The issues behind the 17th Communist Party Congress

Context

When he visited Shanghai at the beginning of October, Hu Jintao was photographed refereeing a tug-of-war contest. Back in Beijing, however, he has been pulling at his end of the rope for months to try to get a favourable outcome to the nomination process at this month’s Party congress for new posts on the regime’s top body, the Standing Committee of the Politburo. One member of this nine-man group died during the summer. Two others are due to retire.

The Party leader and President is reported to have wanted to slim down the Standing Committee to seven members and put in just one new man – his protégé Li Keqiang, Party boss in northeastern Liaoning province. This would make Li, who has presided over the modernisation of the economy in the Manchurian rustbelt region, Hu’s successor when he leaves office in 2012 after serving for a total of 10 years.

But this plan has run into opposition from other Standing Committee members, notably holdovers from the “Shanghai Faction”, which ran China under Hu's predecessor, Jiang Zemin. They want to balance Li with at least one other member of the next generation of leaders and are generally keener on continued high growth than Hu, who champions a “harmonious society” to reduce disparities and achieve better balance between the coast and the interior.

A number of candidates have been mentioned as possible members of the Standing Committee and thus as rivals to Li in the succession stakes – see our June Trusted Judgement for more on the frontrunners. The most talked about is the recentlyappointed Shanghai Party secretary, Xi Jinping. Hu’s praise for the city during his recent visit and a gushing article in the People’s Daily have boosted the chances of Xi, who took over China’s richest city after the ousting of the former municipal Communist Party boss last autumn on corruption charges. A September Reuters report also cited two unidentified Party sources as naming Xi as a likely candidate for the committee.

Xi is reported to have topped a national straw poll among cadres to rank the popularity of provincial leaders. He is reckoned to have done a good job on the economic front in his previous post as head of Zhejiang province, one of China’s fastest-growing regions. His track record there and now in Shanghai means that senior “Shanghai Faction” figures who want to continue high growth find him acceptable. As the son of a reformist vice-premier, he is one of China’s “princelings”, but he is not linked to any of the factions that have competed in the Politburo since 2002. This makes him acceptable to Hu and an ideal compromise candidate for the succession.

If Hu has failed to get his way on the succession, this does not threaten his assumption of a second five-year term, but it means that he will have considerably less than the overwhelming authority exercised by the men who set the template for leadership in the PRC. This may be welcome from many viewpoints. But it contributes to the core problem with which the Communist Party is confronted but which it will evade at the Congress – its own authority.

The CCP remains a Leninist party with Chinese characteristics. It second-guesses the government and acts as a block on policy-making. Ultimate authority lies in the Politburo and, above all, in its Standing Committee. Reform of the financial sector has been delayed for more than a year by the illness and subsequent death of the Standing Committee member responsible for the issue. Or, in another example, the appointment of a non-CCP member as health minister this summer was hailed by some observers as a sign of the Party being ready to relinquish power to a professional. But his predecessor held on to his governmental rank and, more tellingly, remained head of the CCP section that oversees the ministry’s work.

The old question of whether China should be run by “reds” or “experts” – political figures or those who know what they are doing – remains, despite the three decades that have elapsed since Deng Xiaoping appeared to have cast the die in favour of the latter. That lies at the heart of the challenge facing China’s leadership in the next five years after the Congress, although Hu's concern for the Party's moral prestige and reputation perhaps makes him more receptive than Deng to the more ideologically-driven cadres. To be effective, government at both central and provincial level has to be freed from Party control, and the Party itself has to be modernised and made more relevant politically in a country vastly changed since it established the 1949-era political structure that has endured even through the economic reform process launched in 1978.

Hu’s problem is that the nature of the system militates against change, with enormous in-built interest groups resisting any threat to their positions. Mao’s iconic status enabled him to bulldoze through change – with disastrous effects, particularly during the Cultural Revolution. Hu is on weak ground for two reasons: he lacks the authority of a dictator in a dictatorial system and faces heightened resistance from CCP cadres who have made the most of the decentralisation pioneered by Deng Xiaoping after 1978.

Moreover, Hu is a Janus-like figure. Reformism fits in with his role as a follower of the reformist Party leader, Hu Yaobang, in the early 1990s. But, like Deng Xiaoping, who picked him as the future leader after his masterminding the repression of protest in Tibet in 1989, he puts the continuation of Communist Party dominance first.

After the protests of 1988-89 that culminated in the Beijing massacres and the subsequent war on inflation led by Zhu Rongji, Jiang Zemin had a relatively easy time as growth boomed on the back of exports and infrastructure projects. Now, the fault lines bred by growth have become wider and deeper (and high inflation has returned), while perennial issues such as the requisitioning of land and corruption spark tens of thousands of protests each year – see our fault lines channel theme for more details.

Against this background, the key issue for the Communist Party is not so much who gets on to the Standing Committee this month – particularly since policy differences are small, if they exist at all. Rather, it is the ability of the Party to modernise itself to become a more relevant instrument to grapple with China’s problems and less of a self-interested cabal of cadres that really matters. Since the CCP is not going to relinquish power, it has to engineer a more effective machinery to deal with a rapidly changing society and to develop methods of resolving discontent before it reaches danger proportions.