Professionalization and Institutional Innovation Required For Developing a New Type of Think Tanks With Chinese Characteristics

Proceedings of 2015 Global Think Tanks Summit - ZHANG Xiaoqiang

-- An exclusive interview with Mr. Zhang Xiaoqiang, Permanent Vice Chairman and CEO of the Executive Board of the Council of China Center for International Economic Exchanges (CCIEE)

Introduction: “A key criterion for judging a think tank is whether it can influence decision-making or not”.

Author /Dai Qian, Economy and Nation Weekly

Think tanks have a long-standing history. Menke, or hangers-on of aristocrats, military counselors and advisers can be said to be the earliest forms of think tanks. They played an important role in military and political activities in the ancient times. The saying that “Three cobblers with their wits combined equal the master mind of Zhuge Liang (a well-known Chinese strategist in the period of the Three Kingdoms)” speaks volumes about the importance of think tanks.

The modern think tanks can be traced back to the Second World War when the US military organized a group of staff officers and researchers to draw up military plans, plan military operations and make military deployment behind closed doors. They named the organization “think tank”, a term that has been in extensive use up to the present. Today, think-tanks mainly refer to professional research institutions that study public policies for the purpose of influencing government’s decisions. They aim to serve the public interests and follow the norms of social responsibility in their research.

The Chinese government is increasingly attaching more importance to think tanks. The Decision of the CPC Central Committee on Some Major Issues Concerning Comprehensively Deepening Reform adopted by the Third Plenary Session of the 18th Central Committee of the Communist Party of China (CPC) stressed the need to "strengthen the building of a new type of think tanks with Chinese characteristics, and build a more sound consultation mechanism on decision-making". This is the first time the concept of "think tanks" has appeared in a CPC Central Committee document.

Undoubtedly, China’s think tanks are now facing unprecedented opportunities for development. But, what is the current situation of Chinese think tanks? How should they develop? In the following, Mr. Zhang Xiaoqiang, Permanent Vice Chairman and CEO of the Executive Board of the Council of CCIEE and former Vice Chairman of the National Development and Reform Commission (NDRC) expounded his views on the development of a new type of think tanks with Chinese characteristics.

What does the “new type of think tanks with Chinese characteristics” mean

Weekly: On 27 October 2014, in deliberating the Opinions on Promoting the Development of a New Type of Think Tanks with Chinese Characteristics ("Opinions") at the 6th meeting of the Central Leading Group on Comprehensively Deepening Reform, General Secretary Xi Jinping of the CPC Central Committee pointed out that a new type of think tanks with Chinese characteristics should be developed as an important and urgent task. What’s your views and understanding of this concept?

Zhang: China's national conditions determine that we must follow the path of socialism with Chinese characteristics under the leadership of the Party. This is a basic feature a think tank must maintain. Thanks to many years of efforts, a number of think tanks have come to the fore in China, including some within the government system, such as the Chinese Academy of Social Sciences (CASS) and the Development Research Center of the State Council (DRC), both of which are full ministerial-level public institutions directly under the leadership of the State Council. Local governments at all levels also have their own research centers in the style of think tanks, such as the Shanghai Academy of Social Sciences, which ranks among the top 100 think tanks in China. Meanwhile, the research offices of many departments, in a sense, are built-in mini think tanks. There are also research institutions operated by large enterprises and institutes of higher learning.

However, generally speaking, think tanks within the government system tend to pay more attention to giving interpretation and publicity of government policies than making independent, forward-looking and strategic research. Therefore, not many of them could put forward creative and independent proposals. Moreover, as many research institutions are within the government system, they carry strong administrative features. This together with the constraints of financial disciplines have made them relatively weak in forming creative views and conducting open and active discussions.

Given the new changing situation, the enhancement of the government’s governing and decision-making capacity requires the think tanks to take a more active part in the decision-making process, conduct more forward-looking research, have a broader vision, put forward proposals from a more strategic perspective, and have better communication with and understanding of different social sectors.

In my opinion, the "new type of think tanks" means the following:

First, their research reports should not only include policy interpretations but also reflect the opinions and suggestions of all sides for the reference of the government in making decisions and formulating rules and regulations and policies.

Second, as the government is transforming its functions across the board, think tanks can no longer count on the government to increase financial support for their development. A more relaxing environment needs to be created for the development of non-governmental think tanks. On the premise of adhering to the path of socialism with Chinese characteristics, social organizations, enterprises and institutes of higher learning should also develop think tanks with distinctive features in line with their respective strengths, thus forming a complete and unique think tank system that can play a positive role.

Third, the market is now playing a decisive role in resources allocation, a situation think tanks should adapt to in managing themselves. Therefore, the development of the new type of think tanks in the next stage should focus on promoting scientific and sustainable development of their self-management system and enhancing their self-renewal capacity.

Weekly: The Opinions pointed out the need to implement a national plan for building high-end think tanks to strengthen the overall planning and scientific layout of think tanks, and coordinate and consolidate existing think tank resources of high-caliber. Priority should be given to building 50 to 100 badly needed top-notch think tanks that have distinctive features and original systems and can spearhead the development of professional high-end think tanks. Then how to define the "professional high-end think tanks"?

Zhang: Professional think tanks are relatively easy to understand. They should be the ones that have strong research capabilities in specific areas and their research results are recognized by various sides, or adopted by government agencies, large business groups or industry associations. They should also be able to make some ideological achievements. This is somewhat similar to the professional development of enterprises. They should not adopt the same model or focus only on one popular area of research. Instead, they should adapt themselves to the diversified demand of the market and social development. Yet, they should not be jacks of all trades either.

Then how to judge whether a think tank is of high-end or not? The US experience suggests that although think tanks are relatively independent, the research results they produce could significantly influence the US government's decisions. So many people believe that a very important criterion for judging a think tank is whether it can influence decision-making or not.

For example, at the start of the Korean War, personage from various circles in the United States researched whether China would send troops or not. The Rand Corporation, which was commissioned by the Pentagon to produce an advisory report on this issue, drew the conclusion that China would send troops. Yet, the majority of the other mainstream research institutions in the US concluded otherwise. Eventually, the Pentagon made the strategic judgment that China would not put troops on the ground and made deployment accordingly. So when China sent the troops, the US was caught off guard.

For another example, Europe emerged from World War II a big loser, miserable and dilapidated and its relations with the Soviet Union much strained. What kind of policy should the US government take to deal with this situation? The Brookings Institution suggested increasing aid to Europe. First, the US accumulated huge production capacity during the war, which became redundant after the war, and many people got unemployed. The aid to Europe could ease pressure on the US. Second, Europe was America’s ally, and better relations with Europe were good for both sides. Third, it could contain the expansion of the Soviet Union. This proposal was finally adopted by the US government and turned into a complete plan, namely the Marshall Plan. The Marshall Plan was a very successful strategy of the US government both politically and economically and in many other aspects.

The recent strategy of rebalancing to the Asia-Pacific of the Obama Administration’s was also first put forward by an American research institution.

Of course, under the new normal, whether a think tank can build public consensus, reflect the public opinion and promote harmonious relations between the government and society is also an important criterion.

How do think tanks influence decision-making

Weekly: During the past 30 years of reform and opening up, the number of China’s think tanks has been on the rise. It has reached 426, the second largest in the world, which is in direct proportion to China’s economic growth. But when it comes to influence, the best ranking China can get among the world’s top-notch think tanks is 20th. How to change this situation and increase both the quantity and quality of China’s think tanks?

Zhang: The general direction of reform of think tanks should be consistent with that of the ongoing reform of public institutions and social organizations. During the reform over the past years, many ministries in charge of industries were removed and transformed into industry associations. For example, China’s Ministry of Metallurgical Industry was transformed into China Iron and Steel Association. It is not merely a social organization; it also undertakes some government functions. It is a “quasi-government agency” so to speak. There are around 100 organizations of this type. Although performing certain administrative functions, they are still public institutions with social organizations affiliated to them.

Last year, the CCIEE did a research report on China’s think tanks, which shows that there are over 2,000 think tanks of all sizes in China. The number 426 is a research figure released by the University of Pennsylvania. As a matter of fact, some self-claimed high-end think tanks have only a few staff or one or two researchers. More often than not, they just organize forums to make money, and are more like PR companies.

The future development of think tanks should be more market-based. Associations or public institutions in the same field should be allowed to compete for survival. The development of think tanks should follow market rules rather than administrative decrees. While only a few selected think tanks can become high-end ones and be affirmed by government authorities through a scientific evaluation system, a market-based elimination mechanism should be introduced for the over one thousand other thinks tanks.

Weekly: Now there are a host of non-governmental think tanks in China. How can they reflect the public opinion and influence decision-making? What can we learn from the practices and mechanisms of the top-notch think tanks in the West?

Zhang: The question you raised needs to be studied more closely. Currently, there are think tanks of various types. How can they convey the public opinion to the government or form forward-looking judgment about policies that can be adopted by the government and play a positive role?

First, channels are very important. Only when your research results come into the attention of the decision-makers, can they possibly know whether they are valuable or not. Now the channels are being improved and the new media can be seen as one of them. If your proposal has high click rate, the central leadership would notice it pretty soon.

As far as I know, some think tanks within the government system also pay close attention to gathering public opinions from the new media and the society. I used to work with the NDRC, which reports information on political affairs to the State Council in different ways. Apart from the various departments of the Commission, the State Information Center SIC also gathers a large amount of information from the Internet every day, and selects and reports the most valuable to the State Council through NDRC. The non-governmental think tanks can also directly submit their advisory reports to higher authorities or release them to the public.

There is a revolving door system in the Western think tanks, under which many heavyweights of think tanks take up posts in political institutions and come out after serving for a period of time. This has made the channel of reporting open and smooth. A case in point is Dr. Kissinger, who was a university professor before becoming the US secretary of state. After leaving office, he founded the Kissinger Institute. He can call the White House directly and their research reports are sent directly to the president’s office and reach the president very quickly. Sometimes the president would pick up the phone and call him directly for consultation and advice, or even have face-to-face discussions with him from time to time.

Some have suggested that China learn from such a practice. This, I’m afraid, will take a long time. Now there are already many ways for people of different sectors to take up posts in government agencies, or participate in the administration and deliberation of state affairs through the Chinese People’s Political Consultative Conference. These include people from the think tanks. Whether, in the future, there is the possibility for government officials to take up posts in think tanks and vice versa remains a question that needs to be further explored.

Enhance governing capacity and build up public consensus

Weekly: In foreign countries, funding support behind many top-notch think tanks is representative. How to handle the correlations between and among the funding, development and authoritativeness of think tanks?

Zhang: Think tanks surely need funding support. In the US, many think tanks are supported by consortia or foundations. After years of development when the foundations have grown very strong, they make investment with the principal while supporting the day-to-day operation of think tanks with the proceeds, thus forming an effective mechanism. Some think tanks get funding through government procurement. The better they do, the more willing the government will be to pay them to do research.

For think tanks within the government system, what is more important is how to make more effective use of their fund. We need to, for example, establish an incentive and constraint mechanism. Currently, the salary system of both CASS and DRC are similar to that of the civil servants. For think tanks with no government background, they need donations from enterprises, and that is why government should give these enterprises tax incentives. Now tax is canceled only when it comes to charity donations, and fund for think tanks does not enjoy such a privilege and is not included into pretax expenses. Similarly, the proceeds think tanks earn from effective management of their fund also need to pay taxes. The government may consider providing think tanks with some preferential policies since they are still at the initial stage.

Weekly: What a substantive role could a full-fledged top-level think tank system play in promoting China’s future development?

Zhang: A new type of think tanks with Chinese characteristics is an integral part of China’s soft power. The development of a big country is not only a process of enhancement of hard power such as economic strength, but also a process of enhancement of soft power such as ideology and culture. Think tanks are important carriers of a country’s soft power, and they are increasingly an essential factor in international competition, playing an irreplaceable role in external relations. To project a good image of socialist China, introduce Chinese culture and the values of contemporary China to the outside world and make China’s voice heard in the international arena, we must work hard to bring into play the important role of the new type of Chinese think tanks in public diplomacy and cultural mutual learning, so that China can have a stronger international influence and greater say in international affairs.

When such a think tank system is put in place, it will be instrumental in boosting China’s overall strength and intellectual system. As an organic part of scientific decision-making, the development of a new type of think tanks with Chinese characteristic has been incorporate into the effort to enhance China’s governing capacity, which adds new dimensions to modernizing the governance of the country. This kind of intellectual system will not only provide support for decision-making, but also play a better role in pooling public consensus, conveying the public opinion to the government and promoting social harmony. (End)