The Essence and Contemporary Characteristics of the Centennial Great Changes

By Liu Jiangyong

China’s Diplomacy in the New Era

The Essence and Contemporary Characteristics of the Centennial Great Changes

By Liu Jiangyong

CPAPD Council Member, and Professor of Tsinghua University

The concept of the times refers to the ruling party's understanding of the issues of the times, which is the strategic judgment at the highest level of a country. The "new era" proposed in the Report to the 19th National Congress of the CPC is mainly from the perspective of building socialism with Chinese characteristics. The Report points out: "This new era will be an era of building on the past success to future advance our cause, and continuing in a new historical context to strive for the success of socialism with Chinese characteristics. It will be an era of securing a decisive victory in building a moderately prosperous society in all respects and of moving on to all-out efforts to build a great modern socialist country. It will be an era of the Chinese people of all ethnic groups to work together and work hard to create a better life for themselves and ultimately achieve common prosperity of everyone. It will be an era for all of us, the suns and daughters of the Chinese nation, to strive with one heart to realize the Chinese dream of national rejuvenation. It will be an era that sees China moving closer to center stage and making greater contributions to mankind.”1This era outlook is the historical orientation of the Communist Party of China for the development of socialism in today's China.

On the occasion of the 70th anniversary of the founding of the People's Republic of China, this paper focuses on what era the world is in from the perspective of historical materialism and the history of social development, what the relationship between the era of great victory of socialism with Chinese characteristics and the great era of the world today is, and what the lessons and their theoretical roots of the 70-year practice since the founding of New China are. These issues are not only important theoretical issues, but also important strategic judgment issues, which involve how to view the century-old changes from the perspective of the characteristics of the world era.

G20 Summit held in Osaka, Japan in June 2019. President Xi Jinping takes advantage of his participation to carry out diplomacy with Chinese characteristics. G20 is playing increasingly important role in many areas in the international community.

I. The coexistence of two social systems and the multi-national models competition enter a new stage

Today, as the human society is about to enter the 2020, looking back at the great changes in the past 100 years, we can see that the era of coexistence of two systems and competition of multi-national models has gone through the following stages of development, which is the essence of the great change in the past century.

The first stage of brewing period (1917-1948). After the success of the October Revolution led by Lenin in 1917, the first Soviet socialist regime was established and the ideal of the Paris Commune in 1871 was realized. The establishment of the Union of Soviet Socialist Republics (USSR) in 1922 opened a new era of human history. Under Stalin's leadership, the Soviet Union made an important contribution to the victory of the world anti-fascist war in the Second World War. After World War II under the influence of the Soviet Union, Eastern Europe saw successful establishment of some new socialist countries and affected Asia. While the capitalist countries went through the stage of imperialism, some of which were defeated and surrendered in the war, still others have become the post-war world's hegemony, and are in a strong position globally, but the colonial system still exists.

In the initial period of the second stage (1949-1978). The birth of New China in 1949 marked the rise of socialism in Asia. In the 1960s, Yugoslavia, Romania and some other Central and Eastern European countries formally changed their names to Socialist Republics. Countries with two social systems emerged globally, forming two huge camps. In the 1960s, Asian, African and Latin American countries became independent one after another, so the colonial system completely collapsed, forming a vast "middle zone". During the Cold War, countries with different social systems confronted with each other. Countries with the same social system but different models had fierce competition, and even witnessed serious opposition.

Although the United States and the Soviet Union had different social systems, they had adopted almost the same diplomatic and security model in military priority, alliance system and external expansion. The Soviet Union mistakenly characterized the exploration of different socialist models as a betrayal of socialism, which led to the internal division of the socialist camp. The "Hungarian Incident" of 1956, the Soviet invasion of Czech Republic in 1968 and the Sino-Soviet border conflict in 1969, especially the ideological friction between China and the Soviet Union caused serious vicious circles. This is the most profound lesson of socialist countries in the 20th century. Meanwhile, the post-war German and Japanese economies rapidly re-emerged.

In the early 1970s, trade frictions between the United States and Japan began to occur, and the international pattern showed a multi-polar trend. The third stage is exploration period (1979-2009). China ended the "Cultural Revolution" and made great achievements in major reforms such as the transformation of the state model since the year 1979, which greatly liberated the Chinese people's ideology and productivity. However, in the year 1989, Eastern Europe saw the Soviet Union and some other countries changed dramatically, Germany became unified in the year 1990, and the Soviet Union disintegrated at the end of the year 1991, so the balance between the two socialist systems in the world tipped seriously. While adhering to the socialist road, China continuously promotes reform and opening up and has gained a firm foothold. Deng Xiaoping put forward in the 1980s that peace and development are the two major themes in the contemporary world. In the year 1992, the Report to 14th National Congress of the Communist Party of China puts forward for the first time: "Peace and development are still two major themes for today's world. Development needs peace, and peace cannot be separated from development."2

On the other hand, the intense trade frictions between the United States and Japan forced Japan to change partly its national development and business model. The United States enjoys the dividend after the Cold War and relies on the advantages of science and technology to maintain the status of the superpower and the traditional American model, while Japan ended the rapid economic growth cycle due to the collapse of the bubble economy in 1990s. Russia maintains the traditional military strength and geostrategic security of the former Soviet Union in the transition of its national model. There is no social system dispute between the United States and Russia, but geostrategic contradictions and military confrontation are still unavoidable. Most Asian, African, and Latin American developing countries are exploring their own development path, some of which begin to rely on the United States in terms of security, but on China in the field of economy and trade.

The fourth phase of stalemate (2010-2049). Compared with the war and the revolutionary era experienced by the First World War, Russia's "October Revolution" about 100 years ago, the world in the second decade of the 21st century ushered in a century of profound changes, and socialism with Chinese characteristics entered a new era. In the year 2010, China's total economy surpassed that of Japan and became the second largest economy in the world and the gap with the United States is narrowing. The year 2021 is the centennial of the founding of the Communist Party of China and 2049 is the centennial of the founding of the People's Republic of China, which will be an important landmark for China to continuously improve its national model through reform and opening up on the socialist road.

This process is bound to be the process of realizing the great rejuvenation and peaceful reunification of the Chinese nation. Forty years ago, Deng Xiaoping put forward the idea of "peaceful reunification, one country, two systems", which conforms to the characteristics of the present era of "one globe, two systems" and China's national conditions, and has historical inevitability. Back then, there was a big gap in economic construction, development level and living conditions between the two sides of the Taiwan Straits, and the mainland needed to introduce Taiwanese capital and Taiwanese enterprises to develop its economy. Forty years after China's mainland reform and opening up, the economic construction, development level and living conditions between the two sides of the Taiwan Straits have fundamentally turned around, and nowadays Taiwan needs the market, capital and tourists of the mainland. In the past 40 years, the results of competition between different social systems and development models across the Taiwan Straits are obvious to all. In the forthcoming 40 years, peaceful integration and eventual reunification between the two sides of the Taiwan Straits will be irresistible.

In the new era, there will be some new trends in the coexistence of two systems and multi-models competition, and "coexistence and competition" will become normal among various countries in the world. China is willing to maintain peaceful coexistence and win-win cooperation with all countries with different social systems. In the competition of various national models, it is an objective trend that the Chinese model is recognized by more and more countries. Following Vietnam's reform and opening up, the DPRK has tried to abandon its "military priority politics" since 2018 and began exploring the adjustment of the state model of "concentrating on economic development". It has its own national conditions, and may learn from the successful experience of China and Vietnam, but can not copy them completely. In order to move towards reform and opening up, the international community has yet to lift sanctions against the DPRK. In the new era, China will be more open, inclusive and confident. China has further improved the investment environment for attracting foreign investment through the formulation of the Foreign Investment Law and other domestic reforms; has pioneered the world import expo; and Chinese enterprises and industries go abroad to build the Belt and Road with the rest of the world. In this process, China does not draw a line according to ideology, social system or national model, but rather seeks partners in all corners of the world and never interfere in their internal affairs and development paths.

On the contrary, some developed capitalist countries are becoming more and more closed, exclusive and cowardly. They are accustomed to using social system and ideology to draw lines and interfere wantonly in the internal affairs of other countries in an attempt to eradicate the so-called "tyranny" of other countries by military and non-military means; they build high separation walls in border areas and high tariff barriers in the field of international trade, resulting in domestic and international chaos. They regard countries with different social systems as "aliens", carry out so-called "value diplomacy", "Arc of Freedom and Prosperity" and "Indo-Pacific strategy", etc. and establish a geo-strategic structure and exclusive economic circle aimed at blocking and balancing China.

In capitalist countries, the U.S. model led to the outbreak of the financial crisis in 2008, the trade deficit and fiscal deficit remain high, and the gap between rich and poor gets widened. The essence of the tariff war launched by the United States in trade frictions is a way to pass on the crisis of American national model. Around the construction of the U.S.-Mexico border wall, the political power struggles between the two parties in the United States exposed the hypocrisy of American democracy. After the Cold War, NATO led by the United States launched several local wars, which have harmed itself and caused serious consequences. Such violent

multilateralism not only destroys the order of some countries in West Asia and North Africa, but also frustrates European integration, successively resulting in European debt crisis, the influx of refugees, the increase of terrorist attacks and the rise of populism, etc. Nowadays, the Trump Administration is unwilling to provide free protection for NATO, and the contradictions within NATO have risen. The "yellow vest" movement in France reflects the intensification of social contradictions and the change of people's minds. The debated Brexit from Europe Union heralds the setback of the post-war European integration process and the adjustment of Britain's national model. The cabinet of Abe seeks to amend the Constitution of the post-war Japan so that Japan can become a "war-participating country" which will mean that the peaceful development model of Japan may be transformed after the war if he succeeds. If Japan joins the ranks of violent multilateralism in the future, it will make Japan more insecure and the world less tranquil.

Looking back at the history of one hundred years, we can see that the Soviet Union, as the first socialist country in the world, changed its color and disintegrated after 70 years. Although the People's Republic of China has experienced a tortuous road and adversity, socialism with Chinese characteristics has entered a new era of vigorous development after 70 years. The important reason lies in whether we can form a national model in line with the trend of the times and our national conditions under the guidance of the correct concept of the times, and constantly improve and develop it through reform. These laws are not found in the classical Marxist-Leninist works, which needs China to discover and summarize timely in practice and upgrade to theory.

II. National Models Competition and Sino-U.S. Relations

China is not subjectively competing with the United States in terms of social system and state model, but objectively this kind of competition is unavoidable. This is the background for the future development of Sino-U.S. relations.

(1) Competition of the national models decides to a great extent the success or failure of a country.

This is not only reflected between the United States and the Soviet Union during the Cold War, but also between the United States and Japan in the 1980s in the post-Cold War. Currently, the Sino-U.S. trade frictions are not caused by the antagonism between two different social systems or between different ideologies of the two countries, but by the imbalance of economic and trade development led by different state development models. In the next 20 years, the competition of national models between China and the United States will become more prominent.

American policymakers historically regard countries that could replace their global dominance as major national security threats. It is inevitable for the U.S. National Security Strategy Report in December 2017 to list China as the number one strategic competitor. If American policymakers continue to adhere to or even strengthen the traditional power politics and geostrategic thinking, no matter who is in power in the future, this situation will become difficult to change, or even get worse.

This is an inevitable historical phenomenon when the balance of economic strength between China and the United States enters the shoulder-rubbing period. One of the typical cases in recent years is that Huawei, a private multinational high-tech enterprise of China, has been subjected to political pressure from countries such as the United States, etc. It is reported that Huawei has 180,000 employees from 165 countries and operates in more than 170 countries. By the year 2017, it has won 74,307 patents, leading the world in 5G technology. This shows that in the field of high-tech, the United States is beginning to meet challenges from different social systems and different national models. The global blockade of Huawei by the United States on the grounds that its products affect national security is tantamount to the recognition that the technological capability of this multinational private enterprise of China is too strong, which objectively amounts to a free global advertisement for Huawei, and the first case in the history of human society development. The unreasonable detention of Cathy Meng, Vice President of Huawei Company, by the Canadian authorities together with the United States, appears to be the encirclement of a Chinese private enterprise, but essentially is a symbolic event that two social systems coexistence and multiple models competition enter a stalemate.

The progress of science and technology can be used for both military and civilian livelihood. The United States stimulates the development of the arms industry by war and leads the production of civilian products by military technology. This model has both great advantages and disadvantages. For example, because of the influence of international politics and other factors, the export of high-tech weapon systems of the United States can only drop in a trap of its own making, meanwhile it has to import a large amount of products that are under-produced domestically, which will inevitably lead to serious imbalances in foreign trade. China takes peaceful development as its responsibility, giving priority to the development of civilian products production and scientific and technological innovation, so as to promote and support the development of national defense industry. Therefore, the export competitiveness of Chinese products in the world consumer market is bound to be stronger than that of the United States.

(2) The Characteristics, Crisis and Way Out of the American Model

The characteristics of the American model are as follows: two-party system, military complex, military priority, global alliance, military power, scientific and technological innovation, financial statehood, brain-drain and so on, which play an important role in maintaining the capitalist system, special interest groups and superpower status of the United States. However, in the competition of various national models, the American model also exposes its drawbacks and shortcomings, which include: the domestic industrial structure lays particular stress on military industry and lacks a sound supporting civil industry system; the high military budget leads to high fiscal deficits; launching or participating in international wars or profit-making through arms exports leads to tensions in the world; the American-style democracy, the two-party system and the separation of administrative powers often lead to government policies short of continuity as well as opposition between the President and Congress, and may even lead to the government "closed down" and political instability; military alliance mode will inevitably lead to geostrategic competition with countries outside the alliance, and the proliferation of unilateral military force or violent multilateralism will damage international peace. These shortcomings lead to the increasing cost of national security of the United States, while the sustainable security of the United States lacks effective guarantee.

U.S. President Trump has a perceptual understanding of the drawbacks of his national model, but lacks rational thinking about the transformation of the American national model. In fact, the fundamental way out for the rational transformation of the American model is to carry out reforms in line with the national conditions, take the domestic economic construction of the United States as the center, strengthen the modernization of infrastructure, and change the industrial structure of the military complex. The scientific and technological advantages of the United States are brought into play in this process and contribute to world peace and development. China can play an active and constructive role in this process. However, this requires a process. Unfortunately, the Trump Administration is eager to achieve a quick result through trade sanctions, but the result is not good and harmful, not only it cannot reduce the trade deficit, but causes the rising U.S. international trade deficit in 2018 and the damage to the domestic economy.

(3) The Characteristics of, Resistance to and Response by the Chinese Model

China will remain in the initial stage of socialism for a long time to come. Over the past 40 years of reform and opening up, China has gradually formed a national model in line with its own national conditions. The Chinese model will continue to be improved through reform and innovation.

In the year 1995, the author forecasted that "China in the 21st century will be more open, and China's national model will be a "pluralistic integration" structure with ten characteristics: (1) China's economic system and ownership forms are public ownership as the main body with coexistence of various economic components. (2) Distribution system is based on distribution according to work and practicing multi-legal distribution forms. (3) The economic system and operational mechanism take market economy as the main body and adopt various means of macro-control, such as rule of law, planning, administration and taxation. (4) The national political system takes the National People's Congress as the main organ of power for legislation and supervision, and the division of labor and cooperation among government departments. (5) The political party system is based on the leadership of the Communist Party of China, multi-party participation in political discussion, giving full play to the role of the CPPCC and the democratic parties. (6) The population structure of the Chinese nation is mainly based on Han nationality, and all ethnic minorities are united and friendly for common development. (7) The state structure is the "one country, two systems" with the socialist system in the mainland of China as the main body and the capitalist system practiced in some regions. (8) Ideology is based on Marxism-Leninism and Mao Zedong Thought as the main body, drawing on all the progressive civilizations in the world, and enriching and developing continuously. (9) Culture and art sees the Chinese national fine tradition as the main body, absorbing all the healthy and excellent culture achievements of mankind. (10) Foreign policy takes peaceful development as the main body to promote diversified friendly cooperative relations and economic, trade, science and technology, and cultural exchanges with various countries in the world."3

Over the past 20 years, although these views need to be further complemented and improved, they have indeed been proved by time and practice and are basically in line with the facts and the main characteristics of the Chinese model. It is superficial that some Western media and some scholars misinterpret contemporary China as "state capitalism" or "one-party rule". The practice of the 40-year reform and opening-up and 26-year socialist market economy in China fully prove that the above-mentioned state model of "pluralism and integration" is of vitality and growth. In 21st Century, China advocates the co-construction of the Belt and Road and the community with a shared future for humankind, which is the experimental development of this "pluralistic integration" model.

Meantime, we should also see that the Chinese model still faces many problems and challenges. China's regional and industrial development is unbalanced. Although it has developed rapidly in the fields of high-speed railway network and Wechat payment, it has brought the world a sense that China has surpassed the developed countries in these areas, but it is still the largest developing country in the world on the whole. In the future, as China becomes a big emerging industrial country, the expectation of the international community for China will be higher. In more and more aspects, China will no longer be regarded as a developing country that can continue to enjoy some preferential treatment. China's model will also encounter greater resistance, including vicious competition and suppression in violation of international practices. This situation may be particularly prominent in the Sino-U.S. relations.

We must adopt a steady, reasonable and wise way to deal with this matter in the process of national growth. In the face of China's trade surplus of more than 400 billion U.S. dollars annually between China and the United States, we should and can strive for a positive expansion of the balance through strengthening the economic and trade relations between the two countries, rather than relying solely on each other's tariff increases to move towards a negative reduction of the imbalance. Of course, the most fundamental way out may lie in the successful transformation of the American national model. China and the United States need to transform trade frictions into a model of coordination and integration, and strive for mutual benefit and win-win situation. In the future, even if China surpasses the United States in economic scale, there will be no so-called "Thucydides trap" because China seeks peaceful development. However, if the United States retreats to the second largest country in the world, whether it will challenge the first largest country in the world by military means in order to regain its hegemony and deliberately jump into the "Thucydides trap", which will need a strategic observation of reverse thinking and bottom-line thinking to prepare for the rainy day. In the new era, i.e., the next 40 years to come, the most important national interests for China is to ensure the sustainable security and sustainable development of the country in the process of realizing the great rejuvenation of the Chinese nation and achieving this goal.

III. Conclusion: Two social systems coexist for a long time to come, and different national models can complement each other

In the 21st century, the long-term coexistence between capitalist countries and socialist countries in the world conforms to the law of unity of opposites, while most developing countries linger and watch between the two, choosing the development paths and national models conducive to their own countries.

(1) The basic reasons for the long-term coexistence of the two systems

Capitalism can be sustained through the adjustment of the state models, while the exploration of the socialist state models is unprecedented, and it is bound to advance in twists and turns. Up to now, as the largest developing country and largest developed country respectively in the world, China and the United States have their own advantages and disadvantages in different ways of governing the country and the world. The Sino-U.S. trade frictions in the new era are not so much the confrontation of different social systems as the competition of different national models. Because the United States has trade frictions also with Japan, South Korea and European countries with the same social system, which sometimes are very fierce. China's trade surplus with the United States is largely caused by the export competitiveness formulated by the Japanese, South Korean, European and American enterprises invested in China, which has nothing to do with the social system. Therefore, China and the United States should try their best to avoid the politicization of economic and trade frictions caused by Cold War thinking.

The establishment of socialist countries is not originated from capitalist countries as Marx predicted. Instead, some countries changed their relations of production under the condition of low productivity and entered the socialist society, and some feudal ideological remnants still remain. In addition, the Western powers exert pressure from outside through military and non-military means, which lead to the impoverishment and the sharpening of social and political contradictions of some countries, so sometimes the governments are forced to take stringent control measures, which are accused by Western countries of so-called "human rights violations". On the other hand, in spite of serious social conflicts and repression by the authorities, some capitalist countries are still glorified as the so-called "democratic countries". In the face of facts, the people of these countries are awakening.

(2) The possibility of learning from each other in the competition process of different national models

As far as socialist countries are concerned, with the development and change of domestic and international situations, it is necessary and inevitable to adjust and transform the state models under the condition of unchanged social system. Deng Xiaoping once pointed out in 1991 that "Persisting in reform and opening-up is a way to determine China's destiny... Only by adhering to the reform and opening-up policy can we seize the opportunity to take stages up.4The essence of China's reform and opening-up is not the change of social system, but the rebuilding and improvement of the state model, which is the only way for a socialist country to become strong from weak. China's economic achievements over the past 40 years since its reform and opening-up in 1978 have made China's model the subject of international studies.

Meantime, as pointed out in the Report to the 19th National Congress of the CPC, "The basic dimension of the Chinese context -- that our country is still in and will long remain in the primary stage of socialism – has not unchanged, China’s international status as the largest developing country in the world remains unchanged. The main contradiction of Chinese society in the new era is the contradiction between the people's growing need for a better life and the unbalanced and inadequate development.5The Chinese model is by no means perfect, and still needs to be improved through deepening reform. Especially, we should consolidate the sustainable security of the state and society and strive for the sustainable development of common prosperity by combining the virtue of morality, the rule of law, the civil system, rule of taxation and political education "five governance". As described in the "barrel theory", the rule of "five respects" are like five pieces of a barrel, which are indispensable and one missing is collapse. They should be repaired timely to achieve close connection and seamless connection at a higher level.

Since the implementation of socialist market economy in the 1990s, China has made considerable progress in economic construction, but there are still shortcomings. China can learn from the successful experiences and practices of other countries in the world and constantly upgrade, improve and innovate its own development model. China will not export the so-called China model. The willingness of some developing countries to learn from the Chinese model is an encouragement and affirmation of China's successful practices. Only by constantly improving China's national development model, can China live up to the expectations and high hopes of people all over the world.

(Edited excerpts of the article in Peace and Development, No. 3, 2019)

The BRICS leaders also meet and discuss how to make greater contributions to the international community in Osaka in June 2019.

1. Xi Jinping’s report to the 19thNational Congress of the CPC. http://www.gov.cn/zhuanti/2017-10/27content-5234876.htm.

2. Jiang Zemin’s report to the 14thNational Congress of the CPC. http://cpc.people.com.cn/GB/64162/64168/64567/65446/4526308.www.gov.cn/zhuanti/2017-10/27content-5234876.htm.

3. Liu Jiangyong, “Trans-century Japan, Beijing, Shishi Publishing House, 1995, p.421.

4. Deng Xiaoping, Selected Works of Deng Xiaoping, Vol. III, Beijing, People’s Publishing House, 1993, p.368.

5. Xi Jinping’s report to the 19thNational Congress of the CPC. http://www.gov.cn/zhuanti/2017-10/27content-5234876.htm.