Comrade Kong Dan, he still believes

Kong Dan （孔丹), former chairman of CITIC Group, son of Kong Yuan (孔原, Mao’s head of China’s ‘CIA’ 中央調查部), former Red Guard (he helped lead 首都红卫兵西城区纠察队, who were the good guys, kind of), long-time SOE head, and friend of Xi Jinping, has a thing for talking to Phoenix media. As a pre-eminent Second Generation Red (红二代), and still a believer, I think it is worth trying to understand his thinking.

He is talking for a reason - in support of Chinese Communist Party rule - and represents the views of many in the ruling class (a term he is happy to accept) in China. Reading it, I could not help thinking he and Xi likely think alike on many issues. Here are some thoughts from his February 2015 interview ‘孔丹：国企实际成了中共执政基础 我不想进官场’ with a 华夏时报 editor published on Phoenix. He talked to Phoenix in 2009 too.

Here’s Kong’s quick bio of Kong. For some background on him and his old mate Qin Xiao (they were at school and CITIC together), another member of the 红二代, who has taken a very different direction, see this profile. Here is a quick account of the infamous reunion dinner of Beijing Fourth Middle School (北京四中) - long, contested, story short: Kong denies telling Qin Xiao to ‘Go Fuck Your Mother’.

So what does Kong Dan believe?

Mao was too ‘romantic’ and the Great Leap Forward (GLF) and Cultural Revolution (CR) were not really his fault. Kong divides up CCP history into three parts - the pre-liberation years, 1949-78, and thereafter. In the first period, Mao Zedong developed his own liberation philosophy in a Yanan cave - he took the tenants of Marxism and made them Chinese, by replacing industrial workers with rural peasants as his fighting proletariat, since he ‘sought truth from reality’ (实事求是). This was his genius. Stage two - there were, er, some problems in implementation: ‘At the start [of his rule], Mao was quite stable…after [referring to the GLP and CR periods]…he was still strategic, but my view is that when he acted, he left a little bit China’s reality （离开了实际）’. For Kong, Mao’s problem was ‘economic and political romanticism （浪漫主义)’. As a result, Mao is basically excused - he was facing huge challenges, his aim were legitimate (he wanted to prevent revisionism, corruption and bureaucratic stagnation), but he went astray a bit and bad ‘people with ulterior motives used the situation to gain power’. The CR gave the Party the opportunity to rethink (反思), as society had collapsed, and without this there would be no Reform and Opening Up.

There are more than a few painful mental contortions and historical manipulations going on here. First, the millions of deaths resulting from Party policy throughout the 1950-60s, whether it was from famine starvation, or more pro-active torture or execution in the many violent political campaigns, or the many many suicides, are not mentioned. Kong accepts mistakes such as the effort to melt iron kitchen utensils into steel girders, but this is small change given the far far greater suffering that was happening. Then, Mao’s culpability - he’s off being romantic while others (presumbably his wife, Jiang Qing and her ‘gang’) did all the evil. This contradicts most of the decent history of this period which shows Mao firmly in charge, manipulating the various groups and ensuring the extremist faction, Jiang Qing et al., retained influence way through until 1974, when Mao appoints Deng as Vice Premier and seems to want to rebuild some order. Here, of course, Kong hues closely to the Party’s 1981 ‘Decision on Certain Historical Problems from the Founding of the Republic’, which largely exonerated Mao and demonized the Gang of Four. Mao may have sent to their deaths those who questioned his policy and he determined were disloyal (Peng Dehuai, Liu Shaoqi), but the Party must go on.

Kong’s own family was painfully impacted by Mao’s CR - his mother, who worked in Zhou Enlai’s State Council office, committed suicide after Mao turned against her efforts, under Zhou’s instructions, to curtail the violent excesses of the militant Red Guards. Xi’s dad, Zhongxun, was a vice premier and secretary general in the State Council at the same time. Kong’s own Red Guard Group - the Xicheng Brigade (首都红卫兵西城区纠察队) - worked to the same end. But, despite all this, ‘We kept with the Party, we did not waver, we do not think the Party is not qualified to lead China’.

And here is the crux of the Second Generation Reds - including President Xi. Not to demean it, but its a CCP-style Stockholm syndrome. The families of the Red families were often destroyed by Mao’s selfish and violent scheming, but still they will not deny him. Liu Yuan, a recently retired PLA officer who campaigned gallantly against corruption in the military - and who was thought to be close to Xi too - had his father, Liu Shaoqi, die in prison, emmaciated and tortured. But Liu Yuan will defend Mao and the Party’s right to rule until his dying breath. Maybe Mao’s greatness overwhelms rational calculation of his rights and wrongs. Maybe in their minds his achievements really do outweigh his crimes - but that decision seems to be too easily made, at least in public statements. Who knows how much anger and pain has to be overcome in private. And the white-washing of Party history suggests that they perhaps doubt others would come to the same conclusion as they do if the archives were ever properly opened. More likely, perhaps, to deny Mao would be to blow up a central timber of the Party - and the chaos that they fear would ensue is worth anything to avoid.

Which brings us to…

China is special, its political system - i.e. One Party rule - is the choice of the people - and ‘western-style’ democracy is not suitable. Kong believes in the Party’s right and need to rule. ‘I believe China has come through a special historical process’, he says, ‘to come out with a special institutional arrangement…[our political system] has not come out of a design studio…You can’t put the CCP into the so-called One Person, One Vote framework to prove its legitimacy.’ Critics - and I think Kong is speaking up these days because he believes those critics are bolder in making their case - are ‘too idealistic, too dogmatic…[their ideas are] different from China’s reality’. So the CCP’s legitimacy comes from history, its ability to stand by the people and work for them, and the claim that ‘its always trying to correct its mistakes and face up to challenges.’

And here we get to the phrase de jour: historical nihilism (历史虚无主义) and democratic nihilism (民主虚无主义). I need to take more Party education classes, as I’m not sure the exact meaning, but they are being deployed a lot these days to describe those who question/criticise the Party’s history. Here Kong talks of his friend (who I assume is Qin Shao) who apparently said that the Communist Party had blocked the real liberation that the May 4th movement promised, that Deng’s program was ultimately hijacked by a government obsessed with ‘developmentism’ etc. This is all wrong, it denies the many achievements of the Party.

But what of those who say that the Party’s has been corrupted by power? Kong has an answer. ‘We need to put, as Party Secretary Xi says, power into a cage (要把权力关到笼子里)…if not, it’ll be like Rome, it will lead to corruption, and it will change the nature of the Party ()变质)’. How is that to be done？ It is a shame Kong does not go into any detail, but he does say that the constraint will come from strong leadership and by the Party leadership system’s legal framework’. I guess anti-corruption and Xi-style leadership forever is the answer. The problem is that corruption grew rampant - and changed the Party’s nature (变质) - under the leadership of the Party. A strong leader might be able to tamp it down, but there is no guarantee he will be followed by another strong, inspired leader. In fact, the odds are against it.

I think Second Generation Reds are legitimately concerned about ‘if not us, then what?’. It is no accident that CCTV enjoys showing scenes of the chaos throughout much of the Middle East as dictators and single-party systems have fallen. Such stuff is genuinely horrific. And this is the weakest link for any critic of the CCP - how to do better, given all the constraints? President Xi has spoken forcefully of the need to guard against such a slide, vowing in an early, secret speech to stand resolutely against any colour revolution. I imagine Kong would have no problem with deploying the army again, like in 1989.

On economic policy, there is no crisis and no big need to act radically - and SOEs need to stay that way. Here Kong is best described, I think, as an unworried statist. In his mind, there is no imminent economic crisis. He criticizes Wu Jinglian, his former professor at CASS, and other economists who say that we need ‘an overarching plan’ (顶层设计), which I think Kong views as code for big change and less state control. Instead, he likes the phrase ‘crossing the river while looking for stones’(摸着石头过河)，a phrase ever-associated with Deng, which I guess is Kong’s code for keeping the basic foundations of the socialist economy in place, and enacting moderate change gradually. And it looks like this view has won out on top.

He says things like ‘there is no western economic theory that can explain China’s success’ and ‘if anyone can explain China’s reform success, they deserve the Nobel prize in economics’. You hear this kind of stuff a lot. Its a bit silly and code for ‘we’re unique, we’re successful, but we’re not a free market economy and we’ve not copied you’. Its a useful way of shutting down criticism - since you do not really understand - especially if you want to propose a market-oriented policy which works elsewhere.

Privatisation is, of course, not the solution to the state-owned enterprise (SOE) problem, though he allows for the private sector to operate in some sectors. SOEs are, he says, the basis of the CCP’s rule (国企实际成了中共执政基础). Kong argues that the key two problems with SOEs are, one, the incentive/constraint problem (激励约束) and two, unstable leadership. He argues that matching compensation with performance is the best way of solving the former (which he says they’ve done well at CITIC). CITIC - for reasons I don’t understand - seems to have maintained a stable leadership team over the years too (Kong has been there 11 years). But other SOEs have their CEOs appointed by the Party’s Organization Department every three to four years - and that tends to lead to frequent change in strategy, direction, culture etc. You get the impression Kong thinks this is dysfunctional. One proposal in Beijing is that the top guy at the SOE should be an official, who is on the government payroll and could move to become a minister after his term is up, while under him, the senior management team is professional, compensated so, and remains in place. Kong does not criticize this arrangement directly, but does not seem to like it; bureaucrats and business leaders are two different types of person, he argues, requiring different skills and experience. He is undoubtedly right. He’s been involved in setting up a CITIC Research Fund which has been proposing reform ideas in line with Kong’s statist line.

Finally on economic policy, he quotes Tim Geithner, who apparently in a speech in Singapore, said that in 2008, the US government ‘didn’t do anything right, we made endless mistakes….in the end we were lucky’. But China, Kong says, ‘very quickly found the right response and implemented it via its strong administration, and [these measures] had a very good effect.’ While folk like Wu Jinglian and other reformists think the legacies of that decision were mostly really bad. Kong is unworried. If this lack of worry really does pervade the top, then we do have a really serious problem.

And if you’d like to see Kong in action - here he is in 2015 talking to…Phoenix!