Xi’s Power Grab Towers over Market Reforms

Publication: China Brief Volume: 13 Issue: 23

While the recent Third Plenary Session of the 18th Chinese Communist Party (CCP) Central Committee was expected to unveil major initiatives in economic liberalization, what has struck Chinese and foreign observers most is the weight that the leadership has given to enhancing state security, particularly centralizing powers in the top echelon of the party-state apparatus. the CCP’s monopoly on power. The plenum set up a National Security Committee (NSC) to better coordinate the work of departments handling functions that range from police and counter-espionage to the media and foreign affairs. Given that apart from the NSC, President Xi will most likely also head a newly established Leading Group on the Comprehensive Deepening of Reform, the already formidable powers of the party General Secretary and Command-in-Chief will be augmented further.

A paragraph in the plenum communiqué, which was released on November 12, said that the NSC was set up to “perfect the structure of state security and national-security strategies, so as to [better] safeguard national security.” “We must improve the ways of social governance, stimulate the energy of social organizations and bring about innovation of systems to effectively prevent and end social contradictions and improve public security,” the document added (Xinhua, November 12; People’s Daily, November 12). While the official media has given scant details about the NSC, it is expected to be a state organ whose status is on par with commissions and leading groups—such as the Central Military Commission and the Leading Group on Foreign Affairs (LGFA), which are also headed by Xi—that report directly to the Politburo Standing Committee (PBSC), China’s highest ruling council. In his explanation of the "Resolution on Certain Major Questions regarding the Comprehensive Deepening of Reforms" (hereafter "the Resolution"), the full text of which was released on November 15, Xi noted: "The NSC’s main responsibilities are to formulate and implement national security strategies, to push forward legal construction on state security, and formulate the goals and policies of national security work." Referring to the connection between external and internal threats, Xi said: "Our country faces the double pressure of protecting national sovereignty, security and developmental interests from outside [threats] and safeguarding internal political safety and social stability" (Xinhua, November 15; China News Service, November 15).

While the NSC shares its name in Chinese with the U.S. National Security Council, it is believed to be focused primarily on internal security. This includes combating challenges posed by “hostile anti-China forces from abroad.” Within the party’s highest echelons, there are already two units—the LGFA and the Leading Group on National Security—that perform roles similar to that of the American NSC. Reports in the non-official China media and the Hong Kong press have published several possible lists of ministries and ministerial-level units that will send senior representatives to the new body. Each list is slightly different, but there is a substantial overlap, all of them including the following bodies: the People’s Liberation Army, the People’s Armed Police (PAP), the Ministry of Foreign Affairs (MOFA), the Ministry of Defense, the Ministry of Public Security, the Ministry of State Security (MSS), the Ministry of Trade, the Department of Propaganda and the International Liaison Department (ILD). The NSC will be chaired by President Xi. The two Vice-Chairs are expected to be Politburo member Meng Jianzhu, who is in charge of the Central Political-Legal Commission (CPLC), the country’s top law-enforcement body; and Politburo member and Director of the Central Policy Research Office Wang Huning, who is Xi’s top diplomatic advisor. Its secretary general is tipped to be either CPLC Secretary General Wang Yongqing or the Deputy Minister of Public Security Fu Zhenghua, who is deemed a Xi protégé. Full details of the components of the NSC and its principal officials, however, have yet to be released by the authorities. (China Review News [Hong Kong] November 14; Ming Pao [Hong Kong] November 14; Apple Daily [Hong Kong], November 13).

Foreign Ministry spokesman Qin Gang linked the NSC to China’s campaign against the “Three Evils,” saying that the commission “will make terrorists, separatists and religious extremists very nervous.” The Three Evils are a crossover between foreign and domestic security concerns, usually described as sources of domestic instability caused by the meddling of other countries or non-state groups. According to Li Wei, Head of the Anti-Terrorism Research Center of the China Institute of Contemporary International Relations, the NSC is “geared toward handling the increasing number of major incidents and mishaps that will impinge upon our country’s security and interests.” Li indicated that the NSC’s concerns include non-traditional security issues including economic and financial security, environmental safety, terrorism and piracy (People’s Daily, November 14; China Review News [Hong Kong], November 13). Given the CCP’s long-standing belief that many of the country’s destabilizing agents are abetted by hostile foreign countries—which seem bent on subverting the socialist system via mechanisms such as “color revolutions” or “peaceful evolution”—internal order can only be upheld through obtaining sound intelligence from units such as MOFA, ILD, MSS as well as military-intelligence units. As the Global Times pointed out, “social transformation has resulted in the profusion of contradictions within China.” “Foreign forces are increasingly keen to challenge China by exploiting our internal problems—and their levers for doing so have become more numerous,” the party mouthpiece added. The paper cited as example the growing number of accidents involving ethnic minorities, “which have turned ugly owing to China’s radically changed external environment” (Global Times, November 13; Sina.com, November 13). Given the leadership’s growing awareness of what the Global Times calls “the mega concept of security,” the current top organ for maintaining security—the party’s Central Political-Legal Commission, which is in charge of the police, the prosecutor’s office and the courts—does not have enough resources to cover all aspects of national security. Moreover, the reputation of the CPLC has been dealt a heavy blow as Zhou Yongkang, the former PBSC member who headed the commission from 2007 to 2012, is believed to have been under investigation for alleged corruption (South China Morning Post, October 22; BBC Chinese Service, October 21). Chinese media, however, have yet to disclose details about the relationship of the NSC and the CPLC.

Quite a number of liberal intellectuals are alarmed by the NSC’s apparent similarity to the all-powerful internal-security units in the former Soviet Union. According to economist Xia Yeliang, a former Peking University professor and noted public intellectual, “the authorities are very worried about stability despite the apparent achievements in economic development.” “The NSC will make better use of the military, the [quasi-military] PAP, spies and even anti-corruption agents to promote internal security,” he told the Hong Kong media. “There are parallels between the NSC and the KGB [under the Soviets].” Internationally recognized dissident Hu Jia noted that the NSC is a “much-strengthened version of the Central Political-Legal Commission.” “The spirit of the KGB is alive and well in China,” he asserted. Beijing-based human-rights lawyer Liu Xiaoyuan asked this rhetorical question: “The CCP has set up the NSC to uphold state security, can we set up a people’s security commission to safeguard the security of the people?” (Thehousenews.com [Hong Kong] November 13; VOA Chinese Service, November 13).

Given President Xi’s concerns about stability—and the maintenance of a strong leadership—it is perhaps not surprising that while the plenum communiqué indicated that market forces would be playing a “decisive role” in the allocation of resources, party members and the business community alike are asked to “unshakably consolidate and develop the public ownership system, uphold its dominant status… and incessantly strengthen the vitality and influence of the state-owned economy.” (Hong Kong Economic Journal, November 14; South China Morning Post, November 13). The Resolution, however, made pledges about gradually allowing private enterprises to get into the financial sector and also incrementally allowing peasants to monetize their plots of land through means including using them as collaterals. The Resolution also vowed that the construction of free trade zones such as the one that recently opened in Pudong, Shanghai, would be "speeded up." As expected, the one-child family policy was partially liberalized. A couple may have two kids if either the husband or wife is a single child (Xinhua, November 15; CCTV News, November 15).

In discussions in the run-up to the plenum, Premier Li Keqiang, who is the PBSC member with responsibility for the economy, has reiterated that wherever possible, “the government should allow the market to do its job.” The communiqué and the Resolution, however, have put the emphasis on “top-level design,” meaning that the party-state leadership should firmly control whatever kind of economic and social transformation that meets Beijing’s criteria of “striking a balance between reform, development and stability.” As the Resolution pointed out, the authorities must “boost society’s harmonious factors to the largest degree” and “raise the level of social governance so as to safeguard state security and to ensure social order.” “We must push forward the modernization of the institutions of social governance,” it added (Xinhua, November 15; China News Service, November 13).

To ensure the success of reforms, the plenum also decided to set up a Leading Group on the Comprehensive Deepening of Reform. The Wen Wei Po, a Chinese-controlled Hong Kong paper, and Phoenix TV, which has close ties to Beijing, have reported that President Xi will most likely be the head of this Leading Group, which will supervise policies regarding reforms in the economy, politics, culture, society, the environment and party construction (Wen Wei Po, November 15; Phoenix TV Net, November 14) That Premier Li has not been given control of the Leading Group is also confirmed by descriptions of the Plenum. Xi rather than Li was named as the Head of the team drafting the Resolution, while two Sub-Heads of the drafting team were the PBSC member in charge of ideology, Liu Yunshan, and PBSC member Zhang Gaoli, who is Executive Vice-Premier (Xinhua, May 15, People’s Daily, May 15). While the exact tasks of this top body have yet to be delineated, will the establishment of yet another high-level organ exacerbate the bureaucratic nature of China’s decision-making process? After all, one of the first efforts of Premier Li upon becoming head of government last March was to streamline the structure of the State Council. Moreover, the National Development and Reform Commission, a “super-ministry” that is often dubbed a mini-State Council, has for the past decade been responsible for the design and implementation of different types of reforms (Ta Kung Pao (Hong Kong), November 6; China News Service, September 2).

Given the likelihood that President Xi, not Premier Li, will take the helm of this leading group, the question of whether too much power has been vested with the supremo—and whether some form of power struggle has broken out between Xi and Li—has been raised. There are also doubts about whether Xi’s insistence on party leadership of economic policy would contradict the pride of place that Li seems to be giving to market forces. The plenum communiqué and Resolution put a lot of emphasis on the fact that “comprehensively deepening reform must require strengthening and improving party leadership, and fully developing the core leadership function of the party in taking charge of the whole situation while coordinating [the needs] of different sectors.” The documents also called upon “party committees of all levels to earnestly fulfill the leadership responsibility over reform.”

In the eyes of Chen Ziming, a famed theorist of reform, the much-anticipated Third Plenum has turned out to be more a question of power than of reform. “With Xi Jinping becoming the head of the two new committees [set up at the plenum], he has tightened his stranglehold on the reins of power,” Chen said. “We still do not know enough of Xi to tell what he is about to do. He can go down the road of [the reformist former Taiwan president] Chiang Ching-chuo or he could become another [Cambodian dictator] Pol Pot.” (Ming Pao, November 14; Ming Jing News [Hong Kong], November 12). The tortuous history of China’s reforms seems to show that the quasi-superpower has yet to undergo tougher tests before it can hit upon a formula that will satisfy both the rulers’ urge to control and the people’s desire to liberate their production forces.