The Pacific Review, Vol. 22 No.

4 September 2009: 429–450

Sixty years of the People’s Republic:

local perspectives on the evolution of the
state in China

David S. G. Goodman

Abstract Although the People’s Republic of China turns 60 in 2009, popular and
to some extent academic perceptions of its political system remain over-determined
by the experience of its first 30 years. The socio-economic impact of the policies
of the last three decades is well recognised but not the context in which these
have occurred. In particular, there is a tendency to differentiate sharply between
dramatic economic growth and its consequences and the lack of political change.
While it is clearly the case that the Chinese Communist Party remains in power
it is equally as obvious that economic reform has had and been accompanied by
major political change. Studies on the state in transition at local levels certainly sug-
gest that change has been significant. Moreover, these local studies also indicate
the need to further conceptualise understanding of the state in China. The state
idea is rather too general a concept and too blunt an instrument for analysis com-
pared to research that considers the state’s values and ideology, the social base of
political power, the structures and processes of the political system, the authorita-
tive decision-makers, bureaucracy and administration, and the state’s international
interactions.

Keywords China; state; local; social and political change.

David S. G. Goodman is Professor of Chinese Politics at the University of Sydney, where he is

also Director of the Institute of Social Sciences. He was educated at the University of Manch-
ester (Politics and Modern History), Peking University (Economics) and the London School
of Oriental and African Studies (Chinese and Chinese Politics.) His research has concentrated
on China’s provincial politics; the history of the Chinese Communist Party; and social and
political change in China since 1900, especially at the local level. He is currently undertaking
research on the formation of local elites in contemporary China (with Dr Beatriz Carrillo and
Dr Minglu Chen); and on German colonial adventurers in China 1870–1937 (with Dr Yixu Lu).
His most recent publication is The New Rich in China: Future Rulers, Present Lives (2008).
Address: Institute of Social Sciences, University of Sydney, NSW 2006, Australia.
E-mail: david.goodman@usyd.edu.au

The Pacific Review

ISSN 0951-2748 print/ISSN 1470-1332 online

C 2009 Taylor & Francis

http://www.informaworld.com/journals
DOI: 10.1080/09512740903127960
430 The Pacific Review

The Third Plenum of the 11th Central Committee of the Chinese Com-
munist Party (CCP) in December 1978 has long been acknowledged as a
clear turning point in the 60 year history of the People’s Republic of China
(PRC). This was the meeting that ushered in three decades of increasing
prosperity and announced the party-state’s commitment to ‘reform and
openness’. Gross domestic product (GDP) growth rates of 9–10 per cent per
annum have followed so that the aggregate PRC economy is now the sec-
ond largest in the world, with debate intensifying about when it will match
or overtake that of the USA, and how the rest of the world should cope
with this phenomenon (Economy and Segal 2009; Scissors 2009).
The socio-economic consequences of the Third Plenum’s decisions are
widely acknowledged. The PRC economy has essentially been restructured,
not least through the introduction of elements of marketisation into a state
socialist system (Huang 2008). The PRC has become a major global man-
ufacturing centre. In the process, while there remains a substantial state-
operated sector of the economy, there are now also other kinds of economic
enterprise which dominate in many of its sectors. At the same time, the es-
sentially regionalised economies of the PRC have become more integrated
over the three decades, through the development of both communications
infrastructure and through wider markets for the circulation of labour and
goods (Keng 2001; Groenewold et al. 2008). These economic developments
have been accompanied by quite considerable social change. Housing has
become largely privatised, and welfare provision almost totally reconsti-
tuted. New classes of migrant labour have been mobilised, and various cat-
egories of the new rich have been both the drivers and the beneficiaries of
much of this change (Goodman 2008a).
Seeing the Third Plenum as a turning point in these terms is not totally
misplaced, but there remain lacunae in this apparently simple narrative that
may distort understanding of the dynamics of change. In the first place, al-
though the PRC’s economic performance has been spectacular since 1978,
it was not disastrous between 1952–78 despite sometime appearances to the
contrary. Over those years as a whole GDP grew at an annual average of
4.39 per cent per annum, outpacing both the USA and Europe in the same
period (Maddison 2007: 44). This is not simply a matter of statistical inter-
est but important for understanding that as a modernising regime before
1978 the PRC had already started to deliver social and economic benefits.
Indeed, it is possible to see the pre-1978 economy as the foundations on
which the successes of the reform era have been based, not least because
although the earlier system established a basic state infrastructure it also
had so many inherent economic inefficiencies.
A second deficiency in interpreting the Third Plenum as the start of only
an economic success story is that it reinforces the very common message
that while the PRC has reformed economically, there has been little or no
political change. Given the relative stability in strategic policy that has char-
acterised the PRC since 1978 this would be a remarkable conclusion to try
 D. S. G. Goodman: Sixty years of the People’s Republic 431

to maintain. During its first 29 years the PRC experienced extreme policy
instability, with considerable debate within the leadership of the CCP over
the general strategic direction, and six or seven major changes (depend-
ing on how precisely these are counted) during that period (MacFarquhar
1991).
Nonetheless, there is a very well-articulated body of informed opinion
that contends not simply that the PRC’s political development lags behind
the changes in economics and society, but that (in the words of Minxin Pei)
‘the core features of a Leninist party-state remain essentially unchanged’
(Pei 2006: 4; Mann 2007; Perry 2007). It has even been fashionable to con-
trast the transitions from state socialism in the former Soviet Union and the
PRC in these terms, with the latter said to have prioritised economic reform
over political change, as opposed to the Soviet Union’s successor Russian
Federation, which emphasised the move towards political pluralism (White
1994; McFaul 1997). One result is that in the popular consciousness outside
China the PRC often remains characterised by the politics and system of
Mao Zedong even though in the 60 year history of the PRC it is 33 years
since Mao died and more than 30 years since the Third Plenum.
Of course those who argue that the PRC remains ‘essentially unchanged’
are unlikely to be arguing that there has been no change at all, any-
more than those who seek to identify the elements of political change can
deny that the PRC remains a party-state dominated by the CCP with no
institutionalised open political competition. The problem is that statements
about the unchanging state in these terms mask as much as they reveal.
Certainly the state has long seen itself in a period of transition. This was
the meaning of ‘reform’ in the reform era articulated at the end of 1978,
though the end goal is rather a socialist than a liberal democracy (Goodman
1985). In particular the Third Plenum announced a change in the party-
state’s view of the relationship between state and society. From the mid-
1950s until the end of 1978 the state had seen itself in something akin to a to-
talitarian perspective. It had a unitary and holistic view of state and society
together in which the state directly managed the economy and society, and
was the initiator of social and economic change. The changes introduced at
the Third Plenum were designed to bring about a more recognisably author-
itarian regime where the state regulates society and the economy indirectly,
and intervenes less directly in social and economic activity.
One of the results of those changes was necessarily that state and society
became in some senses more clearly differentiated, at least to the extent that
both singly and jointly the CCP and government increasingly come to recog-
nise certain activities as not their responsibility and even possibly not even
in their purview. A whole range of institutions have moved into the politi-
cal space created by those changes, including chambers of commerce; non-
governmental organisations (NGOs); and even loose organisations which
might loosely be described as ‘rights organisations’ protecting either self in-
terest (for example, in disputes over land or water usage) or more altruistic
432 The Pacific Review

concerns (as, for example, those offering protection and support to people
infected by HIV/AIDS) (Mertha 2008; Weng 2006; O’Brien 2008).
Necessarily, given the PRC’s founding principles and methods of oper-
ation (however much these may be in transition) the boundaries between
state and society remain not clearly defined, are constantly changing, and
are in any case hotly contested. Indeed, there is some evidence from the
last decade that while during the 1980s and 1990s there was a distinction
being driven firmly between state and economic activity, more recently the
state has started to become ‘a grabbing hand’ in terms of its ability to take
control of resources and economic enterprises, especially at the local level
(Huang 2008: 283; Pei 2006). At the same time it is clear that a ‘local preda-
tory state’ (Pei 2006: 35) is still some distance from a centralist totalitarian
state.

The problem of the state

A key problem in this context is that the ‘state’ is a difficult concept to op-
erationalise, not least because it is not strictly comparable to a situation
where a system of governance (the regime) can be clearly differentiated
from that particular expression of authority currently responsible for lead-
ership or government, as is more usually the case in a multi-party democ-
racy. This lack of operational distinction between a specific government
and the regime is of course a common feature of party-states. It is vir-
tually impossible to regard any move away from one party dominance as
anything less than a fundamental change in the state, and one-party states
have always had a tendency in practice (though not in principle) to avoid
governance–government distinctions, not least because they are teleologi-
cally driven (Ionescu 1967).
Research on the development of specific localities and studies of the lo-
cal level more generally certainly suggest that the state as well as politics
in China have changed considerably since the beginning of the 1980s. One
sure marker of change is decentralisation, which has been a characteristic of
the reform era. Decentralisation was discussed before in the PRC, and even
partially implemented during the mid-1950s and the early 1960s (Solinger
1993), but not in such far-reaching, system-altering ways. Now, however, as
Pierre Landry observes, the PRC has probably become the world’s most
decentralised state system, with 70 per cent of governmental expenditures
at sub-national levels. Any doubts over this statement result not so much
from an assessment of China’s decentralisation as the world-wide report-
ing of data (Landry 2008: 3). Moreover, in that process the separation of
government from much economic administration is as fundamental as the
devolution of decision-making from the centre to the provinces to the local-
ities within the territorial administrative hierarchy (Montinola et al. 1995).
Journalists and academics outside China inevitably focus disproportion-
ately on Beijing and national level politics. Nonetheless, it may actually
 D. S. G. Goodman: Sixty years of the People’s Republic 433

be at the more local levels that changes in politics and the state are most
obviously made manifest. Of course the term ‘local’ in PRC political and
administrative usage covers a range of jurisdictions, some of which would
hardly qualify as local in scale anywhere else in the world. For the
PRC party-state, ‘local’ is anything beneath the national level, including
provincial-level jurisdictions which are equivalent to the countries of the
European Union in their population numbers and land areas; and including
too Shanghai, which would now have some claim to being a world city at
least on a par with Beijing (Friedmann 1986). The provincial-level is local
in the PRC but so too are lesser-order prefectural districts, cities, counties,
towns and villages. Decentralisation in governmental expenditure and over
economic decision-making has placed discretion over resource allocation,
regulation and taxation at the local levels. It has also given greater room for
manoeuvre to local officials who may see themselves more as local leaders
than as agents of the central state.
The growing importance of understanding local change has led since 1990
to the publication outside the PRC of large numbers of provincial and local
studies of social and political change (Jae Ho Chung 1995; Li 2006a; Duckett
1998; Fitzgerald 2002; Goodman 1997; Hendrischke and Feng Chongyi
1999; Jia Hao and Lin Zhimin 1994; Li 1998, 2009; Naughton and Yang 2004;
Oakes and Schein 2006; Oi 1989; Walder 1998). Local change is explicitly
described and analysed, yet possibly the most far-reaching conclusion from
these studies is one that is far more implicit: the need and the means to
further conceptualise the ‘state’ in China. Research is almost always cen-
trally concerned with the state in transition, yet its definition is unclear.
This is neither undesirable nor not a viable strategy for explaining change.
The ‘state’ generally can of course be and is understood in many different
ways. It is sometimes equated with a society’s political structure and the ex-
ercise of sovereign authority in the territory of that society, and sometimes
with specific governments in that area. For political scientists the notion of
the state is usually more specifically some definition of the system of gover-
nance within which politics occurs; for economists, it is more usually a black
box of regulatory decision-making or an economic actor.
Most definitions of the state refer back to two early twentieth century de-
velopments of the concept. One is the development by geographers of the
concept of ‘the state idea’ – the dominant identity for political organisation
in any given territory – to explain how societies maintained structures of
authoritative decision-making within specific territories (Hartshorne 1950).
The other is Weber’s definition of the state as a structure that ensures the
monopoly of the legitimate use of violence in the maintenance of its orders
(Weber 1997: 154). Later operationalisations of these ideas, especially when
applied to communist party-states, have focused more on the existence and
structures of the state than on the exercise of state power. A definition of
the state in China which goes little beyond the description of one party rule
says something fundamental about the PRC, but is clearly limited. It makes
434 The Pacific Review

assumptions about the exercise of state power, but runs the risk of minimis-
ing enquiry into questions of legitimacy and authority, and the processes of
decision-making and policy implementation. It also runs a high risk of being
too static and not identifying the dynamic aspects of change.
One antidote to these problems is to adapt recent perspectives that em-
phasise the extent to which the state is a project constructed by social inter-
action (Migdal 2001). Instead of understanding state and society as being
inherently separate, and to some extent in conflict, this perspective focuses
on how the two interact in the exercise of state power (Perry and Selden
2000). To this end the strategy for understanding the state is to identify
the elements that constitute the articulation, structures, and operation of
state power, as well as the limitations to the exercise of state power. Of
necessity this entails that the state is no longer seen as static but in a con-
stant process of change. Not all change is the violent and dramatic change
usually described as revolution, but nonetheless change remains a constant
(Wertheim 1974).
From the local perspective it is possible to identify six different key ele-
ments of the state in transition. While each is presented and considered sep-
arately, they are necessarily overlapping and mutually reinforcing in pre-
senting a model of the state. Identifying and understanding these different
elements in the construction of the state necessarily also assists in explain-
ing the extent of change during the last three decades.
The earlier broad conceptualisations of ‘the state idea’ is a convenient
place to begin the task of identifying the various elements that determine
the exercise of state power. The justification for the existence of the state
and the direction of policy is provided by the values and beliefs that shape
the exercise of political power (ideology). This dimension of the state is
particularly high profile and important where there is or has been a com-
mitment to revolution, and where there is an explicit ideology, as is the case
in a Communist party-state. Similarly, a large part of the legitimacy for any
state rests on its social foundations (social base) hence the importance in
the modern era generally of the emergence of the idea of the nation-state.
This though is not to say that there may not be significant differences in
the state’s interactions with the political nation as a whole, and a more nar-
rowly based ruling class. This has clearly been the case in the past experi-
ence of Communist party-states where citizenship has often been variable
with class.
In a Communist party-state it would be logical to expect the system of
governance – the formal and informal rules and regulations for the op-
eration of the political system (regime) – to be heavily influenced, if not
at times over-determined, by the ideology. One way in which the PRC
has started to change in the reform era is that even allowing for earlier
comments about the difficulties of distinguishing government from gov-
ernance in a party-state, as the system has become more institutionalised
after Mao then authoritative decision-makers (government) have become
 D. S. G. Goodman: Sixty years of the People’s Republic 435

conceptually distinct. One might even argue that separating government

from governance was in some sense a primary goal of the reforms overseen
by Deng Xiaoping. In turn, both governance and government are to be dis-
tinguished from the administrative structures (bureaucracy) that implement
policy and the decisions of government.
The final element that shapes the state in these terms is its international
relations. Particularly when as in this case the party-state has committed it-
self to ‘openness’ it would be reasonable to expect interactions with sources
of power and influence based beyond its territorial borders – other states,
international institutions and global economic interests – to significantly in-
fluence the exercise of state power. Both for reasons of space and because
this article is accompanied by another reviewing the PRC’s international
relations after 60 years, this element of the exercise of state power is not
considered in detail further here.

Ideology
The current (1982) Constitution of the People’s Republic of China provides
a certain guide to the state’s official ideology. As has been consistently the
case since the establishment of the PRC in 1949 there remain two elements
to the justification of the state idea. The PRC lays claim to millennia of
Chinese history, civilisation and culture; as well as to a goal of socialist
modernisation, enshrined in the formulations of Marxism–Leninism–Mao
Zedong Thought. Before 1978 the relationship between these two elements
in state ideology was sometimes a little uneasy, with aspects of Chinese cul-
ture sometimes coming under direct attack. In the Cultural Revolution for
example the vestiges of ‘traditional culture’ became a target for extirpation,
and when Lin Biao fell from grace in and after 1971 he was criticised in
parallel with Confucius. This tendency for the state to turn on its appar-
ent historical antecedents, despite laying a claim to the continuity of the
Chinese state before 1911 (and the succession of Chinese dynasties) let
alone 1949, is a well understood paradox in the development of modern
Chinese nationalism. As an explicitly revolutionary regime the PRC has
long struggled with the determination of what can and should be maintained
from previous eras, and what should be replaced (Guo 2004).
In the reform era the local perspective on this determinant of state power
suggests very strongly that the balance between cultural nationalism and so-
cialist modernisation has swung heavily towards the former. Here too there
are paradoxes for the mark of cultural nationalism is actually an increased
discourse of localism. Before 1978 a discourse of localism articulated by
local leaders was almost always cause for dismissal, if not worse (Teiwes
1966). In 1958 the Governor of Shandong, Zhao Jianmin was purged af-
ter reportedly having said ‘I am a native of Shandong. I am for the peo-
ple and cadres of Shandong’ (SCMP 1958: 24). In the 1990s however it be-
came almost de rigeur for provincial and local leaders to embrace a localist
436 The Pacific Review

discourse of development (Oakes 2000). In contrast to the events of 1958

just cited, the Governor of Shanxi, Hu Fuguo was celebrated for saying

I was born in Shanxi, grew up in Shanxi, lived and worked in Shanxi

for 44 years. Shanxi is my home, and the Shanxi people raised me
as a son of peasants. As the saying goes ‘Home influences are hard to
change, home feelings hard to forget.’ I have never been able to forget
the affection of the people at home. My own fate and that of my home
are firmly bound together. (Hu Fuguo 1996: 11)

While localism was seen as in opposition to the state before 1978, since
the adoption of policies of ‘reform and openness’ that equation has been
abandoned. Instead localism and the promotion of local identity is now
seen as a positive force that will enable resources – and especially human
resources in the shape of entrepreneurs dedicated to developing their na-
tive places (Carrillo 2008; Minglu Chen 2008) – to be fully mobilised to the
national goals of modernisation. The ideological sanction for the commod-
ifiable development of local culture emerged in the wake of the events of
June 1989. The leadership of the CCP saw a need to reinforce its nationalist
credentials, emphasising its commitment to ‘China’s broad and profound
traditional culture’; a formula which went further than any statements of
that kind since the early 1950s in relating contemporary China to its pre-
1949 development. In January 1990 the then Minister of Culture then pro-
ceeded to unpack the idea of ‘traditional culture’ in terms of China’s local
and folk cultures (Guo 2004: 31). From 1992 onwards, almost all provincial-
level jurisdictions, and many other lower-order localities, began to develop
specific cultural development strategies which targeted the development of
state-sponsored local identities (Jing Wang 2005). However, in contrast to
earlier times, expressions of local identity are seen in a hierarchy of identifi-
cation that stretches from village to county to province to China as a whole:
localism is in short a building block of nationalism. At the same time, the
encouragement of local culture does significantly shift the balance underly-
ing the exercise of state power (Goodman 2002).
In addition to these changes in the state’s ideological settings, other
authors have also seen a less explicit apparently neo-liberalist agenda to
be found in the values and belief system of the contemporary state that
clearly contrast sharply with the values of the pre-1978 era and particu-
larly those of the Cultural Revolution (Harvey 2005: Ch. 5). Lee and Zhu
in their study of Guiyang’s housing reform explicate these values in terms
of: neoclassical economics; market regulation replacing state intervention;
economic distribution favouring capital; moral authoritarianism centred on
the nuclear family; international free trade; and opposition to unionised
labour. They argue that the Chinese state has taken a distinct neoliber-
alist turn, most especially by allowing the market to determine the allo-
cation of housing resources and through encouraging China’s integration
 D. S. G. Goodman: Sixty years of the People’s Republic 437

into the global economy (Lee and Zhu 2009). Oakes in his discussion of
local cultural development strategies in Guizhou goes further. The argu-
ment is clear. Wealth creation has been the principal message being de-
livered by the state. At the same time, local governments have become,
of necessity, more entrepreneurial as central funds have not kept pace
with population and economic growth. Particularly in the poorer parts of
China local cultural practices can with appropriate support and mobil-
isation become a significant financial resource for local government. In
terms which will resonate in other parts of the world that have experi-
enced a neoliberal turn, the apparent ‘shrinking’ of the state actually re-
sulted in the government-sponsored privatisation of cultural heritage; a
closer relationship between government and the private sector than an es-
pousal of market principles might otherwise have suggested (Oakes 2006:
23).

Social base
As might be expected, changes in the construction of the state’s social base
and in the development of China’s political nation are as dramatic as the
ideological contrasts just described. The state’s social base has changed
most dramatically with the CCP’s embrace of the new rich, and in partic-
ular of business people. At the local level it is clear that the core of the
political nation has become the alliance between party-state cadres and en-
trepreneurs. At the same time it is clear that the ranks of the politically ac-
tive have widened even further, particularly with the development of issue-
oriented politics. The consequences of these changes are perhaps clearer
for the construction of the state’s social base – where increased polarisa-
tion threatens to undermine the CCP’s wide social appeal – than for the
development of the political nation.
The CCP and by extension the PRC had appealed to certain social cate-
gories and discriminated against others between 1949 and 1978 fairly con-
sistently, though there were minor variations, especially during the era of
the Cultural Revolution. The appeal had generally been to the peasants and
workers. The privileged were those whose class origin and class background
(technical terms in the universal classification) were considered beyond
political reproach: the families of those who had dedicated themselves to
the Communist revolution, people from peasant and worker backgrounds
who had advanced through academic merit and service to the state (White
1976). Wealth rapidly became a target for state discrimination after 1949.
First land reform attempted to tackle the issue of inequality in the coun-
tryside; then in the mid-1950s a series of urban campaigns eventually led to
the socialisation of industry and commerce. Although until the mid-1950s
the CCP had always worked with landowners and the leaders of industry
and commerce, entrepreneurs and business people had been excluded from
CCP membership since at least the early 1940s. From the mid-1950s on the
438 The Pacific Review

families of those who had been the landed and of former entrepreneurs
were effectively excluded from the political nation.
The emergence of new social categories of new rich entrepreneurs and
professionals has been a hallmark of the last three decades that was
always likely to challenge the construction of the state’s social base
(Dickson 2003: 89). The ways in which new enterprises emerged, often
through the development of rural collective capital or from the restructur-
ing of the state sector inevitably meant that even by the mid-1990s many
entrepreneurs were not only CCP members but had served (and some-
times continued to serve) in positions in the party-state (Dickson 2008:
60). It is also clear that at the same time many private entrepreneurs
who had no previous CCP membership or link with the party-state were
being pressured to join the party, and sometimes even to take leader-
ship positions, despite formally being excluded from that possibility. They
were also often invited to participate in the operation of the party-state in
other ways, through serving as members of governments and government
agencies, or standing as deputies to people’s congresses (Goodman 2008b:
33).
The then President of the PRC and General Secretary of the CCP Jiang
Zemin first publicly articulated the notion that entrepreneurs and business
people should be included in the conceptualisation of the political nation in
2000. This was the principal innovation of his theory of the ‘Three Rep-
resents’ – business people representing the ‘most advanced’ elements in
Chinese society, which Jiang was advocating should be embraced for
China’s development (Jiang 2002).
The reincorporation of the capitalist class is clearly one of the most im-
portant symbolic acts of all the reform measures undertaken by the state,
if only because of the contrast with the exercise of state power since the
early 1950s. Certainly the symbolism of these changes that emphasises not
only the roles of entrepreneurs and enterprise, but also the importance of
wealth in its own right, cannot be underestimated. A village head in Ox
Market Fort, Guizhou Province, is reported to have commented on wealth
and local leadership in ways that would previously have been unutterable
without severe political consequences:

Before Liberation, this was a very cultured village. Over one-third of

the households were landlords! . . . These days, Jiang Zemin and Deng
Xiaoping consider the landlords the advanced representatives of eco-
nomic progress. We should understand this. To me, they weren’t land-
lords, they weren’t exploiters. They were people who worked hard,
saved their money, and advanced the village along with themselves.
(Oakes 2006: 23)

Beyond the symbolism the reality of local development, as repeated by

scholarly study after scholarly study, is that leadership and indeed the
 D. S. G. Goodman: Sixty years of the People’s Republic 439

exercise of local state power is now exercised by the close community

of interest between cadres and entrepreneurs. For example, Blecher and
Shue describe the development of Shulu County, Hebei in terms of this al-
liance (Blecher and Shue 1996); Unger and Chan detail the phenomenon in
Guangdong (Unger and Chan 1999); and Whiting in Jiangsu, rural Shang-
hai and Zhejiang (Whiting 2001). Ray Yep focuses on this relationship as
the principal driver of rural industrialisation in Zibo, Shandong (Yep 2003).
Chih-jou Chen has detailed how this alliance significantly affects property
rights in the Yangtze Delta and in Fujian (Chih-jou Chen 2004). Perhaps
the most comprehensive study is that of Jean Oi who found evidence of
the close involvement of cadres and entrepreneurs in Beijing, Liaoning,
Sichuan, Tianjin, Shandong, Guangdong, Henan, Hunan, Jiangsu and Zhe-
jiang in interviews from 1986 through to 1996 (Oi 1999). Oi (and indeed
others) have sometimes referred to this phenomenon as the emergence of
‘local state corporatism’ (Oi 1992).
Possibly because there has been a concentration in the exercise of state
power at the local level, it is also apparent that the political nation has also
widened in other ways. Even without the possibility of opposition to the
CCP, formal or otherwise, there is now a greater diversity of political ac-
tors than before 1978. Social change and complexity, especially as a result
of economic growth and its impact on the environment and lifestyles has re-
sulted, as already noted, in a range of self- and altruistic interest groups. An-
drew Mertha for example has written about the ways in which opponents of
large-scale dam projects have become part of the hydropower policy mak-
ing process (Mertha 2008). In examining the development of a movement
against domestic violence against women, Louise Edwards certainly identi-
fies elements who are active safely within the party-state (members of the
Women’s Federation) but also finds that there are those who are so far
outside that they do not even constitute an organisation of any sort, only
coming together for specific acts and events (Edwards 2009).
The longer term consequences of these changes are far from certain.
There is some evidence from studies in a number of issue areas that change
in the social base of the state and current policy settings about encour-
aging wealth creation may well threaten social polarisation. This conclu-
sion is clearest in various studies of housing reform that have been under-
taken, in a variety of places as distant as Guiyang (in the Southwest) and
Shenyang (in the Northeast) (Lee and Zhu 2009; Tomba 2008). Outside the
PRC, particularly in North America, there has long been an expectation
that the growth of a private sector of the economy and of independent-
minded entrepreneurs would lead to pressures for political change, if not
liberal democracy. The evidence from the research of those who have stud-
ied private entrepreneurs in greatest detail is quite to the contrary. In recent
studies both Bruce Dickson and Kellee Tsai have highlighted the private
sector’s dependency on the party-state and the CCP’s desire to maintain
its close relationship with private entrepreneurs to such an extent that the
440 The Pacific Review

use of the term ‘private’ in this context sometimes is called into question
(Dickson 2008; Kellee Tsai 2007).

Regime
It is abundantly clear in a number of ways that the PRC remains a CCP
party-state. Many of the pre-reform structures of governance necessarily
remain in place, including crucially the pre-eminence of the CCP’s Political
Bureau and its subordinate units in authoritative decision-making. There
has nonetheless been significant change in the system of governance. The
conceptualisation and operationalisation of state–society relations have al-
tered, as has the CCP’s control of government activities, and, as already
noted, the spatial distribution of power.
One of the key characteristics of much scholarship on pre-reform China
was its assumption of an opposition between state and society. The CCP for
its part took a somewhat different view in its insistence that it could and
should speak for society as well as control it. The reform era has fundamen-
tally altered both of these views of the state–society relationship. Marketi-
sation in general, and the commercialisation of welfare in particular have
placed the exercise of state power in a different relationship to society than
before. At its most extreme these changes have meant that the state is no
longer responsible, as was previously the case directly for most of the urban
population, and indirectly for the rural population, for the individual life
chances of the individual. Once again the development of housing reform is
an area where this is acutely demonstrated, though the same is also the case
for the provision of education and health-care (Lee and Zhu 2009; Duckett
and Carrillo 2009). Moreover, as already noted both generally, and with
respects to the development of the social base, while the state remains a
political actor in its own right to some extent, the system of governance also
now allows partial interests to become involved in the political process in
ways that were previously unthinkable. From the external viewpoint state
and society cannot always be assumed to be in contradistinction; internally,
other voices may be heard in a kind of lobby process alongside the CCP,
even if the latter may still occasionally have the louder voice and remain
the framework for decision-making (Perry and Selden 2000; O’Brien 2008).
It would be a mistake to see the emergence of social interests, of NGOs,
or even of local interests in opposition to central dictates as the emergence
of any kind of political pluralism. Much of it is sanctioned by the CCP
in the interests of ensuring the greater efficiency of socialism, rather than
a belief in the virtue of pluralist diversity (Goodman 1985). At the same
time, the ways in which the CCP exercises controls have clearly changed. In
the past CCP control over lower levels of the state structure was ensured
through a tight management of appointments to leadership positions; and
through the fear of expressions of local interest being regarded as the polit-
ical crime of localism. In the reforms of the last 30 years, first the number of
 D. S. G. Goodman: Sixty years of the People’s Republic 441

leadership appointments subject to appointment was dramatically reduced;

and as already noted, the CCP has encouraged the development discourses
of localism by way of increasing symbolic capital that may be harnessed
to the greater good of wealth creation. Of course the problem of control
over local cadres remains and this has been met by ensuring tighter qual-
ifications on entry, both political and technical, and considerable amounts
of on-the-job and in-post training and professional development. Landry,
in his study of elites in Jiangsu emphasises this point and quotes Deng Xi-
aoping’s comments on his ‘Southern inspection Tour’ to the effect that ‘We
must educate . . . If any problem arises in China, it will arise from inside the
Communist party. . . . We must pay attention to training people . . . ’ (Landry
2008: 257).
The role of decentralisation in fundamentally altering the system of gov-
ernance in China has been a key feature of the reform era. There are those
who criticise the extent to which decentralisation remains incomplete, and
the problems that this causes, notably the emergence of greater corruption
(Gong 2006). All the same, even to date the extent of change has been re-
markable. Local governments have gained greater control over their own
budgetary processes, revenue raising and resource allocation, state enter-
prises, and even in their involvement in foreign investment and trade. While
this then delivers a scenario in which (from the CCP’s point of view) cadre
training may be even more important than ever, not least in order not to
jeopardise the maintenance of the CCP’s local political authority, there may
be even more dramatic and undesired results at the very lowest levels in the
exercise of state power. Devolutionary pressures, especially in the poorest
regions, may well leave county, township and village in a contest for control
of a limited resource base. Moreover, regional development policies dur-
ing the last 20 years that have been designed to mitigate the worst effects
of unequal development through the establishment of city-regions, city-run-
counties and the like (all of which have been fairly common attempts across
the PRC) appear to run the risk of merely moving control of rural resources
to urban governments (Hsing 2006).

Government
These fundamental governance changes, and in particular the introduction
of decentralisation, have had a profound impact on the location and oper-
ation of government. Although the territorial administrative hierarchy of
the PRC is usually spoken of only in terms of centre and locality, it can
be more usefully analysed in terms of three basic levels of government:
central, provincial, and local. The provincial level of jurisdiction includes
municipalities directly under the State Council (Beijing, Shanghai, Tian-
jin and Chongqing) and the autonomous regions (Xinjiang Uighur, Xizang
Tibetan, Guangxi Zhuang, Ningxia Hui and Inner Mongolia). The local lev-
els include counties and city level counties, townships and villages. Before
442 The Pacific Review

the 1980s of these only the county level was regarded as a part of the formal
system of government.
Decentralisation in the reform era has had three separate consequences
for the operation of government, all concentrated at the more local levels.
Significant economic decision-making has been localised; local leaders, in
townships and villages as well as at the county-level, have become economic
actors in their own right and not simply state agents; and the CCP seems
not to operate at the local level in quite the same way it did before. The
essence of these changes is that local government and local government
leaders appear now to exercise considerably more authority in their own
right, than was previously the case.
It is not hard to find examples of the ways in which the changes of the
reform era, and in particular decentralisation, have resulted in increased
and significant decision-making now occurring at local levels. A whole
range of studies have detailed how different aspects of development
are planned and executed locally. Gong details how decentralisation in
economic decision-making has brought discretion over resource allocation,
licensing, investment, and taxation to the local levels (Gong 2006). Hsing
analyses the increased capacity of localities to be involved in the processes
of land management, which have of course been crucial in industrial and
real estate development (Hsing 2006). Lee and Zhu deal with local exper-
imentation with housing reform (Lee and Zhu 2009) and Oakes details
how localities have the ability to choose specific settings and directions for
their individual cultural development strategies (Oakes 2006). Inevitably
this has meant that the practice of policy implementation differs locally,
sometimes substantially (Chih-jou Chen 2004; Jae Ho Chung 1999, 2000).
Important as this degree of decentralisation would be in its own right, the
imperfect process of decentralisation has effectively meant that local lead-
ers have become significant economic actors and not simply local agents of
the state. Sometimes this characteristic of local cadre behaviour has led to
them being described as agents of the local state (Oi 1995). A more effec-
tive decentralisation would concentrate on deconcentrating power at the
local level, and aim to increase accountability and representation (Gong
and Chen 1994). While the first has clearly been part of reform-era PRC
decentralisation (at least to the extent of separating government and party
functions and operation) increased accountability and greater representa-
tion have been considerably more muted. One result is that local cadres
have been able to build up not only extra budgetary revenues (which cen-
tral government sanctions to some extent outside the formal plan process)
but also off-budgetary revenue (which higher levels of government know
nothing about at all). These resources enable local officials to move beyond
the formal budgetary boundaries which are a major direct control mecha-
nism available to higher levels of the state (Gong 2006).
With the political and economic pressures that they face to deliver
economic growth, local cadres effectively act to maintain and develop
 D. S. G. Goodman: Sixty years of the People’s Republic 443

local interests. Gone for the most part are the political campaigns that
characterised their management of localities before 1978. Their primary
concern is now the development of the local economy. Moreover, while
they rarely own economic enterprises themselves when in office, they are
significant brokers and dispensers of influence and support. As Gong points
out this is a significant change in government because now as opposed to
earlier years of the PRC central government has ‘to rely heavily on its lo-
cal “agents” to rule in an increasingly cellularized power structure’ (Gong
2006: 151). This is a process which may often lead to considerable higher-
level frustration at its ability to intervene meaningfully at the local level
(Hsing 2006).
In some ways these observations suggest that the party-state may be fray-
ing at the edges, or at least in the localities. Although the CCP remains cen-
tral to politics at central and provincial levels, at local levels while the CCP
still exists it would seem to be much less part of the exercise of the state
power in its own right than is the case at higher levels of the system. While
the CCP is much in evidence when matters of PRC policy or strategic direc-
tion are being discussed centrally or provincially, in the examination of case
studies in specific localities the CCP often has either no or only a shadowy
existence. As already noted, a better focus for analysis would seem to be
the community of interest developed between local party-state cadres and
private entrepreneurs. It is that nexus that provides the platform for the
exercise of state power locally.

Bureaucracy
The 9–10 per cent annual growth rate of the PRC economy since 1978 is
frequently remarked on by external commentators of all kinds. Less men-
tioned but no less significant, not least as the foundation for current success,
was the average 6 per cent (according to official PRC State Statistical Bu-
reau data) per annum growth rate achieved overall between 1952 and 1978
(State Statistical Bureau 1990: 6). While that figure masks some severe fluc-
tuations, especially during the aftermath of the Great Leap Forward it did
mean that especially during the 1950s the PRC established a working ad-
ministrative system. In particular, the bureaucracy supplied and managed
education, health and welfare services in line with the dictates of the state
planning process.
As already noted, the principal change to bureaucracy with the advent
of reform has been the introduction of market principles in the allocation
of resources and services. The state’s administrative structures now provide
less directly by way of public goods and services and instead increasingly
play the role of being the market regulator. Experiments with introduc-
tion of the Housing Monetarisation Policy in Guiyang in and after 1998,
designed to reform the housing market, indicate the extent and the im-
pact of this change on both bureaucracy and the wider society. Housing had
444 The Pacific Review

previously been provided by each work-unit, with a subsidy provided by lo-

cal government, since each work-unit was effectively a branch of the state, if
not of the local government itself. There were clear inequities in this system
not least since while state operated enterprises could house two-thirds of
their employees this way, only one-third of collective sector employees were
similarly provided for. By 1998 state investment in housing development
had almost disappeared locally and been replaced by private investment.
State provided housing was sold off and subsidies ended, to be replaced by
a one-off cash subsidy to workers. In place of the former work-unit system
of housing provision the local government introduced policies designed to
differentiate between high-income earners, who would be directed to buy
their own private housing; middle to low-income earners who would be ex-
pected to buy provided low-cost housing; with the poor receiving low-cost
social housing. The results appear to have been increased urban poverty,
greater social inequalities, and the ghetto-isation of the housing market in
line with wealth (Lee and Zhu 2009).
One clear corollary of these changes in bureaucracy is then that social
welfare is increasingly passing from the state bureaucracy to other social
institutions, often established by villagers themselves. Oakes in his de-
scription of village adoption of cultural development strategies in Guizhou
details the activities of the 18th Festival Association in Jin Family Fort.
Through its various activities and the promotion of tourism this associa-
tion raises enough funds to substitute for the state in the provision of ba-
sic village welfare and public goods (Oakes 2006). Similar findings are re-
ported by Lily Tsai’s research of public goods provision in Fujian, Hebei
and Jiangxi (Tsai 2007).
Less predictable perhaps, and certainly less intended, has been the impact
of the marketisation of public services on local bureaucracy. As might be
expected given earlier comments on the growing strength of the local levels
of the exercise of state power in their relationship with higher levels of the
system, the evidence from local studies is that local bureaucracy has to some
extent been captured by local government. Hsing’s analysis of the new land
management bureaus and their activities is particularly acute in this respect:

The stated mission of land bureaus is farmland conservation. Yet un-

der the growth-minded urban government leaders, local land man-
agement bureaus have become an important channel for the urban
government to control rural land inventories, oversee farmland con-
version and land lease sales. (Hsing 2006: 187)

The tendency then would appear to be that local bureaucracy is likely to be-
come part of the local power constellation controlled by local leaders. This
may not always be in opposition to other parts of the state administration,
but the potential for that kind of conflict is clearly there, even if it may still
be contained within the framework of the party-state.
 D. S. G. Goodman: Sixty years of the People’s Republic 445

One final observation about the ways in which the state bureaucracy
is no longer as it was can be drawn from consideration of path depen-
dency. The pre-reform era state bureaucracy operated on principles and
procedures crystallised during the early 1950s but inherited from earlier
CCP experiences (Barnett 1967; Lieberthal and Oksenberg 1988). The path
dependence of the bureaucracy was taken for granted by the leaders of the
CCP before 1978 and even to some extent desired, representing a form of
reliability. This has changed though with the advent of reform, where the
bureaucracy has been required to learn new tricks, not just once, but sev-
eral times as even the reforms of 20 or 10 years ago have had to be replaced.
This has required the state bureaucracy to develop new strategies in order
to ensure both that specific reforms are implemented and also that a climate
welcoming and productive for change and improvement is sustained. The
bureaucracy has had to develop itself as a learning institution in ways that
would have been completely alien to those who administered in its offices
during 1949–78 (Li 2006b).

The state in transition

Even without considering the role of international interactions (the sixth el-
ement in the model outlined) on the exercise of state power, it would seem
reasonable to argue that the evidence from local studies is that there has in-
deed been substantial change since 1978. Of course, that is not to argue that
there are no continuities with the pre-reform era, and indeed even from
a local perspective it is clear that those continuities help shape the state
and the exercise of power. Leadership remains crucial to the operation of
the PRC as party-state and leadership appointments, despite many organ-
isational changes, remain a CCP control mechanism. Even despite all the
apparent value change there is still authority in Marxism–Leninism–Mao
Zedong Thought as the party-state’s ideology. Though it may not have led
to the commitment of funds that the program required it is clear that a large
part of the justification for the campaign to ‘Open Up the West’ that started
in 2000 was precisely an appeal to both general considerations of equal-
ity and earlier promises made to develop the Western Region (Goodman
2004).
In considering the PRC as a state in transition there are two frequently
asked questions, to which a third might usefully be added: should, will, and
can the state change even more fundamentally? By way of conclusion it
seems useful to consider some of the possible responses.
There is a considerable literature to the effect that the state should
change even more fundamentally, some of which has been reflected in the
arguments presented here. Although it is hard to avoid a moral tinge to such
perspectives, by no means all those arguing for change do so on the grounds
that China should be more like the US or that a communist party-state is
necessarily undesirable. There is also a very clear argument presented that
446 The Pacific Review

the exercise of state power in China would be more efficient and effective
in delivering public goods if it were more accountable and more represen-
tative.
The frequently asked question ‘Will the PRC change?’ is most usually
code for ‘Will the CCP stop being the ruling party?’ and is accompanied by
a subsidiary question as to the timing of that event. Social scientists usually
sensibly abjure from such precise predictions, or at least many of them do.
One notable exception, that may speak to the case of the PRC, at least
in part, is the research project undertaken under the leadership of Jack
Goldstone during the late 1980s to investigate contemporary revolutions.
This concluded inter alia that a revolutionary situation was not reached
until three conditions were met simultaneously: a state crisis; a division in
the elite; and mass mobilisation (Gurr and Goldstone 1991). Though the
attention of many outside the PRC is often drawn to examples of small
scale and localised mass unrest, the CCP itself has clearly understood the
importance of avoiding public leadership divisions especially in the wake
of the events of May 1989.
Finally there is the less often considered question as to whether the
state actually can change. Of course there can be fundamental change,
but not necessarily without cataclysm or within the structures established
for the exercise of state power. From the perspective of understanding
the state as a political construct this is in many ways the most intriguing of
these various questions. The justification for the PRC lies both in modern
Chinese nationalism and in the configurations of Marxism–Leninism–Mao
Zedong Thought. For the moment these two are equated. The experience
of other once communist party-states suggests that it is difficult if not impos-
sible for a one party-state to evolve into something else, even though there
must inevitably be an element of path dependency in the later exercise of
state power.
From the local perspective, during the last three decades the state has be-
come centred on nationalism and wealth creation. The governmental sys-
tem has become highly decentralised with the exercise of state power rest-
ing largely in the hands of the community of interest that has been created
between local cadres and entrepreneurs. There is little evidence that fun-
damental change is imminent not least because the party-state has shown
itself well able to adapt to the socio-economic developments of the past 30
years. On the other hand, were other factors to intervene, federal solutions
beckon, as well as the yet greater local differentiation of politics and the
exercise of state power.

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