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Xi and Li: evaluating China’s New Leadership

May 24, 2013 by Timothy Beardson

One of the most discussed issues at the moment is what to expect from the new leadership in Beijing. To tackle China’s many problems will require deep, rapid and structural reform.

“The two prominent leaders, Xi Jinping, the Party General Secretary, and Li Keqiang, the second ranking member of the Politburo, receive the dominant publicity but are flanked by five other members of the key Politburo Standing Committee. These other highly important figures were not chosen by Xi and Li but by a similarly arcane process.
Surmise and hearsay swirl around the possible policy inclinations of Xi and Li but we must be aware that they will not rule China alone. They will need to forge a consensus through discussion and negotiation with both the other members of the standing committee whose views may vary significantly from their own and also past leaders who retain influence. Other figures can represent independent views and influences in the policy arena. Nor should we assume that Xi and Li will share precisely the same views.

Lack legitimacy

Contemporary Chinese leaders do not generally have the charisma and standing of those leaders of an earlier era like Mao Zedong or Deng Xiaoping. They have neither fought in the revolutionary wars nor been elected by the people and therefore lack legitimacy by ballot or bullet. Both presidents Jiang and Hu found it difficult to impose their personal preferences on a system that has become increasingly consensual and institutionalised. This is not a dictatorship. One might note, however, that Xi does have noticeable charisma.
For all these reasons we should not assume that a clear strategic approach will emerge quickly from the new leadership. Indeed with President Hu, after a very long wait for the strategy to emerge, it became clear that despite a welcome rhetorical emphasis on social and environmental themes there was no new strategic approach.

However, what are the indicators we should look for from the new leadership if it is to show a commitment to the meaningful reform that China so much needs? Some of the most pressing issues would include banking reform, household registration, education reform, land use rights, water air and soil pollution, income inequality, healthcare and corruption. Take note that no foreign issue reaches the list. The domestic problems are already so serious. Banking reform is needed so that lending can go to the productive sectors of the economy – not just to the state sector. China needs to reform household registration so that rural migrants into the cities receive fair access to social services in their adoptive homes. Education reform is needed so that critical thinking can replace rote-learning in determining school success and suitability for university. Farmers need security of land tenure to finance equipment for farming and release surplus manual labour for more productive work. Unchecked pollution will poison more people, balloon healthcare costs and generate even more riots. Income inequality is now well above that in the US and creating national anger. Healthcare – in the absence of satisfactory social provision – is unaffordable for many. And, lastly, pervasive corruption rots respect for the state.

Any government which wishes to reform will need to confront these issues. The list is not short; but neither is it exhaustive. When we examine the previous leadership, certain facts are clear. Hu Jintao began as Party leader in 2002 by observing mournfully the income inequality and deteriorating environment and proposing that China needed to become a ‘Harmonious Society’. What actually happened is that through his decade in power the environment deteriorated further and income inequality grew steadily. Wen Jiabao began as Prime Minister in 2003. Throughout his period in power he lambasted the evil of rampant corruption amongst officials and called for democracy. In fact, corruption became worse and democracy was not introduced.

It is important that we do not judge Party leaders by what they say. The only measure must be what they do.

Leadership choices

The overall Party leadership has a number of choices. It can decide to manage the system as it is to avoid rocking the boat and curtailing patronage opportunities. It can decide to continue as is on the basis that it is simply too difficult to change course or there is too much danger to regime stability. Or it could decide that the only solution for national challenges is radical reform. Any change of course could be the product of long internal contemplation by certain leaders who can carry conviction or an act of sudden blinding enlightenment.
No one can be sure which strategies will be chosen – or when. We will only get a sense of real reform when some of the major initiatives are introduced over the coming months. We have learned that today’s remarks are no guide to tomorrow’s performance. The rising tide of public anger sits with high survey (approval?) ratings for central government and economic performance. Blame is cast largely on officials in the regions to the point that ‘corrupt local officials’ has become a tautology. But it is an unstable equilibriumand I therefore have little doubt that this newly intalled Party leadership will be obliged to embrace reform or encounter instability.

I might make two further observations. Reform at home does not ensure good neighbourliness abroad. And future economic and social reforms do not guarantee later political reforms.



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