WASHINGTON (Reuters Breakingviews) - It’s official: President Xi Jinping now ranks as the most powerful Chinese leader since Deng Xiaoping, and perhaps even Mao Zedong. The president emerges from the party congress, a twice-a-decade leadership reshuffle, with his name in the party constitution and no successors in sight. There’s little doubt he can now bend the bureaucracy to his will, but that’s not necessarily a boon for market reform.
The inclusion of Xi’s name and “thought” into the party constitution marks a major shift. In the party’s hierarchical lexicon, it puts him on par with Mao. And without younger faces in the Politburo Standing Committee, the country’s highest political organ, he is likely to wield influence for years to come. To be sure, Xi didn’t throw out the rulebook: the Politburo age limit was respected. Wang Qishan, his 69-year old ally, stepped down. At the same time the new Standing Committee includes members identified with other factions. Even so, the president’s stature today is unambiguously more powerful than a week ago.
That is not a positive economic development. Xi has never been entirely coherent or consistent on reforms. His opening speech to the party congress contained the usual mixed messages, and if anything, he seems focused on protecting party control. References to the market and economy in his speech dropped by around 20 percent and 33 percent, respectively, compared to his predecessor’s speech in 2012, according to a tally by Capital Economics. Mentions of the party rose more than 40 percent.
There is also an elemental tension between Xi’s efforts to aggrandize political power and promote economic liberalization. Ministerial and local government officials terrified of the centre are less likely to resist bad policy ideas, take input from the private sector or experiment with their own initiatives. A more top-down system may become less responsive to market signals, and more sensitive to the whims of individuals in the upper echelons of power.
The tension was on display at the party congress, when Xi told a member of the Guizhou provincial delegation that a local brand of liquor was “not cheap” and implied it might sell better with a price cut. The delegate thanked the president for his instructions and said she would soon act on it. “That’s a question for the market,” Xi responded. “You can’t sell it for 30 yuan just because I said so.” It’s not clear what bureaucrats should make of that, but there’s likely to be more such mixed messaging to come.
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