Mistakes must not halt change, says economist

PUBLISHED : Thursday, 13 April, 2006, 12:00am
UPDATED : Thursday, 13 April, 2006, 12:00am

Veteran economist Gao Shangquan shrugs off criticism of the economic reform process, highlighted by claims that despite the boom times in cities, the public has failed to benefit while special interest groups have reaped the profits.

'It is true that there have been mistakes, such as a small number of people who have sought to advance their own interests in the name of reforms, and we should make rectifications,' he said.

'But it is not fair to point the finger at the reforms for such problems, which can be addressed. Many reform measures have not been put in place and it is not right to deny the goal of the reforms because of some faults.'

For Professor Gao, 77, the debate over China's reforms has been going on since the early years of the open-door policy.

A top government adviser over the past two decades who has staunchly supported market-oriented reforms, he insists he knows where to draw the fine line between pushing the reforms forward and betraying the country's socialist ideology.

The professor was directly involved in orchestrating China's reform policies as vice-minister of the State Commission for Restructuring the Economy from 1985 to 1993. He said Beijing must push ahead with an overhaul of government institutions as the first step in stalled political reforms, which have been blamed for rampant corruption and widespread public discontent.

During a meeting with Premier Wen Jiabao ahead of last year's National People's Congress meeting, Professor Gao suggested a State Council-level mechanism be built to co-ordinate the interests of various ministries and local governments.

'I said the State Commission for Restructuring the Economy should be reinstated to map out an overarching reform plan and timetable,' he said.

But he admitted that it would be difficult for top leaders to adopt such a proposal because the government had pledged to trim the bureaucracy.

The past year had been designated as a time to address deep-rooted problems, Professor Gao said, but it had ended up witnessing a fierce debate about the merits and demerits of market reforms.

'The reforms are at a critical moment of overcoming major difficulties, featuring two bottlenecks: resource restraints and environmental degradation,' he said.

'It is getting more and more difficult to reach consensus with the emergence of various interests groups.

'However, we have no alternative but to carry on reforms.'

Citing failures in education, medical and housing reforms, critics have openly questioned the economic reform process over the past year and have aimed their fire at so-called mainstream economists who support faster overhauls.

Professor Gao said he felt he could not keep quiet when a few pro-reform economists stood up to such criticism.

Debates were inevitable, as proven by the long reform process, he said, but the quest for a consensus had to go on.

'The motivation for reform is on the decline, while noises [questioning or even opposing reform] are mounting,' he said.

'We must eliminate interference and unwaveringly push forward reform.'

Professor Gao said he was proud that the top leadership had supported him and other vocal pro-reform economists, such as Wu Jinglian, with President Hu Jintao and Mr Wen calling last month for consensus building on the implementation of reforms.

'It is rather unusual that only opinions about the demerits of reform or attempts to deny reform have found popular support among the public, while people who think otherwise dare not speak out,' he said.

He had been surprised to see so many varying public opinions, thanks to the internet, on many present and historical issues that the authorities had already drawn conclusions about.

'I even see people voice support for the People's Commune and the Cultural Revolution and, frankly, I don't understand why they have ignored the central government's conclusions,' he said.

'I don't think it is wise to argue who are mainstream economists and who are not, or who belongs to the leftist camp and who belongs to the rightist, what is a socialist economy and what is not,' he said, citing late leader Deng Xiaoping .

'We should avoid using ideological labels in the debate.'

Professor Gao, who has been branded a neo-liberal by his opponents, singled out Larry Lang Xianping, a renowned critic of economic reform at the Chinese University of Hong Kong, who recently said social evils were as prevalent now as at any time in China's five-millennium history.

'If we don't deal with such opinions in building consensus, how can we push forward reforms?' he said.

'The direction of our reforms, which are socialist market-oriented, is by no means incorrect. We cannot retreat to the era of the command economy.

'For such a large-scale reform, it is unavoidable to have some problems. We should persist with the right direction and tackle the problems when they occur.'

Professor Gao was the head of the Economic Subgroup of the Preparatory Committee for the Hong Kong Special Administrative Region and chairs two leading pro-reform think-tanks, the China Society of Economic Reform and the China (Hainan) Institute for Reform and Development, both government-backed.

He said it was about time to convene a consensus-building meeting among academics to conclude the debate, which was the third in China's reform process.