The Red Dream

Chapter 6After 30 Years, Was Deng Xiaoping Right?

Are such things as stock markets good or not?

—Deng Xiaoping, Shenzhen, January 22, 1992¹

In Shenzhen in late January 1992, Deng Xiaoping, China's last emperor, was fleeing the political disputes fracturing his party in Beijing. The left wing had identified the financial reforms of the 1980s as the main source of the social chaos at the decade's end. Deng had come to Shenzhen to see if its special economic zone, bustling with Hong Kong companies, might present a way forward for mainland China. The spot he was standing on is now a vacant lot with a huge billboard showing only his face in profile. Surrounded by the same white tiled buildings he had seen in 1992, his portrait is placed against a deep blue background; shouldn't it be red? This lot, in a not-so-modern part of town and despite the terrible events of June 4, remains a hallowed piece of ground in a China where there are very few. It is the only memorial to Deng anywhere in the country save, perhaps, for his hometown in Sichuan.

Standing there surrounded by reporters and his entourage, Deng was asked about the social function and effects of stock markets. He famously replied, “Are such things as stock markets good or not? Do these things exist only in capitalist countries or can socialist ones use them too? It is permitted to try them out … If they work out … then we will open up … If they are mistakes, just correct them or close the markets.”

These words provided ...