Today’s China Readings June 25, 2012

I am heading to the US later today for a few weeks. Posting will be light to non-existent for the next couple of days but will resume from DC.

Stock market reaction to Saturday’s New York Times report alleging data manipulation and a deeper economic slowdown than anticipated should be interesting. It is quite possible that Hong Kong and China markets will rise as investors believe this news will make a bigger stimulus a near certainty. Then again, they could either drop or stay flat. (How is that for hedging a market prediction?)…

Regular readers of Sinocism know that I disagree with some of the foreign media reports about senior leaders pushing for Western-style political reform. Last year’s Views On Political Reform And Leadership Splits In China is just one of several comments I have made on the subject.

In the latest issue of the Jamestown Foundation’s always excellent China Brief, Peter Mattis discusses the prospects for political reform in Central Party School’s Critiques Suggest New Leadership Dynamics:

Political reform in China since Deng Xiaoping’s “Southern Tour” in 1992 has seemed a distant if always tempting narrative for analysts and observers. The cycles of foreign hope and disappointment with Chinese leadership attest to this. The most recent stirrings of political reform discussion may be keeping within strict boundaries that do not challenge the CCP’s right to rule, but recent articles in the official Chinese media suggest this discussion is more than mere rhetoric—or, at least, has political implications for the 18th Party Congress…

An article in the latest issue of the school’s journal, Red Flag, posed the question of whether Deng Xiaoping would approve of structural political reform. The answer, unsurprisingly, was “no,” at least as Westerners understand it. The CCP’s rule “suits China’s national conditions and is in accord with the fundamental interests of the people” (Red Flag, June 12). Structural political reform—if it did not include removing the CCP from power or implementing anarchy-causing, Western-style democracy—however, could be understood as China’s adaptation to the structural changes in society as well as dealing with the problems of bureaucracy, excessive concentration of power, corruption and local officials carving out exploitative fiefdoms. Combined with an attack on those who would walk away from the CCP’s leadership, the article seemed to be critical of those who supported the ousted Chongqing Secretary Bo Xilai and other counter-reformers….

True systemic political reform may not be in China’s near future; however, the discussion inside China suggests the status quo is increasingly unacceptable to China’s leaders. Structural political reform may remain elusive, but the CCP appears to be engaged in a serious debate about the future of China—serious enough that Beijing is concerned leadership splits may emerge that would damage Chinese stability. Without a loyal PLA, the party leadership may not have the confidence to continue their discussion, leading once again to political stagnation. The Central Party School attacks could indicate a new alignment between Hu and Xi, disrupting conventional wisdom about factional divides. Although uncertain, this possible realignment would have profound implications for the makeup of the next Politburo Standing Committee and the prospects of even limited CCP-centric reforms.

As I wrote last month, there is no question there are differences at the top, but I wish someone would produce evidence that the differences are ideological ones as opposed to battles over personal interests and political advantages. Speeches about reform are not evidence someone is a reformer. We may see debates and eventually reforms around intra-Party democracy, but the idea that anyone at the top is seriously pushing for western-style political reforms seems rooted more in hope, manipulation and confusion than any evidence-based reality.

Wang Xiaolu (王小鲁), author of the 2010 study looking at China’s grey income, posted on his blog a recent interview he did about income distribution in China–答《时代周报》:收入分配改革为何迟迟不出台?. The National People’s Congress, for the eighth time since 2004, is debating a salary reform plan. Wang is not confident of its passage because the true reforms needed to improve income distribution touch too many vested interests.

A report today makes the passage of the proposed plan even less likely. According to Economic Reference News (经济参考报), authorities in 12 provinces so far have requested permission to reduce the mandated increase in the minimum wage, in response to the slowdown in the economy–12省区工资指导线涨幅下调 经济减速或为主因. Rising wages are key for the much needed economic rebalancing, and worker expectations for salary increases are such that any reductions in the rate of growth could upset a lot of people.

We have two sets of assholes du jour. First, residents in the hometown of Feng Jianmei, victim of the recent forced abortion at 7 months, unveiled a banner calling on people to “beat the traitors, expel them from Zengjia Township“. The reason? The family did an interview with a foreign correspondent (a German one according to Weibo). Per Weibo, the aborted child’s father was forced to flee. The reaction on Weibo is decidedly in opposition to the villagers’ actions, and those villagers clearly did not get the memo about the policy that Bloomberg discusses in Traitor Gets Treated to Lunch as One-Child China Seen Softening.

Second, Chinese supercar drivers set speed record, lose licenses:

Chinese police have fined two drivers 2,200 yuan (US$346) and revoked their licenses after they were caught speeding in their “supercars,” reaching 258 kilometers per hour on the G15 Shenyang-Haikou expressway, setting a speed record for the country’s highway system.

“Off with their heads” is something a lot of people could probably get behind these days…

The best way to read this blog is to subscribe by email, especially if you are in China, as Sinocism is still mostly blocked by the GFW. The email signup page is here, outside the GFW. You can also follow me on @niubi or Sina Weibo @billbishop. Comments/tips/suggestions/donations are welcome, and feel free to forward/recommend to friends. Thanks for reading.

Today’s links:

The best way to read this blog is to subscribe by email, especially if you are in China, as Sinocism is still mostly blocked by the GFW. The email signup page is here, outside the GFW. You can also follow me on @niubi or Sina Weibo @billbishop. Comments/tips/suggestions/donations are welcome, and feel free to forward/recommend to friends. Thanks for reading.

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