Anthony Harrington reflects on what the growing power and strength of China’s President Xi Jinping: the first ‘strong leader’ since Mao – might mean for business aviation
When a determined reforming leader comes to power in a country where corruption is simply a normal part of how things get done, there are three logically possible outcomes: 1) the reformer succeeds, and the system is purged and becomes more efficient; 2) he fails rather spectacularly and after an initial flurry of activity that throws up a great deal of dust, things settle back to the way they were; or 3) he gets bogged down in his reforming efforts and everything grinds to even lower levels of efficiency. In this latter instance, the set of possible outcomes starts to include a complete collapse of the existing system with no real clarity as to what might eventually replace it.
What does all this have to do with business aviation? Boiling everything down to the simplest terms, business aviation is joined at the hip to the economic cycle. We all prosper when the global economy hits a boom phase, and we all have to brace for the shock and don hard hats when it looks like hitting the buffers. So is China in danger of imploding any time soon and taking a good chunk of the global economy with it? Most experts would say, absolutely not. But the funny thing about experts is that they are expert at following an existing trajectory and they have a long history of missing that lightning-out-of-a-blue-sky moment that completely shatters the pattern.
Which brings us to China’s zealous reforming President Xi Jinping and his anti-corruption drive. In a very interesting article for the Foreign Policy Research Institute (FPFI) June Dreyer, Professor of Political Science at the University of Miami and the author of two books on China, points out that the stresses and pressures generated by Xi’s “house cleaning” are producing some really unusual cracks in the normally imperturbable public face that the Chinese Communist Party leadership strives to present to the world.
Without getting into too much detail, let’s start from the fact that while Xi had looked like the next leader for some time before he was anointed, there were some who queried his fitness for the role. Dreyer points to a 2009 visit by Xi to Mexico City, when he burst into a rant against “foreigners with full bellies who have nothing better to do than to try to point fingers at our country… China does not export revolution, hunger, poverty, nor does China cause you any headaches. Just what else do you want?”
Actually these are comments that make me personally feel rather sympathetic to Xi’s points. However, in diplomatic terms, it looks and sounds like shooting from the hip, and that is not what senior Party officials abroad are supposed to do. A good sign that you’ve overstepped the mark in China is when the censors delete all references to your speech from the Internet and news reports. Xi’s outburst vanished as if it had never been. So it is reasonable to assume that when Xi came to power one of his early priorities was to secure his position by weeding out and removing doubters and opponents in general, and the protégées of former leaders in particular, since those are the circles from which powerful rivals are likely to emerge.
The anti-corruption campaign, either fortuitously or by design, has cut a swathe through the latter. Xi’s investigators have a well-publicised approach to unearthing and convicting corrupt dealings. They divide the alleged miscreants into ‘Tigers’ and their attendant ‘Flies’, with the Tiger being the highly placed individual, of course. The approach is to squeeze one or more flies, threatening them with lengthy imprisonment or the firing squad unless they give up all the juicy details on their boss, which many of them duly do.
It is important to remember that this is China we are talking about. The Party rules, not the courts. The investigators act on behalf of the Party and the Party is Xi, for all intents and purposes. When the investigators turn up at your doorstep, there is nowhere to go. Innocent or guilty, the tumbrels are going to roll and you are headed for the guillotine – figuratively speaking, of course. They wouldn’t be at your doorstep if you weren’t already fingered for the chop.
That Xi is a man determined to secure his position by getting his hands on every possible lever is pretty obvious. He has amassed a large number of titles since he succeeded Hu Jintao as president. These include becoming General Secretary of the Party, Head of the Central Military Commission and chairman of any number of ‘think tank’ policy forums that would normally have had a slew of different officials in that role. Since January 2016 official party media outlets have been referring to Xi as the “core leader”, i.e. the one that matters, with everyone else on the Politburo Standing Committee and sundry other bigwigs being relegated to bit-part roles. And the smaller the bit-part and the meeker they play it, the safer for them.
So with Xi apparently consolidating his power and getting stronger and stronger, where are these supposed cracks in the Party façade and do they matter?
Among the incidents that Dreyer points to are a post by the party member and real estate mogul, Ren Zhiqiang, on Ren’s social media site. Xi had directed that the media should focus on protecting the authority of the central party leadership (are we seeing a theme here yet?). Ren asked pointedly when exactly the people’s media had become the party’s media. His post was quickly suppressed, but as Dreyer points out, it went out to his 35 million followers before it vanished.
In similar fashion, and probably more damaging, Dreyer notes that an essay appeared on the website of the party’s Central Discipline Inspection Commission, or CDIC, (a chilling enough title to Western ears). The essay was titled: ‘A Thousand Yes-Men Cannot Equal One Honest Advisor’, an allusion to King Zhou of the Shang dynasty, who surrounded himself with people too afraid to say anything he did not want to hear – which led to the downfall of the dynasty in 1045 BC.
However, the clincher is that the whole party leadership structure, after Mao, was specifically designed to prevent the emergence of a single strong figure who could grab all the reins of power and run the horses where he pleased. Mao’s own schemes – remember the Cultural Revolution? – had been so disastrous for China that the dangers of such a figure re-emerging were clear.
Yet now we have Xi, ‘the core leader’, an implacable strong man, resolutely pursuing an anti-corruption drive that appears to be knocking more than a few points off China’s GDP, despite the new five-year plan’s bold predictions of steady 6.5% year-on-year growth over that period. So it seems we can kiss goodbye to the old model of consensual party leadership. That model had produced serious weaknesses anyway since it fostered corruption (got to give a bit to get a bit…). So what is wrong with the Chinese party leadership morphing into a solitary, strong Chinese leader, given that the consensual model spawned so much corruption?
The answer? China is way too big and too complex to be run by any single person and Xi is already seriously bogged down. That does not bode well for China’s economy. A heavy hand at the centre is likely to generate even more heavy-handed (and inept) industrial policies, which failures Xi will doubtless attempt to deal with ‘robustly’, which will create still further mayhem.
As an instance of how unpredictable life can be for a ‘strong leader’, take the Panama Papers. No one saw that coming. But lo, what did we find in the small print? Xi’s brother-in-law had three companies in the British Virgin Islands and relatives of eight other Party bigwigs were similarly engaged. Corruption? Hmmm.
This presents Xi with yet another dilemma. Does he pursue the evidence and go after everyone involved, risking stirring up still further the backlash among the Party elite against his anti-corruption campaign, or does he take the approach adopted by Vladimir Putin, who denounced evidence in the Panama Papers of corruption amongst his circle as contemptible attempts by the West to discredit the glory that is Russia? There are reports that Xi has already gathered family members together and told them to cease and desist attempts to accumulate wealth.
In reality, Xi seems to have consolidated a position for himself where he has the media and control apparatus to legitimise any decision he cares to take. So in this sense the Panama Papers are a mere irritant, since he can decide to ignore any evidence he chooses.
Industrial output and economic matters, however, are not exactly ignorable features of the landscape, and it seems rather doubtful that proclaiming oneself ‘the core leader’ gets you any closer to a solution to problems that an Austrian economist would say were best left to the market to solve.
This is the bit that business aviation really needs to worry about. We need a prosperous and growing Chinese economy – and it is starting to look at least possible that the Party’s hand on the tiller, in its unique version of command and control capitalism, could be becoming even less sure than it was before Xi came on the scene. The underlying economy may be robust enough to chug on through anyway; we shall see. However, any business aviation company banking on China’s economy getting a smooth ride over the next few years might want to develop a Plan B rather soon, if it hasn’t already…