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THE INSTITUTION OF DEMOCRATIC REFORMS IN THE CHINESE ENTERPRISE SINCE 1978

Jeanne L. Wilson

The People’s Republic of China has undergone dramatic changes since the death of Mao Zedong and the convocation of the landmark Third Party Plenum of the Eleventh Party Congress in November 1978. Although not unchallenged, Deng Xiaoping’s consolidation of political power in late 1978 has enabled him to launch a series of reforms that seek to enact far-reaching modifications in the social, political, and economic structure of Chinese society. Instituted in many instances as an explicit rejection of policies pursued during the Maoist era, the post-1978 reforms have given a high priority to goals of political institutionalization and economic modernization. Under Deng Xiaoping’s guiding influence, the Chinese Communist Party has embarked on a course of internal self-criticism and rectification designed to purge the Party of Maoist sympathizers, dislodge the geriatric old guard, and elevate a younger, better educated generation of cadres to political leadership. Changes instituted in the economic organization of Chinese society have been extensive. The institution of the agricultural responsibility system in the Chinese countryside has been accompanied by the dismantling of collective production at the level of the production team in favor of a system of household contracting of production. Chinese experimentation with industrial reform, characterized by a decentralization of decision making and increased reliance on the market mechanism, received a go-ahead for nation-wide implementation at the Third Plenum of the Twelfth Party Congress in October 1984.

The efforts of the Chinese leadership to set China upon a new course have been accompanied by an increased interest in the concept of societal democratization. “Without democracy,” according to Deng Xiaoping, “there can be no socialism.”¹ Here too a series of reforms have been enacted, designed to set limits on the capricious display of political power and encourage a more pluralist expression of interests in Chinese society. Among the measures taken to strengthen Chinese democracy, the institution of forms of democracy within the workplace has figured prominently. The subject of this chapter is the Chinese experience with democratic management and the implementation of worker participation in the post-1978 period. The first section of the chapter deals with the theoretical rationale employed for instituting democratic management in the enterprise. The second section then turns to the application of forms of democratic management in practice. The third section examines noninstitutional forms of worker participation. The chapter concludes with a discussion of the Chinese experience with democratic management since 1978 in a historical and comparative context.

The post-1978 process of democratic reform in the enterprise is still in an incipient stage of development that has been marked by considerable fluctuation in policy initiatives and a certain inconsistency in application. Like the broader reform movement of which it forms a component, the attempt to institute forms of democratic management seems to have been guided less by the presence of a master plan than by a commitment to working out generalized goals through experimentation and practice. Nonetheless, an underlying aim of the Chinese leadership in enterprise democratization has been to redress a perceived imbalance between the democratic and the centralist aspects of democratic centralism by directing a greater emphasis to the democratic side of the equation. Current Chinese policy in no way evinces a loss of faith in democratic centralism as an organizational precept nor in the leadership role of the Chinese Communist Party (CCP) as the final arbiter of decisions. The Chinese leadership adheres to standard Marxist-Leninist doctrine in viewing the relationship between the CCP and the Chinese people as governed by a mutual correspondence of interest, at least in the long run. It is argued in this chapter, however, that the expression of interests and demands sanctioned and even encouraged by current policy is limited by the prevailing realities of political control. Short of a restructuring of the means by which power is distributed in Chinese society, the concentration of power in the hands of the enterprise Party committee imposes fundamental constraints on efforts to democratize the workplace.

Democratic Management within the Enterprise: The Rationale

Since 1978 the Chinese leadership has instituted a series of measures designed to enhance the operation of democracy in Chinese society. Attempts have been made to strengthen the socialist legal system, develop electoral forms of representation, institute forms of democratic management and “self-management” at the grassroots level, promote “inner-Party” democracy, and expand spheres of autonomy within Chinese society.² Seen in this light, the movement toward enterprise democracy constitutes one facet of a series of interrelated reforms. Nor is it possible to disassociate the Chinese leadership’s reasons for pursuing democratic management from its broader goals for societal democratization. As with other policies of the current regime, the Chinese leadership’s motivation for democratization has an explicit historical referent. Perhaps the most pervasive justification for the democratic reform movement is to establish political stability and prevent the reoccurrence of the political chaos of the Cultural Revolution. For Deng Xiaoping and his supporters, virtually all of whom were victims of political persecution during the Cultural Revolution decade, the attempt to ensure political stability is a paramount political concern. Democracy is seen as a means of preventing the overconcentration of power, cult of personality, arbitrary personal dictatorship, privilege, and corruption exhibited during the Cultural Revolution by placing limits on the uses of political authority. A second objective of democratization, with particular implications for the Chinese enterprise, has been to enhance Chinese modernization efforts. The present Chinese leadership appears to have accepted the assumption, commonly held in the West and in parts of East Europe, of a causative link between modernization and the expression of societal interests.³ In this view, which may be seen as a variant of pluralism, the process of modernization necessitates an increasing specialization in the division of labor, which gives rise to and demands input from different societal interests and demands.⁴

The application of the Chinese leadership’s goals for democratization to the enterprise reflects an accommodation to concrete circumstances of the enterprise environment. The Chinese leadership’s concern to place limits on the authority exercised by the Party is expressed as an attempt to depoliticize the enterprise and to develop spheres of autonomy in enterprise operations. The objective of stimulating the expression of societal interests is tied directly to the aim of increasing productive output. The largely proletarian composition of the enterprise labor force, moreover, entails a special consideration of the relationship between the proletariat and its vanguard in socialist society. Specifically, three rationales for democratization within the enterprise can be distinguished as instrumental to the current leadership’s goals: (1) the promotion of enterprise democracy as a means of underpinning regime legitimacy; (2) the promotion of enterprise democracy as a factor of productive efficiency; and (3) the promotion of forms of worker participation as a means of restructuring enterprise authority relations.

Enterprise Democracy and Regime Legitimacy

To the Chinese leadership, one rationale for the institution of workplace democracy is its functions in underpinning the legitimacy of the regime. The connections between regime legitimacy and enterprise democracy are both ideological and pragmatic, resting on a series of assumptions, some of which remain implicit, about the nature of the relationship between the workers and the state. In the ideological realm the CCP, as do all Communist parties, derives its legitimacy from its claim to act as the vanguard of the proletariat. The reconciliation of Marxist theory with Chinese reality has always been an awkward question in the People’s Republic of China, given the peasant origins of the Chinese revolution and the still predominantly peasant composition of Chinese society and the CCP. Nonetheless, for all his glorification of the peasantry, not even Mao Zedong ever sought to sever the Party’s theoretical links to the proletariat as the leading class of the revolution. The 1982 constitution designates the People’s Republic of China as a “socialist state under the people’s democratic dictatorship led by the working class and based on the alliance of workers and peasants.”⁵ The institution of democratic management serves to augment the Party’s claim that the proletariat, in the final analysis, exercises a contributory role in formulating the affairs of state. Worker participation in the enterprise provides a necessary symbolic evidence of the status of the working class as the masters (zhurenweng) of Chinese society.⁶

Besides serving as a means of ideological justification, democratic management is also perceived by China’s leaders to serve a legitimating function through increasing workers’ support for the system. The current leadership has been candid in expressing its concern about the evidence of slackening political commitments among Chinese workers, especially young workers under the age of thirty-five who are estimated to make up 60 percent of the workforce. Among the many detrimental repercussions of the Cultural Revolution has been a decline in Party prestige, manifest in the workplace by an acknowledged difficulty in recruiting young workers into the Party.⁷ In this context, democratic management is one of several strategies—the intensification of ideological education, and Party rectification being others—advanced to counter worker alienation.⁸ It is hoped that the incorporation of workers into participatory roles will enhance workers’ feelings of efficacy and strengthen their sense of identification with the system. Worker participation is seen to fulfill an integrative function in intensifying workers’ loyalties to the state, thus serving to shore up regime legitimacy.

Enterprise Democracy as a Factor of Productive Efficiency

A second rationale for enterprise democracy, closely related to the perception of socialist democracy as a response to the needs of modernization, is the advocacy of enterprise democracy as a factor of productive efficiency. In this view the institution of forms of worker participation is presented as an objective demand of modernization. The development of the productive forces, which gives rise to increased specialization in the division of labor and complexity in the productive process, is seen as necessitating the implementation of worker participation in management. Enterprise democracy is perceived as an organizational requisite of the modern enterprise, which, despite token efforts taken toward its initiation in the capitalist world, is capable of being realized only under the nonexploitative conditions of socialism.⁹ From the Chinese perspective, moreover, enterprise democracy is directly linked to productive efficiency. The institution of worker participation in management is seen as a means of harnessing workers’ energies to the task of production. As noted by Su Shaozhi: “The important factor of raising labor productivity and developing productive forces lies in the initiative and creativity of the working people. Only with the realization of democratization, thus enabling the working people to become real masters in enterprises, society and state, can the initiative and creativity of the working people be brought into full play.”¹⁰ This perspective is reiterated in the 1984 Reform Decision:

The well-spring of vitality of the enterprise lies in the initiative, wisdom, and creativeness of its workers by hand and brain. . . . In restructuring the urban economy, it is imperative to handle correctly the relationship of the workers and staff to their enterprises so that they are its real masters and can work as such at their jobs . . . . Under socialism there is unity between the authority of the enterprise’s leadership and the status of the working people as masters of the enterprise and their initiative and creativity. This unity is a prerequisite for the proper effective exercise of their initiative.¹¹

The Chinese analysis of enterprise democracy as a factor of productive efficiency is an amalgam that reflects the influence of several contributory sources. The current leadership’s emphasis on worker initiative as a factor of productive efficiency represents a point of continuity between the Maoist and the present era in shared voluntarist assumptions about the innate creativity of the working masses. The Chinese conception of enterprise democracy as an integral component of socialist managerial practice, however, traces its ideological origins to Soviet-derived principles of scientific management. Despite criticisms made by Western observers of Taylorism as outmoded, Taylorism is defended in the People’s Republic of China as a reputable managerial system that ensures “the best utilization of the workers’ physical capabilities.”¹² To the Chinese, as dedicated adherents to the practice of democratic centralism, there is no irreconcilable conflict between the emphasis on the role of the human factor and centralized leadership and strict labor discipline.

The Chinese analysis of democratization as a factor of economic efficiency, however, moves beyond the parameters of Soviet discourse—although the differences may be mostly a matter of degree—into the East European camp, including its émigré wing. Since Deng Xiaoping’s consolidation of political power, major East European reform documents have been translated into Chinese and studied by Chinese reformers.¹³ Reportedly, several East European émigré economists now living in the West—i.e., Ota Sik, Włodzimierz Brus—who had been influential proponents of democratic reforms in their own countries have been consulted by the Chinese for advice in instituting reform measures.¹⁴ The influence of Brus is clearly evident, for example, in the writing of Su Shaozhi, director of the Institute of Marxism-Leninism and Mao Zedong Thought of the Chinese Academy of Social Sciences. In discussing the argument between Brus and Stanislaw Gomulka over the application of democracy within socialism, Su comes down squarely in favor of Brus’s analysis of democratization as a factor of economic development. Although Su does not make use of the same vocabulary, his analysis follows Brus’s acceptance of Harvey Libenstein’s notion of “x-efficiency” as a factor of economic development. For Su, as for Brus, democratization of the enterprise is seen as a means of motivating employees in production.¹⁵

Although undoubtedly written with an awareness of their existence, Chinese writings are notably devoid of references to East European experiences with democratic management that have transgressed the boundaries acceptable to the Communist Party. Contemporary Hungarian practice in democratic management, for example, is presented as a successful example of workplace democracy; the establishment of Hungarian workers’ councils in 1956 does not appear as an item for discussion on the Chinese reform agenda.¹⁶ The Chinese evaluation of democratic management in any given European state is generally more closely tied to the state’s foreign policy relationship with the People’s Republic of China than to a measured assessment of objective factors of democratic management.¹⁷ Nor do Chinese democratic reform discussions touch on theoretical questions of Marxist theory, which are of interest in certain East European circles. The Chinese debate about the possibility of the existence of alienation in a socialist society that developed after 1979, whatever its pragmatic utility in providing a justification for Deng Xiaoping’s reform efforts, lacked a Marxist theoretical analysis linking alienation to relations of production within the workplace.¹⁸ Rather, Chinese attention to East European theorizing about democratic management is mainly propelled by a pragmatic interest in its application as a factor of economic efficiency. East European ruling elites themselves may have no less utilitarian motives in advancing an expansion of forms of worker participation.¹⁹ However, East European efforts to establish democratic management originated in the 1970s, partly out of a concern to identify the social prerequisites of conditions of “developed socialist society.”²⁰ Chinese reformers have not hesitated to borrow from East European models, despite the obvious differences in levels of socioeconomic development. But in the Chinese interpretation, democratization is advanced not as a method for coping with the complexities of industrialized society but as a means of socialist construction.

Worker Participation and Reforming the Enterprise Leadership System

The institution of democratic reforms within the enterprise since 1978 has been integrally connected to attempts to restructure the enterprise leadership system. The key issue is the role of the Party in the enterprise. China’s short-lived experiment with the Soviet-style system of managerial responsibility for enterprise operations was discarded in 1956 in favor of the Maoist-approved system, which allocated an operational control over the enterprise to the enterprise Party committee. The Third Party Plenum of the Eleventh Party Congress, in developing a critique of the abuses of political power in the People’s Republic of China, singled out the operation of the Party within the enterprise as a target of special attack, noting the overconcentration of enterprise authority and the tendency of the Party committee to substitute for the enterprise management. What was a virtue in the Maoist era was now seen as a distinct liability. In contrast to the “politics in command” ethos of Maoism, the current leadership has stressed the desirability of professional management, technical expertise, specialization in the division of labor, and the development of spheres of autonomy in enterprise operations. The central theme in the ongoing debate over the reform of the enterprise leadership system has been the issue of managerial versus political authority in the enterprise distribution of power. Nonetheless, a consistent subtheme of discussion has argued the need to reform enterprise structures so as to provide institutional opportunities for workers to participate in the enterprise decision-making process.

By late 1978 the CCP leadership had announced its intention of restructuring enterprise authority relations, laying out some guidelines for the direction of future change. Criticisms of the Party’s monopoly of power within the enterprise were combined with calls for the establishment of a system of managerial responsibility and increased attention to mechanisms of worker participation. Speaking to the newly resurrected Ninth National Congress of the All-China Federation of Trade Unions (ACFTU) in September 1978, Deng Xiaoping called for the institution of enterprise elections, in which workers would elect their managers, and for the establishment of workers’ congresses, representative meetings of enterprise staff and workers, as structures of worker participation.²¹ By mid-1980, Chinese proposals to reform the enterprise leadership system had advanced to a format that envisioned a tripartite sectioning of authority between the workers’ congresses, the management, and the Party. According to this scheme the workers’ congresses would assume a policy authority to make decisions on enterprise policy, the management would exercise a command authority entrusted with the responsibility for overseeing the day-to-day details of enterprise operations, and the Party would take on a supervisory authority, retiring to the second line of enterprise operations and concentrating on political and ideological work within the enterprise. Each actor was portrayed as playing a functionally separate role, enjoying operational autonomy and a more or less equal status in enterprise operations. In its most liberal format, reform advocates went so far as to advocate the replacement of the “factory manager responsibility system under the leadership of the Party committee” with the “factory manager responsibility system under the leadership of the workers’ congress.”²² Nor did the reform proposals remain a matter of rhetoric alone, as the “factory manager responsibility system under the leadership of the workers’ congresses” was adopted at selected keypoint enterprises on an experimental basis during 1980.²³

The suggestion that the workers’ congresses replace the enterprise Party committee as the “highest structure of authority” in the enterprise represented, at least on paper, an attempt to effect a startling shift in the distribution of power in the enterprise. Although the all-important details of implementation were not worked out, Chinese reform proposals explicitly called for democratization of the enterprise by granting increased authority to the workers’ congresses. Inspiration for the reform proposals was perhaps derived from Chinese interest in the Yugoslav model of self-management. The tripartite division of authority envisioned in the Chinese reforms bore a certain resemblance to the Yugoslav method of work organization, and Chinese suggestions for democratic reform coincided with a nation-wide movement to grant increased self-management powers to the enterprise.²⁴

The year 1980, however, constituted a high-water mark for liberal advocates of reform in the People’s Republic of China. The reform movement suffered a severe setback at a Party Work Conference in December 1980 when antireform forces in the Party, by now a broad coalition who ran the gamut with respect to political beliefs but shared a common discontent over the direction in which the reformers were heading, managed to halt the momentum of the reform movement.²⁵ Reform was not swept off the agenda altogether, but a period of economic “readjustment” was ordered, which placed a moratorium on reform efforts. In the aftermath of the conference the notion that the workers’ congresses serve as the repository of policy authority in the enterprise was shelved. Issued in June 1981, the “Provisional Regulations Concerning Congresses of Workers and Staff Members in State-Owned Industrial Enterprises” by and large provided for the reconstitution of the workers’ congresses in their pre-Cultural Revolution format, definitively subject to the authority of the enterprise Party committee.²⁶

Set in the context of traditional assumptions of Chinese Communism, the democratic reform suggestions of 1980 appear highly iconoclastic, possibly the reflection of opinions held by a minority of progressive intellectual reformers but not a sentiment embraced by the mainstream of the political leadership.²⁷ The Chinese leadership’s decision to reassert the primacy of Party controls over mechanisms of worker participation was wholly in accordance with long-standing Marxist-Leninist convictions about the relationship of the Party to the proletariat. But the Chinese leadership’s decision to reject the 1980 democratic reform suggestions may also have been reinforced by the external influence of the Polish crisis. The debate over the reform of the enterprise leadership system, as it unfolded in 1980, was notable in its failure to discuss the role of the trade unions within the enterprise, and the few references made to the unions were uncharacteristically cryptic and tentative.²⁸ Although the reformers showed a preoccupation with differentiating spheres of authority in the enterprise, no mention was made of the possibility of instituting an operational autonomy for the unions. Despite the geographical and cultural distance separating China from Poland, evidence suggests that the Chinese leadership viewed the Polish situation as a lesson with direct implications for China.²⁹ After an initial period of discrete toleration, the Chinese leadership adopted a dim view of Solidarity, taking the orthodox Marxist-Leninist position that the concept of an independent trade union movement was nothing less than a contradiction in terms and an affront to the vanguard role of the Communist Party. The emergence of Solidarity, moreover, presumedly strengthened the hand of those segments of the political leadership opposed to the democratic reform movement and may well have caused others, originally more sympathetic, to think twice about the wisdom of granting expanded powers to the workers. Although the workers’ congresses differed from the unions in operating only as self-contained units at the enterprise level, without the potential for nation-wide mobilization, the Chinese leadership apparently found the concept of workers’ congresses operating independently of direct Party controls too threatening to permit.

Despite the setback received in 1980, however, the reformist forces in the Party have gradually been able to regain the upper hand.³⁰ Although more conservative than the 1980 democratic reform proposals, “The Decision of the Central Committee of the Communist Party of China on Reform of the Economic Structure” promulgated in October 1984 reveals a continuing commitment to enterprise democratization. A key goal of the reform decision is to institute the depoliticization of the enterprise. The 1984 document lays to rest, at least in theory, the “factory manager responsibility system under the leadership of the party committee,” replacing it with the “factory manager responsibility system.” The differentiation of spheres of authority—in particular between the Party and the management—constitutes another critical aspect of enterprise operations. According to section 11 of the reform decision:

Modern enterprises have a minute division of labor, a high degree of continuity in production, strict technological requirements and complex relations of co-operation. It is therefore necessary to establish a unified, authoritative and highly efficient system to direct production and conduct operations and management. This calls for a system of the director or manager assuming full responsibility. Party organizations in enterprises should actively support directors in exercising their authority, in giving unified direction to production and operations, guarantee and supervise the implementation of the principles and policies of the Party and the state, strengthen the Party’s ideological and organizational work in enterprises, improve their leadership over the trade union and the Youth League organizations, and do effective ideological and political work among the workers and staff members.³¹

The description of enterprise authority relations laid out in the 1984 Reform Decision is best seen as an attempt to reconstitute the Soviet-style model that was only imperfectly adopted in the People’s Republic of China prior to 1956. The extent to which the Reform Decision specifies a return to the Soviet-style model has perhaps been somewhat obscured by the predominant attention given to reform directives that sanction the partial dismantling of the planned economy through decentralization of decision-making powers and the introduction of market mechanisms along the lines adopted in Hungary. Nonetheless, the Chinese elaboration of the “factory manager responsibility system” is in reality the application of the formerly much maligned Soviet style system of “one-man management.”³² Despite the Soviet leadership’s hostility to many of the changes adopted in China, there is nothing in that quotation that conflicts with the standard Soviet analysis of enterprise operations.³³

Nor does the description of enterprise democracy delineated in the Reform Decision per se exceed the parameters of the Soviet-style model, although subsequent Chinese discussions have perhaps moved closer in practice to the East European variant. Enterprise democratization is essentially viewed as a process of continuing the depoliticization of the enterprise through the expansion of spheres of authority. Despite the twists and turns of Chinese policy since 1978, the current Chinese line on enterprise democratization conforms to the original guidelines laid out by Deng Xiaoping in his 1978 speech to the Ninth Congress of the ACFTU in identifying the workers’ congresses, enterprise elections, and the trade unions as components of democratic management. Thus, since the beginning of the decade, the Chinese leadership’s treatment of the question of the unions has also returned to Marxist-Leninist orthodoxy in acknowledging the indispensable function of the unions as a link between the Party and the proletariat. In fact, the current Chinese articulation of the trade union line is easily the most liberal of the entire post-1949 era, with unions urged to take the representation of the workers’ interests as a primary endeavor. Present policy also acknowledges the legitimacy of a trade union operational autonomy. The revised trade union constitution unveiled at the Tenth Congress of the ACFTU in October 1983 noted for the first time the importance of independence in trade union work.³⁴

To the Chinese leadership the promotion of enterprise democracy is seen as complementary to the institution of the factory manager responsibility system rather than in contradiction to it. The reform of the enterprise leadership structure is viewed as a means of strengthening Party, managerial, and mass work in their respective scopes, a process referred to as “strengthening in three respects” (san jiachang). As noted in an article in Workers’ Daily:

Enlargement of enterprise decision-making means enlarging the decision-making powers of the enterprise as a whole, including workers and not just enlarging the decision-making power of factory directors as individuals. Introduction of the factory manager responsibility system does not exclude worker participation in working out an enterprise’s important decisions and in its democratic management.³⁵

The Chinese leadership’s current conception of enterprise authority relations has thus retained to a certain degree the tripartite division of authority central to the 1980 reform proposals. The question of the relationship of the Party to structures of democratic management, however, possesses few of the ambiguities currently besetting efforts to define the Party-managerial relationship.³⁶ The independent operational authority granted to factory management by the Reform Decision does not extend to structures of workplace democracy. For all the talk of autonomy, the workers’ congresses and the trade unions are explicitly identified as subordinate to the enterprise Party committee, which maintains the leadership role of the Party.

Enterprise Democracy: Forms of Worker Participation in Practice

Observers of the Chinese reform movement have noted that Chinese attempts at democratization have tended to stress depoliticization, or the retreat of the state from society, over mobilizational efforts to increase mass participation.³⁷ The institution of democratic reform in the workplace, however, appears as a partial exception to this pattern in which the incorporation of workers into participatory roles has been advanced as a vital element of enterprise democracy. As mentioned, current policy identifies three principal formats by which workers are provided with opportunities to express their interests: workers’ congresses, enterprise elections, and the trade unions.

The workers’ congresses, as representative meetings of elected staff and workers, are seen as the fundamental means for incorporating workers directly into the enterprise decision-making process. Both state- and collectively owned enterprises in China are expected to establish workers’ congresses. Scheduled to meet biannually, two key functions of the workers’ congresses are to conduct investigations into enterprise operations and to exercise supervision over the enterprise management. The enterprise director is enjoined with the responsibility of presenting periodic work reports to the workers’ congresses and responding to workers’ comments and criticisms. In the past several years workers’ congresses have increasingly been identified as the appropriate body to deal with such questions as housing allocation, wages, bonuses, work regulations, and the implementation of a punishment and reward system in the enterprise.

In contrast to the workers’ congresses, which represent a reconstitution of a pre-Cultural Revolution organ, the institution of enterprise elections is essentially a Dengist innovation.³⁸ The implementation of elections to select enterprise cadres has been highly experimental in format, subject to considerable variation in application. Current policy suggests that collectively owned enterprises should universally hold elections in choosing their managerial leadership. State-owned enterprises, on the other hand, have been presented with the option of either electing or appointing managerial cadres, with some mechanism for soliciting worker and staff input in the selection process. Reform proposals have often attempted to differentiate between lower and higher levels of enterprise personnel, leaving open the alternative for direct appointments to managerial positions at the highest levels. The process of enterprise elections, moreover, needs to be coordinated with reform efforts to institute qualifying examinations prior to the appointment of managerial personnel.

Despite the specter of Solidarity, or perhaps because of it, the current Chinese leadership has chosen to concentrate upon the trade unions as a key structure for instituting enterprise democratization. As with the workers’ congresses, each enterprise in China, whether state- or collectively owned, is expected to have an operational trade union. Trade union membership is open to all Chinese wage earners.³⁹ A substantial percentage of Chinese staff and workers, however, are not unionized, largely because trade unions are not universally established in the rural and collective sectors of the economy. As of the end of 1982, approximately 67 percent of the total Chinese wage-earning population belonged to trade unions.⁴⁰ Chinese unions are conceived, in accordance with the classic dictates of Leninism, as performing a transmission-belt function, linking the leadership to the workers in the enterprise. Unions are seen to serve as a conduit simultaneously representing the interests of the leadership to the workers and the interests of the workers to the leadership. Whereas production was identified during the Maoist era as virtually the exclusive focus of trade union activity, the present Chinese leadership has emphasized the democratic side of the continuum in defining the trade union’s primary role as acting in defense of the workers’ interests. The major purpose of the Sixth Executive Meeting of the Tenth ACFTU in July 1985 was to study ways by which the unions could promote democratic reforms in the enterprise.⁴¹ In accordance with pre-Cultural Revolution practice, the responsibility for organizing the workers’ congresses rests with the unions, which are also in charge of handling day-to-day administrative work when the congresses are not in session.⁴² Reform proposals circulated in the past several years have also envisioned a larger role for the unions in enterprise management and urban administration, somewhat along the lines of the East European experience.⁴³ Although it might seem that Chinese unions are tied to democratic management more as representational bodies than as direct structures of worker participation, unions function in the Chinese view both “as an organ of democratic management and a participant in democratic management.”⁴⁴

The development of structures of worker participation in the enterprise is integrally tied to the progress of the enterprise reform movement. Chinese industrial reforms are still in a preliminary stage of implementation, and their final evolution cannot be predicted with any certainty. For the moment, however, the prospect of instituting meaningful forms of worker participation within the enterprise is constrained by two interrelated factors: (1) the movement toward decentralization sanctioned by the 1984 Reform Decision leaves significant managerial powers lodged above the enterprise level, and (2) the Party still maintains a leadership role over the implementation of forms of worker participation in the enterprise. These features, of course, are not unique to China but to a greater or lesser extent plague the implementation of worker participation in all socialist-style societies.

The reform of the Chinese urban economy set forth in the 1984 Reform Decision locates China, on the continuum of socialist economic forms, closest to Hungary. The Chinese Reform Decision does not have the goal of abolishing central planning but of combining methods of central planning with some reliance on the market mechanism as an indicator of scarcity values. The number of products subject to mandatory planning allocated by the method of material balances by the state has been reduced from 120 to 60; other products are expected to be regulated through the institution of guidance planning and the application of economic levers. As in the Hungarian case, moreover, the Chinese economic decentralization laid out in the 1984 Reform Decision falls short of a complete devolution of authority to the enterprise, leaving significant decision-making powers located above the enterprise level. The Reform Decision decrees that the enterprise is to operate as a “relatively independent economic entity.”⁴⁵ To date, however, a significant beneficiary in the redistribution of decision-making authority has been the cities, which have sought to use their newly gained powers to impose their will upon individual enterprise.⁴⁶

The partial decentralization of decision-making authority to the level of the enterprise, moreover, has not been accompanied by a coextensive effort to introduce forms of shopfloor participation in management. Although the functions and powers delegated to the workers’ congresses appear extensive on paper, a closer examination of the workers’ congress regulations reveals that all resolutions and proposals passed by the workers’ congress are dependent upon the factory manager for implementation. Workers’ congresses may put forward their own suggestions in cases of disagreement with the enterprise leadership, but they are bound by the principles of democratic centralism to abide by the final decision of the enterprise leadership. The infrequency of workers’ congress meetings—twice a year—serves to substantiate the impression of an organization relegated to the sidelines of the enterprise decision-making process. Economic decentralization may be considered a necessary condition for worker participation, but it is not in itself a sufficient condition to guarantee the implementation of worker participation as a form of enterprise democracy.⁴⁷

The major impediment to the institution of worker participation in enterprise management, however, is not the constraints—significant as they may be—imposed by central planning but the domination of structures of worker participation by the Party. The depoliticization of the enterprise is a central goal in the reform of the enterprise leadership structure, but it is uncertain how far the Chinese leadership will be willing or able to go in disengaging the control wielded by the enterprise Party committee. Deng Xiaoping’s strategy to carry out a personnel change in the enterprise, bringing loyal supporters of the reform cause into the enterprise leadership, is a hopeful sign. The replacement of managerial cadres at the enterprise level has been a feature of administrative reform; the third stage of the Party rectification campaign has similarly aimed to evaluate the performance of Party members at the grassroots level, including the enterprise. As of December 1985 some 10,000 enterprises in China were reported to have instituted the factory manager responsibility system, signaling the Party’s relinquishing of operational control over the enterprise.⁴⁸

It seems, nonetheless, that Deng Xiaoping’s political aim in the enterprise has been more to change Party personnel than to change the organizational basis of Party operations. Certain elements of Party organization remain intact and do not seem likely to be called into question. Democratic centralism, the existence of the “interlocking directorate,” and the Party’s prerogative to exercise a final say over personnel choices seem sacrosanct as fundamental principles of Leninism. Compared with the East European or the Soviet case, moreover, Chinese enterprise operations have been distinguished by the pervasiveness of political controls, exercised through informal as well as formal channels. Political organization in the Chinese enterprise has typically extended down to the workshop floor. The Party has monitored workers through such measures as the maintenance of dossiers, files kept on each enterprise employee, including a political evaluation, and the operation of enterprise small groups, which have served as a focal point for political study and the initiation of periodic criticism and self-criticism sessions.⁴⁹ The reform of the enterprise structure to allow the establishment of spheres of autonomy necessitates that the enterprise Party committee effect its own form of retreat from the shop floor and modify its traditional preoccupation with assessing forms of political behavior.

The envisioned depoliticization of the enterprise, however, is not viewed as incompatible with the maintenance of Party leadership over structures of worker participation. The revival of the workers’ congresses since 1978 has been orchestrated under the guiding hand of the Party. A reading of the workers’ congress regulations reveals an explicit commitment to the leadership role of the Party. The Party’s control over workers’ congress proceedings is virtually assured by placing Party members—“leading cadres of the enterprise Party, administrative, trade union, and Youth League organizations,” according to article 11 of the regulations—on the workers’ congress presidium.⁵⁰ The operation of the interlocking directorate, moreover, has acted to ensure that the chairman of the workers’ congress be a concurrent member of the enterprise Party committee. Delegates to workers’ congresses are selected under the watchful eye of the Party, which has sought to cull out potential troublemakers. By interjecting its personnel in key roles within the workers’ congress structure, the Party has thus been able to control the agenda of workers’ congress proceedings.

Problems with the implementation of the workers’ congress system have been readily acknowledged in the Chinese press, where workers congresses have often been criticized for lapsing into a sterile “formalism.” Excerpts from a series of letters from workers published in the Zhejiang Workers’ News, for example, bear testimony to the domination of the congresses by the enterprise leadership structure. Workers complained that “they had sent their representatives to meetings only to raise their hands,” that “workers are allowed to hold congresses only when they serve the needs of the leaders,” that workers’ representatives were “not selected by workers but designated by leaders,” and that the presidium of the workers’ congress had become “a joint meeting of Party branch secretaries.”⁵¹ Such problems, however, are blamed on “bureaucratism” and improper adherence to regulations rather than conceived as a symptomatic reflection of the enterprise distribution of power.

The same mechanisms of control that operate to subordinate the workers’ congresses to the Party may similarly be seen at work in the Party’s interactions with the trade unions. The recent sanctioning of a limited trade union independence arises out of a recognition of the trade union’s need for autonomy if it is to fulfill its designated role to defend the workers’ against injustices perpetuated by the enterprise leadership. Nonetheless, the trade unions’ ability to act even as a semiautonomous actor within the enterprise structure is fundamentally constrained by the network of ties binding it to the Party. The trade union constitution establishes the Party’s leadership role over the unions, specifying the unions as organizations that have the duty to respect the Party line and uphold Party policy.⁵² As with the presidia of the workers’ congresses, Party members dominate the higher echelons of the trade union leadership within the enterprise, and the enterprise trade union chairman is usually a member of the enterprise Party committee. Nor are the informal ties between the Party and the trade union any less pervasive. Because the Party has controled ladders of career advancement in the enterprise, trade union cadres have found it a risky business to oppose political norms. Speaking out for the workers’ interest has typically been a highly charged political act, liable to sound the death knoll for a cadre’s career. As Kang Wenhua, the chairman of the Mukdan Trade Union Committee, has noted: “In the past we felt that to grasp production was safe; to grasp livelihood was dangerous. To follow the tide was safe; to independently take responsibility for developing movements was dangerous. To be responsible to the leadership was safe; to be responsible to the masses was dangerous.”⁵³ The traditionally low status of the trade union in the enterprise, moreover, does not augur well for the trade union’s prospects in carving out its own independent niche in the enterprise hierarchy.

Although recent trade union policy proclamations have unceasingly stressed the need to strengthen trade union operations, preliminary evidence suggests that the enterprise reform movement has either failed to address certain long-standing problems of the trade union’s role or has had unintended detrimental consequences for the unions. A December 1985 editorial in Workers’ Daily acknowledged that “since the implementation of the economic reforms, more and more problems have affected the trade union movement.”⁵⁴ Neither the Party nor management has demonstrated a consistent commitment to the task of trade union institutionalization, rather showing a reluctance to relinquish certain functions that were incorporated into the management’s sphere of operations during the Cultural Revolution.⁵⁵ In carrying out the reform of administrative personnel, the enterprise leadership has been prone to transfer capable people out of the trade union to other departments and to use the trade unions as a sort of final resting spot for surplus cadres. Speaking to this problem, the Party secretary of Hunan Province, Liu Zhengwei, noted that the overall quality of trade union cadres was actually being lowered as a result of administrative readjustment as older cadres with a low cultural level were being transferred into the trade union.⁵⁶ Evidence also suggests that the movement toward economic decentralization has made the trade unions more vulnerable to the whims of the enterprise leadership while weakening the vertical links connecting the enterprise trade union to higher levels of the union organization.⁵⁷

Workers’ opportunities to exercise a voice in the selection of enterprise leaders are also constrained by the leading role of the Party. Electoral slates in the People’s Republic of China have moved from one candidate per position to allow for a choice among candidates. Preparation of the slate of selectors for leadership posts, however, takes place under the supervisory guidance of the enterprise Party committee, making it extremely unlikely that a non-Party-approved candidate would appear on the ballot. Judging from the East European experience with limited choice elections, personality is likely to become a factor in differentiating between candidates.⁵⁸ Individual candidates may also conceivably take different positions on how to implement policy, with significant implications for enterprise employees. But the basic policy line, set from above, is not a matter open to debate.

Noninstitutional Forms of Worker Participation

The limited opportunities for workers to raise demands through structures of workplace democracy raise the question of how, if at all, Chinese workers seek to pursue their own interests. Interest articulation is by no means absent in the Chinese enterprise, but the domination of the Party over institutional structures of worker participation has left workers prone to developing strategies based on informal, or, more rarely, illegal means. Nonetheless, the Party’s domination over the network of enterprise authority relations shapes the pattern of behavior open to workers. The Party’s ability to control the dispersal of rewards and punishments in the enterprise, which is accentuated by the reliance of workers on the enterprise for the provision of such scarce resources as housing and the delivery of social services, has led to a situation that Andrew Walder has labeled “organized dependency.”⁵⁹ Walder’s research has emphasized that organization in the Chinese enterprise, far from conforming to Weberian ideals of impartiality, is highly personalized, characterized by the development of vertical ties of interaction linking subordinate to superior. Workers are enmeshed in a network of personal connections that encourages the growth of patron-client relationships. For the Chinese worker the cultivation of a cordial personal relationship with a superior is usually the most effective way of pursuing one’s interest. This behavior, which often includes the bestowal of special gifts and favors, is generally considered in the West a form of corruption. It constitutes, however, a primary example of political participation in its focus on the distribution of scarce resources within the enterprise, although it may not fit in very well with Western assumptions about the scope of participatory behavior. The portrayal of the Chinese enterprise as a network of connections in which personal loyalties reign supreme runs contrary to the Chinese Communist analysis of organizational activity as well, which stresses, no less than Weber himself, the predominance of institutionalized rules of conduct. But the propensity of Chinese workers to pursue their self-interest under the protective guise of patron-client relations has certain advantages for the Chinese regime. The highly personalized structure of ties in the Chinese system acts to ensure that workers will seek to gain rewards on an individual basis. As long as Chinese workers remain atomized, pursuing their interests independently of one another, the threat to the regime is minimal.

The convergence of formal and informal mechanisms of political control within the enterprise serves as a powerful deterrent to the unsanctioned collective expression of worker interests. But the Party’s capacity for exercising control and ensuring compliant behavior among workers is, of course, incomplete. Expressions of worker discontent exist, ranging from such frequent individual behaviors as absenteeism and the illicit use of sick leave to less usual collective forms. Probably the most commonplace collective expression of worker interest in China takes the spontaneous form of the work slowdown. But strikes are not unknown and constitute yet another form of worker participation, albeit one that is not sanctioned by the regime. In an interview with foreign journalists in 1983, Chinese trade union executive committee member Wang Jiachong acknowledged the existence of strikes in China, although he declined to give specific details.⁶⁰ Some Chinese workers, inspired by the Polish example, have also sought to raise demands through establishing independent trade unions. State president Li Xiannian was reported to have acknowledged the existence of Lech Wałęsa sympathizers in the People’s Republic of China in the midst of an attack upon Solidarity as an example of “sham trade unionism” (jia gonghui zhuyi) delivered at the Tenth Congress of the ACFTU in October 1983.⁶¹ Scattered reports, moreover, have indicated attempts to establish Solidarity-style trade unions in China, with no notable signs of success.⁶²

A significant challenge to the Chinese leadership is the need to redirect illegal forms of worker participation into acceptable channels. The Polish crisis poses the same problem to the Chinese leadership as to its East European and Soviet counterparts, namely, how to defuse worker antagonisms and integrate workers into the system. Mao Zedong’s rather uncharacteristic reaction to worker disturbances in Poland and Hungary in 1956 was to enact a policy of liberalization and partial concessions, which failed because of the escalation of demands beyond the Party’s boundaries of acceptable discourse. The current leadership, far more ideologically predisposed toward such a course in any case, has similarly emphasized liberalization as a response to the Polish crisis. Despite the Chinese leadership’s original hesitation over the role of the unions at the height of the Polish crisis in 1980, it presumedly subsequently decided that increased participation within the system was preferable to the increased potential for labor unrest outside it. Given the experience of the 1950s, when the unions were twice condemned for “syndicalism” and “economism,” this was a decision that was most likely thought to involve risks.⁶³ A fear of the trade union’s potential capacity for nation-wide mobilization is evident in the guidelines issued by the Second Session of the Tenth Congress of the ACFTU in December 1984, specifying that “national, transregional, and transindustrial mass activities should by all means be discouraged.”⁶⁴ The current leadership, no less than with Mao Zedong, faces the issue of striking a balance between the forces unleashed by liberalization and the maintenance of control.

The tensions engendered by the Chinese leadership’s attempt to expand the boundaries of legitimate participation are also illustrated by the issue of strikes. The right to strike, which was first installed, at Mao Zedong’s behest, in the Chinese constitution of 1975 and retained in the constitution of 1978, was eliminated in the 1982 constitution.⁶⁵ Like the removal of the “four big freedoms” from the constitution in 1980, the right to strike was castigated as an example of extensive democracy verging on anarchism. Nonetheless, a rather quixotic discussion on the status of the right to strike exists in the People’s Republic of China. In early 1984 ACFTU chairman Ni Zhifu stated in an interview:

In socialist China, we don’t approve of strikes to solve problems. It only harms the interests of the working class in the end. The state, the enterprise, and the workers have no fundamental conflict of interest. Workers can use democratic methods to solve their problems and uphold workers’ rights. They have no need to strike.⁶⁶

Ni, however, proceeded to qualify his impeccably Leninist analysis by suggesting that workers might legitimately be driven to strike in situations in which working conditions were intolerably dangerous and management deaf to workers’ exhortations. The strike, according to Ni, could be viewed as an extraordinary measure used in a case of last resort to combat bureaucratism. The responsibility for organizing the strike and serving as an intermediary between workers’ and management would be that of the trade union. The quasi-legitimacy accorded to worker collective action directed against a recalcitrant management is reiterated in the resolution of the Second Executive Session of the Tenth Congress of the ACFTU, which states that “trade unions should support workers in exercising their rights to boycott those who direct production in violation of regulations.”⁶⁷ As a practical matter, the prospects of the trade union’s organizing the workers to strike against management appear remote.⁶⁸ But the discussion of the right to strike is of considerable theoretical interest in its implicit recognition of the existence of conflicting interests in Chinese society.

Besides efforts to expand the basis of worker participation, the Deng Xiaoping leadership has sought to head off labor unrest through making improvements in the workers’ standard of living. As elsewhere, evidence points to the primacy of economic variables as the key determinant of worker support for the state in the People’s Republic of China. The current leadership has staked its main claim to legitimacy among the working class on its promise to deliver in the economic sphere. Seen in this light, the often repeated promise of the Dengist leadership to raise the standard of living of Chinese workers is not simply altruistic. The Chinese leadership’s own understanding of the causal relationship between economics and regime legitimacy is exemplified in Li Xiannian’s reported remark to Simone Weil in 1980 that China would face a situation like that in Poland unless economic reform efforts were successful.⁶⁹

Since coming to power in 1978, the Deng Xiaoping regime has instituted a series of measures, including wage rises and the reinstatement of piecework and bonuses, designed to counter the legacy of falling wages inherited from the Maoist era and to improve the workers’ standard of living.⁷⁰ At the same time the economic reform movement poses a threat to certain institutionalized expectations held by Chinese workers about the nature of the relationship between workers and the state. The announced intention of the state to do away with the state guarantee of employment for urban dwellers, to abolish the system of permanent job security, to widen wage differentials, and to eradicate the complex system of urban price subsidies infringes upon the “social compact” forged between the state and its workers since 1949, with its system of welfare benefits and institutional guarantees that a generation of workers has come to identify as virtual perquisites of socialism. The attempt to abolish worker benefits long espoused as examples of the superiority of the socialist system runs the risk of creating widespread disaffection among Chinese workers.⁷¹ The considerable challenge for the Dengist leadership is to convince the majority of workers that the sacrifices demanded by the reforms will be exceeded by increased material benefits, and that the disadvantages accruing from the institution of reform measures in the short run will be more than compensated for by a rise in the standard of living in the long run.

In the initial stages, at least, the implementation of certain reform measures has run up against obstacles at the grassroots level that reflect shared worker and managerial opposition to directives transmitted from above. Examples include the tendency toward egalitarianism in the payment of bonuses, foot-dragging in enacting the floating wage system, in which wages are to be linked to output, a reluctance to fire workers, and a widespread tendency to use retained profits on bonuses and welfare projects of benefit to workers rather than plowing profits back into capital investment projects. These practices, which reflect a process in which original reform directives have been transmuted in practical application, might be considered to represent an accommodation to demands raised by the workers. The resistance of Chinese workers to market-oriented reforms finds parallels in the reform experience of other socialist states, notably Poland and Hungary. The Chinese system, however, differs significantly from that in East Europe and the Soviet Union on one key point, i.e., the structure of the labor market. Whereas East Europe and the Soviet Union face a labor shortage, China has a vast labor surplus. In a labor market characterized by scarcity, workers in East Europe have been able to use the threat of the withdrawal of their labor power as an effective tool in negotiating with the higher authorities.⁷² Whether Chinese workers possess the resources to bargain successfully with higher authorities over the future course of the reforms is uncertain.

Conclusions

Much of the content of current regime policy on enterprise democracy can be seen as a deliberately formulated reaction to the perceived inadequacies of Maoist practice. Mao’s conception of democracy within the enterprise placed an emphasis on mass movements and the institution of schemes by which workers would take part in management and managers would labor on the workshop floor, thereby breaking down the division of labor. Mao placed little value on institutional structures of worker participation, and the workers’ congresses and the trade unions were among the first casualties of the Cultural Revolution, abolished at its onset in 1966.⁷³ The Dengist leadership is at odds with fundamental precepts of Maoism on such issues as the position of the Party in the enterprise, the establishment of separate spheres of authority, the application of representative forms of democracy, and the role of the trade unions. Deng Xiaoping’s drive to depoliticize the enterprise and to develop the preconditions for the limited expression of interests within the workplace strikes at the very heart of the Maoist model.

Despite its innovative features, the post-1978 Chinese experience with workplace democracy is by no means lacking in historical antecedents. The current leadership’s conception of enterprise democracy traces its ideological lineage back to the years of the early and mid-1950s, prior to the launching of the Great Leap Forward. Trade unions predate the establishment of the People’s Republic of China, and the workers’ congresses were first instituted in Chinese factories in 1949. The closest analogies to the current situation, however, are to be found during the Hundred Flowers period of 1956-57. Proposals were formulated that envisioned a redistribution of enterprise authority, with increased powers delegated to the workers’ congresses, and an operational independence for the trade union was advocated as a prior condition of defending the workers’ interests.⁷⁴ The movement to democratize the enterprise was stillborn with Mao Zedong’s launching of the Anti-Rightist Campaign in June 1957. But it is evident that, far from being relegated to the dustbins of history, the discussions of enterprise democracy from the Hundred Flowers era served as a source of inspiration to the Deng Xiaoping leadership in planning democratic reforms after a hiatus of twenty years.

Thus, although the democratic reform movement carried out since 1978 contrasts sharply with the goals and values of the Maoist era, it exhibits strong underlying continuities in Chinese thought and practice in the early to mid-1950s. Similarly, current Chinese policy on enterprise democracy, far from appearing notable, fits rather imperceptibly into the general range of behavior exhibited by other Communist states. The Chinese attempt to institute democratic reforms to allow for a greater range of expression of enterprise interests parallels attempts previously undertaken elsewhere in the Communist bloc. Even the Soviet Union constitutes a model of sorts to China, in its advocacy of managerial responsibility and the relative absence within the Soviet enterprise of the informal mechanisms of political control—such as the small groups—that have helped to maintain the Party’s domination over the Chinese enterprise. Chinese efforts to grant the trade union an operational independence, to institute representative structures of worker participation, to hold limited choice elections, and to encourage forms of interest articulation within the enterprise correspond to the democratic reform agendas of some East European states. As elsewhere in the Communist world, however, the Chinese leadership remains committed to a belief in Party leadership over Chinese society and to democratic centralism as an essential prerequisite for socialist organization. The democratic reform program of the Deng Xiaoping leadership places China on the liberal end of the continuum in a comparative socialist context. But Chinese policy is still located well within the boundaries of socialist-state behavior.

The question for the Chinese future is whether or not Chinese workers will be able to express diversified interests, raise demands, and exert influence over the enterprise decision-making process. As the Soviet example illustrates, this is a related but separate issue from the establishment of operational authority for the enterprise management. The East European experience with democratic reforms, instituted under conditions usually considered more conducive to the establishment of democracy—i.e., mature working class, an industrialized economy, in certain cases, a “democratic” tradition—strongly suggests that forms of pluralist expression, if they develop at all in China, will do so within circumscribed limits set by the Party. A vast expansion in the parameters of the dialogue over enterprise democracy since 1978 has in some instances pushed China to the edge of Communist discourse. The recent discussion about strikes, for example, is unusual in the Communist context. But the rhetoric of enterprise democracy has not been matched by a corresponding boldness in prescriptive application. The institution of workplace democracy has been characterized to date by the Party’s careful attention to mechanisms of control, lest a dangerous element of spontaneity be injected that could cause workers’ demands to get out of hand.

In the short run the key issue in the Chinese implementation of enterprise democracy is the extent to which the Chinese leadership can push through its projected policy of enterprise depoliticization. For all the leadership’s promotion of the topic, it is unclear what depoliticization will actually entail in concrete application or how its implementation might be diluted with time. It is clear, however, that even the initial implementation of this reform has aroused the opposition of the enterprise Party committees, which fear, quite legitimately, that their powers are being stripped away. The success of enterprise depoliticization is also highly dependent on a number of political intangibles, i.e., how long Deng Xiaoping will live and whether his successors will be willing or able to carry on his reform policies. It does not seem likely that China will revert to a form of Maoism, but a leadership advocating a more conventional Marxist-Leninist approach to modernization is surely not out of the question. Substantial evidence exists—i.e., the “spiritual pollution” campaign of 1983, Standing Committee of the Politburo member Chen Yun’s criticisms of the reform movement at the Fifth Plenum of the Twelfth Party Congress in September 1985—to indicate that at least a portion of Party members feel uncomfortable with the orientation of the reforms. However, if the Chinese leadership is able to restructure the role of the Party so that it no longer plays a direct part in day-to-day enterprise operations, the potential will exist for the development of spheres of enterprise autonomy. This is not to suggest that China will turn into a model of pluralism but to indicate that enterprise depoliticization constitutes a necessary, if not a sufficient, step toward the establishment of an environment in which workers can express their interests.

Notes

1. Wang Qianghua, Liu Jingrui, Zhang Yide, and Tao Kai, “Why Must We Thoroughly Negate ‘Extensive Democracy’?” (Guangming Ribao, Sept. 13, 1984, 2), in FBIS, Sept. 20, 1984, K7.

2. For further discussion of the democratic reform movement, see Brantly Womack, “Modernization and Democratic Reform in China,” Journal of Asian Studies 43, no. 3 (May 1984):417-39; William A. Joseph, “The Dilemmas of Political Reform in China,” Current History (Sept. 1985):252–55, 279–80; David S. G. Goodman, “The Chinese Political Order After Mao: Socialist Democracy and the Exercise of State Power,” Political Studies 33 (June 1985):218–35; and Harry Harding, “Political Development in Post-Mao China,” in A. Doak Barnett and Ralph N. Clough, eds., Modernizing China: Post-Mao Reform and Development (Boulder: Westview Press, 1986), 13–38.

3. This assumption, for example, seems to underlie the institution of the New Economic Mechanism in Hungary. “Socialist democracy,” Janos Kadar told the Ninth Party Congress of the Hungarian Socialist Workers’ Party in November 1966, “meant the better allocation of spheres of authority.” Quoted in Robert M. Bigler, “The Role of Bureaucrats and Experts in the Planning and Implementation of Hungary’s New Economic Mechanism,” East European Quarterly 18, no. 1 (Spring 1984):93.

4. H. Gordon Skilling refers to “quasi-pluralistic authoritarianism” as a potential characteristic of Communist regimes. See H. Gordon Skilling, “Group Conflict and Political Change,” in Chalmers Johnson, ed., Change in Communist Systems (Stanford: Stanford University Press, 1970), 215–34. For discussions about the potential for pluralism in the Chinese political context, see Harding, “Political Development in Post-Mao China,” 13–38; and Andrew Nathan, Chinese Democracy (New York: Alfred A. Knopf, 1985) 224–32.

5. “Constitution of the People’s Republic of China,” Beijing Review 52 (Dec. 27, 1982): 12.

6. Premier Zhao Ziyang noted, for example, in his speech to the Second Session of the Sixth National People’s Congress, that “we must give full expression to the role of the worker masses as masters of the house. This is an important characteristic of our socialist enterprises that must not be overlooked.” Quoted in Zhang Youyu, “Workers’ Participation in Enterprise Management Should Be Allowed, So That Socialist Enterprises Can Be Run Well” (Gongren Ribao, Aug. 24, 1985, 1) in JPRS-CEA-85-008, Oct. 2, 1985, 93.

7. The problems of recruiting young workers into the Party are discussed in Yu Yannan, “Jiachang Dang Xiang Gongren Chunzhongde Lianxi,” Hongqui 23 (Oct. 1982):25–29. Yu recounts the case, for example, of the Nanjing Radio Factory, in which only 9 of the 10,023 young workers who had joined the factory workforce since 1976 had chosen to become members of the Party. Yu also notes such problems as a shortage of Party members on the workshop floor and the existence of production teams without any Party members because of the need to transfer new Party members directly into managerial positions to replace retiring cadres. A more positive account of the recruitment of young workers into the Party is presented in “Jiji Youzhan Youxiu Qingniangong Ru Tang,” Gongren Ribao, June 30, 1985, 1, in which 48 percent of the total Party membership at the Beijing Number One Shoe Factory is reported to consist of young workers under the age of thirty-five.

8. In an attempt to rectify problems of political disaffection, the Party introduced a program in 1983 to intensify ideological and political work among employees in state-owned enterprises. One of the key measures of the program specifies that young workers under the age of thirty–five in state-owned enterprises are to be given paid leave for two weeks a year, on a rotating basis, to attend full-time study courses on patriotism and communist thought. The formal document is presented in “Zhonggong Zhongyan Fachu Quanyu Pizhuan Guoying Qiye Zhigong Sixiang Zhengzhi Gongzuo Gangyao (Shixing) de Tungzhi,” Xinhua Yuebao 465 (1983):78–85.

9. See, for example, Jiang Yiwei, “Lun Shehuizhuyi Qiye Guanlide Jiben Tezheng,” Jingji Guanli 11 (1980): 14—22; and Zhang Youyu, “Workers’ Participation in Enterprise Management,” 94.

10. Su Shaozhi, “Economic Development and Democratization,” Selected Writings on Studies of Marxism 8 (Mar. 1981):5–6.

11. “Decision of the Central Committee of the Communist Party of China on Reform of the Economic Structure,” Beijing Review 27, no. 44 (Oct. 29, 1984):6.

12. “Lu Dingyi on Workers’ Role in Enterprises” (Guangming Ribao, Dec. 15, 1984, 1), in JPRS-CEA-85-006, 15–17. For a discussion of the application of Taylorism in the Soviet Union, see Don Van Atta, “Why Is There No Taylorism in the Soviet Union?” Comparative Politics 18, no. 3 (Apr. 1986):327-38.

13. See Nina P. Halpern, “Learning From Abroad: Chinese Views of the East European Economic Experience, January 1977–June 1981,” Modern China II, no. 1 (Jan. 1985):77–109; and Nina P. Halpern, “China’s Industrial Economic Reforms: The Question of Strategy,” Asian Survey 25, no. 10 (Oct. 1985):998–1012.

14. H. G. Kosta, “China on the Road to a Market Economy?” RAD Background Report/226 (China), Radio Free Europe Research, Dec. 30, 1984, 1–8.

15. Su Shaozhi, “Economic Development and Democratization.” Also see Włodzimierz Brus, “Political System and Economic Efficiency: The East European Context,” Journal of Comparative Economics 4(1980):40–55; and Stanislaw Gomulka, “Economic Factors in the Democratization of Socialism and the Socialization of Capitalism,” Journal of Comparative Economics 1 (1977):389–406.

16. Su Shaozhi’s discussion of W. Brus’s conception of enterprise democracy significantly fails to mention Brus’s characterization of “Kadarism” as a system of limited economic decentralization instituted in the absence of structures of workers’ self-management. See Brus, “Political System and Economic Efficiency,” 48–55.

17. This point is developed in Halpern, “Learning From Abroad,” 77–109.

18. See, for example, Wang Chang-ling, “The Debate About ‘Alienation’ Among Mainland Scholars,” Issues and Studies 21, no. 3 (Mar. 1985):90–103; and Wang Ruoshui, “On Estrangement,” Selected Writings on Studies of Marxism 12 (May 1981).

19. As a Hungarian study of the interrelationship between economics and politics concluded, “The progress of management therefore requires democratic ways in politics.” See “Economics and Democracy,” New Hungarian Quarterly 26, no. 97 (Spring 1985):121–22.

20. For discussions of democratic management under conditions of “developed socialism” in East Europe, see Jack Bielasiak, “Workers and Mass Participation in Socialist Democracy,” in Jan F. Triska and Charles Gati, eds., Blue-Collar Workers in Eastern Europe (London: Allen and Unwin, 1981), 88–107; and Daniel Nelson, “Romania: Participatory Dynamics in ‘Developed Socialism’,” in ibid., 236-52.

21. Zhongguo Gonghui Dijiuci Chuanguo Daibiao Dahui (Beijing: Gongren Chubanshe, 1978), 4.

22. See, for example, Tian Fang, Qi Dong, Liu Xun, Yun Zhen, and Zhen Ji, “Zhongqing Shi Kuangda Qiye Zizhuchuan Shidiande Chubu Diaocha,” Jingji Yanjiu 3 (1981):28–35; “Shixing Zhigong Diabiao Dahui Lingdao Xiade Changzhang Fucizhi,” Jingji Guanli 4 (1981):42–44; Ma Hong, “Guanyu Gaige Gongye Qiye Lingdao Zhidude Tantao,” Renmin Ribao, Nov. 20, 1980, 5; Jiang, “Lun Shehuizhuyi Qiye,” 14–22; and Wang Mengkui, “Qiye Lingdao Zhidu Zhongde Yige Wenti,” Jingji Yanjiu 1 (1981):37–44.

23. See “Shixing Zhigong Daibiao Dahui,” 42–44; “You Zhidaihui Guolun Jieding Qiyede Zhongda Wenti,” Renmin Ribao, Nov. 20, 1980, 1; and Tian Fang et al., “Zhongqing Shi Diaocha,” 28–35.

24. By 1980 an estimated 6,600 enterprises had been granted increased self-management authority in enterprise operations. For discussions of the influence of the Yugoslav model on Chinese reformers, see Kosta, “China on the Road to a Market Economy,” 1–8; and Halpern, “Learning From Abroad,” 77–109. As illustrations of Chinese interest in the Yugoslav system, see Nansilafude Shehuizhuyi Zhizhi Zhidu He Jingji Fazhan (Shanghai: Renmin Chubanshe, 1979); Meng Yunjeng, “Nansilafude Shehuizhuyi Zhidu,” Jingji Yanjiu 12 (1978):53–59; and Pang Chuan, “Nansilafude Zizhi Zhidu,” Jingji Guanli 7 (1980): 13–18.

25. For a discussion of the politics of the reform movement, see Carol Lee Hamrin, “Competing ‘Policy Packages’ in Post-Mao China,” Asian Survey 24, no. 5 (May 1984):487–518.

26. “Provisional Regulations Concerning Congresses of Workers and Staff Members in State-Owned Industrial Enterprises,” in John L. Scherer, ed., China Facts and Figures Annual 1982 (Gulf Breeze, Fla.: Academic International Press, 1983), 28–31.

27. Kosta asserts that no one in the leadership could be found to advocate worker self-management for the Chinese system patterned after the Yugoslav model. Kosta, “China on the Road to a Market Economy,” 1–8.

28. See, for example, Wang Mengkui, “Qiye Lingdao Zhidu,” 37–44; “Shixing Zhigong Daibiao Dahui,” 42–44; “Women Xhi Zenyang Kaihao Zhigong Daibiao Dahuide?” Jingji Guanli 5, (1980):33–35; and “Jingji Tizhi Gaige Xuyau Jinyibude Yixie Wenti,” Jingji Guanli 8 (1980):28–30.

29. After meeting with state president Li Xiannian in July 1980, then president of the European parliament, Simone Weil reported that she had been told that China would face a crisis similar to that in Poland unless current economic reform efforts were successful. See He Shen, “Solidarity Union of Poland and China” (Zheng Ming, no. 10 [Oct. 1, 1981] 26–29), in JPRS 79689, Dec. 1981, 72. For additional discussions of the impact of the Polish crisis on Chinese politics, see Tony Saich, “Workers in the Workers’ State: Urban Workers in the PRC,” in David S. G. Goodman, ed., Groups and Politics in the People’s Republic of China (Cardiff: University College Cardiff Press, 1984), 164; Nathan, Chinese Democracy, 41, 204, 206, 230; and Harding, “Political Development in Post-Mao China,” 22.

30. For a discussion of the leadership struggles waged over reform, see Hamrin, “Competing ‘Policy Packages’ in Post-Mao China,” 487–518.

31. “Decision on Reform of the Economic Structure,” 6.

32. For discussions accentuating the positive benefits of “one-man management,” see Wang Mengkui, “Qiye Lingdao Zhidu,” 37–44; Ma Hong, “Quanyu Gaige Gongye,” Renmin Ribao, 5; and Xiao Liang, “Implementing the Plant Director Responsibility System Is a Major Reform in the Leadership System of Enterprises” (Renmin Ribao, Mar. 17, 1986, 5), in FBIS, Apr. 1, 1986, K7.

33. For a discussion of Soviet perceptions of the Chinese economic reform movement, see Gilbert Rozman, A Mirror for Socialism: Soviet Criticisms of China (Princeton: Princeton University Press, 1985), 80–85, 129–36; and Marshall I. Goldman, “Soviet Perceptions of Chinese Economic Reforms and the Implications for Reform in the USSR,” Journal of International Affairs 39, no. 2 (Winter 1986):41–55.

34. “Zhonggong Gonghui Zhangcheng,” Renmin Ribao, Oct. 24, 1983, 3.

35. Zhang Youyu, “Workers’ Participation in Enterprise Management,” 94.

36. The question of the role of the Party in the enterprise is the topic of voluminous discussion in the Chinese press. For examples, see Xiao Liang, “Implementing the Plant Director Responsibility System,” K6–K10; Cao Zhi, “Improve and Strengthen the Party’s Leadership in Enterprises” (Red Flag 14 [July 16, 1985]:13–17), in JPRS-CRF-85-019, 21–29. For an example of an article defending the system in which the Party secretary retains operational control over the enterprise, see Wu Hanzhou and Yang Jian, “The System of Factory Directors of Enterprises Owned by the Whole People, Concurrently Serving as Party Secretaries” (Jingji Guanli 12 [Dec. 5, 1985]:27–31), in FBIS, Feb. 19, 1986, K8–K15.

37. See, for example, Womack, “Modernization and Democratic Reform in China,” 417–39; Joseph, “Dilemmas of Political Reform in China,” 252–55, 279–80; and Hong Yung Lee, “The Implications of Reform for Ideology, State and Society in China,” Journal of International Affairs 39, no. 2 (Winter 1986):77–89.

38. Elections were held in the Chinese enterprise on occasion before the ascension of the current leadership but never for the selection of high-level leadership cadres.

39. For a discussion of criteria for trade union membership, see Gonghui Gongzuo Wenda (Beijing: Gongren Chubanshe, 1981), 11–15; and Zhongguo Gonghui Zhangcheng Jianghua (Beijing: Gongren Chubanshe, 1984), 33–42.

40. In units in which a trade union was organized, 73,310,000 staff and workers out of a workforce of 85,866,000 were reported to be trade union members at the end of 1982, a membership rate of 85.3 percent. But with a Chinese urban workforce of 112 million at the end of 1982, approximately 27 million Chinese worked in units without a trade union organization, or approximately 23 percent of the total Chinese wage-earning population. Xue Muqiao, ed., Almanac of China’s Economy 1983 (Hong Kong: Chinese Economic Yearbook Limited, 1983), sec. 1, p. 39. In 1981, 85 percent of Chinese trade union members were estimated to work in state-owned enterprises, with the remaining 15 percent of trade union membership drawn from the collective sector of Chinese industry. Saich, “Workers in the Workers’ State,” 161. A current aim of trade union policy, however, is to increase union membership through the establishment of unions in collective enterprises and in rural areas and through the recruitment of contract workers who were often deliberately excluded from joining the trade union in the past.

41. “Tuijin Qiye Lingdao Zhidu Gaige Ba Qiye Minzhu Guanli Yinxiang Xin Jiduan,” Gongren Ribao, July 15, 1985, 1.

42. The trade union’s responsibilities for overseeing the workers’ congresses, however, have given rise to confusion over differentiating between the functions of the unions and the workers’ congresses. See, for example, “Tuijin Qiye Lingdao Zhidu Gaige,” 1; Guo Feng, “It Is the Common Duty of the Party, Administration and Trade Unions to Do Well in the Democratic Management of Enterprises” (Gongren Ribao, June 12, 1985, 3), in FBIS, June 27, 1985, K16.

43. See, for example, Tong Chengmin, “A Discussion on Questions Concerning Urban Trade Unions Participating In and Discussing Government Administration” (Gongren Ribao, Feb. 27, 1986, 1) in FBIS, Apr. 1, 1986, K10–K13; and Xiao Tuo, “Inherent Attributes of Trade Unions and Their Participation and Discussion of Government Administration” (Gongren Ribao, Feb. 27, 1986, 4), in FBIS, Apr. 1, 1986, K13–K15.

44. “Tuijin Qiye Lingdao Zhidu Gaige,” 1.

45. “Decision on Reform of the Economic Structure,” 6.

46. For a further discussion of this question, see Jan S. Prybyla, “The Chinese Economy: Adjustment of the System or Systemic Reform,” Asian Survey 25, no. 5 (May 1985):568; Christine Wong, “The Second Phase of Economic Reform in China,” Current History, Sept. 1985, 278–79; and Dorothy J. Solinger, “Industrial Reform: Decentralization, Differentiation, and the Difficulties,” Journal of International Affairs 39, no. 2 (Winter 1986):113–14.

47. William N. Dunn and Josip Obradovic, “Workers’ Self-Management and Organizational Power,” in Josip Obradovic and William N. Dunn, eds., Workers’ Self Management and Organizational Power in Yugoslavia (Pittsburgh: Center for International Studies: University of Pittsburgh, 1978), 11.

48. “Shixing Changzhang (Jingli), Zerenzhi Hui Buhui Yingxiang Gongren Zai Qiye Zhongde Zhurenweng Diwei?” Gongren Ribao, Dec. 20, 1985, 2.

49. Andrew Walder discusses the mechanisms of Party control in the enterprise in “Work and Authority in Chinese Industry: State Socialism and the Institutional Culture of Dependency” (Ph.D. diss. University of Michigan, 1981); “Participative Management and Worker Control in China,” Sociology of Work and Occupations 8, no. 2 (May 1981):224—51; “Organized Dependency and Cultures of Authority in Chinese Industry,” Journal of Asian Studies 43, no. 1 (Nov. 1983):51–76; and Communist Neo-Traditionalism: Work and Authority in Chinese Industry (Berkeley: University of California Press, 1986).

50. “Provisional Regulations,” 30.

51. “Workers’ Congresses ‘Only Nominal’ Power Organs” (China Daily, Sept. 4, 1983, 4), in FBIS, Sept. 7, 1983, K18.

52. Zhongguo Gonghui Dishici Chuanguo Daibiao Dahui Zhuyao Wenjian (Beijing: Gonren Chubanshe, 1983), 51.

53. Kang Wenhua, “Dang Zhongyan Ban Gonghui Zhichule Zhengquede Fangxiang,” Gongren Ribao, May 2, 1983, 1. In some cases, apparently, the trade union cadres who dare to stand up to the management in defense of the workers’ place themselves in more than a precarious political situation. According to an exposé in Workers’ Daily, when the assistant trade union chair at a Zhongqing glass factory expressed his opposition to the factory leadership’s abuse of the workers’ rights (in this case the factory leadership had illegally appropriated wage raises for itself while ignoring the workers), the assistant factory manager beat him up, sending him to the hospital. See “Gonghui Ganbu Luo Shaohua Dizhi Puji Zhong Waifeng Zaodu Da Fuchangzhang Ma Zhongjie Yi Quanmou Sidong Shou Daren Bei Chezhi,” Gongren Ribao, July 16, 1985, 1.

54. “Gonghui Yao Jiji Can Zhengyizheng,” Gongren Ribao, Dec. 20, 1985, 1.

55. The issue of the adminsitration of labor insurance benefits, officially a function of the unions, has been a particularly contentious issue. For a discussion of the question of distinguishing a distinct trade union sphere of responsibility, see “Resolution of the All-China Trade Union Federation” (Xinhua, Dec. 27, 1984), in JPRS-CEA-008, 118–26.

56. “Bixu Gaibian Gonghui Ganbu Yuebai Yueda de Qingkuang,” Gongren Ribao, Mar. 24, 1984, 2; also see “Buyao Suibian Chaodiao Gonghui Ganbu Zuo Qitade Shi,” Gongren Ribao, Apr. 23, 1983, 3; “Buyao Ba Nianlao Tiruode Ganbu Anpai Dao Gonghui,” Gongren Ribao, July 22, 1983, 2.

57. It was reported, for example, in an article in Workers’ Daily in early 1983 that some enterprise leaderships were using their newly granted powers to abolish the trade union as an enterprise structure, merging its duties with other administration departments and transferring trade union cadres to other positions throughout the enterprise. See “Buyao Suibian Choudiao Gonghui Ganbu,” 1.

58. See Alex Pravda, “Elections in Communist Party States,” in Guy Hermet, Richard Rose, and Alain Rouguie, eds., Elections Without Choice (London: Macmillan Press, 1978), 169–95.

59. Walder, “Work and Authority in Chinese Industry;” “Organized Dependency and Cultures of Authority,” 51–76; and Communist Neo-Traditionalism.

60. Elizabeth Chang (Paris AFP in English, Oct. 17, 1983), in FBIS, Oct. 20, 1983, K9.

61. “Mudi Zai Yu Guanliao Zhuyi Duihang Gongren Keyi Anqian Liyou Bagong,” Zhongbao, Feb. 20, 1984, 1.

62. See Michael Parks, “Chinese Leaders Fear Loss of Control,” Los Angeles Times, Nov. 19, 1981, 1; “Gongren Keyi Bagong,” 1; Harry Bernstein and Michael Parks, “Labor Unions Emerging as a Major Force in China,” Los Angeles Times, Dec. 29, 1980, 1; He Shen, “Solidarity Union of Poland and China,” 72–80; Takashi Oka, “China Gives Workers a Voice to Prevent Solidarity-Like Movement,” Christian Science Monitor, Oct. 21, 1983, 10; Kenneth J. Hammond, “Rise and Fall of a Chinese Version of Solidarity,” New York Times, Feb. 18, 1982, 24. An additional discussion of this topic, with further references, can be found in Nathan, Chinese Democracy 41, 204, 206, 230; and Saich, “Workers in the Workers’ State,” 161, 164.

63. During the so-called first trade union crisis of 1950–51 the trade union leadership clashed with the Party leadership on the issue of the trade union’s right to exercise a limited operational autonomy in defense of the workers’ interests. Despite a purge of the trade union leadership, the unresolved conflict resurfaced during the “second trade union crisis” of the Hundred Flowers period of 1957, ending once again in a thoroughgoing purge of the trade union apparatus.

64. “Resolution of All-China Trade Union Federation,” 126.

65. The constitutional right to strike notwithstanding, it should be noted that Mao Zedong did not hesitate to dispatch the People’s Liberation Army to quell the strikes that erupted in China in 1976.

66. “Gongren Keyi Bagong,” 1.

67. “Resolution of All-China Trade Union Federation,” 123.

68. Nor did Ni provide any concrete illustrations of legitimate forms of collective action in Chinese factories, although he did indicate two cases—including the highly publicized Bohai Oil Rig disaster, in which twelve workers died—as examples of managerial negligence. See “Gongren Keyi Bagong,” 1. In a 1983 interview, then ACFTU executive committee member Wang Jiachong was reported as stating that strikes could be supported by unions in exceptional cases, such as those involving industrial safety. According to Wang, such strikes had already taken place in the People’s Republic of China, although he declined to provide concrete examples. See Chang, K10.

69. He Shen, “Solidarity Union of Poland and China,” 72.

70. Average urban wages declined an estimated 19.4 percent between 1957 and 1977. Andrew Walder, “The Remaking of the Chinese Working Class, 1949–1981,” Modern China 10, no. 1 (Jan. 1984):22–24.

71. For reports of worker unrest stemming from the reforms, see Jim Mann, “Reforms Stir Worker Unrest in Chinese Factories,” Los Angeles Times, Oct. 19, 1984, sec. 1A, p. 1; and K. C. Tsang, “Prospects for Increased Protests Over Reforms” (South China Morning Post, June 24, 1985, 10) in FBIS, June 25, 1985, W1.

72. See Charles F. Sabel and David Stark, “Planning, Politics and Shop-Floor Power; Hidden Forms of Bargaining in Soviet-Imposed State Socialist Societies,” Politics and Society II, no. 4 (1982):439–76. Csaba Mako and L. Hethy noted that the growing demand for labor has provided workers with the ability to secure wage rises in Hungary. Csaba Mako and L. Hethy, “Worker Participation and the Socialist Enterprise: A Hungarian Case Study,” in C. Cooper and E. Mumford, eds., The Quality of Life in Western and Eastern Europe (Westport, Ct.: Greenwood, 1979), 296–326.

73. By 1966, however, workers’ congresses were virtually moribund, and the unions similarly exhibited few signs of vitality. Neither structure had ever fully recovered from the debilitating effects of the Great Leap Forward.

74. The concept of the establishment of separate spheres of enterprise authority is evident in the suggestion that the workers’ congresses “share equal status with management.” Lai Ruoyu, chairman of the ACFTU, went so far as to argue the necessity for the trade unions to develop an “independence” from both management and the Party. See Survey of China Mainland Press, no. 1423, 1956, 10; quoted in Paul Harper, “Political Roles of Trade Unions in Communist China,” (Ph.D. diss., Cornell University, 1969), 277.