tortuous path of the internal reform movement within China itself.
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little to transform an economy without a parallel shift in class
relations, private property, and all the other institutional arrange-
ments that typically ground a thriving capitalist economy. The
evolution along this path was both
fitful and frequently marked by
tensions and crises, in which impulses and even threats from out-
side certainly played their part. Whether it was all a matter of
conscious though adaptive planning (‘groping the stones while
crossing the river’ as Deng called it) or the working out, behind the
backs of the party politicians, of an inexorable logic deriving from
the initial premises of Deng’s market reforms, will doubtless long
be debated.
2
What can be said with precision, is that China, by not taking the
‘shock therapy’ path of instant privatization later foisted on Russia
and central Europe by the IMF, the World Bank, and the ‘Wash-
ington Consensus’ in the 1990s, managed to avert the economic
disasters that beset those countries. By taking its own peculiar path
towards ‘socialism with Chinese characteristics’ or, as some now
prefer to call it, ‘privatization with Chinese characteristics’, it
managed to construct a form of state-manipulated market econ-
omy that delivered spectacular economic growth (averaging close
to 10 per cent a year) and rising standards of living for a signi
ficant
proportion of the population for more than twenty years.
3
But the
reforms also led to environmental degradation, social inequality,
and eventually something that looks uncomfortably like the
reconstitution of capitalist class power.
It is hard to make sense of the details of this transformation
without a rough map of its general path. The politics are di
fficult
to fathom, masked as they are by the mysteries of power struggles
within a Communist Party determined to maintain its singular and
unique hold on power. Key decisions rati
fied at party congresses
set the stage for each step on the reform trail. It is unlikely, how-
ever, that the party would have easily countenanced the active
reconstitution of capitalist class power in its midst. It almost cer-
tainly embraced economic reforms in order to amass wealth and
upgrade its technological capacities so as to be better able to
manage internal dissent, to better defend itself against external
aggression, and to project its power outwards onto its immediate
geopolitical sphere of interest in a rapidly developing East and
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