Exclusive | ‘Reform and opening up are not dead’, but today’s China ‘looks risky’: veteran observer David Lampton

Deng Xiaoping reflected his personal experience in the Cultural Revolution and earlier experience in Europe, and all this was reflected in the manner in which he promoted his policies. Then, president Jiang Zemin came along and not only reflected his experience in the Soviet Union but also his exposure to Western-style thinking in his youth when he grew up in China’s southeastern city of Yangzhou, one of the most open and economically advanced cities of his era.

President Xi Jinping had his own experience in the Cultural Revolution and that has shaped domestic policy and the current era. Each of those eras has reflected the experience of the top leader and certainly those around him.

Though I never personally met Deng, I had a feel for him conveyed to me by his family members whom I did know. He brought his experiences in the West as a young man to the needs of China in his time. I think his thinking is very relevant to today.

Then is China a peaking power as some say?

To talk about peaking power means China has reached the top of its power curve and now it’s plateauing or heading downhill, the implication being that the US and like-minded countries and societies will gain in power, relatively. I think that’s a precarious idea. I’m pretty sure it’s not even true, but it certainly is a dangerous assumption if it leads to incautious behaviour by either side.

If you were an ambitious business executive, would there be a difference between thinking about investing in China during the Deng-era reforms and now?

Well, to put it simply, businessmen are now risk-averse and China looks risky to them, and this is true to some extent of Chinese businesspeople as well.

This is partly because their investments need to be bigger now than before and therefore they are more cautious. But, businesspeople also feel less certain about China’s political direction and the health of its foreign relations.

Also, countries around China have improved their societies and economies, like Vietnam, India and Malaysia. Some of them have lower labour costs and look more stable, presenting more attractive investment options for new, marginal investment.

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What role does China’s economic growth play in justifying the legitimacy of the ruling Communist Party? Some argue that the current shape of the Chinese economy is a result of the party’s lack of capacity and some say it is a lack of willingness to prioritise the economy. Will this undermine the party’s power?

Economic performance affects the legitimacy of all governments, not just the Chinese Communist Party.

When a US administration has poor economic performance, people begin to lose confidence in that administration. In that sense, China’s Communist Party, as the ruling party, will see its popularity and sense of legitimacy necessarily affected by poor economic performance.

There was a period under presidents Jiang Zemin and then Hu Jintao where the party was not very intrusive with respect to foreign business. But now, the party exerts more control and is more present in foreign enterprises. So what is seen by foreigners is the increasing presence and interference of the party in economic decision-making.

Many in the party are not businesspeople. They are concerned about other things like political stability and foreign subversion, while foreign businesses worry about the party just getting too involved in business decisions. Some business executives feel personal insecurity in contemplating travel to China.

President Xi began an unprecedented third term last year. Consequently, an unavoidable question is what is Beijing’s succession plan, if any. What kind of signals should we watch for in order to understand whether Beijing is preparing the way for the next No 1? And what risks might arise if the rules around succession continue to be kept under wraps?

Any individual political leader, like Xi Jinping, may or may not have a succession plan in their own mind – I don’t know what he and those surrounding him may have in mind.

But, for a system to be stable, the population and the broader elite need to know and buy into the succession procedure, and different political groups need to know what the process for succession is. If it isn’t a plan based in a law and in the constitution, when the great leader leaves, the default process is political struggle.

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Chinese President Xi Jinping secures unprecedented third term by unanimous vote

Chinese President Xi Jinping secures unprecedented third term by unanimous vote

People, abroad or at home, cannot have confidence in the outcome of a power struggle. You may just look at China’s history and look at the Great Leap Forward and the Cultural Revolution, and it seems to me that you either have law and constitutionalism and transparent mechanisms or you have power struggle.

So if you have to ask whether there is a succession plan, there is no succession plan.

Just saying the Politburo Standing Committee will decide, is not really a succession plan. And the third plenum has not happened yet. Where did the third plenum go? If you don’t know where the third plenum went, you surely don’t know how things are operating.

The world pays attention to the internal stability and predictability of major powers. So as China becomes more important to the world, the world cares more about what happens in the PRC. Big powers have a special obligation to manage their politics in ways the rest of the world finds stabilising and to guarantee orderly succession.

Ironically, the United States now presents its own challenges in this respect, for the first time in more than 160 years.

In the past 10 years, China is considered to have become tougher towards the US-led West and tougher on national security and economic self-reliance. Would you say the trend represents the will of the entire party elite or is dictated by a small circle of the top leadership? Is there still an influential reformist camp within the Communist Party as some say?

Addressing this question is necessarily speculative. I’ve had some Chinese tell me that China’s leaders are divided into two blocks – two irreconcilable blocks.

One set of opinions tends to want China to boldly move forward in reform – and not just reform of economics, but also to loosen party control and improve relations along China’s periphery and with the West more broadly. Another big group says that given the hostility of the US, instability in the world, and the economic problems facing China, control needs to be enhanced and national security needs to be the overriding priority. There’s the basic question in Chinese politics: which set of policies promotes stability? I think there’s a division.

Some people think more reform will enhance security. Others think more reform and loosening increases dangers and instability. I think that’s the fundamental question the system is debating.

It appears that the group around Xi Jinping is quite solid in supporting the current policy. However, we know that in recent major international meetings Premier Li Qiang doesn’t seem to be so visible to outsiders.

We observe elite appearances because there’s so little transparency; we pay great attention to who we see, how often we see them, and what they say. We also pay attention when ministers of defence or ministers of foreign affairs just vanish with no explanation. We ask, “Why is that?”

On US-China ties, many say relations have sunk to the lowest point in recent years and you have labelled the current era as the “second Cold War”. In your view, what structural conflicts between the two systems account for this cold war and make it seem inevitable?

I do not use the word “inevitable”, because I believe in human agency as it relates to policy and politics. But I do believe that the US and China, and their allies and partners, have entered a period reasonably characterised as a cold war – that is not to say [I can forecast] how “cold” it becomes, how long it will last, or what its outcomes may be. There is lots of uncertainty.

In the first Cold War, we had no trade, no students going back and forth, and no tourists, among many other things. So there currently is much more connection in this cold war. But that is misleading if that is all you look at.

The current period is like the first Cold War in several important respects: ideology is becoming important again; the US talks about the struggle between autocracy and democracy as we used to during the first Cold War.

Once you use an ideological vocabulary, you are then in effect saying that you want China to change its system. Well, no country will change its system because somebody else wants them to. The dichotomy between autocracy and democracy is not a good basis for productive US-China relations.

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Once again, alliance behaviours have become important. Washington is building new partnership organisations and China is doing this with the Shanghai Cooperation Organisation, Brics, and the “no limits” partnership with Russia. And most obvious of all are the rapidly growing military spending and arms, cyber, and space races.

So what would be the possible scenarios, or what would a victory look like for the US side? Would the US aim for a Soviet-style collapse of China? What would a victory look like from the Chinese perspective?

I think no government in its right mind would hope for China’s collapse, because that would be a tragedy for the Chinese people and a tragedy for Asia and the whole world. China is a major engine of the global economy and a major determinant of the globe’s ecological future. Just look at the last pandemic, the Covid-19 pandemic. China produced medical devices that the rest of the world couldn’t produce enough of. If China were to collapse, where would all the refugees go?

To predict or seek “collapse” in either of our societies is to contemplate unimaginable costs for ourselves and the world beyond. In this sense “victory” is an illusion.

I think for most people, they would like to see China evolve in a more reform-oriented way and at a faster pace, and also with less closeness to Russia when Moscow is invading its neighbours.

Further, I think China’s neighbours wish for it to become more respectful of their maritime and other boundaries, or at least shelve disputes and curtail claim advancement. I think China wants Washington to act in conformity with its long-standing one-China policy, not drift towards a “one China, one Taiwan” policy. That’s probably the single most important thing. China also would like to see the US and countries along China’s periphery not so closely cooperating militarily.

But the point is, all of these things don’t look very likely to happen any time soon. Xi has seen Putin more than any other major power leader, and the leaders of Japan, Philippines, and the United States just convened in Washington.

Could you share with us the state of China studies in the US now, and how the field has changed in the past few years? You have mentioned before that younger China watchers are being driven to employ different methodologies to understand the country. Are they relying less on first-hand interviews and field research now? I also learned from a previous interview of yours that you love to study China from the “inside out” – by talking to ordinary people, as well as leaders at various levels. Is that the case for the younger generation of China watchers as well?

I think many of today’s younger China scholars would like to study China more from the inside out, but, frankly, that is becoming less possible. Consequently, China scholars must diversify their methods. Beginning in the late 1970s and the early 80s, China became increasingly open to foreign scholars coming and studying, not only in libraries, but also getting out in the field and talking to people that are not all central government people.

I think we learned a lot and this openness gave China more influence and made people more empathetic to China. We could understand some of the problems China had, and still has.

With the decline of strategic trust and all the talk about spies in both of our countries, it’s become more difficult for foreign scholars, particularly Americans, to do field research in China. Archives like the foreign ministry archive are now not open to foreign scholars, but used to be.

When I was younger, I met most of China’s presidents, chairmen, general secretaries, and premiers. Basically, we had great access. Now, young China scholars want to have that degree of access but they don’t have it. And, I should also say, the US government is similarly restricting Chinese access to our officials for Chinese researchers. So, younger American scholars are relying more on documents, data sets, cyber and remote sensing tools, interviews in third locations, and they increasingly go to Taiwan for language study and research.

The more people experience China from the inside, the better our understanding will be. In the 1950s through the 60s and into the early 70s, most China scholars had to go to Taiwan or Hong Kong because those were the only places where they could even talk to Chinese refugees.

Well, you don’t get a very good picture of a country by talking only to people who left; you also want to talk to people who stayed in [mainland] China. So, China’s current policy is making it harder for outsiders to have an objective view of China.

China has been rivalling the US on different fronts, like tech, science, trade and arms development. How would you assess China’s influence in terms of its hard power and soft power? What are its main strengths and weaknesses?

A country’s hard power is very difficult to judge. Is it measured by how many nuclear bombs it possesses? If we have 1,400 nuclear warheads and China has 500, are we more than twice as powerful as China? If China has more troops than the US, is China more powerful than America?

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Why is the Philippines aligning itself with the US after years of close China ties under Duterte

Why is the Philippines aligning itself with the US after years of close China ties under Duterte

On soft power – both sides are reducing direct access to each other’s scholars – and media – as mentioned above, with the curtailment being much more severe on the Chinese side than with respect to efforts by Washington.

There still are around 300,000 Chinese students and scholars in the US while there are about 400 Americans studying and researching in China. Chinese language training is, to some extent, moving to Taiwan, though there still are important joint Sino-American programmes and institutions operating in China.

The US media doesn’t have many people in China any more. Some are now reporting on [mainland] China from Taiwan.

I have always felt that a China that opens itself gains in power and influence. I hope both our countries will renew the science and technology umbrella agreement that Deng Xiaoping and president Jimmy Carter signed in 1979.

The US is in its election year, with some anticipating a Trump return. If Donald Trump actually makes it back to the White House, what impact do you think that will have on US-China relations, and what changes would he bring to Washington’s China policy?

I believe that it is not possible to, at this moment, predict the outcome of the US general election in November 2024. I do believe that each side in the American contest for the presidency will react and speak with less moderation this year than in non-election years. It, therefore, is important that each side be especially watchful and prudent.

And then there is the fact that Trump, as a personality, brings a degree of unpredictability to decisions unseen in our history. Anybody who hopes for a Trump return must be ready to contemplate very dangerous instability in bilateral relations, not to mention broader American foreign policy.

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There’s a think tank in Washington called the Heritage Foundation that appears to be empowered by Trump to develop policies for the new administration if he wins. The Foundation has put out a long study (set of recommendations) for Trump to implement in a hypothetical Trump administration.

You don’t need to speculate if he is planning to escalate the trade war with China – he’s talked about raising tariffs across the board by a very high percentage if he is elected.

Also, I think trade conflict and less free trade will happen regardless of who gets elected here – the US is spending tens of billions of dollars to rapidly expand the capability of our silicon ship production to compete with China and its industrial policy subsidies. Likewise, China is deepening its industrial policy and the US is greatly accelerating its own industrial policies. This will continue whether you have Trump or [Joe] Biden.

Having said all this, to those who value a more pacific and constructive future, there are no certainties, but the prospects for improvement would be far greater under a second Biden administration. But, even that road will be bumpy, requiring the wisest and most diligent efforts of both nations.

Some US-China trade and military talks have been revived. Xi and Biden spoke on the phone earlier this month. To what extent do you think this can help to diminish the distrust between the two countries? What are their limitations? What could China and the US do to reduce distrust and, realistically speaking, which would be the easiest step to begin with?

I think it’s almost always better to talk than not to talk, so I applaud our two presidents speaking to each other. While talk is good, it also is essential to address the sources of distrust. Enhancing confidence also requires concrete and constructive actions by both sides in important areas.

It’s my sense that neither side is willing to address the most important concerns of the other. For instance, will the US be restrained in weapons transfers and foreign military sales and financing to Taipei? Will Washington suddenly start sending high-capacity chips to China? Is Beijing likely to say bye-bye to the “no limits” partnership with Russia, putting military pressure on Taiwan, and purchasing Iranian oil? I don’t think so.

Operative guidance for the relationship for the next year should above all be the doctor’s code – “First, do no harm”.