Zhu Rongji on the Record: The Road to Reform: 1998-2003

by Rongji Zhu, Henry Kissinger (Foreword by), Helmut Schmidt (Foreword by)

Overview

China's explosive transformation from a planned economy to a more market-oriented one over the past three decades owes much to the charismatic reformer Zhu Rongji. As China's premier from 1998 to 2003, Zhu displayed a pragmatism and strong work ethic that have been key forces in China's drive to greater modernization and global stature.

During this time, Zhu embarked on a plan to reduce the size of government and reform the heavily indebted banking system and state-owned enterprises as well as to overhaul the housing and health care systems. His sweeping efforts ranged from lobbying for the establishment of stock exchanges to revitalizing agriculture through the introduction of a modern grain market. The ramifications of these reforms are still being felt throughout China and the globe, and The Road to Reform provides a real-time look at these plans as they were being formulated during the 1990s to the early 2000s.

The second of a two-volume collection containing more than 100 speeches and personal papers by Zhu, this volume is a revealing and insightful look at Zhu's thinking and will lead to greater understanding of one of the world's two largest economic powers.

Product Details

ISBN-13:	9780815726296
Publisher:	Rowman & Littlefield Publishers, Inc.
Publication date:	01/08/2015
Sold by:	Barnes & Noble
Format:	eBook
Pages:	396
File size:	11 MB
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About the Author

Zhu Rongji served as mayor of Shanghai from 1987 to 1991, then was China's vice premier, and served as the fifth premier of the People's Republic from 1998 to 2003.

Read an Excerpt

Zhu Rongji on the Record

The Road to Reform, 1991â"1997

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By Zhu Rongji, June Y. Mei

Brookings Institution Press

Copyright © 2015 Foreign Languages Press
All rights reserved.
ISBN: 978-0-8157-2629-6

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CHAPTER 1

Speech at the First Plenary Session of the State Council

March 24, 1998

Last night I barely slept, thinking about today's speech. Because this is a plenary meeting of the State Council, I had earlier asked the State Council Research Office to draft a speech, which since then has been revised several times and commented on by all the Vice Premiers and State Councilors. It is a very comprehensive draft, but I'm not going to read it today. It will be printed and distributed to all of you. Instead, this is an impromptu speech for which I take full responsibility. Consider it for your reference only.

I'd like to focus on three topics: (1) the most urgent issues to be resolved this year; (2) reforms of government agencies—if this is not handled well now, the stability of our entire society and the normal operations of government will be at risk; and (3) the need for a major change in the style and mode of work in this administration—without such a change, we won't be able to accomplish our mission. However, I'm going to discuss these issues in reverse order, starting with the State Council's style and mode of work.

Transforming the Government's Style and Mode of Work

Colleagues, the first session of the Ninth National People's Congress clearly has great expectations of our administration, and the media both at home and abroad all place great hope in it. We must therefore ask how we can achieve the weighty task that the people have entrusted us with. I expressed my true feelings in this regard at the press conference at the conclusion of that first session. Subsequently, many comrades asked me, how come you didn't leave any wiggle room at all in your remarks? They raised the question out of concern for me, in that they felt these things could not be accomplished, not even in five years, let alone three. So why did I say that? Because I feel deeply that this administration is being given a historic opportunity as it moves between two centuries, a chance not only to carry on what has come before but also to open up the way forward. If we were to pass up this opportunity, it would be hard for China to achieve things in the next century.

So far, the reforms and opening up initiated by Deng Xiaoping have achieved unprecedented success, the two administrations led by Li Peng have created good macroeconomic conditions, and our nation's economy has become quite strong. All this has laid a good foundation for our future work. But many latent crises are brewing in our country, which may erupt at any time. I don't mean a crisis of government—the collective leadership of the Party Central Committee with Jiang Zemin at its core is strong and united and can steer us through even the most complex situation. Those of you engaged in economic work all know that the problems in this sphere are very serious right now, that people are dissatisfied with us in many respects.

In particular, our officials are corrupt, there is disparity between the rich and the poor, some grassroots officials lord it over others, some senior officials are too bureaucratic and have little regard for the interests of the people—all this has left the people very dissatisfied! The one thing they are still satisfied with, however, is the economy: it continues to grow, prices are falling and not rising, and there's no problem with maintaining basic living standards. If this administration doesn't enact basic reforms aimed at existing shortcomings and lay down a good foundation, it will indeed be hard to achieve much in China into the next century.

I'm the oldest person here, and of those present today, even the "young" ones are no longer young. Having worked for several decades, we have a profound understanding of how hard it is to transition from a planned economy to a socialist market economy. We know, too, the shortcomings of a planned economy. Therefore we have to come up with a relatively good way to gradually resolve [these] and transition to a genuine socialist market economy. We need those of you here who are familiar with both the old and new systems to assume positions of leadership. However, we can't simply promote the good talkers, who can reel off a lot of theory but fail to understand conditions in China or the way its economy has been operating for the past few decades—that would be very dangerous. Instead we need young and capable officials, and once we identify them we should let them rise to the top, perhaps even promote them to a second-in-command position to train them and prepare them for promotion. But this cannot be done in a single step—you need to use a bit of authority to resolve these problems.

Chairman Mao was the core of the first generation of leaders, and Deng Xiaoping was the core of the second generation. Now we have established the third generation of collective leadership with Jiang Zemin at its core. It is leading us as we navigate the domestic economic waters without the slightest volatility. It was a great blessing for the Chinese people that there was not even a hint of it when Deng Xiaoping passed away. One might say that this administration brings together some of today's best leading cadres. I'm not saying this team is perfect, but the consensus both in China and abroad is that this team is quite dependable, capable, experienced, and able to cope with complex situations. We should all feel satisfaction and pride at being part of this transcentury leadership team.

When I said that a "minefield" and an "abyss" lie before this administration, I was not the least bit mistaken, though of course we will avoid such pitfalls. But it's going to be very tough to do so! Colleagues, from this day on, we are "a single entity bound together by fate." You must be determined to "jump" into the abyss with me! Actually, not to jump in, but to find clever ways to overcome the various obstacles before us, to avoid all the dangers and pitfalls, till we triumphantly reach the other side of the course. Let us bind our fates together and with a strong sense of responsibility complete our tasks as quickly as possible, so that we may be accountable to the people.

We must strive hard and govern well and make this a clean, efficient, and "cheap government," in the sense ascribed by Marx. In The Civil War in France, he took the phrase to mean a lean, low-cost government that does not waste the sweat and blood of its people. We must lead by example and become this sort of government; otherwise we won't accomplish this task. It won't work to go on as we have been doing. Each and every one of us, starting with myself, and you, comrades—who have hundreds of thousands or millions following you—must lead by example and be a role model. If the leadership team of the State Council, including all of us here, can do this, we will be able to reverse the current bad trends in society.

I'd like to mention a motto that may be of some help here—one that I put my faith in as soon as I took up my post in Shanghai: "The people respect me not because of my ability, but because of my fairness." That is to say, people respect my authority not because I have such great abilities, for even if I were more capable I wouldn't necessarily be better than others. They accept my authority because I am fair in my dealings. "Officials do not fear my sternness, they fear my probity." Officials below me aren't afraid of me because of my sternness, they're afraid because I'm not corrupt, because there's no shit on my ass. If I can walk tall and sit straight, I can dare to expose your bad behavior. "From fairness comes light, and from incorruptibility comes authority." You can only understand things clearly if you are fair, and you can only have authority if you aren't corrupt.

I always adhered to this principle when I was working in Shanghai. I constantly reminded myself to be fair, even if I wasn't always able to achieve this. I also strove to be clean—even in minor matters, I made sure to consider whether it was consistent with Party regulations and never risked being careless about it. I made the same demands of those working beside me and of my family members. Also, as my secretary frequently reminded me, it is essential to monitor each other. Provided we all work at it, I think we can change the unhealthy trends in society today.

Let me lay out five expectations in the hope that we will encourage one another to live up to them.

1. We Must Never Forget That We Are Servants of the People. We must serve our people with heart and soul and must not seek special privileges. When the Disciplinary Commission of the Central Committee recently investigated several regions and departments, its inspection teams found a lot of problems. What I hadn't expected was that many of those involved were old friends of mine. Is such disregard of rules and regulations even the least bit appropriate for public servants? Do they think that having climbed to their positions, they can do as they please and enjoy whatever they want? How can we let this go on?!

2. We Must Discharge Our Duties Faithfully and Dare to Speak the Truth. If everyone in this administration were "Mr. Nice Guy," we'd be letting the people down. We have to be the "bad guys." Don't think that "our society has now become a society of mediocrities in which no one wants to offend anybody. It's enough that I don't sink to their level." This sort of thinking won't do. First of all, you can go ahead and offend me. I may not have a lot of forbearance and lose my temper easily. If you argue with me, I might turn red in the face on the spot. But I bear this proverb in mind: "Be tolerant and you will be great; forgo desires and you will be strong." If you don't crave anything, you will be strong and fear nothing. This is my motto. Although I'm not very forbearing, I never target others and never bear a grudge. The facts prove this. On the contrary, if someone dares to speak up, dares to contradict me to my face, puts me in an awkward position, I'll give such a person important responsibilities. Of course I can't do this with just anyone, especially if he doesn't have the ability. However, I absolutely will not bear a grudge.

To give you an example, Liu Jibin of this administration and I once got into a raging argument over the issuance of Treasury bonds. At the time I was very upset with him, and even today I still think that he was wrong. His way of issuing Treasury bonds will not work—didn't last year prove that my method was the correct one? We can't have a market auction—that would force interest rates so high that the nation couldn't afford it. China has a special circumstance—the interest on Treasury bonds is higher than that of bank deposits. What other country in the world has a situation like this? If you have a market auction for Treasury bonds, you'll only be paying high interest to those speculators. But Jibin is a very upright and capable person, and I think it very appropriate to appoint him chairman of the State Commission for Science, Technology, and Industry for National Defense. Therefore, comrades, please set your minds at ease about me. At times, I may lose my temper with you, I may argue with you, I may even say some unpleasant things to you, because "it is easier to change the course of a river than to change a person's character." It's not that I'm unwilling to change—it's just that I haven't been able to change. But in my lifetime I've only been targeted; I've never targeted others.

We should all dare to offend not only leaders like ourselves, but also those below us. Otherwise, our nation's laws and rules will be ineffective. I place a great deal of trust in you. I'm not afraid that you might seek revenge, but I am afraid that you'll be reluctant to offend others. You must first dare to offend us, then dare to offend those in your charge: you must keep watch over them.

In some departments, section heads are the bosses. When governors and mayors come to call, they won't even bother to look at them—that's not good. This type of behavior can be found at the State Planning Commission, and the locals react very negatively to it. When officials from local governments arrive to submit a report, they'll find a young woman sitting there who won't offer them a chair, let alone look at them. This has become a "dictatorship of the section chiefs"—how can we allow this? I'm not saying that all section heads are like this, just that if there are any, they should be replaced immediately. Such people are not fit to be section heads; they're not true public servants. They should be sent off to learn how to change their attitudes.

3. We Must Govern with a Strict Hand and Not Be Afraid to Offend Anyone. Governing strictly means being more rigorous, and not casually letting things go. This isn't a question of letting a person slip off the hook—it's an institutional question. Otherwise, the fate of our country might "slip away." As I've just said, many of us are afraid that speaking the truth will give offense, and we're afraid others might be displeased—although it won't be so easy to fool me. We must get into the habit of daring to speak the truth.

4. We Must Be Clean and Honest and See That Corruption Is Punished. Before we can punish corruption, we must be clean and honest ourselves. Otherwise it won't be possible to punish corruption.

5. We Must Study Diligently and Work Hard. We have a great deal to learn about a lot of new things. In the past, we never encountered anything like the Asian financial crisis, so the only thing to do was to learn lessons from it. Our embassies abroad all wired us reports, and I read their analyses of the Asian financial crisis one by one. Although their information was much the same and was copied from newspapers, it helped broaden my knowledge. I read more than 100 telegrams, all the sections of foreign newspapers that dealt with the Asian financial crisis, and at least 3 Hong Kong papers every day—especially the economics pages. If I had not done this, how would I know the state of the stock markets and the price of a barrel of oil? If you don't study, how can you cope with an unpredictable situation such as this? If you don't read reports, don't watch TV, don't read the papers, don't watch Topics in Focus, if you don't know about people's woes and try to understand them, how can you do your work? The most letters I may have signed off on were from the public.

Colleagues, you must care about the woes of our people. You won't know until you've read about them. Many things are utterly outrageous—they make your hair stand on end, and your blood pressure will go up after learning about them. I've been working at the State Council for eight years now, and I deeply feel that it's very easy to come up with an idea. You can come up with many ideas—they can cover heaven and earth, past and present—and you can cite all the classics. It's also not so hard to set a policy—provided you humbly listen to the views of all the departments concerned and draw on the collective wisdom, you can come up with a good policy. But it's very hard to implement it. It's not as if you just write a lot of directives and the people below will faithfully execute them—it's nothing of the sort. The hardest thing is to implement.

(Continues...)

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Excerpted from Zhu Rongji on the Record by Zhu Rongji, June Y. Mei. Copyright © 2015 Foreign Languages Press. Excerpted by permission of Brookings Institution Press.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

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Table of Contents

Contents

Publication Note,
Foreword by Henry A. Kissinger,
Foreword by Helmut Schmidt,
Note from The Brookings Institution,
1998,
1 Speech at the First Plenary Session of the State Council,
2 On the Proper Reassignment, Resettlement, and Reemployment of Laid-off Workers,
3 Reforms of Government Agencies Require Strong Determination, Steady Steps, and Solid Work,
4 Key Aspects of Reform of the Grain Circulation System,
5 A Conversation with U.S. Treasury Secretary Robert E. Rubin,
6 Crack Down Hard on Smuggling,
7 Rebuilding after the Floods with the Same Spirit Displayed in Combating Them,
8 A Talk with the Producers of Topics in Focus,
9 Closing Down Guangdong International Trust and Investment Company Was the Right Thing to Do,
10 A Conversation with Michael D. Eisner, CEO, the Walt Disney Company,
11 "Tofu Dreg Projects" Are a Crime against the People,
12 Speech at the 1998 Central Economic Work Conference,
13 Hainan Must Keep Its Hills Green and Its Waters Blue,
14 Ensure Construction Quality of the Three Gorges Project and Properly Resettle the Area's Inhabitants,
1999,
15 A Conversation with Alan Greenspan, Chairman, U.S. Federal Reserve,
16 A Conversation with an American Congressional Delegation,
17 Remarks at President Bill Clinton's Welcoming Ceremony,
18 Address at a Welcoming Dinner Hosted by President Bill Clinton,
19 The Future of Science Lies with Young People,
20 We Must Be Selective in Supporting Small and Medium Enterprises,
21 To Tame the Yellow River, We Must Conserve Soil and Water in Its Middle and Upper Reaches,
22 We Must Be Determined to Stop Logging in Natural Forests,
23 Some Thoughts on Speeding Up Development in Ethnic Minority Areas,
24 Three Main Approaches for the Development of Western China,
25 The Iron and Steel Industry Must Control Total Output and Restructure,
2000,
26 Let Outstanding Arts and Culture Be Passed Down from One Generation to the Next,
27 Customs Must Regain Its Former Stature,
28 A Conversation with Pascal Lamy, EU Commissioner for Trade,
29 Three Economic Risks We Must Guard Against,
30 The Electric Power System Must Be Reformed,
31 On Using Relending to Help Local Financial Institutions Repay Debts and Guarantee Payments,
32 We Should Use Economic Measures to Eliminate Overcapacity,
33 Several Issues Regarding Xinjiang's Development,
2001,
34 Pay Greater Attention to Environmental Protection and Building the Eco-Environment,
35 Hunan Must Give Priority to Managing Its Mountains and Waters,
36 Teachers Are the Basic Driving Force of Education,
37 The Spirit of Tsinghua Is the Pursuit of Perfection,
38 On Economic Development Issues in Three Autonomous Ethnic Minority Prefectures in Sichuan,
39 Further Speed Up Tibet's Economic Development,
40 In Attracting Foreign Investment, We Must Achieve the "Three Integrations",
41 A Conversation with George Soros,
42 Toward a More Open and Prosperous Chinese Economy,
43 The Impact of 9/11 on Our Economy, and Our Countermeasures,
44 China Can Become the World's Investment Paradise,
45 Strengthen Oversight through the Media,
46 Strengthen Oversight through Publications,
2002,
47 Halt the Tendency to Blindly Seek Increases in Urban Size,
48 Inner Mongolia Should Play to Its Own Strengths in Its Development,
49 A Conversation with Former U.S. Secretary of State Henry A. Kissinger,
50 On Visiting the Former Residence of Hu Xueyan,
51 A Conversation with an American Congressional Delegation,
52 Put "Accuracy" Foremost in Statistical Work,
53 Hong Kong Has a Bright Future,
54 Speech at the 2002 Central Conference on Economic Work,
2003,
55 Comprehensively Understand and Implement the Party's Policies on Religion,
56 A Memorable Five Years,
57 Make a Concerted Effort to Develop Public Transport,
Index,