Kerry Brown
abc.net
October 16, 2012
When China’s new leaders face the world in the middle of November we will have no idea what policies they might have on their minds, writes Kerry Brown.
While the world’s attention is focussed on next month’s leadership contest in the United States, the leadership change that will take place in China just days after the US presidential elections has received comparatively less attention.
Since the great transformation starting in 1978 China has become one of the world’s major powers. It is now the world’s second largest economy and its impact can be felt everywhere: in energy consumption, the environment, global trade flows, the balance of international power. Its voice is increasingly heard in multilateral forums. People talk of a century in which China will be at the heart of world affairs.
So a change of leadership there is a big deal. After November 8, when China holds its five-yearly Party Congress, the world will meet the leaders who are likely to run the country for the next decade. But perhaps the most astonishing thing about the leadership transition currently underway – and which has been underway since China’s last Congress in 2007 – is that policy issues have never reared their head.
For all the speculation about who might be elevated to the body which runs the country – the Politburo’s all-important Standing Committee – never once has there been talk of what policies the new leaders might support. The whole process has been policy-lite.
The party’s main aim is to ensure a smooth transition. Never before has it been attempted in this way. In the past, the patronage of Godfather figures with stacks of political capital – such as paramount leader Deng Xiaoping – was sufficient to anoint Hu Jintao and Wen Jiabao. His reputed support for them was a great card to play when questions were raised. If they were Deng’s men, they were worth looking at. The new leaders have no comparable figure to appeal to. Deng died in 1997!
This time the primary mechanism granting legitimacy is process. November’s Congress will appoint new leaders who are meant to appeal across the 82 million-strong party, and who are seen as part of a collective leadership where everyone broadly agrees. Argument and discussion about different policies has been shunned because it is viewed as disruptive and potentially destabilising. Bo Xilai, the great exception to this rule, has been abruptly felled. Judgement on charges of corruption and a range of other unspecified charges will no doubt ensure he stays in the political graveyard.
So when the new post Hu and Wen leaders face the world in the middle of November we will have no idea what policies they might have on their minds. And given the constraints of the current system, they won’t be able to make changes quickly even if they wanted to. The Five Year Program sets their macroeconomic policy till 2015.
Former leaders are unlikely to disappear in a puff of smoke. They will remain influential long after their ‘retirement’. This will be a long transition. Perhaps two or three years into it we will be able to see authentic fifth-generation leader initiatives.
We shouldn’t be misled, however: new people will almost certainly mean, sooner rather than later, new looking policies. And we need to be part of this process. Xi Jinping, the man most likely to replace Hu Jintao as party boss, reportedly met with an academic in August and spoke of the need for deeper, faster reform.
The new leadership will rule China during a period that will not just be about GDP growth. Under Hu and Wen, China has been an amazing productivity factory. Entry to WTO in 2001 unleashed forces which took China from the world’s sixth-largest to its second-largest economy, and made it the largest exporter and the second largest importer.
But in that time socio-political issues have been neglected. For the fifth generation this will be the critical area. They will need to do something to create an effective social welfare system covering the city and the countryside, and addressing the huge inequalities that exist in China today.
They will need to address tax reform – China is now a country where people self tax through savings, and where the government gets most of its revenues from state-owned enterprises. A redistributive tax system will be one big issue policymakers will need to look at – along with overhauling the largely ineffective pension system, particularly given a rapidly aging population.
Public participation in decision making – through strengthening the role of Congresses at local and national levels – will be important. Finally, addressing the long-term problem of giving civil society groups proper legal status, in an era when they will be supplying many of the services government will need.
The leadership knows that addressing one of these issues will require them to consider the impact on every other issue. Once they move on one, reforms will need to spread across the board. For cautious administrators who know there are high risks, this is a huge task. But it is impossible to see China reaching its stated goal of becoming a middle income country by 2020 without these reforms.
Running a country on a political system largely borrowed from the Soviet Union in the middle of the last century has become increasingly unwieldy. The fifth generation leadership will have to look at the areas their predecessors neglected – building rule of law, and political reforms. Making China a rich country was the easy stuff. Now the hard work begins.
Professor Kerry Brown is Executive Director of the China Studies Centre at the University of Sydney.
