Thursday, January 13 10:41 AM SGT CHINA: Elder warns on economic change The Communist Party may lose "the basis of its rule" in less than 10 years if the private sector is allowed to go on expanding, a leading conservative elder has warned. Former head of the party's propaganda department Deng Liqun said in an internal paper collectively written with his aides that party rule would be threatened unless state-owned enterprises remained the mainstay of the economy. Mr Deng's salvo came as the leadership was debating the extent to which more leeway should be given to the non-state sector, including private and foreign firms. The so-called mainstream faction of the party, led by President Jiang Zemin and Premier Zhu Rongji, favoured giving more elbow room to the non-government sector, particularly after the mainland's accession to the World Trade Organisation. This included encouraging private enterprises to be listed on the stock market and to buy up state firms. A Beijing source said Mr Deng's paper was based on detailed research his advisers had done in cities where non-state firms had become the dominant sector of the local economy. "In cities where the state sector is no longer predominant, administrations are dependent on private and foreign firms for taxes and other kinds of income," the paper said. The conservatives said mayors and other local cadres were obliged to please the private bosses because the leaders of the "new classes" might move their businesses elsewhere if their views were not heard. They said the declining role of the state sector would change the entire political and social climate of the country, which would threaten the Communist Party's monopoly on power. The rising economic and political power of private entrepreneurs had spread from the coast to inland regions, the paper said. The conservatives warned that, in some cities, members of the moneyed class were either buying up political offices or having a say in the appointment of cadres. Analysts said the views of Mr Deng struck a chord among a broad spectrum of party members, particularly those over 50. Despite the opposition, Mr Zhu had been pushing hard for a bigger role for private businessmen in reforming state industry, the analysts said.
Copyright (C) 2000. South China Morning Post Publishers Ltd. All rights reserved ------------------------------------------------------ Daniel F. Vukovich Dept. of English; The Unit for Criticism University of Illinois Urbana, IL 61801 ------------------------------------------------------