CIA: China’s Second Revolution – National Intelligence Estimate, May 1986, Central

China’s Second Revolution – National Intelligence Estimate, May 1986, Central Intelligence Agency This declassified CIA National Intelligence Estimate from May 1986 assesses the sweeping reforms in the People’s Republic of China that senior Chinese leaders have called a “second revolution.” The document is notable for its detailed analysis of political, economic, military, and societal changes and for outlining the challenges the United States may face as China modernizes. The record was released to the public through a Freedom of Information Act request and declassified by the Director of Central Intelligence in June 2004. The Black Vault hosts the full text of the estimate at the URL provided in the archive entry. The estimate begins with a statement from Chinese leader Deng Xiaoping in March 1985, in which he described the reforms initiated after the Third Plenum of the Central Committee in December 1978 as a “second revolution.” The assessment continues: “China’s far‑reaching reform effort—unprecedented in Communist experience—has already achieved certain notable successes and is likely to continue, albeit at a somewhat reduced pace, over the next decade. This means that in the broader overall context China’s power and influence will grow, a prospect that will offer both significant new long‑term opportunities and challenges for the United States.” The principal goals of the reform movement, which the authors argue constitute a second Chinese revolution, are listed as follows: — To restructure, reorient, and rejuvenate the political leadership. This entails reorganizing and reforming the Party; separating Party and state functions; revamping ideology along more pragmatic lines; establishing stronger legal and institutional structures; and bringing younger, better‑educated, and more qualified personnel into positions of responsibility. — To expand the economy. This entails narrowing the scope of central planning and gradually allowing market forces to determine more economic activity; improving efficiency, productivity, and quality in production; raising the standard of living; developing more effective financial institutions; gradually eliminating government involvement; promoting development of a relatively unregulated tertiary sector; opening China’s economy to foreign participation; and giving priority to existing industrial bases. — To fashion a leaner, more professional military establishment. This entails establishing a younger and more educated officer corps; reducing the overall size of the armed forces; constricting the role of the military in the economy and in politics; reorganizing military regions and commands; and acquiring and deploying improved weapons and equipment from domestic and foreign sources. — To create a society less constrained by political and social controls. — To expand ties to the outside world that will assure China breathing space to concentrate on its ambitious modernization efforts and to provide access to economic, scientific, and technical support. The authors then outline the constraints that could slow or halt reform: — Deng Xiaoping and his supporters must loosen certain controls to stimulate creativity while preserving the Party’s monopoly on power. This internal contradiction may prove the most vexing problem for the leadership. — Sharp differences exist among the leadership on the scope and pace of reform, leading to uneven implementation. Traditional networks of personal relationships, favoritism, and “back‑door” practices are unlikely to disappear quickly. Senior officials fearing loss of power, prestige, or benefits may resist elements of reform. Lower‑ranking cadres may doubt the durability of changes, and concerns persist that rapid opening to the West could introduce “unhealthy influences” or create dependence on foreign nations. — Technical, financial, and managerial obstacles will impede progress. Infrastructure gaps in energy and transportation lie beyond China’s immediate control. — Modernization will generate disruptive economic and social problems such as inflation, corruption, income disparities, regional inequalities, and occasional social unrest. The manner in which the Party addresses these issues, and the succession process following Deng, will significantly influence the reform trajectory