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Massacre and Miracle

June 4, 2009

Hu Ping

In this probing essay about the relationship between the June Fourth crackdown and China’s economic “miracle,” Hu Ping, editor of the Chinese-language Beijing Spring magazine, argues that because the economic reform initiated by Deng Xiaoping in the late 1970s was in effect a refutation of the legitimacy of the Communist Party, government concession to the demands for political reform in the 1989 protests would have meant the end of Communist rule in China. It was only by suppressing the protests that Deng was able to forestall further challenges to the Party regime. The result was the recipe for China’s economic “miracle”: enforced social stability and an iron grip by the government on the economy, mixed with a spiritual vacuum, individual greed, and an unprecedented emancipation of material desires among the people.

This year is the 20th anniversary
of the June Fourth
massacre. Twenty years ago,
China erupted into a democratic
movement of the greatest scope
in history, which ended when the
Communist Party of China
(CPC) authorities brazenly
deployed tanks and field forces
in an appalling massacre of
unarmed students and citizens.
In China today, the regime that
carried out the massacre is still
in power and continues with its
one-party dictatorship.

At the same time, the economy
has achieved astonishing development,
which many people
refer to as the “Chinese miracle.”
Of course, this kind of development
Has many problems,
including the ingredients of a
bubble economy. Also, there is
the gap between rich and poor,
and the clash between government
officials and regular folks.
Environmental pollution is
destroying the balance of the
ecosystem. Nevertheless, we have to admit that China’s
economic development was rapid. So, how did this so-called
Chinese miracle happen? There are, naturally,
many reasons, but in my opinion, the most important
reason is the June Fourth massacre. Without the massacre,
there would have been no “Chinese miracle.”

The Reform Has Led to the Negation of the CPC Revolution and the Legitimacy of Its Regime

As everyone knows, the Chinese government started a market-oriented and capitalist-oriented economic reform in 1978. The reform had three results.

First, it boosted China’s economic

Second, it led to the self-negation
of the Chinese Communist
Party revolution and the legitimacy
of its regime. The purpose
of the communist revolution
and the regime it created was to
destroy capitalism and establish
socialism. Now that the CPC has
turned around to dismantle
socialism and reintroduce capitalism,
shouldn’t it be admitting
that the revolution was a mistake?
How can it still justify the
so-called dictatorship of the proletariat?
Therefore, this economic
reform has not been the
self-perfection of the revolution
and the one-party dictatorship,
but their self-negation.

The CPC officials who were the
most vigorous advocates of the
economic reform were very
much aware of its character. I’ve
heard the following story. In
1979,Yuan Geng was dispatched
to Shenzhen in Guangdong Province to establish
China’s first special economic zone—the Shekou Industrial
Zone. Yuan Geng was from Shenzhen. Thirty years
earlier, as an artillery regiment commander of the PLA,
he had led troops to Shenzhen to “liberate” the city.
Before he took up his post in Shenzhen in 1979, his son
asked him: “Thirty years ago, you led troops to occupy
Shenzhen and transform private ownership to public
ownership. Now you are going there again to establish a
special economic zone and transform public ownership
back to private ownership. So what is it exactly that you
are doing?”Yuan Geng was dumbfounded for a good
while. Finally, he said: “Well, we can’t let the Chinese be
this poor forever!”1

The third result of the economic reform is corruption.
As the economic reform deepened, especially as it came
to the cities and industries and the dual-price system
was put forward, business wheeling and dealing and
profiteering by state and party officials became widespread,
and corruption thrived.

Without the massacre, there would have been no “Chinese miracle.”

We all know that China used to practice planned economy,
in which prices were controlled by the government.
In the mid 1980s, China started to reform the
price policy. At that time, many economists proposed
opening up prices all at once and allowing the market
to decide them. However, this opinion was strongly
opposed by the conservatives. Some people then proposed
a compromise: some goods would continue to be
sold at the government-set prices; the price of other
goods would be set by the market. The role of the market
would expand over time. This method, known as
the dual-price system, was the one adopted by the

Today, China’s mainstream economists and many western
economists heap praises on the dual-price system.
They think it opened the way for Chinese-style gradual
Reform that avoided the social turmoil caused by shock
therapy in Russia and East Europe. This assessment is
totally wrong. Many people warned when the dual pricing
system was first proposed that it would give
government officials a perfect opportunity to allocate
resources and profit from the price differential, which
would inevitably lead to widespread corruption.
Indeed, China’s first batch of overnight millionaires was
created while the dual-price system was being put into
effect. The widespread corruption, needless to say,
caused intense popular discontent and became one of
the main reasons for the 1989 Democracy Movement.

The 1989 Democracy Movement and the June Fourth Massacre

The 1989 Democracy Movement had two basic slogans. One was “freedom and democracy,” and the other was “no business wheeling and dealing by officials, no corruption.” One can imagine that if the June Fourth massacre never occurred and the democratic movement had succeeded, the path of the so-called gradual economic reform and the dual-pricing system would have been reversed. Then China would have proceeded much like Russia and Eastern Europe.

The 1989 Democracy Movement caused an unprecedented
split within the CPC leadership. The moderate
faction led by Zhao Ziyang opposed resorting to martial
law and suppression. At the time, as far as I know, a
quarter or even a third of the Party and state officials in
Beijing joined the protesters. Most of those who didn’t
were sympathetic to the students. This is how unprecedented
the split within the Party was.

The reason for this split was quite simple. The moderates
did not endorse the use of military force to crack
down. Why? Because they were unable to talk themselves
into suppressing a democratic movement. They
knew that the popular demand for democracy and
opposition to corruption was valid. Moreover, when the
CPC suppressed freedom and democracy in the past, its
magic weapon had been to pin the label “bourgeois liberalization”
or “advocating capitalism” on its opponents.
Now that the CPC itself had turned to capitalism
and become a capitalist, what reason could it find to
suppress the Democracy Movement?

Nevertheless, Deng Xiaoping used the army to cruelly
suppress the Democracy Movement. Why? Was it
because he still believed in socialism? No. Most certainly
not. Deng stopped believing in socialism a long
time ago. As early as the beginning of the 1980s,Deng
advised a visiting African leader not to adopt
socialism.2 Deng suppressed the Democracy Movement
for the sole purpose of maintaining the CPC’s autocratic
power. As the first generation leader of the CPC
who miraculously fell from and rose back to power
three times,3 Deng enjoyed personal authority within
the Party and the army that younger leaders could not
match. This is why he dared order a military crackdown
on the Democracy Movement. It is conceivable that
without Deng Xiaoping at the time of the 1989 Democracy Movement,
the results could have been completely

Why Did China’s Economic Reform Accelerate after June Fourth?

The June Fourth massacre set the reforms in China
down the wrong path. During the first year or two after
the massacre, as it witnessed the dramatic changes in
the Soviet Union and Eastern Europe, the CPC was in
panic. To maintain power, the new generation of CPC
leaders proposed further steps in guarding against
“peaceful evolution.”They were opposed to capitalism
not only politically, but economically as well.4 As a
result, capitalistic economic reforms came to a sudden
halt and were even reversed. But in the spring of 1992,
Deng Xiaoping proposed accelerating economic
reforms without asking whether they were socialist or
capitalist.5 He clearly understood that the socialist economic
system was not working, and that without
reform it had run into a dead end. He knew that, after
the June Fourth Massacre and the changes in the Soviet
Union and Eastern Europe, socialist ideology was
already bankrupt, and the CPC regime had lost its ability
to cheat and had become only a naked, brute force.
If it claimed to be the people’s government after slaughtering
the people in broad daylight, who would believe
it? The only reason people were not rebelling was
because they were not able to. In this situation, it was
impossible, and unnecessary, to maintain a socialist
facade. Violence had its advantages. It required no ideological
pretense and therefore was subject to no ideological
restraint. Earlier economic reformers were
handicapped by the fear of being labeled capitalistic.
Now there was no need for fear, and more capitalist elements
could be introduced without questioning. Consequently,
China’s economic reforms moved faster and
further after 1992.

Why Did the Most Abominable Reform Model Create the Fastest Economic Development?

The biggest irony is that this kind of reform, while
morally the most shameless and abominable, was perhaps
the easiest to carry through successfully in terms
of effectiveness. This is the case because the economic
reform of communist countries basically consists of
turning public ownership to private ownership, of
turning planned economy into market economy. It is a
task much easier said than done. Some people have
pointed out the difficulties in the process at the very
beginning of economic reforms in communist countries,
comparing it to “turning fish soup back into fish.”

Russia and Eastern Europe mainly used the method of
“division”: all assets were converted into stocks, and the
shares awarded equally to everyone. The advantage of
this method is that it is fair and acceptable to all. Since
the assets nominally owned by the people belonged to
everyone, the most rational privatization plan was
indeed to award each individual an equal share. This is
the so-called privatization among the masses.

But this method has one big problem: it creates excessive
fragmentation of the assets. Every individual in the
country has a share, but everyone has only one share.
This is really no different from the original state-owned
companies and collective ownership. Just as before, no
one cares about the company. So, for a period of time,
not only can it not promote economic development, it
will inevitably lead to a drop in operational efficiency.
Only after a period of competition during which will
emerge a certain number of rich individuals who can
consolidate sufficient capital, get control over a greater
concentration of shares, and become capitalists, will
capitalism take off and the economy start developing.

China did not adopt the privatization among the
masses approach. Without democratic participation
and public oversight, the privatization in China has
become the privatization among the powerful. Party
and government officials of all ranks have made public
assets their own. Today’s communist government is
China’s Board of Directors, and the government officials
the CEOs. In this way, China has avoided the economic
downhill slide of Russia and Eastern Europe.
Stimulated by the workings of capitalism, China’s economy
has kept a sustained growth.

Because China remains a one-party dictatorship, the
government can act arbitrarily. It can disregard public
pressure and change whatever it wants in the manner it
pleases. It can raise prices, lay off workers, sell a state-owned
enterprise at whatever price it feels like, or even
give it away to whomever it wants to for free. Because
the society lacks the power to oppose the government
and keep it in check, and because the government has a
formidable suppression power, it has the ability to
implement its own decisions without any difficulties.

Because China remains a one-party dictatorship that
“nips any and all sources of instability in the bud” (for
example, by banning independent workers’ and peasants’
unions), it has achieved a high degree of social stability.
In the absence of any opposition or any prospect
of a change in leadership, the government’s control over
the economy is strong and its behavior highly consistent
and predictable, which makes it all the more easy to
attract massive foreign investment, while also providing
the domestic economy with resilience against international
economic shocks.

Because China remains a one-party dictatorship,
many domains—especially the political domain—have been designated “off limits,” leaving the majority
of people with no choice but to focus on economic
activities. These restrictions, combined with the emergence
of a spiritual vacuum, individual greed, and an
unprecedented emancipation of material desires, have
all added fuel to the fire of economic development.
Meanwhile, those at the bottom of the social ladder
who have suffered at the hands of bigwig officials and
their manipulation of privatization have no outlets to
pursue justice within the present system. Chinese
labor was cheap to begin with, but this manipulation
has made it slave-like and, naturally, even cheaper.
This has given China the greatest advantage in global
economic competition.

As we know, one of the most important strategies the
Chinese government uses in economic development is
export processing. It attracts huge amounts of foreign
capital into China, uses China’s low-cost labor for production,
and then exports the products for sale overseas.
The Chinese government has become very rich
this way, but the purchasing power of the ordinary people
has not increased accordingly.

The Biggest Problem of the Chinese Model Is that It Lacks Legitimacy

China’s model [of economic reform] has a fatal flaw: it
has no legitimacy whatsoever. We know that the CPC
rose to power by toppling landlords and capitalists, but
now it has become the biggest landlord and capitalist
itself. First, in the name of revolution, it turned the private
property of common people into the public property
of the people as a whole. Now, in the name of
reform, it has turned the public property of the people
as a whole into the private property of its own members.
First it plundered in the name of revolution, and
now it has divided the spoils in the name of reform.
These two opposite crimes were both committed by
one and the same party in the space of 50 years. Has
the world ever seen anything more shameless and

Ten or so years ago Dushu (“Reading”) magazine published
a short piece, quoting an old peasant from
Shanxi: “Deng Xiaoping says we should let some people
get rich first. Well, before the liberation in 1949,my village
already had one landlord and two rich peasants—some people already got rich first, you might say. Had
we known how things would turn out, we needn’t have
bothered [to get rid of them] in the first place.”5 Last
year, a worker from Changsha by the name of Chen
Hong, who had just been laid off, wrote on his own
blog: “The planned economy definitely needs reform.
To have reform, a price must be paid. Still, the planned
economy was not an invention of us workers, but of
you, the Communist Party. So why is it that the workers
and not the Communist Party are paying the price?
Why have we been turned into daily laborers without
permanent employment, while you Communist Party
officials have become capitalists?”6

Speaking of the widening gap between the rich and the
poor in China today, I want to emphasize that not only
is this problem most serious in terms of degree, but the
nature of it is particularly abominable. China’s economic
disparity problem was not created by history or
by market forces, but by autocratic rule. In China, the
reason why the poor live in poverty is because the
wealth they create is seized by those in power; the rich
are prosperous because they use their position to plunder
the wealth created by others. In China today, 0.4
percent of the people own 70 percent of the country’s
wealth.7 Ninety-one percent of those whose personal
wealth surpasses 100,000,000 yuan [US$14,656,223]
are the sons and daughters of high Communist Party

Today’s communist government is China’s Board of Directors, and the government officials the CEOs.

Speaking about corruption among government officials,
there is a popular saying: “Executing all of them
would possibly result in injustice, but executing only
half would certainly let some off.”CPC leaders say they
want to combat corruption, but in fact they tolerate it
because they need it. Deputy Secretary of China’s Economic
Restructuring Research Committee, Wen Tiejun,
is frank in his assessment that today’s China cannot
adopt American-style democratic reform: “For one, I’m
afraid that over 90 percent of our officials spend more
than they officially earn; the more powerful their
department, the bigger this problem is. Can we ferret
them all out? We can’t. Can we hope that these problematic
officials will play fair in implementing our policies?
We can’t. Second, the great majority of our
intellectuals have untaxed income . . . . Third, many of
our entrepreneurs engage in illegal management practices.”9 They all know that if China were to become a
free and democratic country, they would most likely
end up on trial for economic crimes. This is why they
are even more hostile and fearful of freedom and
democracy than they were in the past.

The Chinese Model Is an Enormous Threat to the Freedom and Peace of All Humanity

China’s communist leaders know very well that the so-called
“Chinese miracle” is built upon the foundation of
the June Fourth Massacre, an unfair and unprincipled
foundation that goes against reason and humanity. On
one hand, they use China’s economic development to
justify the June Fourth Massacre; on the other, they
stubbornly persist in maintaining the one-party dictatorship
and oppression. They worry that if they relax
their stranglehold for even a moment, the tide of popular
demand for the settling of economic accounts will
become unstoppable. China’s communist leaders say
that they hope for an additional 20 to 50 years of stability
to do an even better job of strengthening China.
They are simply hoping to continue with the reforms
and development under their dictatorial power, buying
time to launder their ill-gotten gains and ease the gap
between the rich and the poor. In the end, “China will
definitely develop into an even greater power.”10 But
what we can be certain of is this: a powerful nation built
by such reprehensible means will only become an even
more self-confident, overbearing, and powerful autocratic
regime. Such a regime will be increasingly contemptuous
of and hostile to the values of democracy
and justice, and pose an ever greater threat to the freedom
and peace of all humankind.


1. Author’s conversation with Yuan Geng’s son, Yuan Zhongyin, mid-1980s. ^

2. Du Daozheng, “Xin minzhuzhuyi de huigui yu fazhan” [新民主主义的回归与发展], Yanhuang Chunqiu [炎黄春秋], 4 (2008).          ^

3. The three rises and three falls of Deng Xiaoping were: In February 1933, “left-leaning” leaders within the Communist Party of China (CPC) dismissed Deng for supporting Mao Zedong. This was his “first fall.” In June of the same year, the CPC Central Committee transferred him to the Central Military Commission to assume the post of Secretary General. This was his “first rise.” In 1966, after the start of the Cultural Revolution, he was stripped of all his duties. This was the “second fall.” In 1973 he was returned to the post of vice-premier. This was his “second rise.” In 1976, in accordance with Mao Zedong’s proposal, the Politburo of the CPC Central Committee unanimously agreed to revoke Deng Xiaoping’s post, leaving him with only his Party membership. This was the “third fall.” In 1977, the Third Plenary Session of the Tenth Central Committee restored Deng Xiaoping’s duties as the head of the Central Military Commission. This was his “third rise.” See “Deng Xiaoping de san qi san luo” [邓小平的三起三落”], Baidu Zhidao [百度知道], ^

4. Jiang Zemin [江泽民], “Zhongyang zhengzhiju changwei kuoda huiyi jianghua” [中央政治局常委扩大会议讲话], July 31, 1991, 360Doc,; Han Xiaojun [韩晓军], “17 nian qian ‘Huang Fuping’ canyu ‘xingzixingshe’ de na chang zhenglun” [17年前“皇甫平” 参与“姓资姓社”的那场争论], Zhejiang zaixian—Qianjiang Wanbao [浙江在线—钱江晚报], December 9, 2008, ^

5. “Xiaoping jiekai xing ‘Zi’ xing ‘she’ sikou” [小平解开姓“资”姓“社”死扣], The Beijing News [新京报],August 20, 2004, In 1992, during a talk on his southern tour, Deng Xiaoping said, “Is the issue of Mr. Capital orMr. Society the crucial point?” He also said, “[We] won’t dispute, [we will] courageously experi ment,” and “As soon as there is dispute, things become complicated.We will argue our time away and accomplish nothing.” ^

6. Chen Hong [陈洪], “Xiagang gongren tan gaige” [下岗工人谈改革], Changsha Diaomin Chen Hong de Boke [长沙刁民陈洪的博客], posted July 27, 2006,; Chen Hong, “Shaoshu ren shi ruhe bianfu de?” [少数人是如何变富的?], Changsha Diaomin Chen Hong de Boke [长沙刁民陈洪的博客], posted July 27, 2006, ^

7. He Qinglian [何清涟], “Zhongguo zhengfu tuibian cheng zili xing zhengzhi jituan” [中国政府蜕变成自利型政治集团], British Broadcasting Corporation [英国广播公司], January 18, 2009, ^

8. Ibid. ^

9. Wen Tiejun [温铁军], “Tan guonei sixiang qingkuang” [谈国内思想情况] (lecture, Ningde, Fujian,August 13, 2007), ^

10. Premier Wen Jiabao’s press conference with Chinese and foreign reporters, March 14, 2004. ^