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First Of A Four-Part Series

Every society changes, but China's changes faster. The startling transformation that began 30 years ago this month with the accession of Deng Xiaoping has been one of the world's great stories.

Deng's great legacy was undoing Mao Zedong's. Mao captured China and then proceeded to regiment, repress and ultimately deny it of vitality. When he died in September 1976, Chinese leaders knew there would have to be reform. The debate in Beijing was how much should be allowed and how fast it should occur.

The now-accepted narrative is that Deng argued for a startling transformation of Chinese society. We buy the story that he first debated with his fellow revolutionaries, then experimented and finally decreed change.

Yet, in reality, reform progressed more by disobedience than design. Initial failure to meet state-planning goals forced Deng to back away from command-economy tactics and permit individual initiative. Peasants on large collective farms, for example, were permitted to form "work groups" to tend designated plots. Central government policies specifically prohibited these groupings from including just one family. But families started to look after their own plots--and local officials pretended not to notice.

Urban subterfuge followed rural subterfuge. Deng's Beijing strictly prohibited private industry, but entrepreneurs proceeded by operating their businesses as "red hat" collectives and enterprises--private companies operating under the flag of state ownership. Deng's reforms succeeded because the Chinese people disobeyed Deng's rules.

Such defiance would have been unthinkable in the Maoist years. Deng's great contribution, therefore, is not so much that he planned China's "economic miracle" but that he let it happen. The economy during the last three decades has grown at an average annual rate of 9.8% largely because peasants, workers and frustrated bureaucrats made themselves into entrepreneurs and pushed their country forward. By ignoring central government decrees, they built private businesses now accounting for as much as half of the Chinese economy.