Analyzing China’s 19th Party Congress

The 19th Party Congress of the Communist Party of China (CCP) began on October 18 and lasted for a week. According to the CCP Constitution, the quinquennial meeting of 2000+ party representatives will elect over 200 members of the Central Committee and over 100 members of the Central Commission for Discipline Inspection. The Central Committee will then elect 25 members of the Politburo; seven members of the Politburo Standing Committee; and the General Secretary, the most powerful man in China. Unsurprisingly, the election is a tool for Xi Jinping to select his cronies, but a more important function of the 19th Party Congress is to reveal the future direction of Chinese politics. By convention, Xi Jinping gave a report at the beginning of the conference on his work for the last five years and a projection of the future. This article will first examine Xi’s agenda, and then focus on the conflicting signals about democratization in his policy. Although Xi held a firm grip of power over his party and the public, these constraints are likely to be a defense mechanism for his intention to incorporate more diverse interests into the CCP’s coalition through institutional reforms.

Unsurprisingly, the election is just a tool for Xi Jinping to select his cronies, but a more important function of the 19th Party Congress is to reveal the future direction of Chinese politics.

Review of Xi’s Agenda

In his report, Xi reviewed seven aspects of his work: economy, democracy, welfare, environment, military, territorial sovereignty, and anti-corruption. Economic growth is the most important task for the Chinese government, because it is the actual foundation of the one-party rule’s legitimacy, but it has slowed down due to the high debt of Chinese corporations. Having served four prosperous municipalities along the Pacific coast, Xi not only understands the significance of economic growth to politics, but also prepares himself for bold economic
reform. With the help of his advisor Liu He, Xi started “supply-side structural reform” (SSSR), which targets overcapacity reduction and deleveraging. Overcapacity and high debt were caused by the 2008 four-trillion yuan stimulus package issued by the government. The stimulus package offered low-interest debt to help corporations sustain their businesses during the 2008 financial crisis, but also tilted the debt structure of Chinese firms and defended unprofitable firms from market competition. These unprofitable firms hindered the flow of capital and dragged the economy down, but are reluctant to declare bankruptcy due to regulatory flaws that distort incentives. Supply-side structural reform seeks to devise more comprehensive financial regulations against cheap debt and enforce the resolution of unprofitable firms. Last year, many steel factories closed and some mines were decreed to cut production, thus driving up the price of both commodities and the profit margin of the remaining players in the market. Xi’s policy appears effective at first glance, but it might not be sustainable because Xi has not reduced the degree of government intervention in the market nor resolved the root cause of overcapacity, which is the cheap debt released by national banks.

More importantly, Xi’s economic policy imposes great pressure on local officials to secure the employment rate. According to the vision of Xi, firms that no longer profit should close, which means millions of low-skilled workers losing their jobs and a short-term pain to local governors’ budgets. An increase in the unemployment rate means higher probability of local upheaval, and a decrease in local budget means less security against such risk. Hence, even though Xi was determined to transform the Chinese economy for the long-term good and for the middle class’ eventual sustainable and healthy growth, local officials in effected areas might seek concessions when implementing the policy. Last year, the government spent $14 billion to reallocate laid-off workers, giving them more advanced jobs or encouraging them to become entrepreneurs. Yet once again, if the government misplaces them in the market, reallocation will turn out to be another macroeconomic disaster.

What Democracy Means to China

Economic slowdown poses an immediate challenge to the legitimacy of the CCP, but it is arguable whether the CCP has any legitimacy. After all, it is one of the few parties in the world that forbids competitive election. The sources of the CCP’s ever suspending legitimacy crisis dwells in the lack of public participation and rampant corruption in the party. If the CCP banned participation in the one-party system, it would be the only one to blame whenever bad things happen to China. That situation is especially unattractive to Xi because he has a larger stake in the longevity of CCP rule. Unlike low-ranking bureaucrats, Xi is not motivated to exhaust the credit of the CCP for absolute power and wealth, because his position as the public leader of China (later as the respected former leader) gives him more enduring benefits than short-term embezzlement. Thus, when he talks about “democracy,” “legal reform,” “anti-corruption,” “supervision,” and “deliberation,” he is talking about the acceptable concessions he would make to ensure the longevity of one-party rule.

Another reason for Xi to promote “democracy” is the increasing division within the CCP establishment. The CCP has two major factions: the elitist faction and the populist faction. Both factions have found their respective “constituents,” meaning interest groups that are willing to bribe them in exchange for policy favor. The elitist faction appeals to the big corporations and middle class in coastal cities, while the populist faction draws support from the underprivileged population in inland cities and rural areas. Once the two coalitions consolidate and reach the grassroots level, Xi will lose his control over the bureaucracy and society. His version of democracy, however, will create a counter-force to the increasing factionalism in the party. This new force—called “supervision”—will stay loyal to him and the federalist principles for which he stands.

His version of democracy, however, will create a counter-force to the increasing factionalism in the party.

One of the biggest institutional changes Xi will initiate is the establishment of an independent supervisory branch of the government, a branch of equal standing with the legislative, executive, and legal branches. This branch will exist at each level of the bureaucracy, and its leaders will be elected by legislative bodies at each level, rather than appointed by local administrations. This branch will integrate the functions of inspection, investigation, and prosecution formerly held by separate party, government, and legal agencies. The reform is now in the testing phase in three provinces, but a national supervision law will soon follow. Theoretically, the supervision reform should give more independence and efficiency to anti-corruption prosecutions and give the legislative branch oversight on the executive branch and the party. The effectiveness of this reform cannot be testified yet, but Xi makes one thing clear in this deliberate move: he is willing to recruit more players and create more checks and balances in Chinese politics because he does not want to bet his personal authority solely on the backing of his fellow CCP colleagues.

Xi makes one thing clear in this deliberate move: he is willing to recruit more players and create more checks and balances in Chinese politics.

The Party’s Dilemma

Xi is often labeled as the most powerful Chinese leader after chairman Mao, and the most frequently cited evidence includes shutting down dissensions on media, arresting human rights lawyers, and shuffling high-ranking party, government, and military officials. Xi committed these actions, as did all the previous Chinese rulers. Violating civil rights and purging opponents are both strong indicators of tighter authoritarian control, and most foreign media capture them. Yet most media are hesitant to face the dilemma between Xi’s strongman leadership and his intention to create more institutional checks and balances, manifested by the far-reaching supervision reform. This dilemma can be better understood in the review of Deng Xiaoping, the Chinese leader who led the reconstruction after the Cultural Revolution. He used liberal-minded bureaucrats and rationalized the criticism of Mao, introduced the market economy to China, and suppressed the student protest on Tiananmen Square. The perceived inconsistency in Deng’s attitude toward civil rights reveals a fundamental principle of modern Chinese Communist elites: they believe that some participation and power-sharing are good for the longevity of CCP rule, but they want to control who participates and in what form. Spontaneous and organized oppositions are not welcome, but the CCP wants to open more channels for non-confronting appeals, so that individual dissatisfactions are released before collective action takes place. The CCP’s petition system is designed to hear grievances from the underprivileged, and in recent years, petition offices have begun to hire social workers and psychologists to improve the services they provide for petitioners. The legal system has also become more tolerant. Last year, a gay couple successfully filed a lawsuit against the marriage law to court. Though it failed, the lawsuit proved that the Chinese government wants to appear more responsive to popular demand. Chinese think tanks also exhibit more diversity, because more scholars with foreign education experience are invited to join the CCP’s coalition.

The CCP elites want to avoid competitive elections with constant evolution of principles and incorporation of new social forces into the ruling class. It is not too bold to claim that the CCP adopts a similar strategy as the politicians in democratic regimes. The strategy is to divide and conquer. Politicians divide their constituents into groups — by socioeconomic class, geography, education, gender, race, occupation, age — and reward each group respectively. There’s no inherent value to CCP membership — ideology has faded into the blinds of history. Modern politics is about identities and group interests, and the CCP knows how to take advantage of them.

Yumeng Zou ‘20 studies in the College of Arts & Sciences. She can be reached at yumeng.zou@wustl.edu.

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