This month marks the twentieth anniversary of Deng Xiaoping’s “southern tour”, in which the architect of China’s reform and opening policy (retired at the time, but still powerful behind the scenes) re-invigorated economic reforms against staunch opposition. And there is a strong sense in China today that the country again stands at a reform crossroads.
Key figures within the Communist Party, including Premier Wen Jiabao (温家宝), and such notable academics as Sun Liping (孙立平) — the former doctoral adviser to now vice-president and successor apparent Xi Jinping (习近平) —have warned that China’s development is threatened by resistance to further reforms.
Others argue that China’s reform project is already a proven success, and that China’s government-led economic model is an example for others to follow. There is no need, in other words, for further reform.
Then there are those who believe reforms are to blame for the problems China faces today, and who say China should turn back.
Behind these competing views, which I have just vastly oversimplified, is a general sense of unease over exactly what China’s upcoming leadership transition this year will bring. This is more than a vague uncertainty. President Hu Jintao’s July 1 speech to commemorate the Party’s 90th anniversary, a carefully scripted text emerging no doubt from much internal wrangling, was a virtual blank slate, giving no indication of what anyone can expect beyond an emphasis on “stability.”
Adding to our dossier on the reform debate inside China, the following piece is from Qin Xiao (秦晓), a former Red Guard who has held a series of important positions at various state-run enterprises and is now chairman of the Boyuan Foundation, a Hong Kong-based economic think-tank.
This article, which first appeared on FT Chinese on January 20, has been re-posted on a number of China’s major internet portal sites, including QQ.com and Hexun. QQ.com attributes the article to Nanfang Online, the official website of the official Party newspaper in Guangdong province, Nanfang Daily.
A few comments on the article at QQ.com follow below:

“Reform in China Must Not Stop in its Tracks”
By Qin Xiao (秦晓)
People in China generally believed in the 1950s that socialism was the liberator of the people. Free markets, on the other hand, were detrimental to society. In the 1960s, when I was packed off to the countryside in Inner Mongolia for re-education (再教育) I recognized that the ideological fervor [over socialism] masked inherent defects in our planned economy. That is where I would like to begin telling China’s story.
As a corporate leader, I have personally experienced the past 30 years of reform. I have a greater understanding of the problems China must face. China is now in the midst of a latter phase of transition from a planned economy to a market economy — and our discussion of the relationship between the government and the market is vastly different from that seen in countries with mature market economies.
While China’s rate of economic growth has stood around 10 percent annually for three decades now, our debate still orbits around the following question: Has this success resulted from government control, or from free market [economics]? The answer [we give] to this question will decide China’s future. Will China continue to promote free market reforms that have yet to be completed, or will it bring three decades of transition to an end? Do the problems now facing China’s economy, and social tensions in our country, originate with market reforms themselves, or are they the result of bottlenecks and setbacks in the reform process? Is China’s [present] state-led economic model an end in itself, or should it be changed through deeper reforms?
In the process of tackling economic problems, democratic governments are restrained by the preferences of the electorate and by struggles among political parties. This can mean that efficiencies are sacrificed, or that responses are excessive. Modern democratic systems are not always ideal partners with market systems. Nevertheless, there are no utopias in our world, and there is no such thing as the ideal system. The question of whether these systems can be sustained and whether they can be accepted by society rests on whether or not they can avoid gross mistakes, whether they have mechanisms for correction and can make relevant and necessary adjustments.
Economists and statesmen have historically sought a model that might replace the modern market [economic] model. Two of the principal experiments put forward were the “Leninist-Stalinist Model” (列宁-斯大林模式) of the Soviet Union and the so-called “Asian Model” (东亚模式). The former provided the basis for China’s planned economy of the Mao Zedong era. Most representative of the latter model was Japan, and the model made economic stars of Japan and several other Asian nations.
In the 1930s, as the economies of the West slid into the “Great Depression”, the role of the Leninist-Stalinist Model in driving rapid economic growth in the Soviet Union was hotly discussed among economists. Thirty to forty years later the Japanese model became another hot point of debate. Nevertheless, history has already proclaimed the failure of these two models. The first model suffered sclerosis, sacrificing basic human rights to divert all energy to development of the economy and the military. The second model created price distortions (价格扭曲), misallocation of resources (资源错配) and corruption (官商勾结).
The modern democratic and market system still needs to be improved, but it remains viable — and no better choice has yet been found.
Well then, what does this teach China? In the 1970s, China’s government launched off on a process of reform and opening, setting aside the planned economic model and converting to a socialist market economy. In this way China’s economy was spared collapse and developed rapidly. In the early stages of this transition it was necessary for the government to play a leading role as the market was not yet developed, and this [necessity] resulted in the emergence of a government-driven model not unlike that of the [previous] Asian or Japanese models.
The mission of this government-driven model has now been achieved. But now we must cast aside the impediments [to further development] kept in place by powerful vested interests (特殊利益团体), transforming the function of the government and further promoting market reforms.
At present there are two tasks we must work to achieve. First, the government must shift the focus away from developing the economy (发展经济) over to improving rule of law and providing public services (公共服务). Second, our economic system must be transitioned from a government-led [model] to a market-led [model], with the government serving only a regulatory function.
In order to achieve the above-mentioned goals, the government must dispense with approval procedures for all sorts of economic and market activities (aside from industries that must necessarily be regulated). [It must] cease interfering with market pricing and transactions, progressively removing controls on land, labor, energy, mining and capital pricing (interest and exchange rates). The government must reform monopoly [state-run] enterprises. [It must] carry out a fair and efficient process of privatization of state-owned assets. [It must] reform tax institutions (税收制度) with the goal of improving social welfare. Aside from these, [the government] must increase spending on social security, healthcare, education, housing, the environment and other public services.
The spread of the economic crisis throughout [developed] capitalist countries has prompted skepticism about the future fate of free markets. Nevertheless, China’s story cannot become the justification for opposing free markets. Quite the contrary, market reforms are the reason China has achieved success over the past 30 years.
To move forward, China now must transform the role of the government in economic life, promoting further reform in the direction of a free market system. Our mission is still not accomplished.

The following are a number of comments appearing after this article at QQ.com:
(1) In fact reforms have already stopped. We’re even seeing a turning back!
实际上已经停止,而且出现倒退!
(2) Private ownership is the root of ten-thousand evils.
私有制是万恶之源。
(3) Aren’t reforms done? What need is there for further reform?
改革不是已改完了？怎么还要改？
(4) In order to protect vested interests, [reforms] have basically already stopped, or even gone backward! For example, state monopolies and such.
为了维护既得利益，已经基本止步，甚至倒退！比如国企的垄断等等。
(5) The impression people have now is: economic reforms have been stalled for a long time, and the progress on rule of law has gone backwards with major strides.
现在给人的印象是：经济改革长期停滞，法治化进程在大踏步后退。
(6) Prices are going up every year, and little people like me see no increase in wages so its really negative growth. How can I support reform achievements like that?
物价年年涨，我等小民收入没增就等于负增长，这样的改革成就我等如何赞成
(7) Constant reform is the only way of ensuring the country keeps in stride with the times.
不断改革乃是保证国家与时俱进的根本方式！
(8) The planned economy is just a power economy, an economy for officials. That’s where the obstacle to reform is, everyone knows that.
什么计划经济，就是权力经济，就是官经济。改革的阻力在哪里，国人都明白的。

Chinese media reported with shock in January 2012 that the airport in the city of Changsha, the capital of China’s Hunan province, was charging 68 yuan (US$10.7) for bowls of instant noodles the would ordinarily cost at most six yuan in the city. Despite nationwide reporting of these incredible prices, Changsha’s airport continued charging them as usual. In this cartoon, posted by Cao Yi (曹一) to his blog at QQ.com, TV cameras attempt to surround the Changsha airport, where a chef smiles self-assuredly as he offers bowls of noodles for 68 yuan — but the airport, disguised by a giant turtle shell, is utterly impervious.

At a discussion forum of the Guangdong People’s Congress in January 2012, delegate Zhong Keji (钟课枝) advocated more “positive news,” saying that it seemed to her that China’s media was too full of coverage about corruption and other matters. Chinese media quoted her as saying at the forum: “Supposing everything we see is about this Party secretary falling from grace today, and that city mayor falling from grace tomorrow, how sad would that be? That just shows that problems have appeared in our system. Just like with food safety. I don’t want to see that kind of stuff. I just can’t take it.” In response, Zhu Xiaodan (朱小丹), another delegate at the forum, said: “When cadres have committed wrongs and are handled by the justice system, we must let the people know this. . . Not wanting to see something doesn’t mean it doesn’t exist. If we have problems within our [leadership] team, we cannot hide this from the people.” In this cartoon, “The Ostrich Delegate” (《鸵鸟代表》), posted to Sina Weibo by the inimitably bold Kuang Biao (邝飚), Zhong Keji is depicted as an ostrich with her head buried in the earth. She is identifiable by her red “delegate” badge. The text on the cartoon is her quote, as above.

In a post today, CMP Director Ying Chan discussed the way presidential elections in Taiwan this month were actively discussed in mainland China despite a directive from the Communist Party’s Central Propaganda Department that limited Chinese newspapers to using Xinhua News Agency coverage.
Not surprisingly, domestic Chinese microblogs were one of the places where discussion of the elections in Taiwan was most active — and where in fact it continues.
This post, for example, made after Ma Ying-jeou’s victory Saturday by Hong Kong journalist Luqiu Luwei (闾丘露薇), was still being shared and discussed today:

Ma Ying-jeou has won, showing that elections are not a scary thing for a ruling party. Elections four years ago were steady and smooth, and this year was no different. This isn’t the work of any one political party or political figure, but rather a reflection of how the Taiwan electorate has slowly matured. . .

Just to give readers a sense of the microblog-based reach someone like Luqiu Luwei can have, she has a reported following on Sina Weibo of close to 1.3 million. And while followers for VIP account holders can be inflated by microblog service providers in China, there is no doubt Luqiu’s following is substantial.
In response to the Luqiu Luwei post above, one mainland user on Sina Weibo wrote: “[Chinese] authorities, why do you fear elections?”
On that note we turn here to one of the most interesting pieces to appear on domestic microblogs in China this month on the question of democracy in China. The post, converted from text into an image file (a fairly effective means of eluding censorship), addresses one of the most frequent rationalizations given by opponents of democracy in China: that the Chinese people are just too base in character to make it work.
Posted on January 6, this version of the image-as-text file was shared more than 9,000 times on Sina Weibo, drawing close to 2,300 comments as of January 17. We’ve posted the image file as the bottom of our translation, and readers can see from the overlapping Weibo account names at the bottom-right that this file was re-posted a number of times.

Those who fight against democracy, please answer the following questions right away:
1. You emphasize that our people are of low character, not suited to carrying out Western democratic systems. But how is it then that we are able to implement an even more advanced socialist system? Is it that socialism doesn’t demand of the people a very high-level of character and conduct? Or is it that socialism is inferior to capitalism?
2. You advertise that autocracy is more efficient than democracy, and so you reject democracy. If this is the case, wouldn’t an even more autocratic imperial system have a higher degree of efficiency still? Should we then return to the imperial system? Is high efficiency necessarily good? And what if there is high efficiency in doing bad things — what then?
3. You emphasize that our people are intelligent, hardworking, courageous and good, the most excellent people on earth. How then do you explain that this most excellent population, having passed through 5,000 years of corrupt history and then having subsequently lived through 50 years under the most advanced and ideal system replacing [the old corrupt system], are still of such low character that they aren’t suited to the most basic democratic rights?
4. You emphasize that the peoples’ character is too low so we can’t have democracy, but why is it that intra-party democracy too cannot move ahead? Does this mean that elites within the Party are also of low character? If people are of low character, are they qualified to rule a nation and its people?
5. You say that the Party is the servant of the people, and that the people are the masters of our nation, but you emphasize that we must uphold Party leadership. Why is this?
6. You say on the one hand that we must take command politically, that politics is a required course. But on the other hand, you don’t allow us to discuss politics. On the one hand you say officials must talk politics, but on the other you don’t allow the ordinary people to participate in the administration and discussion of state affairs.
7. You say that you represent advanced culture, but you can’t tolerate freedom of expression as mandated in our Constitution. You don’t permit criticism, but only allow paeans of praise [for the Party]. So where is this advanced [culture] you talk about?
8. If the National People’s Congress is the highest organ of power in our country, why is it that it must work under the leadership of the Party?
9. Why though you are clearly staunch materialists do you completely worship a fabricated Ism [i.e., socialism with Chinese characteristics] and define this as the ultimate truth, not permitting the existence of other ideas?
10. If the people are the masters of our nation, why is it that these masters don’t have the right to demand democracy, freedom and human rights?
11. Why is it do you think that while the Party has set its mind to opposing corruption, corruption has not just seen no decline over the past decade and more, but in fact has grown more and more serious? Does this mean that the central Party’s commitment to fight corruption isn’t strong enough, or that it doesn’t have sufficient capacity?
12. You publicize the advanced nature of the proletariat, and you publicize violent revolution. But when the proletariat has used violent revolution to seize power and then annihilates the propertied classes to become the masters of the nation and monopolize all of the resources of society, cna they still be called the proletariat? Can they still maintain their advanced nature? Did our nation’s proletariat really become the nation’s masters?
13. [You have said:] “Why must we have violent revolution? Because the proletariat are the most advanced, and they demand revolution”; “Why is the proletariat the most advanced? Because they are the most completely devoted to the revolution.” What kind of logic is this?
14. You have publicized that, “Revolution is guiltless, and revolt is rational.” But now you emphasize that “stability is the overriding priority,” afraid of the wind even stirring the grass. In this era of peace, how is it that you work along contrary lines?
15. You publicize that we are a society where each person receives according to his labor, but the the power and standards for distribution [of wealth and resources] are all in the hands of just a few officials, and ordinary Chinese don’t have the right to question. What should we make of this?
16. You say there was “never a Savior”, but you parade the idea that “he [Mao Zedong] was the Great Liberator.” How do you explain that? [NOTE: Here the writer is attacking the cult of Mao Zedong, the idea that the leader’s legacy is unassailable.]
17. You publicize that in our wicked old society the people were no better than cattle and horses, but you call on the people to strive to be willing old oxen of the revolution. Could you explain this idea?
18. How is it that our leaders are always the greatest and most enlightened, but our people are always regarded as having a debased character? Is it that our leaders are unable or unwilling to work to lift up the character of the people? And how is it that we can manage to find such great and enlightened from among a population of debased character? Further, wouldn’t it be right to say that in those countries where the character of the people is not so base, the leaders there even greater and more enlightened than our own?
19. How is it that [you say] our system is the most advanced, that our government is that most enlightened, that our leaders are great, and our people are the most diligent, but the country is still very backward and poor?
20. You say that the Party was established for the people, that [the Party] is single-minded in serving the people, but the expenses of the Party are from the national treasury and the people don’t have the right to ask questions about them. Why is that?
21. The people are asked to report their personal income and pay taxes, but there is objection to the idea that government officials make their assets and holdings public. What is the reason behind this?
22. Why is it that the people are asked to pay taxes but have never been informed how this money is being spent?
23. Why is it that our economy has shown a high rate of growth year after year but the incomes of ordinary Chinese have not grown?
24. Why is it that ordinary Chinese are always asked to obey this rule or that rule, but have never been permitted to voice their doubts about the rationale behind these rules?
25. Why is it that when officials pocket millions of yuan through corrupt means these acts can always be played down, but if an ordinary citizen steals just more than ten-thousand yuan they can face capital punishment?
26. Why is it that the proletariat are the most advanced? Is it that one can become advanced simply by becoming poor, by having nothing? Do our poor people today still have this advanced nature?
27. Seeing as [according to Party doctrine] the workers are the master class of our nation, why is it that masses of laid-off workers have fallen to the lowest levels of our society?
28. Why when you are materialists through and through are you constantly seizing control, with a mountain of paperwork and a sea of meetings all to send out instructions, [urging] consensus, the study of ideology, understanding the essence [of this or that declaration], expending so much energy on all of these ideological things?
29. Why when you are materialists through and through do you have such a taste for all of these superficial articles, exaggerating and concealing things, and why do you send all of these slogans flying?
30. Why when you are materialists through and through are you so vigorous in controlling thought, requesting [, as the Party did during the Cultural Revolution, that the people] ask for instructions in the morning, report their actions in the evening, and engage in determined self-criticism?

On December 21, 2011, a journalist in Henan’s capital city of Zhengzhou stumbled across a sign outside a local restaurant that said: “The following types of people will not be served: 1. Those who aren’t filial to their parents; 2. Those who keep mistresses; 3. Those who use public funds for themselves; 4. Those who don’t believe that property prices will drop.” The boss of the restaurant told the reporter that these types of customers rubbed him the wrong way and insisted this was a principal on which he ran his business, not a purposeful advertisement. News of the sign quickly spread across China’s internet, resulting in a number of cartoons. In the above cartoon, posted by artist Chen Chunming (陈春鸣) to his blog at QQ.com, a restaurant owner leans across his service counter, apparently asleep, as he has no customers to serve. The sign on the counter reads: “The following types of people will not be served: 1. Those who aren’t filial to their parents; 2. Those who keep mistresses; 3. Those who use public funds for themselves; 4. Those who don’t believe that property prices will drop.” A dog looks on, thinking to himself: “So, this boss isn’t short on cash?”

Last Saturday, Taiwan held its fifth direct election for president. The event was an important one for Taiwan and mainland China not just because the outcome, the victory of incumbent President Ma Ying-jeou, was the one Beijing favored. This time, the election process itself was followed closely by mainland Chinese. And in that sense, the election was an important milestone for China, Taiwan and Hong Kong.
The authorities in Beijing have always regarded democratic elections in Taiwan as a highly sensitive issue, and this year was no different. According to a friend who works for a traditional media outlet in mainland China, the Central Propaganda Department sent out an order on Taiwan elections to all media well in advance, saying that they must “hold to [propaganda] discipline, using only official releases from Xinhua News Agency.”
As could only be expected, newspapers in mainland China did stick to Xinhua coverage over the weekend, not just Party papers like the People’s Daily but also commercial newspapers like Southern Metropolitan Daily, the Oriental Morning Post and The Beijing News.
Xinhua coverage referred to incumbent Ma Ying-jeou not as the “president” but as “the leader of the region of Taiwan” (台湾地区领导人). Nevertheless, newspapers did strive to distinguish themselves in terms of treatment, layout and headlines. Guangzhou’s Southern Metropolis Daily devoted nearly its entire front page to a photograph of Ma as he made his victory speech. The bold headline read simply: “Ma * Victory.” Strong and concise, this was a statement drawing power from what was left unsaid.

But coverage of Taiwan’s presidential elections didn’t stop there. This, after all, is the age of the internet.
Four years ago, a limited audience of Chinese who could access coverage on Hong Kong-based Phoenix TV could follow the presidential elections in Taiwan. Beyond this, savvier Chinese able to circumvent domestic internet controls, or “scale the wall” (翻墙), could seek out uncensored coverage.
Things were different this time around. As Phoenix TV beefed up its online coverage, that coverage was shared by Chinese internet users. The four major internet portal sites in China, Sina, QQ, Netease and Sohu, all prominently featured information on the Taiwan elections. The sites invited comment and context from figures readily recognizable to many Chinese, including the likes of former Phoenix TV commentators Cao Jingxing (曹景行) and Yang Jinlin (杨锦麟). Even People’s Daily Online devoted some attention to the story, although its treatment was relatively simple.
China now has more than 500 million internet users and, according to government figures, more than 300 million registered users of domestic microblogs. In recent weeks microblogs have been another medium through which information on the Taiwan elections has been shared actively. Information on the presidential elections was shared constantly through mainland-based microblog platforms, both by mainlanders in Taiwan and by Taiwanese users.
With information, including multimedia content, appearing on domestic internet sites and shared through social media, mainland users were able this time to find the latest information on the elections without circumventing domestic internet controls.
More interesting still was the commentary inside the mainland that could be found on Chinese microblogs. As Beijing hailed Ma Ying-jeou’s victory as positive for warmer cross-straits relations, mainland observers talked about the deeper significance of the elections. Writer Murong Xuecun remarked on his microblog account: “Regardless of whether Ma or Song wins the presidential elections in Taiwan, the victor is ultimately Taiwan. This is a victory of [Taiwan’s political] system.”
The blogger Yao Bao, who writes under the pen name Wuyuesanren, remarked: “The focus in observing elections in Taiwan has already begun to shift from cross-straits relations and the question of Taiwan independence to the process of the elections themselves. This signals a greater consciousness of elections and rights among we who are watching from the sidelines . . . Possibly, the question of reunification or independence is not so essential, but actually superficial, and the real issue is whether [both sides of the straits] can see elections like this. If they do, there’s no controversy at all over the question of reunification.”
Other domestic microblog posts reflected Taiwan’s presidential elections back on politics at home: “The Kuomintang was once a dictatorial political party, but it turned over a new leaf, changing with the time. It decisively ended restrictions on the press and on other political parties [in the 1980s], ending the kickback politics and corruption of the era of tyranny. Eight years after being thrown from power, the Kuomintang regained the trust of the people and returned to power [with Ma Ying-jeou’s election as president]. The Kuomintang shows us that a political party can reform itself, and that even if it steps down there is opportunity. But once a party has been overthrown by the people, it is completely finished.”
On another positive note, DPP presidential candidate Cai Ing-wen level-headedly conceded defeat while urging Ma Ying-jeou to address such issues as the growing gap between rich and poor in Taiwan, working for the prosperity of ordinary Taiwanese. In a political culture known for its heat and emotion, Cai did not shed tears or make emotional appeals. Instead, she encouraged her supporters to remain loyal to their ideals. They would feel disappointment, she said, but they must not give up. They must strive to be a strong opposition party, speaking out for disadvantaged groups.
The rational and orderly nature of presidential elections in Taiwan should bolster the courage of authorities in Beijing to explore democratic reforms in China. If Taiwan can achieve democracy, why can’t mainland China?
Why, for that matter, can’t Hong Kong? In Hong Kong, which calls itself “Asia’s international city,” the chief executive is still chosen by electoral committee rather than by popular vote. The process of selecting Hong Kong’s next chief executive will be under way soon. But now, as Taiwan has set the bar, how can we not feel a touch of shame?
A Chinese version of this article appeared in the January 16, 2012, edition of Hong Kong Economic Times.

Looking back at China’s internet in 2011, there were three broad trends that deserve greater attention. The first trend was a general shift from emotionally-driven nationalist chatter as the defining tone of China’s internet toward a more basic attention to issues of public welfare. The second was the rise of what we can call the “social power of the internet” (网络社会力). And the third trend was a more pronounced deficit in understanding on the government’s part about the role it should play in a networked society. While it became readily apparent, that is, that we now have a networked civil society in China, it became clearer at the same time that we lack government administrators who are internet literate (网络化的治理者).
The Turn from Online Nationalism
Nationalism has been a defining issue on China’s internet since the very beginning. For example, People’s University of China professor Peng Lan (彭兰) has argued that one landmark event in the emergence of online public opinion in China [as a social force] was internet-based opposition by the international Chinese community (including mainland Chinese) against attacks on ethnic Chinese during the Indonesian riots in May 1998.
In “The Glory and Promise of Online Public Opinion” (网上舆论的光荣与梦想), written by Lin Chufang (林楚方) and Zhao Ling (赵凌) and published in Southern Weekly on June 5, 2003, the authors argued that, “The turning-point date when domestic [Chinese] web platforms were used to voice public opinion was May 9, 1999, when People’s Daily Online opened up a forum to rally opposition to the bombing of the Chinese embassy in Belgrade by NATO forces. This was the first current affairs news-related forum to be opened up by the website of a traditional media outlet.”
Nationalist sentiment has long persisted as a perennial hot topic on China’s internet. Issues like Sino-American relations, Sino-Japanese relations and the question of Taiwan have always invited fierce activity on the internet in China, even sometimes setting off mass rallies offline. This trend has been noted frequently by observers outside China. The Economist magazine even at one time devoted a sub-headed section to China’s “online nationalism” in a report on the digital era.
The nationalist trend online peaked in 2008 following March riots in Tibet that year, and in the midst of the international torch relay for the Beijing Olympics. That time marked an unfortunate setback in the relations of China and the West, ushering in a deeper sense of isolation in China that threatened to push China into a more protective and less open posture. This is an ongoing issue, and if the West continues to take an antagonistic attitude toward China’s rise, it is conceivable that China could be pushed back further, even onto its old path of isolation and decline.
The successful hosting of the Beijing Olympics in 2008 was a symbolic moment for China’s rise, and a moment of deep pride for Chinese. But just as the curtain closed on the Olympics, the revelation of widespread melamine contamination throughout China’s dairy industry, a scandal directly impacting millions of Chinese families, came a jarring reminder that external glory cannot disguise internal decay. The impact on Chinese society and on the country’s manufacturing sector was profound. The widespread sense of debilitating setback was conveyed by Chinese internet users in a vivid couplet:

We labor half a year to turn a new page, 辛辛苦苦大半年，
And in a single night are returned to the pre-Olympic age. 一夜回到奥运前.

Ever since that time, the confident tone of a China rising has flattened into notes of sorrow among Chinese. Shanghai successfully hosted the World Expo in 2010, but quite quickly came news of a disastrous fire in Shanghai that claimed 58 lives and injured scores of others. Just as in the eyes of some the so-called China Model was in its flushest moment of success, even meriting emulation by other countries, the high-speed rail collision last summer completely annihilated this fantasy.
People started questioning whether this was really a system at all. Online public opinion grew turbulent, and one user famously wrote: “China, please slow your soaring steps, wait for your people, wait for your soul, wait for your morals, wait for your conscience! We don’t want train collisions or bridge collapses. We don’t want our roads becoming pitfalls, or our homes becoming deathtraps. Move more slowly. Let all lives enjoy freedom and dignity, so that no one is cast aside by the times, so that every person can reach our destination smoothly and in peace.”
Many people still sympathetically push for greater Chinese nationalism, calling for a stronger China. But ever since 2008 the trend has been for nationalistic agendas to take a back seat to agendas relating to the welfare of the people. As social tensions in China have grown more serious, Chinese have devoted more attention to social development issues that are more concretely relevant to their lives. As the anniversary of Japan’s invasion of China approached in 2010, the mood at Sina Weibo, one of China’s top social media platforms, was extremely tense — the fear being that Chinese might try to organize anti-Japanese rallies, drawing the ire of the authorities to the Sina Weibo platform itself, which at the time was merely a “beta version” and could be shuttered at a moment’s notice.
In the end, “September 18”, this date that had erstwhile been so sensitive, never became a major topic of discussion on Sina Weibo in 2010. Instead, the hottest discussion centered on the Yihuang self-immolation case in southern China’s Jiangxi province, a case exposing the evils of forced property demolition in China and lack of rights protection.
Clearly, the winds are changing. When you cannot find safe milk for your child to drink, when their school buses are hazardous, when you worry that you might be exposed to dangerous recycled cooking oils if you go out to a local restaurant, when the city where you live is choked with pollution and you have no idea what the actual PM2.5 measures for the most dangerous air particles are, the question that possesses you above all else is what direction Chinese society is heading. You care more about how the people of China can enjoy lives of peace and prosperity, and less about the murderous logic of the Boxer Rebellion. [NOTE: Hu is suggesting here that trends of extreme nationalism in China are marked with the same sort of anti-foreign violence seen during the Boxer Rebellion.]
Online Social Power Emerges
The second trend in 2011 was the growing maturing of what we can call “online social power” (网络社会力). Since the 1970s, researchers in China have talked about the need to encourage the development of non-governmental organizations, to move away from urban communities based on the old work unit system and to carry out other social reforms in order to find new points of development. Today we can say without hesitation that an independent and richly participatory civil society is emerging on China’s internet. The internet in China today has quite a different political function from what we see in countries with relatively full political freedoms. The internet cannot usher in dramatic change to political life in China, but it can promote the creation of social capital on the basis of citizen rights and duties, giving rise to and strengthening social forces independent of the Chinese state.
China is entering an era of “rights.” Farmers, workers and an newly-emerging middle class are all fighting for their civil rights. Since the 1990s, along with a number of “important turns and other reversals” (Sun Liping’s phrase), there has been a clear expansion of social conflict and opposition in China, both in terms of frequency and scale. Researchers have observed that perhaps one of the most apparent new characteristics of this [social unrest] is the use of sophisticated electronic technologies, which enable protesters to connect more readily and make it possible also to communicate with media and supporters in the international community.
Thanks to technology, new social relationships and bonds are forming in China, and new forms of mutual interest taking shape. As a direct result, the mobilization capacity (动员能力) for related social movements has increased. The recent Wukan incident in Guangdong is a prime example of this trend.
The efforts by Chinese to fight for their civil rights are of course tied up with efforts to fight for their right to information. In the broadest sense, the right to information means the freedom to converse, connect, gather and coordinate without fear. These rights are the same rights guaranteed through the human rights documents of the United Nations and the constitutions of various countries, all of which collectively affirm the right of citizens to access and share information. For example, Article 19 of the Universal Declaration of Human Rights affirms that: “Everyone has the right to freedom of opinion and expression; this right includes freedom to hold opinions without interference and to seek, receive and impart information and ideas through any media and regardless of frontiers.”
In terms of basic rights on the internet, an international consensus has already emerged, including a firm commitment to freedom of access and the freedom to share information (发布自由). Internet rights, therefore, already exist as a matter of convention within the [international] political context, where many people argue that the same standards of freedom and human rights that operate offline apply to the online environment as well.
Lacking a Networked Mindset in Governance
This brings the third trend that has become clearer in China’s online public opinion environment. This is that while we already have a networked civil society in China, we continue to lack a networked leadership — which is to say a government that understands and accommodates the internet on its own terms.
The internet naturally generates knowledge and value from the end user and not from centralized gatekeepers — and the right to connectivity, use and dissemination are to a great degree built into the fabric of the internet. For this reason, the building of internet governance policies should proceed along the same lines, raising competition, encouraging innovation, permitting free expression, raising credibility, all with minimal government interference.
Unfortunately, internet governance in China at present goes entirely against these principles. If China’s internet is to continue to develop, internet users and the government will have to work together toward mutual interests, jointly formulating principles [for internet use and development].
For the government’s part, it must be clear that web users are not only to be monitored but also to be served — that in fact the principal attitude must be one of service. A totalistic approach [to internet governance] by the government will only engender an internet mob (暴民型网民), while service-oriented [internet governance] will foster a population of responsible internet users. For the government’s part, building a networked society requires first and foremost a change of attitude in governance, a transition from totalistic governance (全能政府) to service-oriented governance (服务型政府).
In such a government approach, internet-related problems should be solved in a “web user–market–society–government” sequence. Issues, that is, that web users can solve themselves should be solved by web users; issues web users cannot solve on their own that can be solved by the market should be solved by the market; issues that the market cannot resolve and that can be resolved by society should be resolved by society; for issues that cannot be resolved by society, the government should step up to offer services and guidance.
A service-oriented government does not mean entirely eliminating controls, only that controls are implemented for the sake of service, not for the sake of controls themselves. Such controls would be restricted the law, with a fixed scope and procedures and a clear system of responsibility.
When people are denied the opportunity to participate in the formulation of rules, these rules lose acceptance and credibility, and stability is difficult to achieve. This principal is as true online as offline.
It is impossible for the government to serve as the only source of public administration (公共治理者) in an atmosphere as complex and diverse as China’s today. The government will have to coordinate with non-governmental organizations, social groups and the public to better manage public affairs. And in the same way, an approach to internet governance based on serving the interests of web users would necessitate a fundamental change in the government’s role.
Drawing hundreds of millions of Chinese web users into the process of internet governance requires, first of all, respect for the basic rights of Chinese internet users. The benefits for China in such a shift would be substantial. Chinese internet users today are not unlike Chinese farmers thirty years ago, or township and village enterprises twenty years ago, capable of unleashing immense [productive] forces outside the state system (非体制的力量).
This commentary was translated and edited from a piece originally appearing in China Newsweekly magazine on January 13.

On January 9, the Social Development Task Group of the Sociology Department at Tsinghua University released its 2011 “Research Report Series on Social Progress,” in which it warned that “powerful vested interests” in China were now “holding reforms hostage.” The report, authored by sociology professor Sun Liping (孙立平), the former doctoral adviser to now vice-president and successor apparent Xi Jinping (习近平), argued that China was in the midst of a “transition trap” (转型陷阱) in which the energy and impetus to push ahead with necessary reforms was being lost.
A lengthy summary of the Tsinghua University report was published in the January 9 edition of China Youth Daily, and was quickly posted to a number of major Chinese web portals, including People’s Daily Online. But within hours, links to the article were disabled.
By mid-day the link to the China Youth Daily version at People’s Daily Online called up a warning page that read: “The page you are looking for does not exist. You will be automatically re-directed to the People’s Daily Online homepage in 5 seconds.” A similar warning from the popular Netease web portal read: “We’re sorry, the page you are visiting does not exist or has already been deleted.”

For several hours, users on the popular social media platform Sina Weibo shared a link to a cached version of the China Youth Daily report at Baidu.com, as well as news that the article had been deleted from sites like Netease. By day’s end the Baidu version had been pulled down as well. The page now linked only to the electronic edition of China Youth Daily, where an unreadable image of the original newspaper page could be found but the text to the right only read: “This article has been deleted.”

The China Youth Daily article, mostly a stringing together of various quotes and passages from the report, was a challenge to translate under time constraints — but we offer our version here with the hope readers will find it helpful and informative. We have also pasted the Chinese under the translation.
We welcome any comments and/or clarifications on translation, as well as other observations and context. Please contribute these in the comments section at the bottom of the page.

“We Must Be Alert to ‘Becoming Obsessed With Feeling the Stones, to the Point Where We Don’t Want to Cross the River Anymore'”
China Youth Daily
January 9, 2012
“Today, system reforms have already become mired in difficulties. This, it can be said, is an undisputed truth. In recent years, a number of important reform measures have been shelved, and political reform has failed to move forward.”
Released today by the Social Progress Research Institute of Tsinghua University’s Kaifeng Development Research Center, and by the Social Development Task Group of the Sociology Department at Tsinghua University, the end-of-year 2011 “Research Report Series on Social Progress” points out that what our country most needs to be alert to right now is the “transition trap” (转型陷阱).
Transition Trap: Midway Through Reforms, “Not Wishing to Cross the River” (“不想过河”)
One decade into the new century, domestic observers say that “the disposition of Chinese society is changing”; Some people think that reforms have already ended, already died. “If we say that the 1980s were characterized by reform, and the 1990s were characterized in the first half by reform and the second half by opening, then in the latest 10 years stability preservation has become the defining tone,” [says the report].
What is going on here? Lately there have been two explanations. One holds that China has struck upon the middle income trap that developing nations have experienced before. Another holds that reforms have stalled or are even rolling back.
This report, whose chief author is Professor Sun Liping (孙立平) of Tsinghua University’s Sociology Department, points out that what China most needs to be alert to right now is the “transition trap.”
The “transition trap” refers to the creation in the process of reform and transition of powerful vested interests (既得利益集团) that obstruct further reforms, demanding that the prevailing system of the transitional period be firmly established in order to create a “mixed system” (混合型体制) maximizing the benefits [accruing to the vested interests], an eventuality that would result in the malformation of social and economic development and the accumulation of economic and social problems. “It is like an inferior and temporary shelter that people then re-decorate. They set up a makeshift kitchen, get married, have children. The residence becomes their world [despite its slapdash nature].”
The report argues: “In the past, we have placed too much emphasis on the advantages of gradual reform. But looking [at the situation] now, there is much greater risk of a country gradually reforming sinking into the transition trap. This is because gradual reform presents more opportunities in the process of transition for stalling and for hardening [of institutions] (定型化), and the conditions are more conducive to the emergence of powerful vested interests.”
[The report argues further that:] “Actually, the challenges facing reform in China today are not as they have been described by some, who say that, ‘Reform has entered a deep zone, in which [further] reforms cannot get off their feet.’ In the early days of reform, raising [the metaphor of] ‘crossing the river while feeling the stones’ was a realistic choice. But the problem today is that we’ve become so obsessed with feeling the stones that we don’t even wish to cross the river anymore.”
Taking Stock of Five Major Symptoms: Using the Excuse of “Stability Preservation” to Avoid Reform
The report analyzes “five major symptoms” of the transition trap. The first symptom is the growing ponderousness and constant malformation of economic development.
The report points out that the most real problem in China’s economy right now “is not stagnation, but rather development that is hyperactive (畸形) and malformed (畸形).” On the one hand, the potential provided by the development of backward regions, industrialization, urbanization and other factors is still there. On the other hand, nature of China’s political system gives the government powerful latitude in combating the slowdown of economic growth.
Within the pattern of the transition trap, the situation for private enterprises and particularly small and medium-sized enterprises is difficult, and the private impetus (民间动力) for economic activity goes down. This means there can only be greater and greater reliance on the government to drive the economy forward, which means demolishing buildings everywhere and rebuilding (大拆大建), holding large-scale events (办大活动), constructing huge buildings (盖大高楼), building huge plazas and squares (修大广场), and even erecting big statues (造大塑像).
The report refers to this as “incremental capital over-dependency” (增量依赖症): “In the transition trap, major system reforms have not been relied upon to resolve problems, and so the only answer is to rely upon enlarging the cake, using incremental capital from development to relieve problems, under the precondition of not touching powerful vested interests.”
Under this sort of incremental capital over-dependency, the people may not necessarily benefit from economic expansion; but if there is no growth, the people will suffer damage as a result.
The second symptom is that institutional factors in the transitional period become hardened.
Quite surprisingly, the report points out that “loss of momentum in reforms is not merely a question of the reform-minded wishes of the leadership classes, but an issue of doubts already emerging among the masses about reform.”
“If it were the case that the people demanded continued reform and powerful vested interests resisted and opposed them, then the situation would perhaps be relatively simple,” [the report says]. The report goes on, “The problem is that powerful vested interests have caused reforms to become deformed and lose their shape, and they have sought to enrich themselves in the name of reform. This has engendered antipathy toward reform among the people. Just like we can see in our daily lives, that now as soon as anyone starts talking about reform ordinary Chinese get jumpy. So the result is not only that real efforts to reform are constrained, but that the whole notion of reform has fallen out of favor.”
For example, in the midst of healthcare reforms in a number of regions unreasonably high prices for medicines have been brought down and the cost of medical care itself correspondingly raised in order to do away with over-reliance of the medical profession on expensive prescriptions. But after a period of time, the prices of medicines shot up again, with the result that the previous situation of low-cost medical care and high-cost medicines became a system of high costs across the board, and the burden on patients went up.
The third symptom is the trend toward hardening of the structure of society, hardening into a fractured society “stratified into rich and poor.”
The report cautioned that most in need of attention was the current social atmosphere or social psychology: First, as the thresholds in society had been raised [for access to all manner of benefits, etc.], society has seen a substantial drop in vigor and vitality. Second, the sense of opposition between various levels of society is now pronounced, and the collective sense of “hatred for the rich” (仇富) or “disdain for the poor” (嫌贫) were on the rise. Third, an ordinary sense of imbalance has been replaced among a portion of people with a sense of despair. “For example, among farmers, migrant workers and those at the lower rungs of society, there is a sense of despair and hopelessness. The intensification of some social tensions is inevitably related to this.”
The fourth symptom is an overcautious mentality and policies oriented toward “stability preservation”, which is rooted in misjudgment over social tensions and conflicts.
“In recent years, social tensions have shown a clear increasing trend. It should be said that there are many tensions that can arise as a matter of course in a market economy, and of these the vast majority do not constitute a serious threat to political power or to basic institutional frameworks. But in recent years, relevant parties [i.e., political leaders] have made a serious miscalculation [in assessing threats to basic stability], resulting in a fantasy of instability.”
The regime of “stability preservation” [in China] has emerged on the basis of this reading of the situation. Big or small, it lumps all matters together under the prerogative of stability preservation, “mobilizing the resources of society for an all-out campaign of stability preservation, taking special [extreme] measures meant for special [extreme] situations and normalizing them, systematizing them, with the result that the political, social and economic life of our nation has been thrown in a [chronic] state of ab-normalcy.”
The report points out that using “stability preservation” at a rationalization for not carrying out substantive reforms is classic “transition trap” logic. The ultimate outcome of the rigid thinking of stability preservation and the massive stability preservation project is in fact the intensification of social tensions, and it even takes a number of tensions arising normally from daily life and transforms them into doubt and resentment toward the system [as a whole].”
The fifth symptom is an ever more salient sense of social defeat. “This is seen first and foremost in the way government power in some local areas is out of hand, [for example] the violent interception of petitioners (暴力截访), violent [property] demolition and removal [of residents] (血腥拆迁). The direct result of runaway power is the decline of the society’s ability to preserve fairness and justice. As a result, loss of bottom line social [standards], slipping morality, the loss of professional conduct and professional ethics have become extremely common phenomena.”
How Did the “Transition Trap” Emerge”?
The report points out that [the “transition trap”] is the special product of the odd alliance between power and the market. “[The “transition trap”] is often [seen in] the alternate and combined use of power and market means, turning to power means when power means are convenient, and turning to market means when market means are convenient.”
According to the report’s analysis, in the process of the emergence of powerful vested interests, [abuse of power through] the following processes play important roles: “official profiteering” (官倒) [in which Party or government organs engage in profiteering activities against the regulations of the State Administration of Industry and Commerce], restructuring of state-owned enterprises, the exploitation of coal and other resources, land development, property speculation, public listing of enterprises . . . [Through these activities] powerful vested interests quickly come to dominate land, mining, financial resources, basic infrastructure nationwide, urban development, public works projects, the development of rural water projects as well as energy, electrical power, telecommunications, manufacturing and other important industries.
“The so-called China Model is a development model derived from this sort of system. [It is about], in the context of strengthening [government] administrative capacity, taking a market system and shattering it into market factors, then using power to reorder these market factors in order to achieve a high degree of monopolization of resources.”
The report also analyzes the chaotic nature of the debate lately between the intellectual “left” and “right.” “For a number of years, in fact, people have been habituated to viewing the market and power as two things in wide opposition, as being inversely related.”
In this context, the “left” can be understood [in the simplest terms] as [a sense of] alertness to the “market” or “capital” factors within this [above-mentioned] mixed system, while the “right” can be understood as sensitivity to “power” factors. Put another way, the “left” advocates for factors of “power” while the “right” advocates for “market or capital” elements.
“Before the transition trap is broken through, either [camp of] advocates might be used by powerful vested interests, turned into means by which their interests can be maximized.”
As people are debating over whether the transition to the market economy has gone far enough or too far, the connection between non-market power and maketized products has become the most effective means by which [vested interests] can profit. “For example, [officials] can obtain land at a cheap price through administrative means and then turn around and sell it for a high price on the market. Is there anything more valuable than this [method] to powerful vested interests in the amassing of wealth?”
The report argues that the actual impetus of social change [in China] has already grown weaker and weaker. “The transition trap can become a ‘snare’ because at this time the [status-quo] system has already made detailed preparations to repress change, the monopolization of resources grows more and more serious by the day, vested interests are expanding, and society is more and more tightly controlled. This doesn’t mean, however, that there is no longer any impetus in society for change.”
“Lately dissatisfaction with the stalling of reforms has increased, and demands for change are coalescing. In addition, as groups who benefit from vested interests are shrinking, many segments of the population are being shut out [from the benefits of development]. These both provide potential impetus for change, but the problem is how to transform this potential impetus into real impetus.”
The report argues that there are three roads out of the “transition trap”: the first is the government carrying out top-level [institutional] design, and promoting these [institutional reforms] with sufficient strength; the second is to use existing potential factors to promote the development of social forces (社会力量), using these social forces as an impetus to break through the status quo; the third is passive change in the midst of tensions and crises, “but this depends upon the self-examination and consciousness of vested interests.”
Regardless of which path is taken, there are four measures, according to the report, that are “unavoidable”:
1. “[China must] move in the direction of the mainstream world civilization.” The report holds that the “mainstream world civilization” has as its core values “freedom, rationality, individual rights, market economics, democratic politics and rule of law.”
2. “Recreating social vitality through political reforms.” “Political reform and social construction (社会建设) offer the most practical impetus [means] of moving out of the transition trap.” The report argues that resolving the problem of black case work (暗箱操作) [or behind the scenes dealing], and promoting the open operation of power, creating mechanisms to check power (制约权力的机制), can serve as the breakthrough points for political reform (政治体制改革的突破口). In recent years, the central party has already promoted open government information (政务信息公开).
3. Carrying out reforms in terms of top-level [institutional] design on the basis of public participation (民众参与). “In fact, one of the most important reasons that reforms have taken a malformed path in recent years is a lack of participation in reform by the masses. In the 1980s reforms were supported by the enthusiasm of an idealism [in society], and the defect of inadequate public participation was not yet so readily apparent. But once this idealism faded, interest [self-interest, the profit motive, etc.] became the chief factor driving reforms. Reform, in the absence of public participation, can quite easily become a large-scale dividing of the spoils (大规模的‘分赃’). Many clear examples of this could be seen in the restructuring of state-owned enterprises in the 1990s.”
4. Finally, the report advocates using “equity and justice” to form a consensus on [further] reforms. “What people feel most readily in the midst of the transition trap is disaffection, that equity and justice have been destroyed. Therefore, re-coalescing a consensus on reform must be done by defining equity and justice and the most basic value and objective [of reform]. In this sense, the building of democracy and rule of law must be the core content of future reforms in China.”
The report concluded: “In an era like today, what China needs above all else is courage, the courage to face vested interests head on, to break through the fabric of vested interests and through the logic of the ‘transition trap’, the courage to move beyond the present deadlock and morass.”
——————
须警惕“石头摸上了瘾，连河也不想过了”
2012-01-09 03:19 来源：中国青年报
“在今天，体制改革已经陷入困境，可以说是个不争的事实。近些年来，一些重要的改革措施被搁置，政治体制改革尚未进一步推进。”
清华大学凯风发展研究院社会进步研究所、清华大学社会学系社会发展课题组今天发布2011年度“社会进步系列研究报告”，指出我国目前最需警惕的是“转型陷阱”。
转型陷阱：改革中途，“不想过河”
在新的世纪走完10年后，国内的观察家说“中国社会的气质正在发生变化”；有人则认为改革已经终结，已经死亡。“如果说上世纪80年代的特征是改革，90年代的特征前期是改革后期是开放，而最新的这10年，维稳则成了最基本的基调。”
这究竟是怎么回事？目前流行的有两种解释。一种是认为出现了发展中国家经历的“中等收入陷阱”，另一种认为是改革处于停滞甚或倒退状态。
而这份由清华大学社会学系孙立平教授主笔撰写的报告指出，中国现在最需要警惕的，不是上述两者，而是“转型陷阱”。
“转型陷阱”指的是，改革和转型过程会造就一个既得利益集团，这个集团会阻止进一步变革，要求把过渡时期的体制定型化，形成使其利益最大化的“混合型体制”，由此导致了经济社会发展的畸形化和经济社会问题的不断积累。
“这就如同在一幢烂尾的大楼中，人们简单装修一下就搭灶做饭，娶妻生子，也俨然成为一片天地。”
报告认为：“过去，我们过多地强调了渐进式改革的优势，但现在看，一个渐进式改革的国家陷入转型陷阱的危险会大大增加。因为在渐进中，使转型过程停滞并定型化的机会太多，既得利益集团从容形成的条件更为有利。”
“其实，现在中国的改革困境并非像有些人所说的那样：‘改革开始进入深水区，已经改不动了’。在改革初期，提出‘摸着石头过河’是一种现实的选择，但现在的问题是，可能是摸石头摸上瘾了，连河也不想过了。”
盘点五大症状：用“维稳”的理由，拒绝改革
报告分析了转型陷阱的“五大症状”。第一个症状是，经济发展步履沉重并日益畸形。
报告指出，中国在经济上最现实的问题“不是停滞，而是亢奋、畸形的发展”。一方面，落后地区发展、工业化和城市化的潜力等仍然存在，另一方面，体制决定了 政府“反放缓”、“反停滞”的能力是极强的。“在转型陷阱的格局中，民营企业尤其是中小型民营企业处境艰难，经济活动的民间动力下降，于是，只能越来越依 靠政府推动，大拆大建，上大项目，办大活动，盖大高楼，修大广场，甚至造大塑像。”
报告把这称为“增量依赖症”。“在转型陷阱中，人们没有通过重要的体制变革来解决问题，于是只能寄希望于做大蛋糕，在不触动既得利益格局的前提下，用发展形成的增量来缓解问题。”
在这种增量依赖症中，经济增长了，民众不见得会受益；但如果不增长，民众则会受损。
症状之二是，过渡的体制因素被定型下来。
出人意料的是，报告指出“改革动力的丧失，并不仅仅是领导层的改革意愿问题，而是在民众中已经对改革发生了疑问”。
“如果现在是民众要求继续改革，而既得利益集团在那里阻挠和反对，事情也许还比较简单。”报告分析，“问题在于，既得利益集团让改革走样变形，以改革的名 义获取利益，由此引起一般民众对改革的抵触。正如我们在现实生活中能看到的，现在老百姓一说起改革就心惊肉跳。其结果是，不仅实质性改革受阻，而且这个字 眼都在失去民心。”
比如，在一些地区的医疗改革中，需要降低不合理的高药价，相应提高医疗的价格，改变“以药养医”的现象。但过一段时间，压下去的药价又高了，结果是由过去的药价高、医疗价格低变成两者价格都高，患者的负担进一步加重了。
症状之三是，社会结构趋于定型，固化为“贫富分化”的断裂社会。
报告提醒，值得注意的是现在的社会氛围或社会心态：其一，由于社会中的门槛加高，社会活力大大下降。其二，阶层之间的对立情绪凸显，“仇富”与“嫌贫”的 集体意识在蔓延。其三，普遍的不平衡感为部分人的绝望感所取代。“比如在农民、农民工和城市底层等群体中，存在看不到希望的绝望感。一些社会矛盾的激化往 往与这个因素有关。”
症状之四，就是误判社会矛盾形成的拘谨心理和“维稳”政策导向。
“近些年来，社会矛盾有明显增加的趋势，应当说，一些本来是市场经济中正常存在的矛盾，其中绝大多数并不会形成对政权和基本制度框架的严重威胁。但近些年来，有关方面产生了严重的误判，形成了一种不稳定的幻象。”
在这种判断的基础上，“大维稳”模式形成了。它将社会的大小事都与稳定联系起来，“动员社会资源进行全方位维稳，将一些特殊时期的特殊做法常规化、体制化，使我国政治经济社会生活处于一种很不正常的状态”。
报告指出，用“维稳”的理由拒绝实质性改革，是“转型陷阱”的典型逻辑。“僵硬的维稳思维以及大维稳模式，最终结果往往反而是激化社会矛盾，甚至把一些日常生活中的矛盾演变为对体制的怀疑和怨恨。”
症状之五，社会溃败日渐明显。“首先表现为一些地方政府权力失控，暴力截访、血腥拆迁；权力失控的直接结果，是社会维护公平正义的能力在降低。于是，社会底线失守，道德沦丧，职业操守和职业道德的丧失成为相当普遍的现象。”
“转型陷阱”是如何形成的？
“转型陷阱”下的体制，是怎么逐步定型下来的？
报告指出，它以权力与市场的奇异结盟为特征。“往往是权力与市场手段的交替结合使用，在权力手段方便的时候使用权力手段，在市场手段方便的时候使用市场手段。”
报告分析，在既得利益群体崛起的过程中，下述过程起到了重要的作用：“官倒”、国企改制、矿产资源开发、土地开发、房地产热、企业上市融资……既得利益集 团迅速支配了土地、矿产、金融资源，涉及遍布全国的基础设施、城市开发、公共工程、农村水利建设以及能源、电力、通信、制造等重要行业。
“所谓中国模式，就是在这种体制中派生出的发展模式。在行政能力继续强化的前提下，把市场体制打碎为市场因素，通过权力重组市场因素，实现对资源的高度垄断。”
由此，报告也解析了目前中国思想界“左派”和“右派”争论的混乱。“因为在过去许多年中，人们一直把权力和市场看成是两个截然对立的东西，两者关系是此消彼长的。”
在这种情况下，可以把“左”理解为对这个混合型体制中“市场”或“资本”因素的警惕，将“右”理解为对“权力”因素的警惕。反过来说，“左”是在为“权力”因素呼唤，而“右”是在为“市场或资本”因素呼唤。
“在打破转型陷阱之前，无论哪种呼唤，都有可能被既得利益集团借用，变成完善利益最大化的手段。”
而当人们还在为我国“市场化改革不彻底还是过头”争论的时候，一些权力的非市场化和商品的市场化相衔接，已经成为最有利的牟利方式。“比如从行政上获得廉价的土地和资源，然后再以高价格卖到市场，还有比这种方式更有利于既得利益集团聚敛财富的吗？”
靠什么打破“转型陷阱”？
报告承认，目前变革社会的现实动力已经越来越微弱。“转型陷阱之所以能成为‘陷阱’，就是因为此时的体制已经对遏制变革作出了周密安排，资源垄断日益严重、利益集团坐大、社会控制愈益严密。但这并不意味着社会已经完全没有变革的动力。”
“目前对改革停滞的不满在增加，变革的要求也在凝聚，另外，由于既得利益集团的圈子在不断收窄，许多群体被甩出圈子之外。这都是进行变革的现实动力，问题是如何将这种潜在的动力变成现实的动力。”
报告认为，可能走出“转型陷阱”的道路只有三种：一是由政府实施改革顶层设计，并有相应的力量推动；二是利用现有可能的因素推动社会力量的发育，使社会力量成为打破现状的动力；三是在矛盾和危机推动下的被动改变，“但这要取决于既得利益集团的自省和觉悟”。
不管哪一条路，报告呼吁，有四大措施是“不可回避”的：
首先是，“汇入世界主流文明的方向”。报告认为，这个“世界主流文明”的核心价值包括“自由、理性、个人权利，市场经济、民主政治、法治社会”。
第二，“以政治体制改革再造社会活力”。
“政治体制改革和社会建设，是走出转型陷阱最现实的动力。”报告认为，可以将解决暗箱操作、促进权力公开运作、形成制约权力的机制，作为政治体制改革的突破口。近些年来，中央政府已在推进政务信息公开。
第三，在民众参与的基础上进行改革的顶层设计。
“实际上，近些年来，改革之所以会走样变形，重要原因之一就是缺乏民众对改革的参与。在上个世纪80年代，改革是由理想主义的激情来支撑的，缺少民众参与 的弊端还没有充分显示出来。但在理想主义消退之后，利益成为主导改革的重要因素，缺少民众参与的改革很容易演变为大规模的‘分赃’。上世纪90年代的国企 改革中就有很多明显的例子。”
第四，报告最后呼吁，用“公平正义”凝聚改革共识。
“在转型陷阱中，人们感受最深的、最不满的，是公平正义受到了破坏。因此，能够重新凝聚改革共识的，就是将推进公平正义作为改革的基本价值和目标。从这个意义上说，民主与法治建设应当是未来中国改革的核心内容。”
“在今天这样一个时代，中国最需要的是一种勇气，一种能够正视既得利益格局，冲破既得利益格局，打破‘转型陷阱’的逻辑，走出目前僵局与困境的勇气。”报告最后写道。

[NOTE: We have changed the phrase “transformation snare” to “transition trap” per the valuable suggestion of Duncan Innes-Ker below. The term “trapped transition” is used by economist Minxin Pei in his book China’s Trapped Transition.]