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Three ways that Xi Jinping, Davos man, undermined Trump today

Xi Jinping appeared this morning at the World Economic Forum, a first for a Chinese leader, with a full-throated defense of globalization. (Gian Ehrenzeller / European Pressphoto Agency)

Three days before Donald Trump takes office as the most protectionist and nationalist American president since before World War II, and on the same day that British prime minister Theresa May outlined her vision of a ‘hard’ Brexit from both the European Union and the European single market, Chinese president Xi Jinping (习近平) made an audacious claim for China’s global leadership in the 21st century. 

Xi, who delivered a landmark speech at the World Economic Forum in Davos, Switzerland, made that claim by embracing the values that American leaders have globally championed for decades (at least prior to Trump’s rise): a stable world order, free trade among nations and the notion that globalization, for all its faults, makes everyone better off.

Xi’s speech, the first ever by a Chinese leader at the World Economic Forum, is the most high-profile response so far from China’s president to Trump’s election. Despite Xi’s generally measured and cautious prose — he never once mentioned Trump by name — there’s no way to view Xi’s remarks other than as a warning and a rebuke to the rise of populist nationalism and protectionism in the United States and Europe over the last 18 months.

There’s a lot of justified ridicule of Davos as the gathering of self-important global ‘elites,’ but Xi’s speech today is perhaps the most important one that’s ever taken place during the forum.

Opening with a line from Charles Dickens, Xi pledged to keep opening China’s economy to the world, and he committed China to a stabilizing role in the world, including to the Paris accord on climate change, and to reforming the global financial system to smooth its bumpiest elements.

But the key point from Xi’s speech is this: ironically, jaw-droppingly, and likely not for the first time in the Trump era, the head of the world’s largest and most durable Communist Party took to the international stage to defend some of the fundamental principles of global capitalism.

Make no mistake, Xi Jinping is not coming to Davos to embrace those other values that remain a hallmark of what American global leadership projects — individual liberty, political freedom and liberal democracy with broad-based protections of civil and minority rights. Notably, no one today can claim that the People’s Republic of China under Xi enjoys the same political freedoms as Americans and Europeans do.

In 2016, China ranked 176 out of 180 countries in the Reporters Without Borders press freedom index (only Syria, Turkmenistan, North Korea and Eritrea were worse). Under Xi, Chinese censorship of the Internet has worsened, with fewer VPN networks still available to circumvent state controls. Under Xi, political dissent has been less tolerated than at any time in the recent past, even in traditionally liberal Hong Kong. Critics allege that Xi’s wide-ranging anti-corruption campaign amounts to a power grab designed to eliminate Xi’s internal enemies. Taiwan’s rejection of a services trade agreement with Beijing and the election of a nominally pro-independence president in Tsai Ing-wen (蔡英文) have worsened cross-straits relations. China’s east Asian allies are increasingly on alert over Chinese aggression in the South China Sea.

Nevertheless, Xi’s remarks were a consequential turning point for a country that is home to the world’s largest population (1.3 billion) and its second-largest economy, and a sign that China very much expects to take a stronger global leadership role in the years ahead.

In three key ways, Xi challenged Trump’s world view even before the incoming US president has taken the oath of office. Xi’s gauntlet comes just days after Trump blasted both NATO and the European Union in interviews over the weekend, alienating traditional US allies across the continent and stirring anxiety over the future of the trans-Atlantic alliance. Continue reading Three ways that Xi Jinping, Davos man, undermined Trump today

Tsai rides green wave to landslide in transformational Taiwanese election

Tsai Ing-wen, the first woman to lead a country in the Chinese-speaking world, won a landslide victory in Taiwan's presidential election Saturday. (Facebook)
Tsai Ing-wen, the first woman to lead a country in the Chinese-speaking world, won a landslide victory in Taiwan’s presidential election Saturday. (Facebook)

It’s not an exaggeration to say that the last time Taiwan’s pro-independence party won the presidency, it was something of a disaster. taiwan

Sixteen years ago, opposition leader Chen Shui-bian (陳水扁) ousted the ruling  Kuomintang (KMT, 中國國民黨), the first time since the Republic of China (ROC) separated from the mainland in 1949.

Chen’s election came not long after Taiwan’s transition in the 1990s from one-party rule under the Kuomintang to emerging democracy. From day one, Chen faced a recalcitrant and wounded Kuomintang determined to throw roadblocks in the new government’s path. If Chen’s Democratic Progressive Party (DPP, 民主進步黨) knew little about governing, the Kuomintang knew even less about serving as the loyal opposition.

Most of all, the Kuomintang still controlled Taiwan’s legislature, giving it the tools to frustrate Chen’s agenda.

Taiwan ultimately survived its first real test of democratic transition (and, perhaps most importantly, without causing hostilities with mainland China), but not without a few bruises.

Chen’s eight years in office weren’t without victories. Taiwan formally joined the World Trade Organization in 2002 and Chen’s administration handled the 2003 SARS epidemic adroitly. But Chen’s reelection campaign featured an assassination attempt (that the opposition claims was faked) and legal wrangling over the result in court after the election. Chen’s second term ended in a blaze of corruption charges, and he and his wife were convicted on bribery charges in 2009. Chen was released on medical parole only last January.

The DPP retreated to the opposition after the 2008 elections under the leadership of a soft-spoken policymaker, Tsai Ing-wen (蔡英文), who previously headed the Mainland Affairs Council in Chen’s first term from 2000 to 2004. A graduate of Cornell University and the London School of Economics, Tsai came to politics after a career as a law professor. Despite losing the 2012 presidential election, Tsai stayed on as the DPP’s leader, and she continued to rebrand the party in the post-Chen era, efforts that have now clearly paid off.

Channeling a wave of popular discontent with the Kuomintang’s growing efforts to tie Taiwan closer to mainland China, Tsai won a landslide victory today in Taiwan’s presidential election, as expected, giving the DPP a second chance to govern the country.taiwan16taiwan yuan

What’s more, the DPP (along with its allies in the ‘Pan-Green coalition’) for the first time in Taiwan’s history will control of the Legislative Yuan (立法院), giving Tsai an unfettered chance for political success.

From a global perspective, the DPP’s victory today, long expected, is important because it could create tensions with mainland China, where leaders have been ‘warning’ Tsai for months not to take a stridently anti-mainland tone to Cross-Strait relations, and state media reports on the Taiwanese election have ranged from patronizing to misogynist to downright insulting.

The DPP, in theoretical terms, still favors a formal declaration of independence from the mainland People’s Republic of China (PRC).

But even the more fiercely nationalist ‘deep green’ Chen never attempted a universal declaration during his administration, and no one expects Tsai, who is generally seen as a highly pragmatic and ‘light green’ leader, to do so.

In her victory speech, she emphasized that she will seek to maintain the status quo with Beijing, just as she has worked throughout the campaign to reassure both Beijing and Taiwan’s allies in Washington and elsewhere. But more radical members of her party, newly empowered with a legislative majority, could try to push Tsai into a more confrontational relationship with the PRC.

Tsai faces in PRC president Xi Jinping (习近平) a strong-willed adversary expected to hold office through 2022. Xi has consolidated more power than any mainland leader in decades, and he has consistently disregarded political reforms, instead cracking down on Internet censorship and undermining long-promised free elections in Hong Kong next year. Home rule advocates will be watching the dynamic between Taipei and Beijing more closely than anyone.

Practically, however, fresh tumbles in the Chinese stock markets and a looming sense of broader economic trouble in the wider PRC economy mean that Tsai will spend far more time worrying about Taiwan’s economy than about Cross-Strait strategy.  Last week, PRC premier Li Keqiang admitted that the government’s ‘bazooka’ strategy of ever more government stimulus wasn’t working to turn around the fundamental problems with the mainland economy.

Taiwan still has one of the world’s most impressive economies, but it’s linked more closely than ever to the mainland Chinese economy. Fully 27% of Taiwanese exports now go to mainland China and another 13% go to Hong Kong. But GDP growth slowed to just 1% in 2015, and Taiwan risks entering a recession this year if the wider Chinese economy collapses.

Continue reading Tsai rides green wave to landslide in transformational Taiwanese election

Ma-Xi meeting takes place with Kuomintang’s political woes looming

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Taiwanese president Ma Ying-jeou and Chinese president Xi Jinping shake hands before their historic meeting in Singapore (Kua Chee Siong / Straits Times)

As far as Taiwanese public opinion goes, the relatively pro-Chinese stand of president Ma Ying-jeou (馬英九) has been a disaster, especially in his second term.taiwanChina Flag Icon

When he leaves office early next year, Ma will do so as one of the most unpopular Taiwanese leaders in memory, stirring a popular revolt last year among Taiwanese citizens who believe his government has been too quick to cozy up to Beijing. The student-led ‘Sunflower movement’ protests so rattled Ma’s government that he abandoned what he hoped would become one of his administration’s most important policy achievements — the Cross-Strait Service Trade Agreement, which would have liberalized many service sectors between mainland China and Taiwan, including tourism, finance and communications. Though Ma concluded negotiations with Beijing over the CSSTA, the Taiwanese parliament still hasn’t ratified the agreement.

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RELATED: Taiwan watches battle of wills
between Beijing and Hong Kong

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Ma’s decision to meet with Chinese president Xi Jinping (习近平) today is not necessarily a popular decision back home — and its swift announcement earlier this week was a bombshell in the campaign for Taiwanese elections just nine weeks away.

With just months left in office, his ruling party, the Kuomintang (KMT, 中國國民黨), is far behind in the presidential race. For the first time in Taiwan’s history, the Kuomintang and its allies that form the Pan-Blue Coalition could lose control of Taiwan’s parliament. The Kuomintang’s first presidential candidate, Hung Hsiu-chu (洪秀柱), the vice president of the Legislative Yuan (立法院), Taiwan’s unicameral legislature, sunk so low in polls since becoming the KMT presidential nominee in July that the party dumped her last month. Her replacement, Eric Chu (朱立倫), the party chairman and, since 2010, the mayor of New Taipei, is gaining little traction.

Neither Ma nor Xi are expected to announce any new policies or make any joint statements as a result of the meeting taking place today at Singapore’s Shangri-La Hotel, on ‘neutral’ ground. That’s not necessarily a problem, though, because the fact that the two are meeting on (relatively) equal — Ma as the head of the Kuomintang and Xi as the head of the Chinese Communist Party (CCP, 中国共产党) — is historic in its own right.

Given that so much of Ma’s unpopularity stems from his pro-China stand, his meeting today in Singapore may well doom the Kuomintang’s chances entirely in January’s general election. Indeed, the party’s low standing in public opinion may have made it eaiser for Ma to engage Xi. The near-certainty of losing power might have liberated Ma toward a historic meeting that will almost certainly have long-term benefits for better cross-straits relations.

In one sense, Ma’s position follows naturally from the force of economic gravity — 27% of Taiwan’s exports now go to China, and another 13% go to Hong Kong. Direct flights between Taipei and Beijing are now commonplace, trade continues to rise and mainland tourists are no longer a rare sight. Though Taiwan has the world’s 19th largest economy and incomes are far higher in Taiwan than on the mainland, China’s growing economic prowess (even as it may be headed into recession) is simply a matter of fact. Among the issues Ma expected to raise with Xi: a direct hotline between Taipei and Beijing, greater cooperation from Beijing in dealing with Taiwan’s murky international status and Xi’s change of heart in inviting Taiwan to join the Beijing-led Asia Infrastructure Investment Bank that Xi formed last year as a counterweight to US-dominated global financial institutions.

Xi, a ‘princeling’ whose father was a top Party official, is expected to head the mainland Chinese government through 2022, has more thoroughly dominated the CCP than any leader since perhaps Mao Zedong, waging a widespread campaign against corruption within the Party that has snared so many top officials that critics argue it functions as a purge of Xi’s internal rivals. Fresh off meetings to design China’s next five-year economic program, Xi’s government has been particularly aggressive, if not successful, about ameliorating economic headwinds, including failed efforts to stop a Chinese stock market crash over the summer. Two weeks ago, China formally ended its ‘one-child’ policy, and Xi’s government has worked with the United States to establish goals to reduce Chinese (and global) carbon emissions in the next two decades, plans that will take center stage at the international summit on climate change next month in Paris.

Nevertheless, the Chinese economy faces a difficult patch as its working population ages and it transitions from top-down growth built on internal improvements and an economy based on manufactured exports produced mainly along China’s dense eastern coast. Politically, Xi has gradually cracked down on dissent and tightened internal controls on Internet freedom. Nevertheless, he faces an angry Hong Kong population that has demanded a greater voice in choosing who will be eligible to stand for chief executive in 2017. Relations between Beijing and China’s western ethnic communities, such as the Uyghurs and the Tibetans, are still strained. The last thing Xi wants is a reversal of Beijing’s gains with Taiwan since 2008. It’s been Xi (and not Ma) who has resisted a meeting in the past; Xi’s accession to today’s meeting reflects that growing economic ties alone are not enough to secure those gains.

In local elections last year, the Kuomintang suffered defeats nationwide, including the Taipei mayoral elections, where an independent candidate, Dr. Ko Wen-je (柯文哲), a respected surgeon, easily took power with the support of the opposition Democratic Progressive Party (DPP, 民主進步黨). The losses were so severe that Taiwan’s prime minister stepped down. Those losses seem likely to multiply on January 16, when the DPP seems likely to win the presidency for just the second time in Taiwanese history.  Continue reading Ma-Xi meeting takes place with Kuomintang’s political woes looming

China formally ends ineffective one-child policy — decades too late

For the past 30 years, China has enforced a one-child policy with vigor. (Alain Le Garsmeur/CORBIS)
For the past 30 years, China has enforced a one-child policy with vigor. (Alain Le Garsmeur/ CORBIS)

Faced with a deep economic slowdown for the first time since the 1970s, the headline news emerging today from the Chinese Communist Party (中国共产党) at its fifth plenum this week is that it will formally end its one-child policy as the country deals with the more pressing problem of a rapidly aging population.China Flag Icon

The meeting, where the Communist Party will design its 13th five-year program for the Chinese economy, is an important moment for ruling officials to chart the path that Chinese president Xi Jinping (习近平) will carry forward through the end of his first term and a second term to which Xi will presumably be selected in 2017.

Though the Chinese government has been relaxing the terms of the one-child policy for years, today’s step formally ends a policy first enacted in 1978 at a time when China’s economy and demographics were far different than today. In the wake of the post-Mao era, Chinese Communist officials worried that exponential population growth would worsen environmental problems that were becoming apparent four decades ago, spread too thinly resources for educating a new generation of Chinese children and keep the country mired in poverty.

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RELATED: China’s stock market crash is a political, not economic, crisis

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After introducing the one-child policy, China turned to the neighborhood associations that Mao Zedong created throughout the country to enforce the new family planning edict. Almost overnight, local party infrastructure became an essentially intrusive mechanism to keep Chinese families in line and restrict reproductive freedom in the name of collective development. Parents who violated the policy faced monetary fines and, in some cases, forced abortions or even forced abductions of their second child. Throughout China, second children essentially became pariahs, and they faced restrictions on government-funded health care and education.

Farmers in parts of rural China were exempted from the policy, especially when their first child was a daughter. Moreover, ethnic minorities (even in urban areas) were exempt from the policy as well. In 2013, China relaxed the policy even further by allowing parents to have two children so long as both parents themselves were only children. That exemption largely ended the policy, meaning that today’s decision to end the one-child policy is more a formality than a real change. In an era where Xi has cracked down on political dissent and Internet freedom and arguably launched a widespread crackdown on corruption to purge rivals within the ruling Party apparatus, today’s decision is a rare extension of Chinese freedoms.

Gauged by the worries of policymakers in the 1970s, the one-child policy has been a slight success. That’s at least insofar as parents and grandparents dote on a country full of only children, deploying each family’s resources on the educational and developmental progress of a single child. But it’s the country’s breakneck growth, not family planning, that played a far greater role in lifting China out of poverty. Four decades of economic liberalization and international trade, which began under Deng Xiaoping in the early 1980s, is responsible for that. It helped that China didn’t face the kind of turmoil that roiled it during World War II and the civil wars of the 1940s, the rural famine that marked Mao’s ‘Great Leap Forward’ of the 1950s or the political terror of the Cultural Revolution of the 1960s and 1970s.

Moreover, what’s become increasingly clear in retrospect is that the one-child policy may have accomplished far more harm than good by accelerating the aging of China’s population and by facilitating a highly imbalanced sex ratio of boys to girls.

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Thomas Malthus’s largely discredited brand of population economics inspired the one-child policy.

The intellectual roots of the one-child policy lie partially in the problematic economic ideas of Thomas Malthus, who argued at the end of the 18th century that rapid population growth would be invariably met with disease, starvation and war. If left unchecked, a doubling of the population would burden the ability of a country’s land to generate enough food to support a demographic explosion. But the human experience over the ensuing two centuries has been exactly the opposite as innovations in agriculture have produced far more food with increasingly less labor. In the year 1800, global population is estimated to have been around one billion; today, it’s 7.4 billion and growing at a time when global poverty is in decline.

Moreover, by the time that China’s policymakers got around to introducing the one-child policy, China’s fertility rate was already rapidly declining, matching global trends in both the developing and the developed world, partially as a result of the widespread availability of medical birth control. The one-child policy, estimated to have prevented between 250 million and 500 million births, had the effect of pushing China’s birthrate away from that of a developing closer to one much more characteristic of a developed country. But as the chart below shows, as based on UN data, China’s birthrate had already slowed long before the one-child policy took hold.

(Nielsen)

(Nielsen)

Had China done nothing, fertility rates would have naturally continued to decline — and all without expending the costly efforts to restrict freedom in such an intimate and fundamental way.

For all the costs of enforcing the most restrictive family planning in world history, China doesn’t have much to show as a result.

China’s median age (today) is 36.7 — that’s akin to Iceland and just slightly younger than the United States (37.6), Australia (38.3) and Russia (38.9). The United Nations estimates that by 2025, China’s median age will be essentially the same as the US median age and, thereafter, China’s median age will be ever older.

As its neighbors South Korea (40.2) and Japan (46.1) have aged, however, economic growth has slowed. That might be fine for South Korea and Japan, because they now both enjoy income levels roughly equivalent to developed countries. China, though it’s well on its way to becoming the world’s largest economy, has only just reached middle-income status. So the one-child policy might have put China on a slightly less fertile trajectory — but only slightly.

With economic uncertainty looming, it seems likely that the era of residual double-digit GDP growth in China is coming to an end.  So while China has ‘caught up’ on aging, it hasn’t quite caught up on income levels and per-capita GDP. Even when China transcends its current economic gloom (and it will), it will be more difficult for it to play catch-up with an aging population and fewer working-age people in the labor market. Moreover, the low-hanging fruit of the past three decades — building the infrastructure (hospitals, bridges, schools, entire towns and cities) for a rapidly modernizing country — will be increasingly out of reach for economic planners.

Exacerbating China’s demographic woes is one of the world’s most lopsided sex ratios — only 100 women for every 112 men. There are a lot of reasons for that, including a sex ratio that tilts naturally at around 1.01 in favor of males. But given traditional cultural preferences for males, more Chinese families have opted to ensure that the single child permitted to them is male and not female. In a country of 1.38 billion people, that means that tens of millions of Chinese men have had and, for the foreseeable future will have, only negligible chances for marriage or starting their own families. At a time when economic misery is rising in China, that’s not particularly good news for ruling Party officials who could struggle to contain political and social anger in the event of a prolonged economic slump.

China’s “crisis” continues…

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Just a reminder to everyone freaking out about the secondary effects of China’s equity markets: the Shanghai composite was trading much, much lower — even after today’s “crash” — on this day exactly one year ago. China’s having a correction, and that’s clear from the five-year trend.China Flag Icon

The ‘crisis’ here isn’t economic, it’s political. It’s the ineffective response of the ruling Communist Party and, more importantly, the cognizance of over 1 billion Chinese subjects that Xi Jinping isn’t infallible.

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RELATED: China’s stock market crash is a political, not economic, crisis

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China’s stock market crash is a political, not economic, crisis

shanghai composite

In January 2014, the Shanghai Composite Index was hovering at around 2,000. China Flag Icon

Today, it’s ‘down’ to just above 3,600 and everyone from Beijing to London is gnashing teeth and wrenching hands over the great Chinese stock market crash of 2015.

However, in the light of the massive gains of the past two years, the current bear market seems more like a correction than a crash. You wouldn’t know it, though, from the response of China’s one-party state, which has intervened in just about every way imaginable to prop up the equities market.

Part of the anxiety, both in China and abroad, is due to the country’s role in the global economy — as the era of double-digit annual growth slows to ‘just’ 6% or 7% growth, global demand from the world’s largest economy will invariably slow. That will have a global impact. But no one expected China to grow at spectacularly outsized rates for decades without end, and that alone isn’t necessarily enough to torpedo the US or European economies. The ups and downs of China’s wild stock markets, moreover, aren’t necessarily correlated with long-term economic growth. That doesn’t obviate some of the real harms suffered by largely unsophisticated retail investors who dumped their savings into Chinese stocks during the rally of the past year and a half.

This underlines that the real crisis is political, not economic. Under pressure to ‘do something,’ the Chinese Communist Party (中国共产党) is doing a little of everything — devaluing the yuan, halting new IPOs, prohibiting trading in some of the hardest-hit stocks, buying stock in an attempt to keep prices artificially high, cutting interest rates. Certain institutional investors will not be permitted to trade (i.e. sell) stocks for up to six months.

It’s a panicky response that only further perpetuates the ‘crash’ narrative and further sell-offs. But it’s also the response of a governing regime that knows — and knows that the Chinese people know — there’s no competing political party to blame. Chinese leaders often argue that the one-party system incentivizes long-term policy planning because there’s no short-term gains to be had from elections every two years. But the acute knowledge that the Communist Party owns every policy (and every policy misstep) cuts both ways. The current stock market turbulence shows that Chinese Communists, just like American Republicans or Democrats, aren’t above taking hasty steps to end short-term political pain.  Continue reading China’s stock market crash is a political, not economic, crisis

Kuomintang loses Taipei as premier resigns

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Forget Japan’s election in two weeks — the political earthquake in east Asia today come in the form of a new pro-independence mayor in Taipei, the capital city of Taiwan, also known as the Republic of China (ROC).taiwanChina Flag Icon

The result is a stinging defeat for the ruling Kuomintang (中國國民黨), and prime minister Jiang Yi-huah stepped down in response to the Kuomintang’s defeats in municipal elections held Saturday across the island of Taiwan. The scale of the ruling party’s defeat in the November 29 elections indicates that it will be hard-pressed to hold onto Taiwan’s presidency in 2016,  paving the way for a more stridently pro-independence president.

Following the local elections, the Kuomintang lost power in eight of the country’s 22 various city and county governments.

In Taipei, Dr. Ko Wen-je, a respected surgeon and an independent candidate supported by the opposition, pro-independence Democratic Progressive Party (DPP, 民主進步黨), easily won the capital’s mayoral election, ending 16 years of Kuomintang control.

Ko defeated Sean Lien, a financier, and, as the son of a former vice president, a scion of the Kuomintang elite. Lien was never the strongest candidate for Taipei’s mayoral election, and Ko headed the trauma hospital unit that saved Lien’s life four years ago. A surgeon team supervised by Ko successfully removed a bullet from Lien’s head after he was shot at a 2010 campaign rally.

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While Lien promised to bring international capital (including, presumably, from Beijing, Shanghai and elsewhere in the PRC) to Taipei, Ko focused on social justice in a country that faces growing income inequality and rising housing prices, familiar concerns across the developed world.

The elections were something of a referendum on the Kuomintang’s push to create closer economic ties with the Chinese mainland. So while the results are a setback for Kuomintang and Taiwan’s president Ma Ying-jeou (馬英九), they are even worse for the People’s Republic of China.

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RELATED: Taiwan watches battle of wills
between Beijing and Hong Kong

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Earlier this year, young Taiwanese students protested in full force to stop the Cross-Strait Service Trade Agreement (CSSTA), which would have significantly liberalized trade in services with mainland China. Ma’s attempt to push the agreement through the Taiwanese legislature met with furious opposition, and the CSSTA hasn’t yet been passed into law, a significant victory for the self-proclaimed ‘sunflower student movement.’ Continue reading Kuomintang loses Taipei as premier resigns

China has self-interested incentives for a bilateral climate deal

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When you walk through the streets of New York or Washington or even Houston or Los Angeles today, the air is clear — by at least global standards.USflagChina Flag Icon

That’s due, in part to the 1963 Clean Air Act in the United States, which together with wide-ranging 1970 and 1990 amendments that have largely brought air pollution under control within the United States. Sure, Los Angeles is still known for its smog, but the worst day in Los Angeles is barely a typical day in Beijing.

The PM2.5 reading (a measurement of particulates in the air) for Los Angeles last year averaged around 18. In Beijing? A PM2.5 reading of 90, on average. Los Angeles’s worst day was 79, while Beijing’s was 569.

That’s one of the reasons that the landmark carbon emissions agreement between the United States and the People’s Republic of China, announced in the wake of the Asia-Pacific Economic Cooperation (APEC) summit is such a big deal — it’s not necessarily a coup for US diplomacy, but it’s definitely a signal that Chinese authorities are taking pollution seriously. It shows that Chinese leaders under president leader Xi Jinping (习近平) recognize that in order to showcase their seriousness about environmental hazards, they have to engage the international community on climate change.

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Landmark though the US-Chinese bilateral agreement may be, it is still much more about domestic Chinese priorities than trans-Pacific good will. As James Fallows writes in The Atlantic, pollution and environmental harms are the single-most existential challenge to the now 65-year rule of the Chinese Communist Party (中国共产党):

But when children are developing lung cancer, when people in the capital city are on average dying five years too early because of air pollution, when water and agricultural soil and food supplies are increasingly poisoned, a system just won’t last. The Chinese Communist Party itself has recognized this, in shifting in the past three years from pollution denialism to a “we’re on your side to clean things up!” official stance.

If you want to showcase to 1.35 million citizens that you’re serious about the environment, there’s no better way than signing a high-profile agreement with the world’s largest economy (and the world’s second-largest carbon emitter).

Xi himself has admitted earlier this year that it’s China’s most vexing policy issue, when he plainly stated that pollution is Beijing’s most pressing problem. Shortly thereafter, in March, premier Li Keqiang (李克强) declared a ‘war on pollution’ within China:

“Smog is affecting larger parts of China, and environmental pollution has become a major problem,” Mr. Li said, “which is nature’s red-light warning against the model of inefficient and blind development.”

That’s already having an effect, with the first drop in coal use in China in over a century, a result that’s possibly affecting global coal prices, though part of the effect might be explained by a slowing Chinese economy — it’s expected to grow at a pace of just 7.5% this year. That’s still robust by most standards, but it would be the lowest reported GDP growth in China since 1990.

Republicans in the United States grumbled that the pact was ‘one-sided,’ and perhaps it was (though you’d expect grumbling from incoming US Senate majority leader Mitch McConnell, a Republican from Kentucky, the heart of the US coal mining industry). But if so, it’s one-sided in the way that unilaterally lowering tariffs is good for trade. But US president Barack Obama’s commitment to lower US carbon emissions by 2025 by between 26% and 28% (compared to 2005 levels) is only going to accelerate the transition of the US economy from fossil fuels to cheaper, cleaner alternatives, including renewable energy.

China, on the other hand, has agreed to reduced emissions that it expects to peak in the year 2030, when it hopes to raise 20% of its energy from zero-carbon emission sources under the agreement. But Obama has already, through executive action, committed the US Environmental Protection Agency to work to reduce emissions levels by 17% through the year 2020, so the United States (for now) is already committed to carbon reductions on a unilateral basis.

Of course that’s lopsided, to some degree, but only if you ignore that the United States and Europe polluted without abandon in the 18th and 19th centuries when they were going through the same level of industrialization and development — and they surely didn’t do it with national populations of over a billion consumers.

Today, China is by far the largest emitter of carbon into the global atmosphere, responsible for 29% of the world’s total carbon emissions, while the United States is responsible for 15%, the European Union 10%, India 7.1% and Russia another 5.3%.  As White House correspondent Josh Lederman writes for the Associated Press, however, one of the agreement’s benefits might be in the power it will have to nudge other countries to join the fight against carbon emissions and its role in climate change with the 2015 Paris conference fast approaching:

Scientists have pointed to the budding climate treaty, intended to be finalized next year in Paris, as a final opportunity to get emissions in check before the worst effects of climate change become unavoidable. The goal is for each nation to pledge to cut emissions by a specific amount, although negotiators are still haggling over whether those contributions should be binding. Developing nations like India and China have long balked at being on the hook for climate change as much as wealthy nations like the U.S. that have been polluting for much longer. But China analysts said Beijing’s willingness to cap its future emissions and to put Xi front and center signaled a significant turnaround.

But there’s an even stronger benefit in the US-Chinese accord, insofar as it demonstrates that Xi is willing to work with the United States on tricky issues, even as China scrambles to compete with the more developed US efforts (through the Trans-Pacific Partnership) to form an Asia/Pacific trade bloc.

As Chinese military and political influence grows throughout the Asia/Pacific region, agreements like today’s on carbon emissions show that US and Chinese diplomats are establishing strong working relationship for potential collaboration in the future — cooperation that could be vital in the decades to come in maintaining a peaceful Asia and world.

 

Taiwan warily eyes battle of wills between Beijing and Hong Kong

Photo credit to Reuters / Toby Chang.

In Hong Kong, they may be protesting with umbrellas, but in Taiwan earlier this year, it was sunflowers.Hong Kong Flag IcontaiwanChina Flag Icon

As Beijing locks itself into what now seems like a needless showdown with the pro-democracy activists who have formed Hong Kong’s ‘Occupy Central with Peace and Love,’ among the chief incentives for proceeding with caution are mainland China’s relations with the Republic of China (ROC), the island of Taiwan, which split from the People’s Republic of China (PRC) in 1949 in the aftermath of the Chinese civil war and which has maintained its de facto sovereignty ever since, to the annoyance of decades of Chinese leadership.

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RELATED: Hong Kong — one country, one-and-a-half systems?

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Even as Western commentators trot out tired comparisons to the 1989 Tiananmen Square protests and crackdown (at a time when Hong Kong’s British colonial governors were not prioritizing democratization in any form), the Hong Kong protests have a readier comparison to the ‘Sunflower Student’ movement in Taiwan earlier this spring, when another group of protesters demonstrated against closer ties between Taiwan and the PRC.

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In June 2013, Taiwanese president Ma Ying-jeou (馬英九) and the ruling Kuomintang (中國國民黨) signed the Cross-Strait Service Trade Agreement with mainland China, which would liberalize trade in services between Beijing and Taipei, including, most controversially, tourism, finance and communications. When Ma (pictured above) tried to push the CSSTA through the Taiwanese legislature without as much political deliberation as promised, an already skeptical Taiwanese opposition howled, and CSSTA protesters occupied the Legislative Yuan (立法院) to stop Ma’s push to ratify the agreement. Today, Taiwan’s legislature still hasn’t approved the CSSTA.

Moreover, Ma came out in favor of the Hong Kong protests on Monday and reiterated earlier this week his opposition to reunification with mainland China:

“We fully understand and support Hong Kong people in their call for full universal suffrage,” Ma told a gathering of business leaders in Taipei.

“Developments in Hong Kong have drawn the close attention of the world in the past few days. Our government has also been very concerned,” he added. “We urge the mainland authorities to listen to the voice of Hong Kong people and use peaceful and cautious measures to handle these issues.”

Cross-Straits relations have crested and ebbed over the last 65 years, but today it’s indisputable that Taiwan and mainland China have more ties than ever. Since 2008, direct flights between Taiwan and China have greatly intertwined the two economies, and a deluge of Chinese investment has taken root in Taiwan.

While Hong Kong and Taiwan have very different histories and relationships with the PRC, they share many similarities, so it’s not surprising to see so many similarities between the two popular anti-Beijing movements that swept across both jurisdictions in 2014.

In the second half of the 20th century, Taiwan and Hong Kong both became magnets for defectors from the Chinese Communist Party (中国共产党), and both Taiwan and Hong Kong became pockets of economic prosperity while mainland China languished under Mao Zedong (毛泽东) and his fearsome reign of socialism, rural famine and political terror. Throughout, both Hong Kong and Taiwan developed particular cultural identities, such that majorities in both places see themselves today as Hong Kongers and Taiwanese rather than Chinese.

Both Hong Kongers and Taiwanese also worry that Beijing is plotting to  bring Hong Kong and Taiwan more firmly within its grasp. If it’s outlandish to think that Beijing can accomplish that goal with military might, it’s not difficult to believe it can do so through economic and political coercion. That’s exactly the kind of insidious influence that motivates both the Occupy Central’s fight for Hong Kong’s democratic sovereignty and the Sunflower Student movement’s fight for Taiwan’s economic sovereignty. Continue reading Taiwan warily eyes battle of wills between Beijing and Hong Kong

Xinjiang nationalism challenges Beijing’s alternative national vision

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Guest post by Christopher Skutnik

Amid stories of missing airplanes, transnational warfare, and deadly diseases, a somewhat less visceral part of the world has been sporadically popping up in the headlines of national news agencies.xinjiangChina Flag Icon

Xinjiang (officially the Xinjiang Uighur Autonomous Region) is China’s westernmost and remotest province, and has been bubbling over amidst reports of social unrest, terrorism, ethnic strife and more – reports that evoke memories of Northern Ireland in the 1960s and 1970s, or perhaps Chechen separatism in the 1990s.

The latest challenge to befall Xinjiang occurred on August 4, in the form of an attack that the Chinese media labeled as terrorism, allegedly perpetrated by Uighur separatists. Nearly 100 people were killed during the violent demonstrations, including 35 Han Chinese killed and 59 of the alleged terrorists shot dead by police.

Sadly, this is not the first time that violence in Xinjiang has resulted in large-scale bloodshed: in 2009, the provincial capital of Ürümqi experienced a very severe riot that resulted in 197 deaths and 1,721 non-fatal injuries.

Despite these statistics, the area’s violent past, and accusations of terrorist conspiracies, you might be forgiven for wondering why there’s so much unrest in the first place.

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In short, the issue revolves around differences between the ethnically Han Chinese regional government and the local Turkic-speaking Uighurs, who are predominantly Muslim and whose history extends over a thousand years. (As a modern term for the Turkic-speaking descendants of the Uighur Khaganate, which dates back to the 9th century, the term “Uighur” dates to around the 1920s.)

The current tensions between the Uighurs and the Chinese central government can be conveniently folded under the aegis of ethnic nationalism — they are similar to the tensions between Tibet and China, who share ethno-religious differences, and less so than the Taiwan and China, who hold essential political differences. Continue reading Xinjiang nationalism challenges Beijing’s alternative national vision

Chui faces easy reelection as Macau’s residents demand democracy

chui It’s not just Hong Kong that wants a greater voice in selecting its own government — its smaller cousin Macau is increasingly demanding wider democratic choice as well. China Flag Iconmacau

Earlier this summer, activists in Hong Kong waged an increasingly vocal campaign to bring greater democracy to the special administrative region (SAR), through an online referendum advocating the direct election of Hong Kong’s chief executive in 2017, and a movement, ‘Occupy Central with Love and Peace,’ that’s threatened to shut down the city’s downtown core in protest.

The central Chinese government responded with a white paper that appeared to disregard some of the fundamental tenets of the ‘one country, two systems’ principle that’s guided Hong Kong’s administration since its handover from British to Chinese authorities in 1997, forcing Hong Kong’s chief executive, Leung Chun-ying, not known for his democratic sympathies, to work to reduce tension between the two camps.

Perhaps no one was watching the tussle between Hong Kong and Beijing more than the residents of Macau, where its own chief executive, Fernando Chui, will almost certainly win reelection on August 31.

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RELATED: Hong Kong: One country, one-and-a-half systems?

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Macau, like Hong Kong, reverted only recently to Chinese control — in 1999 from Portuguese colonial authority that stretched back to the 17th century. Like Hong Kong, Macau operates on the principle of ‘one country, two systems,’ and it has its own Basic Law guiding the election of a chief executive and legislature. Unlike Hong Kong, however, Macau’s Basic Law does not include a commitment to ‘one-person, one-vote’ suffrage.

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Nevertheless, Macanese activists are organizing their own weeklong referendum on electoral reform meant to coincide with the chief executive election in the hopes of advocating direct election in the next contest in 2019.  Continue reading Chui faces easy reelection as Macau’s residents demand democracy

Hong Kong: One country, one-and-a-half systems?

Downtown Hong Kong from Victoria Peak

Normally, an unofficially referendum conducted online isn’t worth paying much attention — just ask the residents of Venice who organized a deeply flawed, overwrought poll on Venetian independence that attracted just 135,000 participants after initially claiming 2.4 million.Hong Kong Flag IconChina Flag Icon

But it’s worth noting the ongoing online referendum that the Hong Kong-based ‘Occupy Central with Love and Peace’ has organized, because it’s one element of a larger struggle between democracy activists and Beijing that could have major repercussions — not only for Hong Kong, but for the future political development of Macau, the Chinese mainland and, possibly, Taiwan.

Occupy Central’s chief goal is to open the nominating process for the 2017 election of Hong Kong’s chief executive. Hong Kong’s Basic Law, promulgated prior to the 1997 handover to govern the Hong Kong special administrative region, provides for the eventual democratic election of a chief executive. It’s a development that dates back over two decades to the negotiations between the British and Chinese governments over the 1997 handover. Ten years ago, Chinese officials finally relented and committed to some form of universal suffrage for the 2017 race.

Trouble began brewing earlier this month, however, when Beijing released a provocative ‘white paper’ on Hong Kong that took an aggressive posture with respect to Hong Kong’s future:

Published by the State Council Information Office, the unprecedented white paper states that “many wrong views are currently rife in Hong Kong” with regard to the “one country, two systems” principle that governs the territory’s relationship with Beijing. Some residents are “confused or lopsided in their understanding” of the principle, it adds.

“The high degree of autonomy of the HKSAR (Hong Kong Special Administrative Region) is not full autonomy, nor a decentralized power,” said the paper. “It is the power to run local affairs as authorized by the central leadership.”

Local media have gone so far as to describe the white paper as an outright repudiation of the ‘one country, two systems’ principle that has guided China-Hong Kong relations since Deng Xiaoping (邓小平) coined the concept in the 1980s during the initial handover negotiations. Continue reading Hong Kong: One country, one-and-a-half systems?

‘Everybody votes in agreement!’ But why does North Korea bother?

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There’s no country on the planet more autarkic or isolated than the Democratic People’s Republic of Korea.northkorea

Last year, when Kim Jong-un decided to show that he was in charge, he executed his own uncle, Jang Song Thaek, who had been a top advisor to Kim’s father, Kim Jong-il.  There’s no question that Dear Leader is running North Korea, however poorly he may be running it — it has a GDP of around $40 billion while South Korea has a GDP of $1.130 trillion.

But when North Korea holds elections on Sunday to determine the 687 members of the Supreme People’s Assembly (최고 인민 회의), voters will have just one choice — a candidate of the Workers’ Party of Korea (조선로동당), the long-governing party of North Korea.  In some cases, voters may choose the candidate of either the Korean Social Democratic Party or the Chondoist Chongu Party, both of which govern in coalition with the Workers’ Party under the banner of the ‘Democratic Front for the Reunification of the Fatherland.’

Kim himself is standing in constituency #111 — an auspicious number!  He will represent Mount Paekdu — how sacred!

Or whatever.

The Supreme People’s Assembly is certainly not the fount of power in North Korea; instead, it’s a rubber-stamp parliament that rarely even convenes.

Given the nature of power and government in North Korea, what could Kim possibly gain out of the expense and hassle of staging she elections?  It’s not to gain a democratic mandate, because there’s no opposition (and there’s no way for North Korean voters to vote in secret against the government’s candidate).  The elections are such a sham that they certainly aren’t being staged for showing the world that North Korea is acceding to the mechanisms of democratic legitimacy.  I haven’t even listed North Korea’s election s on the 2014 electoral calendar because they so comically fall below the standards of anything we understand to be a valid election.

In contrast, elections for the Politburo Standing Committee of the Chinese Communist Party (中国共产党) in neighboring China seem like bona fide exercises in civic duty.

So what gives?  There are at least three reasons why North Korea continues to go through the charade of holding ‘elections.’ Continue reading ‘Everybody votes in agreement!’ But why does North Korea bother?

Would ‘lottocracy’ be a better form of government than democracy?

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Winston Churchill is attributed with the quote, ‘Democracy is the worst form of government, except for all those others that have been tried.’

But it’s William F. Buckley who said, ‘I am obliged to confess I should sooner live in a society governed by the first two thousand names in the Boston telephone directory than in a society governed by the two thousand faculty members of Harvard University.’

Alex Guerrero, assistant professor of philosophy, medical ethics and health policy at the University of Pennsylvania (and also a law school classmate of mine), thinks Buckley may have been on to something, and he makes the case for selecting representatives not by elections, but through a lottery system in Aeon today:

First, rather than having a single, generalist legislature such as the United States Congress, the legislative function would be fulfilled by many different single-issue legislatures (each one focusing on, for example, just agriculture or health care). There might be 20 or 25 of these single-issue legislatures, perhaps borrowing existing divisions in legislative committees or administrative agencies: agriculture, commerce and consumer protection, education, energy, health and human services, housing and urban development, immigration, labour, transportation, etc.

These single-issue legislatures would be chosen by lottery from the political jurisdiction, with each single-issue legislature consisting of 300 people. Each person chosen would serve for a three-year term. Terms would be staggered so that each year 100 new people begin, and 100 people finish. All adult citizens in the political jurisdiction would be eligible to be selected. People would not be required to serve if selected, but the financial incentive would be significant, efforts would be made to accommodate family and work schedules, and the civic culture might need to be developed so that serving is seen as a significant civic duty and honour.

At first read, it sounds like a nightmare out of an Arthur Miller play.  Three hundred random US citizens would congregate to tackle a discrete issue like climate change, health care reform, or immigration reform.

What’s so bad about democracy? 

Before you dismiss the idea outright, it’s important to bear in mind the long, long list of problems with elections, in their current form in the United States and in other mature democracies — and that’s saying nothing about the question of free and fair elections in countries where democratic institutions are less robust.  The business of policymaking of a typical 21st century government is typically too complex for direct democracy to thrive in most jurisdictions. The need to become informed about the nuances of even major policy decisions would quickly overwhelm all of us.  Experiments with direct democracy, through the proliferation of ballot initiatives to decide key issues, have worked better in some places (Switzerland) than in others (California).  The limitations of direct democracy have meant that, outside the classical era of Athenian democracy and a few referendum-driven jurisdictions, ‘democracy’ for most people today means representative democracy.  Voters elect legislators and executives on the basis of a plethora of policy positions.

Of course, by gaining efficiency, indirect democracies lose precision — voters will choose one candidate over another for many reasons, and no voter’s policy priorities may line up entirely with any candidate.

Moreover, we can see the other problems of representative democracy in modern US politics.  Marketing and advertising, since at least the onset of the television era, can now be more important than policy positions.  Accordingly, representatives spend more time today raising money from donors than tending to the business of lawmaking, undermining the one-person-one-vote principle that undergirds representative democracy.  As Alex notes, the current process is subject to all sorts of problems.  The influence of money and lobbyists can lead to agency and electoral capture.  Collective action problems are rife — interest groups who care deeply about an issue can skew policies to their favor, even at the expense of the widely dispersed gains that might otherwise accrue to the rest of the population.  Protectionism, tariffs and free trade is a classic example.

Gerrymandering, barriers to entry and the advantages of incumbency massively reduce competition within the political marketplace.  It’s left us with a system where, as Alex writes, ’44 per cent of US Congresspersons have a net worth of more than $1 million; 82 per cent are male; 86 per cent are white, and more than half are lawyers or bankers.’ It’s a system where Congressional reelection rates in the United States routinely exceed 90% — even in a massive ‘wave’ election like the 2010 midterms that saw a Republican wave, the reelection rate was still 85%.  Part of that you can blame on gerrymandering, but more so on the natural preferences and geopolitical distribution of urban and rural voters — and perhaps even more so on the US electoral system (i.e., single-member plurality districts instead of proportional representation).  

Tradition, financial and political infrastructure, a first-past-the-post electoral system and path dependence mean that, in the United States, two political parties reign supreme.  When those two parties agree on policy preferences, it means there’s effectively no competition within the political marketplace on many key issues — in the past three decades, this has included drug legislation, foreign policy, national security, military affairs, gun regulation, financial regulation, home ownership policy and other matters.  In many cases, the bipartisan consensus has turned out to be wrong.

Electoral competition, too, is rife with short-term thinking.  In a world where public servants are focused on reelection in two years (the US House of Representatives), four years (the US president) or six years (the US Senate), there will always be a temptation to focus on short-term benefits at the expense of long-term costs.  Say what you want about the People’s Republic of China, but the governing Chinese Communist Party has to contemplate long-term effects of its policies, because there’s no alternative party to blame.  In the US system, Democrats and Republicans can rotate in and out of office and blame each other for perpetuity.  Not so in China — the CCP has to own its policy decisions or face a massive popular revolt.

That all assumes, too, that voters make well-informed, rational decisions.  As Bryan Caplan argues in The Myth of the Rational Voter: How Democracies Choose Bad Policies, borrowing from the insights of economic theory, ‘democracy’ fails primarily due to irrational and ill-informed voters:

In the naive public-interest view, democracy works because it does what voters want.  In the view of most democracy skeptics, it fails because it does not do what voters want.  In my view, democracy fails because it does what voters want.  In economic jargon, democracy has a built-in externality.  An irrational voter does not hurt only himself.  He also hurts everyone who is, as a result of his irrationality, more likely to live under misguided policies.  Since most of the cost of voter irrationality is external — paid for by other people, why not indulge?  If enough voters think this way, socially injurious policies win by popular demand.

It’s also worth asking how truly ‘democratic’ elections have become.  Since the 20th century, government has become so complex that many policy decisions are two steps removed from the ballot box, with legislators ceding control to specialized regulators.  In the United States, the wide-ranging administrative and regulatory state nearly amounts to a fourth, unelected branch of government.  Critics of the European Union have long pointed to a ‘democratic deficit’ within the growing EU institutions.  Despite a growing role for the elected European Parliament and perhaps a more representative era in selecting the European Commission, the key decisions of European integration (including the creation of the single market and monetary union) were made more by treaty than at the ballot box. 

 

So should we, therefore, turn to policymaking-by-lottocracy?  Continue reading Would ‘lottocracy’ be a better form of government than democracy?

With the end of Bo Xilai’s trial, is Xi Jinping co-opting the ‘Chongqing model’?

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It’s been perhaps the most sensational rise and fall of a top Chinese official in a generation, but the corruption trial against former Chongqing party leader Bo Xilai (薄熙来) wrapped up this week with plenty of surprises, China Flag Iconeven if his guilty verdict for bribery, embezzlement and abuse of power, is all but assured.

On the final day of what has been a sensation hearing by Chinese standards, Bo accused a top aide of becoming romantically involved with his wife, capping five days of what has been a spirited defense by one of China’s most charismatic 21st century party leaders.  Far from showing remorse, Bo (pictured above) has vigorously denied the charges and defended his actions:

He said he never cared for money. “The long johns that I’m wearing now were bought by my mother in the 1960s,” Bo said, suggesting he did not approve of the lifestyle Gu had created for their son, Bo Guagua.  “I have been working like a machine. I really don’t have time to care about air tickets, hotel expenses and travel expenses,” Bo said. He added: “The country did not pick me because I am a good accountant.”

That Bo has been allowed to mount such a public (and political) defense is not surprising, given his status as one of the second-generation ‘princelings’ of the Chinese Communist Party (中国共产党).  Even if Bo goes to prison for a decade or longer, the trial will have helped to cement his image as the leader of a ‘New Left’ movement within Chinese politics and society.

But what does that mean for the ‘Chongqing model’ that Bo championed as party secretary in Chongqing from 2007 to 2012?

The ‘Chongqing model’ is a vaguely neo-Maoist approach to governing China that involves a redoubling of state power and control, strengthening state-owned enterprises and aggressively attacking organized crime, while bringing back some truly unique vestiges of the era of former Chinese leader Mao Zedong (毛泽东), such as encouraging the singing of revolutionary-era songs.  It’s often contrasted against the ‘Guangdong model’ — a leadership style that encourages private development to blossom instead of through state-sponsored economic policy and at least a passing respect for the rule of law and other institutional reforms.

You can place the two models on the familiar left-right ideological axis — the Chongqing model prioritizes equitable distribution among all classes, the Guangdong model prioritizes the highest economic growth possible.  In reality, however, the line between the two models is blurrier.  Though the ‘Guangdong model’ is associated with the relatively liberal former Guangdong party chair Wang Yang (汪洋), now a vice premier (though not a full member of the Politburo Standing Committee) in Xi’s government, it was Wang who served for two years as Chongqing party chair as Bo’s direct predecessor.  Realistically, the differences among China’s political elite remain smaller than their shared values.  Just as there’s little chance that China will return to the days of Mao-era socialist state planning, there’s also little evidence that economic liberalization and reform has led (or will lead in the future) to greater political freedom.

Over the weekend, The Wall Street Journal reported that Xi Jinping (习近平), who took power as Chinese president earlier this year after assuming leadership last November as the general secretary of the party’s Politburo Standing Committee, is also lurching to the left in the first year of what is expected to be his ten-year stewardship of the People’s Republic of China: Continue reading With the end of Bo Xilai’s trial, is Xi Jinping co-opting the ‘Chongqing model’?