President Hu Jintao Hands Over the 'Reigns' to Successor

by Stuart Burns on November 13, 2012

Style:    Category: Macroeconomics, Public Policy

President Hu Jintao and successor Vice President Xi JinpingWhat a contrast between the world’s two largest economies.

One has just completed the most public, drawn out, some would say bitter election campaign in the full glare of the media and the world. The other has quietly fixed the new autocratic regime for the next decade behind closed doors.

This week, Xi Jinping, a member of the party’s politburo since 2007 and currently vice president, succeeds Hu Jintao as president, potentially ushering in a new period of enlightened leadership (or so some had hoped) but President Hu’s outgoing address to the party’s 18th National Congress suggests in many crucial areas that little is going to change.

There is a huge amount of debate about the merits of political change for China. Traditionalists will point to the past decade during which China has gone from the sixth largest economy to the second largest in the world, more than quadrupled it gross domestic product, and drastically raised living standards.

Reformers will point to cases like that of Bo Xilai, former Chongqing party boss, now mired in corruption and, with his wife, convicted of murder as examples of a deeply corrupt political system.

With the state not just involved, but driving the economy, such corruption taints nearly every aspect of business activity. As worrisome to the political elite is the growing sense of frustration among a population that sees a growing gap between the general population and the ruling elite and business community, and sees rampant corruption among state officials.

One FT article quotes a professor of politics at a Chinese university who said within three years, the Chinese people would take to the streets to demand the government loosen its grip on power.

In the article, President Hu Jintao acknowledged, “social problems have increased markedly” under his decade of rule. He also warned that if the party failed to curb corruption, “it could prove fatal to the party and even cause the collapse of the party and the fall of the state.”

Continued in Part Two.

Image source: opencanada.org

 

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