The Old Guard in China Beats Back Reformers

On Thursday morning, the new Chinese leadership strode across the stage at the end of the 18th Party Congress at the Great Hall of the People in Beijing.  One of the few surprises was the complete absence of reformers among the seven-member Standing Committee of the Politburo, China’s ruling body.

The Standing Committee had shrunk by two members—maybe to keep prominent reformers like Wang Yang of prosperous Guangdong province off.

But as the new leader Xi Jinping and his premier Li Keqiang assumed the mantle of power, it was clear that the “princeling” faction backed by powerful former president Jiang Zemin had won and the reformers supported by the current premier Wen Jiabao had lost.

Their hopes were high a few months ago when princeling—son of a revolutionary leader—Bo Xilai was deposed in a lurid scandal involving the alleged murder of a British national by Bo’s wife. It makes the scandal embroiling Gen. David Petraeus look like a Quaker meeting.

Some speculated that Bo’s fall was the work of Wen himself who sought to block the rise of this nationalistic, demagogic politician to a position of supreme power.

But Wen didn’t get the last word, while Ziang, who never quite resigned after Hu Jintao replaced him ten years ago, showed his skill as a master schemer.  Xi is his protégé and several Western observers said the new inner circle had Ziang’s stamp of approval.

A few weeks ago, The New York Times reported that Wen’s family made $2.7 billion from various business ventures through a complex web of secret partnerships that I doubt any Western reporter could have discovered for himself.  How did he get the information? Who knows?

In his inaugural address, Xi condemned corruption as the main problem facing China, saying:

Our party faces many severe challenges, and there are also many pressing problems within the party that need to be resolved, particularly corruption, being divorced from the people, going through formalities and bureaucratism caused by some party officials.

And who might those party officials be, Mr. Xi? Next question, please.

China’s new leadership was unveiled at the 18th Party Congress in Beijing. New president Xi Jinping is in the center. Photo: Xinhua.

One who will be gone and probably forgotten is the wooden Hu Jintao, generally regarded as one of the most ineffectual Chinese leaders since the revolution.  As the South China Morning Post reported:

Domestically, Xi will have to clear up the mess left by Hu’s failure to redress the imbalances of the previous 20 years of rapid economic growth, such as widespread discontent over the environment, public health and social security woes.

China has also seen deepening social tensions over corruption, suppression of human rights, unbridled government power and the monopoly of state-owned enterprises.

So, what’s ahead? Cheng Li of the Brookings Institution told CNN that the members of the new Standing Committee were capable stewards of  the economy but that

Economic reform needs serious political reform; otherwise, it can not go too far because of the political bottleneck. This leadership lineup has sent a very clear signal that it is politically conservative.

The new leadership is likely to move cautiously. Big reforms like rebalancing the economy towards consumers will find stiff resistance from the powerful heads of State Owned Enterprises who like the export-driven, state-subsidized economy just the way it is.

And the military will have to be appeased at a time of rising tensions in Southeast Asia and increased involvement by the United States as President Obama tries to “pivot” to Asia.

Off the table: any move towards political liberalization. The Communist Party remains very much in command.

So, although the dark-suited faces in the leadership are different, their message is the same: don’t expect real change in China.

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