China Center Senior Fellow Cheng Li provides an update on the 17th Congress of the Chinese Communist Party, including an assessment of the newly anointed leadership. (See also Cheng Li’s preview of the Congress and update of the Congress.)
“The main outcome of the 17th Party Congress is that it selected two younger leaders and these leaders will succeed Hu Jintao and Wen Jiabao in 5 years. Usually, they would identify one designated successor to become Hu Jintao’s successor, but this time they found two people—54 year old Party Secretary of Shanghai Xi Jinping and 52 year old Liaoning Party Secretary Li Keqiang. Both of them belong to the so-called 5th generation; both of them went to the countryside during the Cultural Revolution and worked there as farmers for many years. Both of them studied law and both of them hold Ph.D. degrees. But they differ profoundly in terms of their socio-economic backgrounds and the regions they represent.
Li Keqiang comes from and represents a humble family background, and advanced his career through the Chinese Communist Youth League, Hu Jintao’s power base. He represents himself as a populist leader and worked in China’s inland province of Henan and also in Liaoning province.
In contrast, Xi Jinping comes from a “princeling” family background—his father was a Vice-Premier of China and also a Politburo member, and he advanced his career [by working] in the coastal regions of Fujian, Zhejiang and Shanghai. He very much represents the interests of entrepreneurs, the emerging middle class, and also those rich and powerful people.
They may also have policy differences between them. For a populist leader like Li Keqiang, he is more likely to emphasize policies such as income redistribution and issues of social justice. He is particularly interested in employment issues and trying to establish a social safety net, especially for public health care. For Xi Jinping, [the concerns are more likely to center around] continuing to accelerate China’s market reforms and maintaining good relations with foreign countries. [He is likely to] try to resolve problems relating to foreign trade, foreign investment, and particularly he will emphasize efficiency and market reform. So you can see that there may be some tensions between them.
Most importantly, by choosing two people to compete against each other, this is something quite new in Chinese politics. So you will see a more dynamic factional politics in the next five years. In a way this is good—it will make the Chinese political system more open, more competitive, and probably more transparent. On the other hand, perhaps things might get out of control, because clearly these two leaders represent some conflicting interests, and the social forces will choose one or the other of these representatives, and this could lead to things spinning out of control.”
Will the American business community sit idly by and watch Trump undertake a trade war with China? They have a lot at stake in this. [Trump's stream of anti-Chinese Tweets poses risks of being misunderstood.] China would regard a potential challenge as more dangerous than it actually might be.
The jobs China is accused of stealing, many were lost a long time ago to Korea or Japan and moved from there to China. A lot of that job loss occurred because of technology change. [And despite Trump's promises to bring jobs back to the US,] nobody in the US would do them at the wages companies would want to charge. Those jobs are never going to be gotten back.