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What China’s leadership transition means for the United States

By Dean Cheng - posted Thursday, 8 March 2012


These considerations in combination suggest that the policies of the new Chinese leadership led by Xi will be more difficult to predict. Further complicating forecasting are fundamental issues of reform and policymaking.

Wealth and Power in Government

Under Hu Jintao, the Shanghai faction epitomized by former Premier and top economic reformer Zhu Rongji is a shadow of its former self. It may be further weakened if former President Jiang Zemin dies during the transition. Economic reformers have effectively been sidelined, and many of the efforts at decentralization have been turned back. Indeed, China's top leaders now control more wealth than their American counterparts. The top 70 members of China's legislature are worth 10 times the combined net worth of the entire U.S. Congress, President, and Supreme Court.

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However, further Chinese economic development arguably requires restarting reform. The World Bank's "China 2030" report emphasizes the need to scale back metastasizing state-owned enterprises. The very people who control the wealth of China, in essence, must choose to divest themselves of much of that, if China is to progress.

Just as China's wealth is concentrated at the top, so too is Chinese power. Hu Jintao has concentrated leadership of the Leading Small Groups (LSGs), responsible for coordinating policy oversight and implementation across Party and government ministry boundaries within the Politburo Standing Committee (PSC) itself. This is in sharp contrast with Jiang Zemin's rule, when some of those LSGs were within the Politburo but not the Standing Committee. If Xi continues this trend, understanding the PSC and the personalities on it will be indispensable if the U.S. is to have any chance of influencing Chinese decision making.

Seeing the Big Picture Means Knowing Where to Look

With so much riding on understanding the shape of the new Chinese government, the U.S. needs to do a better job of fathoming the new leadership.

Seek better understanding of how the PRC decision-making system works. Too often, there is a tendency to rely on tropes and mirror-imaging when examining Chinese politics. Rather than imposing American concepts (e.g., military hardliners versus civilian soft-liners), the U.S. should follow Deng Xiaoping's dictum to "seek truth from facts." Too often, assessments of China appear to be rooted in caricatures of how militaries and civilians think or, worse, in self-interested claims that ignore basic facts.

Look beyond Beijing (and Shanghai). Its consensus-based system, including explicit incorporation of regional leaders, means that Chinese decisions are not based solely on the perspectives of the political and economic centers. It is therefore essential to recognize that Beijing and Shanghai are not the only voices that matter; rather, it is important to gauge how the provinces view issues. China seems to be pursuing "federalism with Chinese characteristics."

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Understand who matters and who does not. What matters is the Party, in many ways more than the government. Thus, the PSC matters, in many ways, much more than the State Council (a rough equivalent to the American President's Cabinet). The PLA, as a Party army, is one of the few institutions that straddles the line. It is a Party entity, and as such is engaged in policy-setting, with access to China's top leader through the CMC. But because it is also engaged in policy implementation, it acts as a governmental entity. By contrast, the Foreign Ministry has a far lower level of influence and no comparable access to decision makers since Hu Jintao took power; in essence, the diplomats are voiceless. If this remains true under Xi, foreign policymakers should approach the Chinese accordingly.

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About the Author

Dean Cheng is Research Fellow in Chinese Political and Security Affairs in the Asian Studies Center at The Heritage Foundation.

Other articles by this Author

All articles by Dean Cheng

Creative Commons LicenseThis work is licensed under a Creative Commons License.

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