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Hedging Bets Through China’s Transition

Author: Elizabeth C. Economy, C.V. Starr Senior Fellow and Director for Asia Studies
September 28, 2012
Washington Post

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Elizabeth Economy is the C.V. Starr senior fellow and director of Asia studies at the Council on Foreign Relations.

This was a big week in China. Former top senior official Bo Xilai, whose wife gained notoriety for arranging the death of a British expatriate, has been expelled from the Communist Party and faces myriad charges from corruption to philandering. The dates for the Party Congress, at which China's new leadership will be announced, have finally been set. And Vice President Xi Jinping is back in public after a recent two-week absence. With these issues behind them, China's leaders hope to end all the speculation about political paralysis and move on with governing.

Unfortunately, their moves raise as many questions as they answer.

At one level, the questions are straightforward. Where was Xi? It matters whether his absence was due to a stroke, an assassination attempt, an effort to hammer out a new political reform program or none of the above; after all, each potential explanation says something different about the political future of China's likely next president. And what will happen now with Bo? Party leaders have thrown everything but the kitchen sink at this onetime political star; what is their endgame?

At a more profound level, however, recent events underscore the deep uncertainty that defines China's political system. This uncertainty surrounds not only the leadership transition but also the contours of China's broader political path forward and the nature of its engagement with the outside world — and this is what Chinese leaders most urgently need to address.

China's leaders could scarcely have scripted a worse political transition. This fall, most of the positions in the Standing Committee of the Politburo — the consensus-based body that leads the Communist Party — are up for grabs. The transition represents the most significant generational leadership shift in a decade, but it has been marred by scandal and vicious political infighting. First came the fall of Bo, who had been widely considered a top contender for membership in the Standing Committee. More recently, retired party elders reportedly sharply criticized Xi for his "unreliability" and unseeming ambition. They see not just the future of the country at stake but also their legacy. Their unwillingness to relinquish influence virtually guarantees that discord and political divisions will continue once the new leadership assumes power.

Meanwhile, a tectonic shift is taking place in the Chinese political consciousness. While officials and scholars debate the appropriate pace and nature of political reform, the Internet is introducing an unprecedented level of transparency, official accountability and even the rule of law into the political system. Via the Internet, Chinese citizens have forced local governments to release accurate air-quality statistics, debated the relevance of Taiwan's presidential elections to their own future, ensured that miscarriages of justice — particularly those involving official malfeasance — are redressed, and organized large-scale protests to pressure local officials to adhere to laws. With more than 500 million users in China, the Internet is not an elite phenomenon. It is a powerful political organizing force for civil society, to which Beijing is struggling to adapt.

China's approach to the rest of the world has also been characterized by increasing uncertainty. Neighbors and others are bewildered by the abrupt shifts in Chinese foreign policy in the past few years. Beijing seems to have forsworn the nearly decade-old mantra of "peaceful rise-peaceful development" in favor of far more assertive rhetoric, announcing, for example, a move from a "near seas" to a "far coastal" defense. In the absence of China's previous "win-win" diplomatic efforts, regional conflicts have escalated quickly. Beijing is battling with the Philippines and Vietnam over sovereignty issues in the South China Sea, and China and Japan are engaged in an increasingly vitriolic gambit over uninhabited islands in the region — known to the Japanese as the Senkaku and to the Chinese as the Diaoyu — that may sit atop oil reserves.

Without a strong signal of restraint from the top, Chinese foreign policy has played out in the media, where virulent nationalists have called for launching a nuclear attack against Japan, while more moderate voices have urged a return to the bargaining table. Throughout much of September, angry mobs attacked Japanese citizens living in China and trashed Japanese stores. China's top leaders appeared oddly absent from the scenes of mayhem, suggesting they were content to let public anger drive the debate or uncertain of what to do next. In either case, many are wondering what kind of power China will become.

When uncertainty is high, so too is risk. As China transitions, the rest of the world hopes equilibrium will emerge sooner rather than later. Beijing should understand that the international community has little choice in the meantime but to hedge its bets — seeking the potential upside of deeper engagement with China while protecting itself by strengthening established international alliances and norms. This is not a policy of containment — it is merely containing the uncertainty inherent in China today.

This article appears in full on CFR.org by permission of its original publisher. It was originally available here.

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