Is China birthing a new dictator?

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China has a history of periodic tyranny. From imperial leaders of old, to strange and brief surges of power such as the Taipings, to the more modern phenomenon under Maoism. Now one wonders if we are not seeing the rise of a new branch of absolute leader, from the FT:

For more than a decade, a tacit understanding among China’s top rulers has ensured the ruling Communist party does not become a gerontocracy. That understanding, known as qishang baxia or “seven-up, eight-down”, dictates that only leaders 67 or younger can ascend to or remain in top posts, while those 68 or older must retire when the party changes guard every five years.

But as China prepares to enter a “selection year” under the leadership of a very unconventional president, Xi Jinping, there is increasing speculation he may try to dispense with the retirement convention entirely.

If so, it will be the biggest test yet of his authority over the party and further distinguish him from his predecessors Hu Jintao and Jiang Zemin, who took a “first among equals” approach during their presidencies.

“To waive the rule is going to be difficult because it would establish [Xi] as significantly more than first among equals,” says Steve Tsang, a sinologist at Nottingham university.

It would also be the strongest signal to date that Mr Xi could ignore a similar unwritten rule on term limits that would require him to step down from his current position as party leader in 2022.

Mr Xi heads the seven-member Politburo Standing Committee, the party’s most powerful body. Since 2012 he has overseen a draconian anti-corruption campaign and asserted his authority over the military and even economic policy, an area traditionally delegated to the premier.

As a result, he is widely regarded as the party’s most powerful leader since Deng Xiaoping, the architect of China’s reform and opening, if not Mao Zedong, the party’s revolutionary hero.

Mr Xi and his premier, Li Keqiang, will be 64 and 62 respectively when the 19th Party Congress convenes late next year to appoint a new Politburo Standing Committee and State Council, ensuring both men another five years at the top of China’s party-state.

All five other members of the Standing Committee will be required to step down under the current retirement rule.

…For Mr Xi, the 19th party congress will be an unprecedented opportunity to stack top party and government posts with his allies, giving him even more authority. “Just wait for his second term” is a common refrain among the president’s supporters, many of whom admit privately that the party has yet to deliver on many of the bold economic reforms promised at the outset of his presidency.

The dictator is enjoying a surge of popularity. But the rise of this neo-Maoist movement could upend China’s stability

I have admired the reform push in China at times but there is no doubt that it has come with an equally potent constriction of freedoms and demand for adherence to Party discipline. This may seem contradictory, but when one is fighting graft it need not be. As Singapore shows nicely, a one party state can function with the freedoms of capitalism.

For Australia the rise of Xi’s power is a mixed blessing. On the economic front it is so far been more difficult short term with the shift away from investment as a driver of economic growth and consequent falls in commodity prices. But it should work to our benefit long term if the reform process helps lift China from a middle income trap that would otherwise bog its growth down permanently.

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It is on the strategic front where Xi’s power is of most concern. Foreign policy tends to reflect the internal predilections of the polity and its leaders. And as Xi asserts Chinese power at home, he is also doing so much more assertively in the region that did his predecessors. Gone are the quiet overtures of the “peaceful rise”, the targeted deal-making that defined the reigns of Hu and Jiang. In its place is an aggressive Chinese economic imperialism reaching out with soft power to engulf regional allies and undermine traditional power relationships, especially those with the US.

Hard power is also being deployed, most obviously in the South China Sea, but elsewhere into Pakistan and Central Asia, jeopardising the regional order that has relied upon US hegemony to order trade relationships and to contain inter-Asian nation historical enmities.

A dictatorial Xi will not make Australia’s position vis its economic and strategic straddle with China and US any more comfortable. We should be hedging accordingly by reducing Chinese economic influence where it is possible and sensible:

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  • by limiting investment to raw materials;
  • banning foreign political donations;
  • reducing immigration to historic norms;
  • tightening and properly policing foreign buying of real estate, and
  • re-engaging with the US.

This is not about choosing the US over China. Those days are long gone. This is about not choosing an uncertain China over the US.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.