November 20, 2012

CHINA: Meet China's New Leader, Xi Jinping

The Wall Street Journal
written by Jeremy Page, Bob Davis and Tom Orlik
Monday November 12, 2012

Where is a new leader of China to turn for advice? Xi Jinping, who takes the country's top post on Thursday, knows better than to look to Mao, the revered founder of the Communist regime who vowed never to take "the capitalist road." Tell that to the hundreds of millions of Chinese who, in the past three decades, have risen from poverty thanks to market-oriented reforms.

Mr. Xi might instead dig deeper into Chinese history, to the austere ancient wisdom of Mencius, the Confucian scholar who advocated the "mandate of heaven" principle that an unjust Emperor could be overthrown. "Why talk of profit?" Mencius asks a ruler in his most famous work. If a king seeks profit over humanity and duty, so will his lords and common people, he says. "Then everyone high and low will be scrambling for profit, and the nation will be in danger."

And there indeed is the rub for Mr. Xi and the rest of China's new leadership. China as a whole has benefited enormously from the "scrambling for profit" of the great masses of Chinese, but the lords on high have been unable to resist doing the same, taking advantage of their privileged positions in a system that is far from being a true market.

Mr. Xi, who is 59, takes the helm in a year of extraordinary revelations about corruption and abuse of power in the Party—most notably the murder last November of a British businessman and MI6 informant by the wife of Bo Xilai, a rising star in the Party.

Even Hu Jintao, who has led China since 2002, acknowledged the scale of the corruption problem in a speech Thursday on the opening day of the 18th Communist Party Congress—a gathering of almost 3,000 Party delegates that will anoint the new generation of leaders. "If we fail to handle this issue well, it could prove fatal to the party and even cause the collapse of the party and the fall of the state," said Mr. Hu in his final speech as Party chief.

It now falls to Mr. Xi, as figurehead of the "fifth generation" of Chinese leaders since 1949, to find a way to adapt a Leninist system of government to 21st-century economic problems and the political dynamics of the social media age. Mr. Xi, currently vice president, has several apparent advantages over Mr. Hu, whose relatively weak leadership is blamed by many in the Party for the lack of economic and political reform since 2002.

Mr. Xi's father was a revolutionary hero who fought alongside Chairman Mao Zedong, only to be purged in the 1960s then reappointed to senior Party posts in the 1980s, when he was a key architect of early market reforms. That furnished the younger Mr. Xi with a network of allies who are fellow "princelings"—as the offspring of Party leaders are known—and now occupy senior posts in the civilian and military leadership. Mr. Hu's father ran a tea shop.

While Mr. Hu spent his early career in inland provinces with little private business or foreign investment, Mr. Xi has spent most of the past 30 years problem-solving and supporting business in eastern provinces that are the engine of China's economic growth. He has a far greater affinity than Mr. Hu for the West, especially the U.S., which he visited first in 1985 when he stayed with a family in the small city of Muscatine, Iowa. His daughter is an undergraduate at Harvard.

A fan of soccer and Hollywood war movies, Mr. Xi also cuts a more likable figure than Mr. Hu among many Chinese people, thanks in part to his burly frame, his deep, sonorous voice and a glamorous wife who is a hugely popular folk singer, although she has adopted a somewhat lower profile in recent years.

"Xi is confident of his party background, his administrative background, his PLA [military] background and his father's political pedigree," said Kevin Rudd, the former Australian prime minister who also served as a diplomat in Beijing and has met Mr. Xi several times. "Therefore he is a man at ease with himself. I also believe he fully grasps the dimensions of the challenge before him."

The question is whether Mr. Xi can use his revolutionary heritage, his elite contacts, his personal charisma and his extensive administrative experience to take on the vested interests within the Party and set China on a new path of development.

Economists inside and outside China warn that to continue growing, the country needs to rely more on private enterprise and consumer spending. That means clipping the power of state-owned firms, curbing land grabs by corrupt local officials and creating tens of millions of new consumers in the cities by giving migrant families better access to welfare.

China is also confronting mounting tensions with its neighbors over disputed territory, even as the U.S. shores up defense and trade ties in the region.

Such is the sense of crisis in the Party elite, according to some insiders, that top leaders recently held study sessions on the ideas of the 19th-century political theorist Alexis de Tocqueville, who argued that the French Revolution ultimately replicated the "ancien regime" that it sought to replace.

Still, the new leadership is unlikely to try pushing through big changes overnight. China's central bank head, Zhou Xiaochuan, a financial liberalizer, warned a former U.S. official recently not to expect a big reform push until at least next October, the official said. Mr. Xi also will be hobbled by a collective decision-making process that values compromise over decisive action and requires new leaders to consult retired ones on key policy changes.

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