[Mr. Zhou’s sudden downfall — he
is the first sitting provincial party chief to be purged by Mr. Xi —
underscores the uncertainty that permeates the Communist elite as they contend
with two unnerving developments beyond their control: an economic slowdown that
appears to be worse than
officials had anticipated and that could mark the end of China’s
era of fast growth, and a campaign against official corruption that has
continued longer and reached higher than most had expected.]
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President Xi Jinping of
Mr. Jinping will be visiting
Credit Andy
Wong/Associated Press
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But by 6:10
p.m.
that day, Mr. Zhou’s career was over, and he faced years in prison.
The Communist Party’s
anticorruption agency announced it was investigating him on “suspicion of
serious violations of party discipline and the law,” signaling his ouster as
the party chief of Hebei Province
Mr. Zhou’s sudden downfall — he
is the first sitting provincial party chief to be purged by Mr. Xi —
underscores the uncertainty that permeates the Communist elite as they contend
with two unnerving developments beyond their control: an economic slowdown that
appears to be worse than
officials had anticipated and that could mark the end of China’s
era of fast growth, and a campaign against official corruption that has
continued longer and reached higher than most had expected.
Driving decisions on both
issues is Mr. Xi, who took the party’s helm
nearly three years ago and
has pursued an ambitious agenda fraught with political risk. Now, weeks before
a summit meeting in Washington
Mr. Xi has positioned himself
as the chief architect of economic policy — usually the prime minister’s job —
and has vowed to reshape the economy, exposing himself to blame if growth
continues to sputter. At the same time, Mr. Xi is making enemies with an
anticorruption drive that has taken down some of the most powerful men in the
country and sidelined more than a hundred thousand lower-ranking officials.
Senior party officials are said
to be alarmed by the state of the economy, which grew at the slowest pace in a
quarter century during the first half of the year, and now seems to be
decelerating further. In a sign of its anxiety, the leadership this month
implemented the biggest devaluation of the Chinese currency in more than two
decades, sending global markets into plunges.
Mr. Xi’s reputation was also
dented this summer by panicked official efforts to prop up
the Chinese stock market after
a sharp dive in share prices. His government had promoted the market as a good
investment to the public for months.
Even before these episodes,
early this year a number of party elders had quietly urged Mr. Xi to focus more
on reinvigorating the economy, according to an adviser to senior party and
government leaders and an editor at a party media outlet, both of whom
requested anonymity to describe internal discussions.
The advice was viewed as a sign
of their dissatisfaction with Mr. Xi’s management of the economy but also as
implicit criticism of his pursuit of high-profile corruption cases that had
tarnished their legacies and targeted their protégés, the adviser and the
editor said. “Right now, the economic situation is not good, so the core of the
party’s work should be shifted more toward the economy,” the adviser said,
paraphrasing the message communicated to Mr. Xi.
Among those brought down by Mr.
Xi are his predecessor’s former chief of staff, Ling Jihua; the party
heavyweight who once controlled the internal security forces, Zhou Yongkang;
and two generals who once ranked second only to the party leader in commanding
the Chinese armed forces, Guo Boxiong and Xu Caihou. Mr. Ling was a protégé
of the former president and party chief, Hu Jintao,
while Mr. Zhou and the generals owed their rise to Mr. Hu’s predecessor, Jiang
Zemin, now 89. General Xu died in Marchwhile
awaiting court-martial on bribery charges. Zhou Benshun, the Hebei
The campaign has also stoked
resentment among the party rank and file and set the bureaucracy on edge, with
wary officials afraid to move forward on important projects, the party media
editor and others said.
Retired party leaders can wield
significant influence in China because of their networks of
supporters across the apparatus. But Mr. Xi appears to have consolidated power
faster than his immediate predecessors when they took office and there has been
no suggestion that his leadership of the party might be challenged.
In the past two weeks, though,
two leading official news outlets have published unusual editorials hinting at
internal turmoil.
The first, which appeared in
the party’s flagship People’s Daily on Aug. 10, warned bluntly that retired
leaders should stay out of politics and “cool off” like a cup of a tea
after a guest has left. Without identifying anyone, it accused “some leading
cadres” of posing a “quandary for new leaders, fettering their hands from doing
bold work” and “undermining party cohesion and fighting strength.”
Another commentary published
Wednesday on the website of the state broadcaster China Central Television
described fierce resistance to Mr. Xi’s agenda and called on his supporters to
step up their efforts to carry out his policies. The article, which was widely
distributed on popular Chinese websites, was notable not only because it openly
acknowledged the opposition to Mr. Xi but also because of its strident
language.
“The stubbornness, ferocity,
complexity and weirdness of those who haven’t adapted to reform or are even
opposed to reform may go beyond what people imagine,” it said.
Mr. Xi has pledged sweeping
market-oriented reforms to overhaul the Chinese economy for long-term growth,
including plans to weaken monopolies enjoyed by state enterprises, to wean the
economy from its dependence on inefficient state-directed investment, and to
liberalize the nation’s financial markets, with the aim of making the country’s
currency, the renminbi, a strong competitor to the dollar on world markets.
But there has been little
progress toward these goals, and as growth has begun to stall, the government
has adopted measures that run counter to Mr. Xi’s call to allow market forces
to play the “decisive role” in the economy, including aggressive intervention
to prop up the stock market last month and policies encouraging state banks to
lend money.
Behind the scramble is a
deep-rooted anxiety within the leadership about possible social instability if
the age of supercharged growth in China China
“Everyone understands that the
economy is the biggest pillar of the Chinese government’s legitimacy to govern
and win over popular sentiment,” said Chen Jieren, a well-known Beijing-based
commentator on politics. “If the economy falters, the political power of the
Chinese Communist Party will be confronted with more real challenges, social
stability in China
Some have asked whether the
party leadership and its technocrat advisers are up to the task of managing a
slowing economy after decades of experience with one that has only soared,
fueled in large part by mass migration from the countryside to the cities. Even
neutral observers warn that Mr. Xi may be promising too much.
“The Xi generation of leaders
has lofty ambitions and resolve that are bigger and broader than their
predecessors, and their objectives are even greater, so he can’t spend as much
energy on specific economic issues as in the past,” said Li Daokui, director of
the Center for China in the World Economy at Beijing’s Tsinghua University and
a former member of the monetary policy committee for China’s central bank.
“Whether such lofty ambitions and objectives can be realized remains to be
seen,” he said in an interview
One concern is the way the
government has handled the stock market. In the first part of the year, state
news outlets cheered as the market climbed to new heights and helped reduce
debt burdens for Chinese firms. People’s Daily declared on April 21 that the
bull market had “just begun.”
But share prices in Shanghai China
“To allow such an idea to
spread among China’s investment community, at a time when China has still not
yet managed to establish a healthy functioning stock market, was deeply
irresponsible,” writes Barry Naughton, a professor at the University of
California, San Diego, in a forthcoming paper.
Professor Naughton said in an
interview that Mr. Xi’s penchant for putting himself in charge of
policy-setting committees — called “leading small groups” by the Chinese — has
upended the way China
But these committees under Mr.
Xi have not fully succeeded in taking control of economic policy, Professor
Naughton said, and that has resulted at times in bureaucratic confusion.
That may have been the case
this month, when China
But it also spooked investors
around the world who interpreted the 4.4-percent devaluation that resulted as a
desperate bid to help China
The policy adviser to senior
party and government leaders said fears that the slowing economy could lead to
social unrest prompted the Politburo in a July 30 meeting to approve a raft of
measures to bolster growth, including the decision to devalue the currency.
Other steps will follow, the person said.
Mr. Xi’s campaign against
corruption enjoys broad support in a nation where the widening gap between rich
and poor is attributed to the ability of a small minority to prosper by abusing
government positions or using political connections. As the economy falters,
though, the risks for Mr. Xi multiply, said one retired party think tank
official.
“The main thing is the economy.
As long as the economy continues to decline, people will have more and more
objections, and there will be more and more pressure on the leadership,” said
the person, who spoke on the condition of anonymity to freely discuss internal
party politics. “And right now, the fact is that the economy is in decline.”
Michael Forsythe reported from Hong Kong , and Jonathan Ansfield from Beijing Hong Kong , and Michael Schuman from Beijing
