In politics, ideas that were once considered on the fringes can eventually become mainstream, and vice versa. This shift in the “window of political possibility” can be seen in countries all over the world, including communist China. A significant example of this occurred in 1978, when China experienced a major shift in its political landscape. Two years after Chairman Mao Zedong’s death, the Communist Party was able to acknowledge that Mao was not infallible, leading to a more pragmatic approach to governance and paving the way for economic reforms under Deng Xiaoping’s leadership.
Fast forward to the present day, China is gearing up for another significant political event: the upcoming third plenum, scheduled to take place from July 15th to 18th. This meeting will focus on economic reform, marking the first time in over a decade that economic issues have been the central theme of a third plenum. The agenda for the meeting includes addressing long-standing economic challenges such as weak consumer demand, limited tax revenues, inadequate social spending, barriers to services for internal migrants, and obstacles for private businesses.
As China prepares for this important gathering, it is worth examining the country’s Overton window regarding economic policies. The Overton window represents the range of acceptable economic ideas within Chinese official circles. With the potential for significant policy changes on the horizon, this is an opportune moment to assess the current state of economic discourse in China and how it may evolve following the third plenum.