The debate in China is usually framed as a choice between export-led investment and consumption, or state and people. But in Chongqing, the municipal government appears to have found a third way by deploying public policy and public funds to improve people's quality of life. This unorthodox model did not encourage individual consumption at the cost of investment, but rather used state resources to stimulate collective consumption. The model focuses on funding investment in areas where living standards could be immediately improved.
In Chongqing, the Bo administration improved public security, rebuilt infrastructure, pulled in foreign direct investment and pioneered several policy innovations on urbanization. The smash black campaign, while widely seen as infringing on civil liberties and private property rights, significantly reduced street crime. Local SOEs in Chongqing, according to Ministry of Finance data, contribute 15-20 percent of their profits to the government, the highest in China, which in turn funds infrastructure and social programs intended to improve people's standard of living. Mayor Huang Qifan (who kept his position) stated in March that his target for SOE profit-sharing is 30 percent in 2015. A $1.5 billion a year tree-planting program, now widely criticized by Chinese media as wasteful, made a huge difference to the ambience of an industrial city. In the past five years, Chongqing's GDP grew at an average of 15.8 percent annually, compared with 10.5 percent for China as a whole, helping to close the gap between Chongqing and China's other centrally managed municipalities.
Bo promoted Chongqing as the place to experiment various policies directed at solving China's age-old urban-rural tensions. By 2011, Chongqing had spent $15 billion in building 13 million square meters of public housing for poor families, with plans for a further 40 million square meters that could house up to 2 million people. The city has also issued over 3 million hukou, or urban residence permits, to rural migrant workers, giving them access to health care, education and social security -- a practice unheard of elsewhere in China. It is these substantive measures, not the populist campaigns he also exploited, that have made Bo's policies popular in Chongqing, even after his downfall. The Chongqing model is a daring experiment in using state policy and state resources to advance the interests of ordinary people, while maintaining the role of the party and state.
In the short term, the Chongqing model will remain tarnished both inside and outside China by the backlash against Bo's political ambitions and policy missteps, as well as the charges against his wife. But when the dust settles and the fog clears, the Chongqing model may be remembered as a useful social and economic experiment that tackled the tensions between state and people lying at the heart of modern China, providing a credible alternative while China struggles to rebalance its economy and policies. While Bo's political career is clearly over, he may also be remembered as a maverick risk-taker for tackling these challenges -- whatever his personal motives.