traction as they did because China's leaders generally act behind a cloak of secrecy, so that without freedom of the press the people can do nothing but speculate. What is happening on the web is direct participation, as short-lived as it is intense, a forced instead of tolerated participation in politics.

Officials in Lanzhou have also felt the effects of local residents' fury. When they tried to stage a run through the city on New Year's Day 2012, artist Ma Qizhi protested online. "Refuse to be a filter made of human flesh!" he wrote on Sina Weibo, a Chinese microblogging website. He meant that the people of Lanzhou shouldn't offer themselves up to be sucking the city's polluted air into their lungs.

The protest wave surged through the Internet for only a few days, but more than 10,000 discussed their opinions of Lanzhou's plans on Sina Weibo. "The decision-makers must have swallowed some kind of pill if they think that children should run under such conditions," noted one person. Another wrote: "In China, the leaders are more interested in saving face than in their underwear, which is why they will not take back their instructions."

Even the state-owned news agency reported favorably on the resistance, and the local sports agency announced that it would take the suggestions of the environmental agency into account in the future.

Ma knew that he had succeeded in teaching the people a lesson. "The sad thing is when citizens don't say what they want to say. Taxpayers support this group of people, which is why they should perform their duties well."

The People Will Hold Government Accountable

The Chinese government has to get used to the idea that its people will be holding it accountable. The country is still filled with confidence. Chinese society has been shaped by the experience that everything was improving for everyone. This combination of economic growth and patriotism lends legitimacy to the regime, turning the people into a society of consumers and patriots.

But farmers, unemployed university graduates and the people in western China also want their share of success. President Hu Jintao himself has identified corruption, the opposite of good governance, as one of the greatest threats to party dominance. In the 2011 Transparency International Corruption Perceptions Index, China was ranked 75th out of 183 countries. Beijing punishes people, even with the death penalty, but by pointing to the individual it seeks to divert attention away from the failings of the system.

Some are simply refusing to accept the deal that the Chinese government offers its citizens: We'll stay out of your private life if you stay out of politics on a large scale. Chinese civil rights activists are going to prison for values that most in the West take for granted. But some in the West also forget that voting rights, an independent judiciary and a democratic constitutional state are never only a means to an end, and never exist only to furnish results. Instead, they are values in their own right. Most Chinese are still satisfied with results, but they have to be good. A minority in China, however, wants more. Those are the people who are locked up for their opinions.

No government that does this can call itself a good government -- even if it delivers good results.

Translated from the German by Christopher Sultan