The Most Overestimated Premier, Zhu Rongji: A Man of Great Ability and Integrity

Toronto Fang Lian released a video: Fang Lian Biography: The Most Overrated Premier, Capable Minister and Cruel Official - Zhu Rongji! The Most Overrated Premier! The Tide of State-Owned Enterprise Layoffs | Tax-Sharing System Reform

Video Link:

Full Text:

Every year around August and September, we hear a popular meme online: Zhu Rongji is once again criticizing Xi Jinping at Beidaihe. At the 19th National Congress, Zhu Rongji's refusal to applaud Xi Jinping's re-election was also seen by many as a symbol of his opposition to Xi Jinping. In various legends, Zhu Rongji seems to be Xi Jinping's enemy and a representative of justice within the party. So, what kind of person is Zhu Rongji, and how should we evaluate him?

Hello everyone, I am Duoduo Fang Lian, a laid-off worker from the Northeast. Today, I will introduce you to the chief executive of reform and opening up, the spokesperson for the transfer of intellectuals from the right, Zhu Rongji.

Born on October 23, 1928, in Hunan, Zhu Rongji's background was not simple. He had a background that would excite fans of the Ming Dynasty: Zhu Rongji was a descendant of the Ming imperial family, a descendant of Prince Min, Zhu Jian, the 18th son of Emperor Taizu of Ming. To put it modestly, he was a descendant of Prince Jing of Zhongshan; to put it grandly, he was a celestial being from the moon.

Unfortunately, Zhu Rongji's parents died of illness when he was only 12 years old. However, it was also fortunate that the legend of the Qing dynasty killing all Zhu family members was ultimately just a legend. With the buff of the Yongle Encyclopedia, the Zhu family still became local magnates. Zhu Rongji's great-uncle, Zhu Changlin, made his fortune in the late Qing dynasty by monopolizing the salt and tea business in Hunan, once becoming the richest man in Changsha. He later invested in modern industry and was one of the financial backers of Hunan's reform movement. With such a family background, although Zhu Rongji's parents died early, he still received a good education.

And Zhu Rongji was indeed very promising. With the support of his family, he was successfully admitted to the Department of Electrical Engineering at Tsinghua University, majoring in electrical machinery manufacturing. Like Jiang Zemin, who also graduated from the Department of Electrical Engineering, they were both smiling tigers, two 'Urumqi's (a pun on their shared background and perhaps a derogatory term).

During his time at university, Zhu Rongji was elected class monitor and chairman of the Tsinghua University Student Union due to his outstanding performance. Zhu Rongji was truly an excellent student. However, at the same time, the timing of Zhu Rongji's birth was very unfortunate. He entered Tsinghua University in 1947, just two years before Chiang Kai-shek would flee to Taiwan and play 'Island Fortress'.

As the saying goes, if you're not fast enough, you become a drag on history. Zhu Rongji, who was slightly slow to react, only joined the Communist Party in October 1949, after the founding of New China. He somewhat missed the 'red envelope' of the era. This late entry into the party meant that even as the chairman of the Tsinghua Student Union, he could only be assigned to the Northeast after graduation to 'play in the wild'. Although this behavior of getting on the train after it had already started, like a ticket holder for a standing spot, didn't bring Zhu Rongji many benefits, if you look at it positively, it didn't bring him any harm either.

In 1954, Zhu Rongji's direct superior, Gao Gang, the

Grabbing the three major livelihood projects: vegetable baskets, transportation, and housing. In internal management, he was also uncompromising; after several senior officials were removed, he first launched a high‑pressure anti‑corruption campaign, then set up an institution, a window, and a seal, pushing for streamlined government procedures. The nickname "Iron Fist" was established at this time.

Of course, at this time he was still under Chen Yun’s wing, and the governance style was still more inclined toward a planned economy, so there were no particularly outstanding actions. However, before long in Shanghai, Zhu Rongji soon faced the biggest test of his life. This test is also a recurring, unavoidable segment of this program’s biographical series, namely the 8964 incident. In April 1989, after Hu Yaobang’s death, the pro‑democracy Shanghai "World Economic Herald" published an article questioning the legality of Hu’s removal, and Jiang Zemin, then in charge of Shanghai, ordered its suspension.

The entire Shanghai public was in an uproar, with students and citizens rallying in support of the "World Economic Herald." In this turmoil, Zhu Rongji neither rushed to Beijing like Jiang Zemin to kneel before the elders and offend all democratic forces, nor did he turn to stand with the democrats and defend the editor. He chose a rather cunning route: he kept a low profile.

He neither publicly opposed the central authorities to anger them, nor actively escalated tensions. Instead, he proposed a middle path, saying Shanghai must not descend into chaos, so what should we do? Focus on maintaining Shanghai’s normal operation, keep himself clean, and make it impossible for anyone to find fault with him—effectively disappearing. To project a moderate image, he even broke convention by appearing on TV, claiming Shanghai was different from Beijing, that no troops or police would be deployed, that Shanghai had 5.08 million workers, so why would military control be needed? He urged the masses not to panic.

He told citizens that historical facts cannot be hidden and that the truth would eventually come out. This footage was later repeatedly edited and circulated, portraying Zhu Rongji as relatively innocent regarding the June 4th events. Yet this is similar to Jiang Zemin’s on‑stage Lincoln quote; Zhu’s maneuver was highly confusing. After the situation stabilized, Zhu quickly carried out the central’s post‑event reckoning. Shanghai’s public security, prosecution, and court systems swiftly held three joint trials, with fast hearings and verdicts; many ordinary participants were imprisoned, and some even sentenced to death.

In June 15, Xu Guoming, Bian Hanwu, and Yan Xuerong were sentenced to death by the Shanghai Intermediate People’s Court for their involvement in June 4, and were executed by firing squad on June 20. Zhu’s speed in executing June 4 participants was not kinder than that of Li Peng, Chen Xitong, or other hard‑line elders; it was even faster than Beijing’s. It’s just that no one wants to pair this with his claim of not deploying troops.

Benefiting from his stance during June 4, Zhu received approval from higher‑ups. After the incident, Jiang Zemin parachuted to Beijing, became General Secretary, and Zhu Rongji was appointed Shanghai Party Secretary, becoming a central alternate member. At this point, Zhu had taken a step forward but had not yet reached his most crucial turning point, which was aligning with Deng Xiaoping.

At this stage, whether out of political idealism or after Deng’s “Tank World” test, Zhu realized who the real power holder was. In Shanghai, Zhu decisively left Chen Yun’s camp, turning from a loyal protégé of Chen into a capable aide under Deng, even earlier than Jiang Zemin. In 1991 China, Deng and Chen were locked in a fierce struggle, and high‑level battles were often fought through newspapers.

The conservative Chen Yun and reformist Deng Xiaoping each wielded their own pens, launching a media war. The conservative strongholds were publications like "Seek Truth," "Guangming Daily," and "Contemporary Thought," which criticized the reform and opening up as excessive bourgeois liberalization. Meanwhile, the Shanghai Party newspaper "Jiefang Daily" published four articles signed by Huangfuping, vigorously promoting reform and directly challenging the party’s conservatives.

One line read: "One who can speak eloquently and charge into battle should be boldly employed." The editor-in‑chief Zhou Ruijin later confirmed that Zhu Rongji himself wrote those pieces. At that critical moment, for an aging Deng who was about to “fly to the tank planet,” this was a lifeline. Shanghai, an important window for reform, had a conservative like Chen Yun who acted like a son sealing the windows, making it hard for Deng to act, driving Deng to the point of biting the tank tracks.

Shanghai was Chen Yun’s stronghold, deeply rooted, and Deng had long wanted to take it over, but progress was difficult. Zhu’s defection gave Deng the final piece of the reform puzzle nationwide. Against the backdrop of the booming Pearl River Delta, Zhu proposed to Deng that Pudong should learn from Shenzhen and undergo massive development. It can be said that Pudong’s later success owes part of its credit to Zhu.

Having successfully backed Deng, Zhu also reaped rewards. In October 1992, at the 1st Plenary Session of the 14th CPC Central Committee, 64‑year‑old Zhu Rongji leapt from alternate central member directly to Politburo Standing Committee member, bypassing the ranks of full central member, Politburo alternate, and Politburo member, ranking first among vice‑premiers and fifth among the Standing Committee—essentially a meteoric rise.

Zhu finally entered China’s core power circle. After moving to Beijing, he quickly entered a new chapter, gaining the ability to influence national affairs. This brings us to the second part of the program: how to evaluate Zhu Rongji. In my view, overall, Zhu’s abilities are very strong, but the CCP system limited his ceiling, resulting in relatively modest actual contributions.

We can illustrate this with specific cases. During Zhu’s tenure, two highly controversial policies were the fiscal‑tax reform and the wave of layoffs in state‑owned enterprises. First, the fiscal‑tax reform was a hard battle Zhu took on upon arriving in Beijing. During Mao Zedong’s era, Mao not only shattered China’s economic, financial, and tax systems but also decimated a generation of financial talent. By 1978, China lacked a sound tax system.

After reform and opening up, due to a talent shortage, a chaotic and poorly planned fiscal system was built. Consequently, local fiscal revenue accounted for nearly 80 % of total national revenue, creating a pattern of a weak central treasury and strong local governments. This sparked panic and anxiety at the center. Many scholars and officials warned that continuing this fiscal relationship would lead China to repeat the Soviet Union’s collapse.

When we now talk about the Soviet breakup, we often blame the United States because Gorbachev was ineffective, but the real reason was that the USSR was overthrown from within—Yeltsin led the rebellion, and Russia toppled it. China feared a similar scenario where local governments might overthrow the center, so the central task became reclaiming tax revenue, initiating the fiscal‑tax reform.

Who should implement such a crucial reform? Logically, it should have been Premier Li Peng, but Li’s competence was severely lacking. Li claimed he suffered a heart attack and went on a “vacation,” disappearing. The heavy responsibility fell on Zhu Rongji.

How did Zhu execute it? Very well. Some might think a fiscal‑tax reform is simple: the central issues a policy and the locals comply. But it was far from easy.

The task was extremely difficult. Take Xi Jinping as an example: his current power can be described as “one word, nine seals” in China. I believe even Deng Xiaoping’s power was not as great as Xi’s. Since the founding of the People’s Republic, only Mao could compare.

Before Xi, attempts to wrest fiscal power from the locals all failed. In 2016, Xi proposed “housing should not be speculated,” aiming to curb rising house prices. Local governments, faced with central directives, began to shirk responsibilities. When high housing prices threatened local finances, they could not repay debts and risked bankruptcy.

Initially, Xi was resolute, saying local debt should be handled locally—"who’s child, who takes it." Local officials saw this as a chance to dodge responsibility, leading to several incidents of unpaid wages among teachers and civil servants, which put pressure on Xi.

Eventually, Xi had to abandon the "no‑speculation" stance and changed his tone, beginning to support local debt relief.

After China's housing prices, another small peak was reached starting in 2018. If China's economy hadn't faltered later, housing prices in China would have continued to rise. Xi Jinping's power is far greater than that of Chairman Xi. The tasks Xi Jinping needs to accomplish are far less difficult than those Chairman Xi faced, but the result is that Xi Jinping has accomplished nothing and has ruined everything.

However, in a similar situation, with higher difficulty and less power, Zhu Rongji would have succeeded. Of course, in terms of the process, Zhu Rongji's approach was also notably sincere. Zhu Rongji did not use the privileges of the central government to suppress local governments and force them to hand over revenue. Instead, he personally assembled a professional team of 60 people and traveled to 17 provinces, cities, and autonomous regions. He negotiated with each province and worked on their mindset province by province.

He discussed everything with these provincial leaders, from the global landscape and national prosperity to the fiscal system. Upon hearing his words, they were moved. Ultimately, Zhu Rongji succeeded in persuading all provincial governments, making the provincial and municipal leaders, in a sense, indispensable to him. However, speaking of this, we need to broaden our perspective.

What was the original intention of the tax-for-revenue reform? It was mainly because the Communist Party at the time had a misconception that if the central government didn't control the purse strings, China would end. The tax-for-revenue reform aimed to solve the political structure of a weak center and strong localities in finance. In the first two years of the tax-for-revenue reform, this was indeed achieved. Immediately after the reform, the proportion of central government revenue in total tax revenue began to increase.

From a low of just over 20% in 1993, it rose to 50% later. At that time, the relationship between the central and local governments began to change smoothly, with the central government becoming the

However, at the time of allocation, Russia had a rule that all stocks could be traded. At that moment, the dictator Yeltsin and his supporters took the opportunity to inflate prices.

With soaring prices, many Russians could not afford to eat. This Russian oligarch bought stocks at very low prices from Russian people in their seventies and eighties. After a round of harvesting, in 1996 the Russian oligarch Beryozovsky, when interviewed by the Financial Times, shamelessly boasted that he and the other six major Russian oligarchs at the time had acquired 50% of Russian stocks in one stroke.

This shock therapy amounted to a massive wealth transfer. At the time, economists generally thought Beryozovsky's claim of 50% was bragging. The World Bank later conducted a rigorous calculation and found that under Russia's shock therapy, Russian enterprises were controlled by 23 individuals. This chaotic oligarchic economy caused Russia's economy to remain stagnant thereafter.

Even though Russia has abundant oil, it still could not overcome the export bottleneck. Russia and China are completely opposite, not in the allocation method but in the results and process. For example, Lithuania, in its early implementation, was exactly like Russia, pursuing universal shareholding. But it quickly crashed.

Former Communist bureaucrats in Lithuania formed a new party, the Democratic Labour Party, and continued to govern under that name. They began to strip Lithuania clean. A large number of enterprise stocks were acquired by officials at low prices and transferred to some plant managers and oligarchs.

Of course, this led to a Lithuanian-style workers' tower and a slowdown in Lithuania's economic growth. In the early 1990s, Lithuania's growth rate was among the lowest in Eastern Europe. By 1996, the situation changed.

Unlike Russia, which stayed on the authoritarian path, Lithuania held elections in 1996. The Democratic Labour Party was voted out. Lithuania's state‑enterprise reform took a sharp turn. To prevent corruption, Lithuania later established a state‑asset fund.

These shares were placed on the international market for bidding, allowing foreign capital to compete. The proceeds from the sale were then subsidized to employees for housing construction, unemployment benefits, and wages.

And it is not only Lithuania; look at the whole post‑Soviet breakup process. Why have the Baltic states and Poland become developed countries today, while Belarus, Ukraine, and Russia remain developing nations?

Many say it is because those countries were already wealthy at the time of breakup, but that is not true. The core difference lies in the direction each country took during dissolution. If the breakup led to authoritarianism, the state was divided among a group of bureaucrats, causing a loss of economic vitality.

If the breakup led to democracy, the democratic system could ensure a fairly balanced distribution. State‑owned assets were treated well and could play a positive role in later economic development, allowing rapid growth.

Shock therapy itself is not wrong; the key is how it is implemented. This determines the different future paths of these countries. So, what about China? How did Zhu Rongji implement shock therapy, and what was the final step?

Zhu Rongji used a method even more brutal than Russia's. First, Zhu's shock therapy distribution was more outrageous than Russia's. Russia at least maintained a veneer of fairness, claiming universal shareholding. In the CCP, that pretense disappeared completely.

The promise was that enterprises belonged to everyone, that they were people's enterprises, but the result was that large firms were directly taken back into state ownership and controlled by second‑generation elites, such as Li Peng's daughter directly controlling the power system, and the second‑generation of the vice‑president’s family controlling arms groups, the Poly Group, and so on. Smaller firms were sold cheaply to major plant managers.

As for grassroots employees, the promise was lifelong support and a jointly built socialist utopia. In reality, they were left with nothing. Zhu Rongji's reform directly caused massive layoffs of Chinese workers.

Zhu's actions were even worse than Russia's. Some may ask, if Zhu performed so poorly, why didn't China's economy collapse? First, who says there was no explosion after the reforms? The region hit hardest by state‑enterprise restructuring was the Northeast.

From a direct perspective, almost all enterprises in the Northeast were effectively destroyed in that round of reform. You can no longer see any of the good firms that survived; they all blew up. Data shows that in 1996, the Northeast was China's industrial base.

At that time, the national GDP was 7.1 trillion yuan, with the Northeast accounting for 690 billion yuan—about 10% of China's total GDP. Liaoning province alone had a GDP higher than Shanghai's. Yet a wave of state‑enterprise reform completely shattered the Northeast's economic future.

Once touted as the Republic's eldest son, the three provinces of the Northeast now together account for only 4.6% of the national GDP. Combined, they barely surpass Shanghai. The biggest wound of the reform was not just tens of millions of laid‑off workers, but the brutal restructuring that crushed the Northeast's economic potential, turning it into a Russian‑style economy.

Why other regions did not suffer the same fate is because China's WTO accession brought massive economic pull, and those regions did not have such large state‑owned enterprises to begin with. We now think China's reform‑and‑opening period had decent growth, but have we considered that if state‑enterprise reform had been done well, growth could have been even higher?

Thus, when we look at so‑called state‑enterprise reform, many immediately link Zhu Rongji with the reform and claim that without him there would be no reform and no opening. That claim shows a lack of economic knowledge. The Baltic states, Poland, and Russia never had a Zhu Rongji, yet they each carried out their own reforms at the same time.

Whether or not Zhu existed, China would have undertaken state‑enterprise reform at this juncture. The reasons for the reform are twofold: the collapse of the Soviet Union removed the authoritarian big brother, and the June Fourth 1989 uprising forced the CCP to reform due to soaring prices, not because a Zhu Rongji appeared.

Of course, many people like to pit the tens of millions of laid‑off workers against state‑enterprise reform, as if without massive layoffs the reform could not succeed and China could not open up. In reality, that is not the case. Zhu Rongji's role in the reform was to achieve two things: first, ensure rapid privatization of state enterprises to quickly unleash economic vitality; second, guarantee a fair and just process that protects workers' interests.

Zhu scored very high on the first point, but zero on the second. He provided no protection for laid‑off workers nor ensured fair distribution of enterprise shares, resulting in a tragic generation that was abandoned and the destruction of the Northeast's economic potential. If Zhu had implemented a fair reform like Poland or the Baltic states, the Northeast would not have become a discarded son of the Republic. He did not.

Nevertheless, I do not think all the blame lies with Zhu. In the political environment of that time, a Baltic‑style reform was unlikely. China lacks democratic oversight; under an authoritarian system, any state‑enterprise reform inevitably becomes a banquet for officials to divide state assets, which is unavoidable.

Moreover, Zhu's task was not to guarantee fair distribution but to ensure the shock therapy was completed quickly and smoothly. On that front, Zhu performed well; the speed of his reform was remarkable. In just six years, official statistics show that Zhu eliminated 28 million jobs, and according to statistical yearbooks, the total loss of state‑sector positions exceeded 28 million, reaching about 60 million.

Zhu not only cut jobs on a massive scale but did so at extremely low cost. Additionally, the 60 million figure includes many civil servants. After Zhu's reforms, the State Council replicated Shanghai's model, halving the number of ministries from 40 to about 20, forcing administrative efficiency upward, a stark contrast to the dozens of new leading groups added under Xi Jinping.

This institutional reform involved an unprecedented scale of personnel changes, with many officials at the division‑level or above either reassigned, sent abroad, or forced into early retirement. It should be noted that the hardest thing to change in Chinese bureaucracy is the established posts—people’s iron rice bowls. Dismantling them is akin to cutting off livelihoods and even harming families.

Moreover, you even killed the iron parents.

Zhu Rongji's cutting of institutions this time offended the mid-level backbone of the entire Beijing bureaucratic system. So whether you say it’s a massive layoff of state-owned enterprise employees or a massive layoff of civil servants, you let Xi Jinping do it—would he dare? Could he accomplish it? He neither dares nor can achieve it.

Now China’s finances are very scarce, and some rural areas have extremely redundant public officials, but Xi Jinping simply does not dare to carry out large-scale civil servant cuts in China. Of course, when Zhu Rongji was able to execute so swiftly back then, it was not only due to his ability but also his ruthlessness. In March 2002, tens of thousands of laid‑off and on‑the‑job workers at the Daqing Oilfield, because of unfair severance buyouts and cuts to medical and pension benefits, took to the streets in protest; the demonstrations lasted nearly three weeks, at one point reaching forty‑to‑fifty thousand people, setting a new record for the scale of workers’ collective protests since the founding of the CCP. Almost simultaneously, workers at the Liaoyang ferroalloy plant, after long‑standing wage arrears and losing everything upon layoff, launched a weeks‑long march.

In the end, under Zhu Rongji’s direction, these worker representatives were arrested and sentenced on charges of illegal assembly, even incitement to subvert state power, and faced the CCP’s iron‑blood repression. Zhu’s ruthlessness was fully displayed at this time. So, regarding his governing style, that’s about it.

Before Mao Zedong died, he left Hua Guofeng a phrase: “I trust you to get things done.” That phrase doesn’t fit Hua well, but it fits Zhu Rongji perfectly. Zhu can be called a capable person; you can assign him a task and be very confident—no matter how difficult, he can complete it with quality and quantity. This far surpasses all other premiers since the founding of the People’s Republic; he was born to be a premier, an absolute capable person.

However, being a good executor does not mean he is a good people’s premier. After all, if we only discuss ability, Hitler might be the world’s best premier. The starting point sometimes matters more than ability, because under the CCP system, Zhu’s achievements were heavily constrained by the system’s strict limits.

When the system assigned him a relatively good job, he performed well—for example, when he handled the WTO accession negotiations, he negotiated smoothly and successfully, positively affecting the Chinese nation and China as a whole. But when the CCP gave him a bad job, he still performed well, which then had a negative impact on the Chinese nation and China.

Unfortunately, the CCP remains a dictatorial regime, and most of the time under this dictatorship, Zhu’s work involved many bad tasks, so my overall assessment of him remains that of a capable but harsh official—the CCP’s toughest whip. Expecting a person with few personal political ideals, whose ability is mainly in execution, to oppose Xi Jinping is simply nonsense.

From this perspective, Zhu Rongji and Zhao Ziyang, who had his own political ideas, dared to challenge Deng Xiaoping, and truly fought for democratic freedoms for Chinese people, are worlds apart; they are not on the same level at all. Zhu Rongji recently passed away, and I see many people commemorating him, still comparing him favorably to Xi. Both are rulers, but Xi can only be described as incompetent, whereas Zhu at least counts as capable.

At the same time, Zhu also represents reform and opening up; many now nostalgically recall Zhu and that era. But we must understand that even Zhu has limits—he is merely a capable ruler, and such capable rulers are not uncommon among dictators. South Korea’s Park Chung‑hee and Spain’s Franco were similar, yet would modern South Koreans or Spaniards want to return to that era? No one does, because they know that under a democratic system, even a poor leader is better than a capable dictator.

A person who does not represent his own interests is useless, no matter how capable. We can use Zhu’s memory to satirize Xi; even if Zhu had flaws, if we set our goal on hoping China will produce another Zhu—a capable dictator—as the hope for our nation’s future, then our nation will have no hope. Wanting a wise ruler and democracy is something Chinese people already knew back in 1920; it should not need to be repeated in 2026.

Moreover, if Zhu could live another life, I believe this capable person would also wish to live in a democratic China, where his abilities could be better unleashed. I believe a democratic China would reform state‑owned enterprises no worse than the Baltic states or Poland, unlike the current situation. In a democratic China, the tax system would not head down the dead‑end of a fragmented tax‑sharing reform. The same Zhu Rongji would perform far better in a democratic government; his strong abilities might even make him a great figure for the ages. Yet under a dictatorial system, he would remain an ordinary premier, leaving only a faint mark in China’s 5,000‑year history. Finally, thank you all for watching today’s program. I am Toronto Fang Lian; please like and support my video to boost its recommendation weight on YouTube. See you in the next episode.