Once in a generation
9/11/12 00:04![[identity profile]](https://www.dreamwidth.org/img/silk/identity/openid.png){kind=small}
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talkpoliticsOkay folks, the US elections are over, and, as the dust is slowly settling, we're beginning to recall that a whole big world exists out there. Now that we've learned who the new/old leader of the world's most important nation is gonna be, let's look at the second most important nation if you don't mind. China.
Apparently there's nothing that scares the Chinese elites more than potential chaos. The CPC may be preaching harmony and stability in society, but in fact the latest developments around the long expected change of power at the tops have shown anything but harmony.
It all began with the huge scandal around Bo Xilai, the former CPC darling. Then came the Bloomberg and NYT revelations about the billions of wealth piled by PM Wen Jiabao and the current frontrunner Xi Jinping. The two media websites were instantly blocked in China and this harsh reaction revealed the vulnerability of the rulers, just before the once-in-a-decade transfer of power. It's supposed to happen at the grand conference of all commie leaders that has started today. But the internal tension within the party and the voices for reform and the growing criticism after the corruption revelations, are promising anything but calm quiet times. And it's not like what's happening in the world's second biggest economy (which holds the biggest currency reserves) is not something to be concerned about.
The fail was really of epic proportions. Bo Xilai, until recently the shiny white knight, the superstar of Chinese politics, the one who was expected to rise to the tops, has suddenly lost everything. The now former party chairman of the monstrous megapolis Chungking is now expelled from the Politburo, removed from all posts and effectively turned into a political corpse. Now he awaits a corruption investigation, and trial on charges of power abuse and concealing a murder.
The scandal broke a few months ago when his wife was accused that she had killed British businessman (and alleged MI6 spy) Neil Heywood, seemingly after some quarrel on business matters worth millions of dollars. She was sentenced to death with a deferred execution, which practically means life sentence (she's the wife of a "more equal than the other equals", after all). But things didn't end there. Another trial followed against the former police chairman in Chungking, and Bo's close aide. He got 15 years in jail for power abuse because he and Bo had tried to conceal the murder. That's when things got really messy.
It was then that many predicted that the grip around Bo's neck would be getting tighter and he'd hardly escape with just an expelling from the party ranks. His downfall was a huge blow on the prestige of the ruling elite, just as the long anticipated party congress was looming. Bo himself was among the frontrunners, and now the party wants to be done with him ASAP and forget he ever existed. Today's conference is supposedly going to focus on the smooth power transfer and the future policies entirely. It's telling that immediately after they set the date for Nov 8, the criminal investigation against Bo Xilai was announced almost simultaneously. It's expected that he'll receive an effective sentence and he'll spend time in jail, after all.
The question remains when the trial will take place. Apparently it was important to take a formal decision before the party congress had begun. I expect Bo will learn his verdict before the conference has ended, so the party could say they're now able to start afresh, having put all that ugliness behind. So, with the closing of the Bo Xilai case, the path to the transfer of power would be cleared and the new generation of party leaders will be able to accomplish whatever they've convened there for. Most importantly, they'll try to put a limit on the term duration of the leaders, which means about 3/4 of the current party heavyweights and government members will have to retire and go into obscurity after the event.
But of course the biggest interest is about who the new 7 members of the 9-seat Politburo will be, which is something like the supreme council of China. The forecasts are that this committee might actually shrink down to 7 members, mostly for concerns that some positions have become too powerful. The outgoing general secretary Hu Jintao will resign and almost certainly hand his position over to Xi Jinping, who'll then be declared president during the annual parliamentary session in March next year. Then the new prime minister Li Keqiang will be appointed, taking the place of Wen Jiabao. Got confused already? I know, all these names sound the same to most. I hope the pics would help a bit...
As one might expect, there's nothing surprising in the selection of Xi Jinping for general secretary of the CPC and future president. Power transferring happens in a well established way, following procedures and series of selections aiming to achieve predictability and no sharp turns. Xi himself is of the "Tzars", i.e. he's a high-ranking party leader, and his place among the top circles is considered inherited and predestined. The little that's known of him suggests he's a pragmatic technocrat, he's tough on corruption and he supports economic development and foreign investment. So the Western biz can sleep well. There's nothing unpredictable about China's future policies, which will essentially be "more of the same, and better". With the tiny caveat that, although he might be considered a supporter of further market liberalisation, so far he has shown no signs that he intends to drastically loosen the regime in terms of political and civil freedoms.
Naturally, the expectations are big. But even if he wanted, he'd hardly be able to carry out radical reforms because he'll be working with an established team and he'll have to take lots of pre-determined limitations, restrictions and conditions in consideration, he'll have to reach consensus and compomise between various interests and factions, so he'll have his hands tied for the most part. Today nothing in China is possibly done single-handedly like at the time of Mao and Deng Xiaoping, because leadership is collective and no one in the Politburo or anywhere else holds absolute power. Even the internal security member of the Politburo is now getting downgraded, to prevent the position from becoming too powerful on its own.
Besides, the party has already agreed on the future framework for the 5 years 2011-2015 (everything is meticulously planned and negotiated), so the Chinese economic policies until 2015 are already known. The key goals are a more even distribution of goods, but still giving a large share of the income to the population within working age, plus extra emphasis on social security and the development of the lagging regions. So the direction is already set. But, as admittedly premature as it may be to ascribe extra expectations to Xi Jinping, it'd be similarly wrong to view him as a complete clone of his predecessor.
And though there are always big hopes associated with the coming of a new leader, I'd expect that he'll act cautiously about economic reform, and even more cautiously about political reform. I don't expect fundamental changes, because the economy is currently doing pretty good, and "When something is working, better not touch it". So the new government will most likely want to make sure that "the foundations are sound", and only then think about significant structural reforms, probably, maybe. Initially, Xi will be sticking with the status quo. Perhaps in 2-3 years he could possibly begin planning a pragmatic change, depending on the situation. But for now there are no indications that he's some big reformer or anything like that. Of course still very little is known about him at this point, but like I said he'll be restricted and limited by the influential people around him. So, even if he wants to do something big, he'll have to wait for a while. And, being an experienced politician, he should know that things in China are done slowly, with lots of deliberations, and long-term thinking is given priority over short-term.
But still, reforms are not only expected and hoped for, but also urgently necessary for China. And the next generation of leaders will have a long list of challenges to deal with. The top priority should be the slowing economy. Lots of analysts believe the whole Chinese development model should be changed because it creates vast inequality, and the gap between wealthy and poor is among the widest and definitely the fastest growing in Asia. Another problem of course is the aging population. The unpopular "one child" policy means fewer Chinese would be working and supporting a larger number of pensioners, and this is coming very soon. What's more, the private sector needs to assert a bigger role in the market, which would stimulate domestic consumption and small- and mid-business.
More and more indications show that there's potential for a crisis in the Chinese economic model. The next decade could be the last chance for a meaningful reform, and the coming generation of leaders should be aware of that. Whether they do realise that they're at a key point in their economic and political development, is yet to be seen, but I'd say the answer is yes. But it's another question if they'll have the courage to act boldly. Or the system is already so sclerotic that they won't be able to do anything even if they wanted.
When the current president Hu Jintao came to power in 2002 he was greeted with insistent calls for ambitious reform. And a number of analysts were seeing a bold innovator in him. But these hopes soon faded away when it turned out he was rather a cautious conformist. And the opportunity was missed. That's why many are now refraining from investing too much hope and expectation in Xi Jinping. But that won't stop the voices for reform, and in fact they're getting stronger.
After three decades of continuous almost two-digit growth, China is expecting its lowest annual growth in a dozen years. The time of wild expansion is nearing its end, and the country will have to put up with "just" a 8% growth or somewhere there. And it'll be increasingly urgent for them to complete the transition from an economy mostly based on exportation and cheap, low-segment production (which is extremely energy- and ecology wasteful), to one that's powered by domestic consumption, a viable services sector, and innovation. How exactly they'll achieve the latter, is beyond me, since there's been a culture of repetition and functionality but not innovation existing there for generations.
But probably the biggest source of potential social discontent remains the power abuse and corruption among the political circles, and the unhealthy symbiosis between government and business. The list of challenges is really long, and the inefficient financial, judicial and social system is in the top-3 as well.
On the other hand, the international situation is equally complicated. The shaky US recovery and Europe's continuing struggle are additional risks for the Chinese economy. Meanwhile, apart from relying on its contacts with the EU and the US, China will have to turn special attention to the turbulent events in its neighbouring regions.
For the last decade or so, president Jintao and PM Jiabao were mostly focused on strengthening the economy and achieving internal stability, rather than making any risky turns. And, while the Chinese government-friendly media are pompously calling the time of their reign "the golden decade", some might be more prone to calling it "the missed decade". So the advocates for change have concrete expectations for the next leader Xi Jinping - like for example their hope that he'll cut some of the privileges of the state companies, and make settling in the rural areas a lot easier, and most importantly curb the huge prerogatives of the provincial and central power which are threatening to suffocate growth at a local and national level.
All that said, the internal issues will be a priority for the new rulers - the successful recovery of the economy, and political stability in the country. They'll have to concentrate on building a constructive relationship with the US, as opposed to the politics of raised eyebrows, odd stares and muted grumbles. We shouldn't underestimate the passive-aggressive conflict with Japan as well which is already damaging the trade relations between the two juggernauts, because both countries have an economic incentive to settle their dispute quickly and peacefully - they're each other's #2 trade partner after all. But, at the end of the day, just like in the US, in China too, "The economy, stupid" remains issue #1. If the economy is not doing good, then social unrest follows. The supremacy of law over corruption, the civic society and the social inequality are the other areas where the Chinese should be working hard.
All of this shows that it's high time for real change. The arrival of a new generation of leaders in Beijing is the perfect opportunity for that. The bad news is that so far none of them have explicitly shown any interest in making a political reform towards anything remotely resembling democracy. But with a slowing economy that's undermining the CPC's legitimacy, they may realise they actually might not have much of a choice in that respect.
Apparently there's nothing that scares the Chinese elites more than potential chaos. The CPC may be preaching harmony and stability in society, but in fact the latest developments around the long expected change of power at the tops have shown anything but harmony.
It all began with the huge scandal around Bo Xilai, the former CPC darling. Then came the Bloomberg and NYT revelations about the billions of wealth piled by PM Wen Jiabao and the current frontrunner Xi Jinping. The two media websites were instantly blocked in China and this harsh reaction revealed the vulnerability of the rulers, just before the once-in-a-decade transfer of power. It's supposed to happen at the grand conference of all commie leaders that has started today. But the internal tension within the party and the voices for reform and the growing criticism after the corruption revelations, are promising anything but calm quiet times. And it's not like what's happening in the world's second biggest economy (which holds the biggest currency reserves) is not something to be concerned about.
The fail was really of epic proportions. Bo Xilai, until recently the shiny white knight, the superstar of Chinese politics, the one who was expected to rise to the tops, has suddenly lost everything. The now former party chairman of the monstrous megapolis Chungking is now expelled from the Politburo, removed from all posts and effectively turned into a political corpse. Now he awaits a corruption investigation, and trial on charges of power abuse and concealing a murder.
The scandal broke a few months ago when his wife was accused that she had killed British businessman (and alleged MI6 spy) Neil Heywood, seemingly after some quarrel on business matters worth millions of dollars. She was sentenced to death with a deferred execution, which practically means life sentence (she's the wife of a "more equal than the other equals", after all). But things didn't end there. Another trial followed against the former police chairman in Chungking, and Bo's close aide. He got 15 years in jail for power abuse because he and Bo had tried to conceal the murder. That's when things got really messy.
It was then that many predicted that the grip around Bo's neck would be getting tighter and he'd hardly escape with just an expelling from the party ranks. His downfall was a huge blow on the prestige of the ruling elite, just as the long anticipated party congress was looming. Bo himself was among the frontrunners, and now the party wants to be done with him ASAP and forget he ever existed. Today's conference is supposedly going to focus on the smooth power transfer and the future policies entirely. It's telling that immediately after they set the date for Nov 8, the criminal investigation against Bo Xilai was announced almost simultaneously. It's expected that he'll receive an effective sentence and he'll spend time in jail, after all.
The question remains when the trial will take place. Apparently it was important to take a formal decision before the party congress had begun. I expect Bo will learn his verdict before the conference has ended, so the party could say they're now able to start afresh, having put all that ugliness behind. So, with the closing of the Bo Xilai case, the path to the transfer of power would be cleared and the new generation of party leaders will be able to accomplish whatever they've convened there for. Most importantly, they'll try to put a limit on the term duration of the leaders, which means about 3/4 of the current party heavyweights and government members will have to retire and go into obscurity after the event.
But of course the biggest interest is about who the new 7 members of the 9-seat Politburo will be, which is something like the supreme council of China. The forecasts are that this committee might actually shrink down to 7 members, mostly for concerns that some positions have become too powerful. The outgoing general secretary Hu Jintao will resign and almost certainly hand his position over to Xi Jinping, who'll then be declared president during the annual parliamentary session in March next year. Then the new prime minister Li Keqiang will be appointed, taking the place of Wen Jiabao. Got confused already? I know, all these names sound the same to most. I hope the pics would help a bit...
Hu -> Xi // Wen -> Li // Bo. Got it? ;)
As one might expect, there's nothing surprising in the selection of Xi Jinping for general secretary of the CPC and future president. Power transferring happens in a well established way, following procedures and series of selections aiming to achieve predictability and no sharp turns. Xi himself is of the "Tzars", i.e. he's a high-ranking party leader, and his place among the top circles is considered inherited and predestined. The little that's known of him suggests he's a pragmatic technocrat, he's tough on corruption and he supports economic development and foreign investment. So the Western biz can sleep well. There's nothing unpredictable about China's future policies, which will essentially be "more of the same, and better". With the tiny caveat that, although he might be considered a supporter of further market liberalisation, so far he has shown no signs that he intends to drastically loosen the regime in terms of political and civil freedoms.
Naturally, the expectations are big. But even if he wanted, he'd hardly be able to carry out radical reforms because he'll be working with an established team and he'll have to take lots of pre-determined limitations, restrictions and conditions in consideration, he'll have to reach consensus and compomise between various interests and factions, so he'll have his hands tied for the most part. Today nothing in China is possibly done single-handedly like at the time of Mao and Deng Xiaoping, because leadership is collective and no one in the Politburo or anywhere else holds absolute power. Even the internal security member of the Politburo is now getting downgraded, to prevent the position from becoming too powerful on its own.
Besides, the party has already agreed on the future framework for the 5 years 2011-2015 (everything is meticulously planned and negotiated), so the Chinese economic policies until 2015 are already known. The key goals are a more even distribution of goods, but still giving a large share of the income to the population within working age, plus extra emphasis on social security and the development of the lagging regions. So the direction is already set. But, as admittedly premature as it may be to ascribe extra expectations to Xi Jinping, it'd be similarly wrong to view him as a complete clone of his predecessor.
And though there are always big hopes associated with the coming of a new leader, I'd expect that he'll act cautiously about economic reform, and even more cautiously about political reform. I don't expect fundamental changes, because the economy is currently doing pretty good, and "When something is working, better not touch it". So the new government will most likely want to make sure that "the foundations are sound", and only then think about significant structural reforms, probably, maybe. Initially, Xi will be sticking with the status quo. Perhaps in 2-3 years he could possibly begin planning a pragmatic change, depending on the situation. But for now there are no indications that he's some big reformer or anything like that. Of course still very little is known about him at this point, but like I said he'll be restricted and limited by the influential people around him. So, even if he wants to do something big, he'll have to wait for a while. And, being an experienced politician, he should know that things in China are done slowly, with lots of deliberations, and long-term thinking is given priority over short-term.
But still, reforms are not only expected and hoped for, but also urgently necessary for China. And the next generation of leaders will have a long list of challenges to deal with. The top priority should be the slowing economy. Lots of analysts believe the whole Chinese development model should be changed because it creates vast inequality, and the gap between wealthy and poor is among the widest and definitely the fastest growing in Asia. Another problem of course is the aging population. The unpopular "one child" policy means fewer Chinese would be working and supporting a larger number of pensioners, and this is coming very soon. What's more, the private sector needs to assert a bigger role in the market, which would stimulate domestic consumption and small- and mid-business.
More and more indications show that there's potential for a crisis in the Chinese economic model. The next decade could be the last chance for a meaningful reform, and the coming generation of leaders should be aware of that. Whether they do realise that they're at a key point in their economic and political development, is yet to be seen, but I'd say the answer is yes. But it's another question if they'll have the courage to act boldly. Or the system is already so sclerotic that they won't be able to do anything even if they wanted.
When the current president Hu Jintao came to power in 2002 he was greeted with insistent calls for ambitious reform. And a number of analysts were seeing a bold innovator in him. But these hopes soon faded away when it turned out he was rather a cautious conformist. And the opportunity was missed. That's why many are now refraining from investing too much hope and expectation in Xi Jinping. But that won't stop the voices for reform, and in fact they're getting stronger.
After three decades of continuous almost two-digit growth, China is expecting its lowest annual growth in a dozen years. The time of wild expansion is nearing its end, and the country will have to put up with "just" a 8% growth or somewhere there. And it'll be increasingly urgent for them to complete the transition from an economy mostly based on exportation and cheap, low-segment production (which is extremely energy- and ecology wasteful), to one that's powered by domestic consumption, a viable services sector, and innovation. How exactly they'll achieve the latter, is beyond me, since there's been a culture of repetition and functionality but not innovation existing there for generations.
But probably the biggest source of potential social discontent remains the power abuse and corruption among the political circles, and the unhealthy symbiosis between government and business. The list of challenges is really long, and the inefficient financial, judicial and social system is in the top-3 as well.
On the other hand, the international situation is equally complicated. The shaky US recovery and Europe's continuing struggle are additional risks for the Chinese economy. Meanwhile, apart from relying on its contacts with the EU and the US, China will have to turn special attention to the turbulent events in its neighbouring regions.
For the last decade or so, president Jintao and PM Jiabao were mostly focused on strengthening the economy and achieving internal stability, rather than making any risky turns. And, while the Chinese government-friendly media are pompously calling the time of their reign "the golden decade", some might be more prone to calling it "the missed decade". So the advocates for change have concrete expectations for the next leader Xi Jinping - like for example their hope that he'll cut some of the privileges of the state companies, and make settling in the rural areas a lot easier, and most importantly curb the huge prerogatives of the provincial and central power which are threatening to suffocate growth at a local and national level.
All that said, the internal issues will be a priority for the new rulers - the successful recovery of the economy, and political stability in the country. They'll have to concentrate on building a constructive relationship with the US, as opposed to the politics of raised eyebrows, odd stares and muted grumbles. We shouldn't underestimate the passive-aggressive conflict with Japan as well which is already damaging the trade relations between the two juggernauts, because both countries have an economic incentive to settle their dispute quickly and peacefully - they're each other's #2 trade partner after all. But, at the end of the day, just like in the US, in China too, "The economy, stupid" remains issue #1. If the economy is not doing good, then social unrest follows. The supremacy of law over corruption, the civic society and the social inequality are the other areas where the Chinese should be working hard.
All of this shows that it's high time for real change. The arrival of a new generation of leaders in Beijing is the perfect opportunity for that. The bad news is that so far none of them have explicitly shown any interest in making a political reform towards anything remotely resembling democracy. But with a slowing economy that's undermining the CPC's legitimacy, they may realise they actually might not have much of a choice in that respect.
(no subject)
Date: 8/11/12 22:41 (UTC)Fuck the alleged 'billions', both NYT and Bloomerg can't live without shit.
But where the China'll go - it's a million dollars quest... sorry, world-wide business.
In some sense it's more important (with all respect to american friends and comrades) than the US elections.
Taking into account that Politbureau's habbits are known, what changes, do you think are bound to happen in China to affect the whole world?
(no subject)
Date: 8/11/12 22:45 (UTC)With the shifting power balance in the world (both economically and geopolitically), it's inevitable that anything that's happening in China would affect the world. Take Africa for example. This continent is now practically turning into China's backyard, the way Latin America is the US backyard. Events in China will certainly reflect on many African countries, including SA where I live, although SA itself is a relative economic heavyweight on its own.
(no subject)
Date: 8/11/12 22:48 (UTC)PS. Re the Chinese reaction on blocking the access -
they don't give a shit to Bloomberg. They just stop the stink. You flush the water in WC after you've finished, don't you? :)
(no subject)
Date: 8/11/12 23:08 (UTC)(no subject)
Date: 8/11/12 23:16 (UTC)(no subject)
Date: 9/11/12 00:07 (UTC)What keeps their economy going is spending their large reserves. Either they build huge cities without reason, or they buy investments for twice the current market value. When China's bubble bursts it's going to ripple across the world
(no subject)
Date: 9/11/12 00:27 (UTC):/
(no subject)
Date: 9/11/12 02:08 (UTC)(no subject)
Date: 9/11/12 10:40 (UTC)1. The official one is that those commanders had shown "too much cautiousness in countering the US military interests and actions against China".
2. Thee fact that the enigmatic Xi Jinping represents the interests and is favored by the central military commission at the communist party, suggests that it was him who inspired this shift at the military tops. Jinping himself started his ascent as an administrative secretary at the military commission, he has a mayor-general rank in the military, and funnily, his wife (the very popular and loved songstress of patriotic songs Peng Liuan) also has a mayor-general ranks at the military (she started in the army at age 18).
Oh, and here she is:
I must admit this was a good overview, overall.