Chinese puzzles

This is my first faltering step in the process of educating myself, some might call it 're-education', on the subject of China.  After all, if I can flounder about in American politics and pretend I know something about it, then it is surely time for me to do the same with the second (for the time being) greatest power on the globe.

Earlier this week, the Chinese 'branch' of the internet went 'viral' (I think the expression has it) with rumours of a heavier than normal police presence in Beijing and even reports of tanks entering the city.  This ended abruptly when the Chinese authorities stamped down on the social networks spreading the stories.  According to the WSJ:

Among the legion of social-media fanatics, there has been fevered chatter of a political struggle inside the towering walls of the Zhongnanhai leadership compound in downtown Beijing.

This followed the sacking of a powerful local chief called Bo Xilai.  He had fallen out with his chief of police who then fled to the nearest American consulate to seek political asylum.  Fat chance of that with President 'peace 'n' love, man' Obama in charge and the man was quickly whisked off to Beijing.  Bo, apart from being the Party boss of the Chonqing province, was also a member of the  Politburo of the Communist Party of China; so, a very big cheese, indeed!  He was also a 'princeling', that is, the son of man who had been part of Mao's entourage and who taken part in the Great March.

No doubt there was a falling out over the spoils of corruption which seems to go hand in hand with almost all Chinese government activities.  However, there also appears to be the beginnings of a great political schism which reaches as far as the Central Committee:

One theory, widely explored: A battle is brewing between Zhou Yongkang—the country's domestic security chief who is believed to be a strong supporter of Mr. Bo—and President Hu Jintao, Premier Wen Jiabao and other leaders who analysts say likely supported Mr. Bo's ouster. Mr. Zhou is a member of the party's all-powerful Politburo Standing Committee, and one of the country's nine most powerful political leaders.

This division is exemplified by Bo's reputation as a Leftist who favoured a return to the Maoist policies of The Great Leap Forward.  The 'China model', so admired by the likes of George Soros and Francis Fukuyama, was instituted after the death of Mao and it has galvanised the Chinese economy.  But now, it is running into real difficulties with a delicate (putting it politely) banking system and a property bubble of eye-watering magnitude.  The era of cheap labour and cheap capital is ending.  Chinese workers want their share of the wealth by means of their wages, and on top of that, the European and American markets which once swallowed anything and everything produced by China have suddenly gone soggy.

This poses a dilemma for the leadership, as described by an admirable article in The Spectator (not on link yet) written by Jonathan Fenby(*):

It can turn left in the direction of even more party control and state power.  That was Bo Xilai's route, which now seems to be blocked.  Or it can veer right by helping private companies which have been squeezed by privileged state enterprises and embarking on a major programme of reform.

In a way this is a prize example of how easy dictatorship is compared to democracy!  As the record shows in the 'liberated' black African nations of the British empire and the current, so-called 'Arab spring', which is almost certainly going to end in a "winter of discontent", it is hugely difficult to change political horses whilst at the gallop.  We, the English, managed it better than anyone before or since but, of course, it took us several hundred years of mostly gentle trotting to pull off the trick.

Hovering over all of these manouvres is the Chinese army.  They are described as being highly nationalistic (so just like everyone else's army, then!) and they are watching these political moves with a beady eye.  The incoming president, Xi Jinping, about whom I wrote a few weeks back, seems to be a highly intelligent man.  I do hope so because he is going to need every ounce of it over the next ten years.

A further report on last week's events can be read at The Washington Times.

(*) Jonathan Fenby is author of a new book on China: Tiger Head, Snake Tails.

Comments

[Jimmy]

David. The Chinese have the ability to cull a few million without the blink of an eye then carry on as normal. When you have a population well over a billion no one notices and the economy is not affected.

[David Duff]

I don't doubt it, Jimmy, but the point is we will notice it! The old saying about America sneezing and us catching a cold goes nowhere near describing the global economic effects if China descends (again!) into civil war.

[Hank]

David

The name sounded familiar.

http://online.wsj.com/article/SB10001424053111904491704576572552793150470.html

http://eclecticmeanderings.blogspot.com/
Hank’s Eclectic Meanderings

[David Duff]

Yes, Hank, I remember reading that at the time. Anyway, with 'Big Daddy' out of power the Ferrari may have to be replaced with a bicycle!