CHINA: POLITICAL AGENDA FOR THE NEW LEADERSHIP

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP04T00907R000200640001-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 13
• Document Creation Date: December 22, 2016
• Document Release Date: May 25, 2012
• Sequence Number: 1
• Publication Date: February 24, 1987
• Content Type: MEMO

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DIRECTORATE OF INTELLIGENCE
24 February 1987
China: Political Agenda for the New Leadership
Summary
China's leaders face formidable political tasks after the dismissal of
Hu Yaobang. Deng Xiaoping and Premier Zhao Ziyang, who is now the
Acting General Secretary of the Communist Party of China, will be the
most prominent decisionmakers in the coming year, but competition for
influence among various groups will be intense as China prepares for a
party congress in October. We believe their first task will be sorting out
new power relationships. Zhao will be working to consolidate his control
of the party at the same time that party traditionalists, emboldened by
recent events, try to reassert dominance. Deng's role will be pivotal, but
we have few indications of his plans or of the extent to which his and
Zhao's agendas may differ.
Three important decisions confront the leadership: the choice of a
new premier, how to build new succession arrangements, and how to
handle Hu Yaobang's numerous supporters in the party and government.
This memorandum was prepared by Office of East Asian Analysis.
Information available as of 24 February 1987 was used in its preparation. Comments
and queries are welcome and may be directed to the Chief, Political Assessments
Branch, China Division, OEA
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Following practice, Deng probably will put tough policy choices aside
while he works out personnel issues, and he may also cede the
conservative wing some ground until he is satisfied with personnel
arrangements.
We believe the most pressing policy concern of the leadership,
especially of Zhao, will be to protect economic reforms already in practice.
Major initiatives probably will be postponed until the political situation is
less turbulent. Another concern is political reform, which we believe will
be confined mainly to attempts to improve bureaucratic efficiency. In
foreign policy, the leadership has demonstrated that it places a high
priority on reassuring foreign countries that basic policies will not change
as a result of Hu's fall. Finally, Beijing has to rebuild confidence in party
stability and in the longevity of reform policies.
Sorting Out the Power Relationships
regain lost influence and restrain the reforms.
The dismissal of Party General Secretary Hu Yaobang and the selection of
Premier Zhao Ziyang to replace him 1 will entail working out new relationships in both
party and government circles, particularly given the tense circumstances under which
the changes took place. We believe party traditionalists see Hu's downfall and the
attendant realignments in the party hierarchy as an opportunity--perhaps their last--to
well as their ability to constrain Deng's choices
We do not know what role Deng Xiaoping will play in working out the new
arrangements, or what his strategy will be, although we believe Deng remains the top
power broker and arbiter. Deng may have incurred debts in calling on the
conservatives 2 of the Politburo and Central Advisory Commission to support his move
against Hu. Deng thus may have to make concessions and depend on coalitions and
dealmaking to a greater extent than he did six months ago. We do not believe that the
traditionalists can force their preferences on Deng, but their influence may be greater, as
Another unknown is the degree to which Zhao's agenda may differ from Deng's.
We believe that, even if Zhao's opinions diverge from Deng's, during the next few
months Zhao will be careful to mute these differences and avoid disputes. Not only is
October, may make more strenuous efforts to continue to act in concert.
For the purposes of this paper we have treated the conservatives as a unified interest
group, but it actually is an alliance of several disparate groups--ideologues,
conservative economists, and some military leaders. In the past, such coalitions have
proved fragile. However, it is possible that the various conservative groups, having
suffered for their lack of cohesion and facing the deadline of the 13th Congress in
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Zhao's political style less confrontational than Hu's, the recent example of Hu's dismissal
makes clear the risks of challenging Deng.
However, over the next year as the succession issue becomes more urgent,
differences between Deng and Zhao may surtace as Zhao begins moving to establish his
post-Deng leadership lineup. Moreover, because Zhao seems positioned to become the
successor to Deng's position of preeminence, Deng may over time become increasingly
suspicious. We lack direct evidence, but some have speculated
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that Deng, like many aging authoritarian leaders, will feel increasingly challenged as
Zhao begins to assert his authority independently.
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The most visible indicator of the strength of competing forces will be the
designation of a new premier. We expect this decision to be made within the next eight
months before the party congress, although it possibly will not be announced until then.
However, some evidence suggests the leadership, wishing to avoid further controversy
following Hu's dismissal, may wait until 1988. To gain time to strengthen his own
choice--Tian Jiyun--Zhao himself may wish to delay the decision, although there are
costs to holding both top jobs. Because he will have the top political and economic
slots, he will be vulnerable to criticism from rivals or opponents of reform. In addition,
combining top party and government authority in one man runs counter to Deng's goal
of separating party and government functions.
We can identify five candidates to succeed Zhao:3
? Wan Li, 71. Wan is the senior vice premier. He is a reform advocate, especially
in economic areas, and was one of the architects of the successful agricultural
reforms of the early 1980s. He is also respected by most conservatives and
apparently has made few enemies. He would be a good compromise choice, but
we believe Deng would still prefer some one younger who could be counted on
to carry reforms forward.
? Li Peng, 59. Vice Premier Li is probably the most conservative of the candidates.
Because of Li's Soviet training and preference for central planning, we believe
Zhao, a strong proponent of introducing market forces, opposes Li's elevation.
His selection ,therefore, would signal not only that Zhao lacks authority to
enforce his preferences, but that the conservative wing has considerable clout.
? Tian Jiyun, 57. Vice Premier Tian is a Zhao protege and well-known as an ardent
champion of reform. He is a finance specialist, but currently has overall
responsibility for managing the economy. We believe Tian is Zhao's first choice,
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but he is opposed by conservatives and by some moderates who believe he lacks
political acumen and leadership qualities.
handled last year's anticorruption campaign circumspectly, which
? Qiao Shi, 62. Qiao, the junior vice premier, also represents a compromise choice.
Although he has close ties to Hu, he has been careful to cultivate conservatives
as well. Qiao, whose responsibilites include the legal and security portfolios,
won him the respect--and gratitude--of many leaders. Qiao lacks
economic experience; if he gets the job, we expect that either Zhao, from his
party seat, or one of the vice premiers, would continue to be the chief executor
of economic policy.
? Li Ruihuan, 53. Li Ruihuan (no relation to Li Peng) is mayor of Tianjin. He has
recently emerged as a rumored candidate for the premiership. Li has a good
record as city administrator and has won Deng's kudos for his firm handling of
student protests in his city, according to Japanese press reports. However, Li
may encounter resistance because of his weak educational background--Li was a
carpenter who first rose to prominence as a labor leader and "model worker." Li
is close to both Zhao and Hu, but we have little information on his political
leanings. If he is chosen, we believe it would be because each of the other
candidates is unacceptable to one of the key players, and that none of them has
won Deng's strong support.
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accept.
There are other personnel choices demanding attention as well--the Politburo
Standing Committee currently has only two functioning members" and will have to be
reconstituted, and Deng will probably make some moves on the party Military Affairs
Commission (MAC) soon. The appointment of a new MAC chairman or new members
will be especially sensitive; a variety of evidence indicates that the MAC's refusal to
accept Hu Yaobang--Deng's choice--as chairman contributed to Hu's fall. Deng may
find his options in this area especially limited by what military elders are willing to
These decisions, we believe, will be the focus of political contention for the next
several months leading up to the party congress. Although he has connections to Yang
Shangkun, the powerful MAC permanent vice chairman, Zhao has few other military ties
and the choice of a new MAC chairman--or at least the appointment of a probable
successor--will be especially important. Zhao will need a trustworthy man for that job
Of the five members of the Standing Committee, we believe only Zhao and Deng are
fully active. After his disgrace, Hu Yaobang is probably no longer a participant in the
committee's decisions. Chen Yun is not active except
on extraordinary occasions. President Li Xiannian appears to have withdrawn from
activity--he has been out of Beijing for several months--for reasons that are not
clear.
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to help him manage the military if he wishes to succeed Deng. Although the choice of
anew MAC chairman is one issue on which Deng and Zhao could conceivably
diverge--because many of Deng's close military allies have no ties to Zhao and may
consider themselves his equal in seniority and prestige--we believe Zhao is unlikely to
challenge Deng on this issue. Zhao can probably work with any of Deng's likely choices.
A somewhat different kind of personnel problem involves handling Hu Yaobang's
supporters in the party and government. Hu was very successful at placing his people
throughout the bureaucracy--in fact, one of the charges against him was that he
monopolized patronage, according to a US Embassy source. Many of these appointees
will be willing to switch allegiance, and some are now running for cover. However, we
believe that there remains a sizable group of disaffected followers of Hu that could
obstruct Zhao's consolidation of power and possibly even Deng's plans. In addition,
because of their numbers and expertise, they are necessary to implementation of reform
policy. Accordingly, Zhao will have to find a way to make at least a temporary
accommodation with them. In his New Year's speech, Zhao suggested that he was
willing to welcome those who would renounce their Hu-ist errors and join him.
Complicating his task is the likelihood that many of Hu's proteges are now on
conservative hit lists. Reformist leaders, especially Zhao and Deng, will need to decide
whom to protect and what cost they are willing to incur in doing so. A test of Zhao's
influence, and of the degree of conservative resurgence, will be the extent of purges of
reformist officials who would probably support Zhao but are tainted by associations with
Hu Yaobang. conservatives have moved to displace a
number of Hu appointees in several areas, including propaganda, personnel, and
international party liaison offices. Deng's role will be critical on this issue, in our view.
The depth of his debt to the conservatives will be indicated in part by how much of a
purge he permits. Struggles over this issue may also disclose whether Hu's supporters
are trying, out of loyalty or desperation, to mount any counterattack.
A major casualty of the last three months was Deng's attempt to craft his
succession. We believe this had already begun to unravel, but Hu's ouster means all
aspects of the succession are unresolved; virtually all the top posts--including the
general secretaryship, in our judgment--are now up for grabs. If, as we believe, a major
sticking point for Deng's plans was that he could not ease Hu out of the general
secretaryship and over to the MAC chairmanship, he may in one sense have simplified
his succession problems; but in our view the new complications outweigh the possible
gains.
Although Deng, who is 82, has frequently stressed having a succession
generation in place before he dies, it is not clear whether he can put together a
succession package. His original plan, we believe, was to skip a generation and install
men in their 50s, reserving a kind of elder statesman role for those in their late 60s and
70s--which includes both Hu and Zhao. Deng was disappointed by his earlier picks and
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may now decide to back Zhao and other leaders of his age as his immediate successors,
letting them choose the next Generation. Or he may decide to stay on indefinitely and
not set up a succession.
On balance, we believe Deng will make his own choices and have his
arrangements in place before he is gone. We doubt that Deng will retire. In our
judgment, he will probably stay but try to position his chosen heirs to take over when
he dies. If we are correct, tension between the apparent successors and Deng and
other elders will persist.
Zhao may well have his own agenda for the succession. He now holds what is
formally the top job in China, and will probably be working to consolidate his position as
Deng's successor as the top leader in fact as well as name. However, Hu's dismissal
has cast doubt on the permanence of any succession arrangement brokered by Deng,
and we believe that over the long term Zhao will face challenges from conservatives and
reformers alike. His position as the apparent choice of Deng gives him advantages, of
course, but also sets him up as a target. Zhao's immediate task is to establish his
authority working under Deng's aegis, but, given Deng's age, he must also soon begin to
build his own power bases--which may lead him into the same troubles Hu
encountered.
The issue of "political structural reform," a vaguely defined set of changes in the
political and legal spheres, was a principal point of contention between Deng and Hu,
and between conservatives and reform activists. Deng, we believe, inaugurated a drive
to promote political reform in the spring of 1986, but probably had much more modest
changes in mind than students and intellectuals began pushing for in the fall. Deng and
Zhao now face the decision of how to carry on this campaign. Zhao has given hints of
the new line in a speech in which he declared that political reform was still on the
agenda but stressed that such reform has narrow limits.
In our judgment, the broad program of reforms discussed in the press last spring.
and summers is on hold indefinitely. Political reform under the new regime will
probably be confined to efforts to improve the quality of party and government cadre
and to cutting administrative redtape. Measures to reduce the party's role in day-to-day
economic and administrative decisionmaking, originally a key part of the reforms, will
probably still be proposed, but, we believe, will be harder to implement now. Official
press stories indicate that the leadership intends to go forward with reforms to make
local elections somewhat freer by permitting more candidates than there are seats, but
any other moves toward democratization seem unlikely. Without a clear return to
reformist policies by the leadership, these efforts will meet with only partial success, in
s A number of articles during the spring and summer of 1986 called for radical changes
in the political structure. Among the proposals were calls for free elections even for
national leaders, for a true multiparty system; some articles even implied that
Marxism was no longer an appropriate ideology for China.
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our judgment. Party authority is clearly ascendant now, and it will be a rare official or
manager who will challenge the local party hierarchy.
The official media continues to extol democracy--in his New Year's speech, Zhao
said that "socialist democracy" was still agoal--but the emphasis now is on setting
clearer limits. We believe that one item for Zhao will be establishing the limits of
permissible discussion of democracy while trying to convince the Chinese that there has
been no policy reversal.
Protecting the Economic Reform Program
A key goal for both Deng and Zhao, we believe, will be saving the economic
reforms already made. A growing conservative trend in economic policy is evident.
Self-reliance, a shibboleth of the Maoist years, has surfaced again in the propaganda;
political study sessions are being stepped up in factories and other workplaces. Price
reforms slated for 1987 have been deferred, and even in agriculture, a reformist success
story, there are signs of conservative resurgence. Many of these trends have roots in
economic difficulties as well as in political infighting, and predate Hu's dismissal, but
they add up to greater conservative influence on economic policy than we have seen for
several years. Certainly Chinese at middle and lower levels will see the policy changes
Zhao and other reformers are aware of the risks to the economic reforms, we
believe, and have undertaken a damage limitation campaign. So far, their efforts appear
to have been confined largely to speeches and articles, although the US Consulate in
Shanghai reported evidence suggesting that Zhao has protected the staff of the
Shanghai-based reformist journal World Economic Herald. Reformers may try to
announce some new initiative, even if it is largely symbolic, to demonstrate that their
program is alive. The recent announcement of regulations for factory management may
have been intended in part to do this, though the regulations were drawn up and
implementation was begun last year.
Reform leaders appear to have put reassuring foreign investors near the top of
their agenda. Announcements that nothing would change for investors appeared within
a few days of Hu's resignation. These protestations indicate that the leaders know fears
of renewed instability might discourage some foreign investors. However, they may not
be sufficiently aware of the more subtle threats; China is already a marginal investment
prospect for many foreign businessmen, and renewed conservative strength would
exacerbate that problem. Fear of innovation, unwillingness of factory managers to make
decisions, the necessity to consult party committees at every turn, and time lost to
political study sessions are all possible consequences that could further discourage
investment. In our view, Zhao needs to send a strong signal that these risks have not
been heightened.
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Restoring Confidence
A crucial item on the political agenda will be to restore confidence in party
stability and in the longevity of reform policies. Beyond the fact that Hu and his policies
were popular with important segments of the population, the abrupt circumstances of
his dismissal have awakened in many Chinese fears of instability, factionalism, and
capricious policy reversal.
Not surprisingly, intellectuals--including college students--are particularly
disheartened, according to a variety of evidence. We believe that Zhao and Deng agree
that China needs the support of intellectuals in its modernization efforts, although Zhao
may be willing to tolerate somewhat more diversity of opinion than Deng in order to
encourage needed innovation. The leadership clearly perceives that it has lost ground
with intellectuals. Moreover, Deng and Zhao seem to be acting firmly to prevent
anti-intellectualism from getting out of hand as it did in the 1983 "spiritual pollution"
campaign against Western influences. According to press information, Zhao has directed
that only Beijing can approve the criticism by name of any intellectual, and that erring
intellectuals should be educated, not attacked. We expect, however, that these attempts
will do little to counter disillusionment among intellectuals in the renewed atmosphere
of repression and rigidity.
Effects on Foreign Policy
We believe foreign policy played a secondary role in Hu's sacking, and doubt that
it will be much affected in the short term. The Chinese leadership has given priority to
reassuring the West and especially the United States that Beijing's policies will not
change. Indeed, press reports and other accounts have claimed that one reason Hu was
dropped was that he was pro-Soviet--one of Zhao's secretaries made this claim to a US
diplomat the day of Hu's resignation. In our judgment, these claims represent efforts to
deflect foreign concerns about Hu's dismissal and convince the United States and others
that Hu was a threat to the open door policy.
Over the longer term, relations with the West might suffer if Zhao and other
reformers are unable to limit conservative influence. Many of those associated with Hu
were among the most active proponents of better relations with the West, whereas the
conservative camp has many who believe China should pursue either a middle course
between the West and the Soviet Bloc or try to go it alone--"self-reliance." A key
indicator of trends in this area will be the makeup of the Politburo and Central
Committee after the 13th Party Congress. We believe that as long as Deng is active
China is unlikely to draw much closer to the Soviets, but power alignments established
at the congress will affect what happens when Deng is gone.
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Greater conservative influence implies greater tolerance for anti-Western ideas
and a touting of the virtues of "Chineseness." These themes have appeared prominently
in the press since December.
We expect the coming year to be politically tense, with the 13th Party Congress
in October the focal point of attempts by all sides to influence personnel choices. The
reformist coalition, under strain before Hu's resignation, will be even more severely
tested. Splits between more moderate reformers willing to compromise with the
conservative wing and the generally younger, more activist reformers may develop.
Moreover, we believe there will be considerable competition within the reform camp for
the seats on the top party bodies, possibly fueling tensions between former Hu
associates and others, and complicating Zhao's task of holding the coalition together.
It is also likely, in our judgment, that the traditionalists within the leadership will
mount a strong effort to advance their position at the congress--assuming that the
conservative coalition stays together. It is possible that new power relationships may
not be worked out and the congress may turn out to be a nonevent, with few real
changes being made in the top policy bodies and the period of infighting prolonged.
We do not know what Deng's own plans for the congress are. Moreover, he may
be limited by his ability to juggle the many decisions competing for his attention. In
recent years, Deng has seemed to have trouble making decisions when faced with
several problems at once and occasionally has made decisions that, we believe, he has
later regretted. An example would be the 1983 spiritual pollution campaign.
Deng halted the campaign when he realized that
many party cadre had far exceeded his intentions and that the campaign was
threatening his economic program.
Faced with both personnel and policy questions, as he is now, Deng has generally
preferred to settle personnel issues first and defer policy decisions. Under the present
circumstances, he may prefer to cede some ground to the conservatives--for instance,
in the propaganda field--while he maneuvers to place his choices in key spots. Thus,
events at the congress will probably provide important pointers to Deng's intentions on
the succession. His personnel choices should also provide clues to his policy plans.
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As for Zhao, he may have different personnel preferences from Deng's. But we
doubt that he would be willing to challenge Deng at this stage, even if the differences
are significant. As he has in the past, he would probably seek to put people
sympathetic to his policies in secondary positions as vacancies occur, possibly also
create some new organizations staffed with his supporters, and wait for a later
opportunity to make top-level appointments.
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Subject: China: Political Agenda for the New Leadership
Distribution:
National Security Council
1 - James H. Kelly, Jr., Senior Staff Member, East Asia, Room 302, OEOB
1 - Doug Paal, Director of Asian Affairs, The White House,
Room 493, OEOB
Department of State
1 - Amb. Morton Abramowitz, Director INR, Room 6531
1 - Stapelton Roy, Deputy Assistant Secretary, East Asian and Pacific
Affairs, Room 6205
1 - Richard Solomon, Director Policy Planning Staff, Room 7331
1 - The Honorable Gaston Sigur, Assistant Secretary for East Asia and
Pacific Affairs, Room 6205
1 - Norman Levin, Policy Planning Staff, Room 7330
1 - Richard Williams, Director, Office of Chinese Affairs (EAP/C),
Room 4318
1 - Joan Plaisted, Deputy Director of Economic Affairs, Office of Chinese
Affairs (EAP/C), Room 4318
1 - John Danylyk, Chief, INR/EC Communist Economic Relations Division,
Room 8662
1 - G. Eugene Martin, (EAP/CH), Room 4318
1 - Tom Fingar, Chief, INR/EAP/CH, Room 8840
1 - Chris Clarke, INR/EAP/CH, Room 8840
1 - Chris Szymanski, Deputy Director, Office of Chinese Affairs, Room
4318
Department of Defense
1 - Colonel David Brown, Executive Secretary, Office of the Secretary,
Room 3A948, Pentagon
1 - The Honorable Richard Armitage, Assistant Secretary of Defense
International Security Affairs, Room 4E808, Pentagon
1 - Rear Admiral Baker, Deputy Assistant Secretary for East Asia, ISA,
Room 4E817, Pentagon
1 - DIA/DB-2B, Room C2837, DIAC
1 - DIA/JSI, Room 1C945, Pentagon
1 - Lt Col Eden M. Woon, Office of the Joint Chiefs of Staff, China
Plans and Policy, FESA J-5, Room 2E973, Pentagon
1 - DIA/AT-3/China, Room 1120, Pompano Plaza West
1 - Major William Suggs, Headquarters, Dept of the Army, Office of
the Assistant Chief of Staff for Intelligence, Attention:
DAMI-FII, Room 2A474, Pentagon
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National Security Agency
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Department of Energy
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