Tag Archives: Political reform

A Petition At The Tip Of A Political Iceberg

The open petition to President Hu Jintao from retired provincial officials criticizing Zhou Yongkang, the member of the Politburo who oversees the China’s internal security apparatus, is remarkable. Such public expressions of discontent are rare in the general let alone the specific. That this one has emerged indicates serious discontent among the Party’s grassroots over the course of political reform and an unease with the appeal by some leaders to Maoist nostalgia, itself a proxy for the battle between those who see the Party’s future best assured by continuing economic reform and its consequent political reform, and those who see it best assured by a return to Party discipline and a statist economy enforcing social harmony.

The 16 signatories are all retired officials in their late 70s or 80s, giving them the protection of age that serving officials wouldn’t enjoy. Some gain further moral authority from being Party members since before 1949. As such, they will remember the worst periods of Mao’s rule, including the famines of the Great Leap Forward and the chaos of the Cultural Revolution. The fall of Bo Xilai, a protege of Zhou’s, has given them an opportunity to speak on behalf of what we suspect are many tens of thousands of younger serving officials who, while growing up in a very different China, share their elders’ feelings but have to be far more circumspect in expressing them.

The petition also serves as a reminder that the sway of the princelings, the elite 400 families who exercise extensive influence over the Party, the economy and the military, may be broad, but is not necessarily deep as far as the Party’s grassroots go. That is where one of the Party’s other main factions, the Communist Youth League, has its base. Princelings dismissively refer to leaders who come up through the league as “sons of shopkeepers.” To what extent that class warfare will make itself apparent in the jockeying for top jobs now underway in the leadership transition remains unclear to outsiders. But if we can’t see through the opaqueness we do hear clearly the occasional creak of an iceberg under stress.

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Bo’s Sacking Doesn’t Free China Of Its Leadership Dilemma

The sacking of Bo Xilai as Party boss in Chongqing brings a spectacular halt to his political career, regardless of what has physically happened to him now, still unknown. Bo’s hoped of promotion to the top rung of the party when it changes its leadership later this year had been on the line since last month when his former close ally, Chongqing’s former police chief, Wang Lijun, tried to defect to the U.S. Wang is currently under investigation and has now been sacked as Chongqing’s vice-mayor, too. Bo may well now follow him in falling under investigation.

Wang’s was the iron fist that cracked down on organized crime and on businessmen and local officials accused of being corrupt by Bo’s administration in Chongqing, which was also marked by its prominent use of nostalgic Maoist era ‘red’ propaganda. The high-profile, popularist Bo was seen as a figurehead for the faction within the Party that wanted to revert to more traditional political means of asserting the Party’s legitimacy to rule. Wang Yang, the Guangdong party chief, is seen as representing the faction leaning towards more economic and political openness. The two men were seen as rivals for promotion to the Politburo’s standing committee, the inner sanctum of the Party’s leadership, later this year. How Bo’s sacking affects that ideological divide, beyond the obvious implications that he himself is gone for now, will take some time to become clear–not that that will stop the speculation.

The factional fault lines within the Party are complex, even within the princelings, the elite collective dynasty of some 400 families descended from Mao’s revolutionary leaders that holds extensive sway over the Party, government, business and the military. Factional alliances exist among those who want to develop a more harmonious form of capitalism with a strong safety net, a narrowing of the wealth gap and more environmental protections; harder line economic reformers who want to diminish the power of the public sector and open up political reforms to embrace a new propertied class; the so-called neo-comms, who want to asset China’s global power through cultural diplomacy, military strength and taking a greater role in international institutions; and some deeply entrenched vested interests who see themselves losing from any change.

Speaking at a press conference after the conclusion of the annual parliamentary session, but at a time when the decision to sack Bo would have been made, Prime Minister Wen Jiabao said that “the Chongqing authorities must seriously reflect on and draw lessons from the Wang Lijun incident”. Wen also said that China needed not only economic reform but also political structural reform, especially the reform of the leadership system of the Party and the government, warning of another Cultural Revolution if they did not happen. Wen has often spoken of the need for such political reform. He has not publicly warned in such dramatic terms of the consequences of failing to undertake it. That gave plenty of scope to those who speculated that the factional differences within the upper echelons of the Party were deeper than had been thought. And it reinforces our view that the Party faces its most important leadership transition in the three decades since Deng Xioaping set it and China on the road of economic reform.

The dilemma is this: If the Party’s legitimacy to monopolistic rule depends on continuing to deliver the economic growth that keeps its citizens getting richer and the country stronger, and if China’s rapid economic growth cannot continue beyond a certain point without institutional reform, as economic history suggests, then managing the role of government in the economy and overcoming state-owned vested interests–in other words reforming itself–becomes the new leadership’s most important concern.

If, however, the Party’s legitimacy to monopolistic rule rests on an ideological footing, the mandate of Mao, it will still need to forge a statist economy that can deliver the economic development to ensure social stability and regional clout, and gamble it can defy economic history by becoming the world’s first developed economy and single-party state. So, again, managing the role of government in the economy but arbitrating between state-owned vested interests becomes the new leadership’s most important concern, and one made more complex by having to operate against a back-drop of a globally connected economy in a world that is already wary of China’s perceived mercantilism, rising power and status.

Who now gets promoted from the Politburo to its standing committee, and how they rank, will reveal to some extent how that great divide liea, and thus how China develops over the next decisive decade. Bo’s sacking tilts the scale towards the economic reforms, but it would be a fool who thought that the scale had tipped decisively. And it would also be wise to remember that all those jockeying for position are united in preserving the Party’s grip on power.

Footnote: Zhang Dejiang, a vice-premier and Politburo veteran who is a North Korea expert and has a reputation for maintaining strict social stability, takes over from Bo in Chongqing. He was Party secretary in Guangdong from 2002 to 2007, taking over just before the SARS outbreak and was criticized for his tardy response to the epidemic.

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Is Anyone Who Matters Listening To Wen’s Call For Political Reform?

Chinese Prime Minister Wen Jiabao's plenary address to the World Economic Forum's 2011 meeting in Dalian, ChinaPrime Minister Wen Jiabao (left) has spoken before about the need for political reform and greater democracy in China, but usually to select audiences and not given the coverage in state media accorded to his plenary speech and comments in a Q&A at the World Economic Forum meeting in Dalian. (Video here).

Much of what he has said before on the subject has fallen on deaf ears among his peers in the country’s top leadership. There is an acceptance that, if China is to move to the next stage of its economic development and not get stuck as a middle-income developing nation, it has to transform its economic model from the one Deng Xiaoping laid out and that has provided the three decades of rising prosperity that underpin the Party’s legitimacy to monopoly rule. However, there is an equal recognition that doing so carries hazards that could jeopardize the Party’s very supremacy. Creating new economic institutions means rethinking the connections between China’s bodies politic and economic.

Wen’s calls for greater democracy take that thought a stage further–and into far scarier terra incognita for the Party. It would decouple what the late legal scholar, Cai Dingjian, called the combination of money and power that is at the heart of the Party’s rule.

The existing leadership has been adept at walking a fine line between gradual economic reform — sufficient to generate the growth needed to ensure political stability — and negating change that threatens the status quo of the political system or vested interests in business, the military and government. The underlying goal has been to ensure the survival of the Party’s supremacy.

China’s next top leaders may be even more dedicated to that cause. The incoming so-called fifth generation, will, for the first time, be men born after the Party seized power in 1949. With their ascendancy from next year, modern China will cross a political and demographic Rubicon.

Their generation is the great, great grandchild of Mao’s first generation of leaders.  Their youth was shaped by the tumult of the Cultural Revolution and the near implosion of the Party in the late 1960s. Many of their families were purged. Their survivalist reaction was to be “redder than red” as a means to advance through the Party’s ranks. Distrustful of anything that might cause instability, it is innately conservative.

Yet at the same time, its members’ political lives have been formed when China has only seemed increasingly powerful, wealthy and expansive. They have ridden high on China’s economic growth. They are more worldly than their predecessors, mostly educated at top Chinese universities, more likely than their predecessors to have social science rather than engineering degrees, and be more likely to send their own children to top U.S. and European universities.

That is also the crucible of the world view of the generation of younger officials coming along behind, an identifiably post-Deng generation to whom Long Marches, Great Leaps Forward and Cultural Revolutions are history not experience. They are on track to take power as the sixth generation of leaders in 2022. This unusual mix of conservatism and economic pragmatism at the top with more self-confidence and Party orientation immediately beneath is likely to net out as caution, stability and an appetite for only incremental change,

All are as pragmatically committed as their predecessors to the Party’s monopoly on power, if divided over whether the basis for that should be ideological or economic. The core of the new leadership are “princelings”–descendants of Mao’s revolutionary leaders, a dynasty of some 400 elite families who hold extensive sway over the Party, army and the economy, especially the state-owned sector which accounts for half the economy and where those three power centers intertwine. One of their own, Xi Jiping, is emerging as Hu Jintao’s successor as paramount leader, successively taking over the top Party, state and military jobs between 2012 and 2014.

Their dilemma is that if the Party’s legitimacy to monopolistic rule depends on continuing to deliver the economic growth that keeps its citizens getting richer and the country stronger and if China’s rapid economic growth cannot continue beyond a certain point without institutional reform, then managing the role of government in the economy and overcoming state-owned vested interests–in other words reforming itself–becomes the new leadership’s most important concern.

Though unlikely, and increasingly difficult to do in a globalized world, China could turn inward and neo-isolationist, relying on its growing internal market and a demographic bias to becoming a deficit country over the next decade, to drive the next stage in its economic development. There is every indication for now that China will continue on its present course. Indeed, there is a plan for that. The new leadership will inherit the country’s current five-year plan at its midway point.

That plan is long on goals but short on a timetable for implementation. That lets a new leadership kick the can down the road for a few more years. A key question is, have the old elites secured control of the new economy: or is their power only temporarily persisting in it, to wane as market institutions eclipse the administrative power of the cadres; or are the old elites just being replaced those made newly wealthy by business? In the answer lies an indication of how much scope there is for political reform.

So far at least, the Party has found a way of absorbing the rise of private power that elsewhere in industrializing economies has led to the rise of new centers of political power. Wen seems to sees those as inevitable in China, and thus to be embraced early; his immediate successors, we suspect, will see them to be smothered.

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Lessons From China’s Floods

This Bystander remains struck by the attention being given, at least by the Western press, to the floods in Pakistan compared to that been given to China’s, which are on an incomparably greater scale, affecting hundreds of millions of people, not tens of millions as in Pakistan.

True, China is not a locus of America’s “war on terror”. Nor has the flooding there led to the sort of chaos seen in Pakistan thanks to China’s well-laid disaster response plans. Local governments have emergency teams and supplies ready and waiting to go; central government can rapidly deploy specially trained soldiers, armed police and Prime Minister Wen Jiabao to the worst affected areas. The earthquakes, floods and droughts of the past couple of years have given them all much opportunity to become seasoned emergency responders. Also, despite months of torrential rains and consequent flooding, landslides and mudslides across the country and a slowly but steadily mounting death toll, there had not been a single incident horrific enough to capture international attention until the landslide that devastated Zhouqu.

That there hadn’t been is thanks in great part to flood-control measures put in place after the terrible flooding of 1998. Those have not been perfect, nor perfectly implemented, and as in the case of the Three Gorges dam some have created new problems of their own, but they have been good enough to prevent a greater disaster than has occurred and particularly to reduce the loss of life.

A question now is what lessons will be learned from the floods of 2010. As we noted earlier, there is debate about the extent to which disasters like the one that has befallen Zhouqu are natural or man-made, an unintended consequence of the rush to economic development in the interior without due concern for the environmental consequences of the construction of hydroelectric dams, increased mining and road building, as well as extensive illegal logging and mining in many mountainous areas. Local officials have been rewarded for economic development, regardless of cost, including to the environment.

Beijing is making great strides for a developing economy in being more protective of the environment. There are policy prescriptions aplenty. That should all be acknowledged, just as the immensity of the challenge of doing that in an economy that the central government wants to be kept growing at at least 8% a year for reasons of political legitimacy should not be underestimated. Even keeping up, let alone catching up is a Herculean task.

There is legitimate economic self-interest in undertaking it. Party leaders are, however, acutely aware of the risk of single-issue social movements evolving into a challenge to their political monopoly.  They know their history well enough to understand that environmental degradation has been a fecund source of political movements in every industrial revolution. China’s will be no different; the outcome will depend on the Party’s ability to manage and co-opt them. The lessons of this year may be that the price of political legitimacy has just gone up a notch and gained an added environmental dimension. It is a lesson that will likely be pushed down to Party and local officials harder than before.

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The Beijing Wall

The 20th anniversary of the opening of the Berlin Wall is taken to mark the fall of communism, but more accurately it was the fall of the Soviet empire. Communist parties still rule in Cuba, North Korea and, of course, China. But the anniversary does prompt a couple of questions, why did communism not fall in those countries, and why in Europe did it fall in 1989 and not in other years of protest such as 1956 or 1968 or 1979. The rulers in Beijing ask themselves those questions repeatedly. The Party’s continued grip on power depends on getting the answers right.

The key point to grasp about the year is that it followed the first free legislative elections in the Soviet Union since 1917 as Soviet leader Mikhail Gorbachev’s pushed ahead with what was essential a European social democratic program of economic, social and political reform. The newly constituted Congress of the People’s Deputies then elected representatives to the Supreme Soviet, and many of those elected were not Party candidates. Beijing has been careful not to lose control of the electoral process.

The Party leadership has also recognized the way centrally directed economies cause economic stagnation, and by extension political unrest, and that unleashing the power of the private sector is necessary. But the Soviet Union, to Beijing’s mind, went too far in its privatizations, creating an unruly and group of oligarchs and too little government control over strategically important industries. While Beijing has held a hard line on political reform, it has pushed ahead, as we well know, with modernizing the economy, prodding the state-owned enterprises into greater efficiency, which keeping them state-controlled, and giving more rein to small and medium sized enterprises.

Eastern Europe got freedom but East Asia got rich. For how long economic reform can continue independently of political reform remains the great unanswered question.

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