Scope of China’s anti-graft drive surprising
CNBC
11/03/2015
KEVIN RUDD: There’s an open question now as to whether he’s becoming the strongest Chinese President since Mao. So let’s just keep our minds open on that one. A couple of years ago when he was elected I said he’d be the strongest since Deng and two years later I’m beginning to think that one through again. I think again like that discussion we’ve just had on the economy, it’s important to keep this in a wider frame. What is he seeking to achieve? Xi Jinping has his vision for what he calls the ‘China Dream’ which is to cause China once again to become a respected global great power and lifting the remaining Chinese people out of poverty, increasing living standards to at least middle-income level across the world and beyond. But his vehicle for doing that, and he’s unapologetic about this, is the Chinese Communist Party. He is not envisaging some transition from the Chinese Communist Party to some form of democratic transformation over time. People who think that, I think, have fundamentally misread him and so the Party is central not just now but in the long-term future. So what has he confronted? He’s confronted since he came to power a couple of years ago, a party whose legitimacy was beginning to erode fundamentally because of corruption – as I said to someone recently, not at a retail level, not even at a wholesale level, but almost at an industrial level in terms of the quantums of corruption. He knew as a party loyalist, that to restore, frankly, legitimacy he had to take the meat axe to this. I’ve been surprised, as a long-time China analyst going back 35 years, I’m surprised by how intense it’s been, how comprehensive it’s been and how long it’s gone – because it is, frankly, going from top to bottom across the country. INTERVIEWER: Are you concerned with what the end-game is? KEVIN RUDD: Looking carefully at what the leadership sought to do at the last party plenum in 2014, where the emphasis was on the reform of the legal system, I think what they are trying to do is to entrench the anti-corruption machinery into the normal workings of the Chinese State and Party. It’s not just a one-off, “here is a massive anti-corruption campaign,” and then everything goes back to normal. What Wang Qishan and the others are trying to do is to institutionalize this across the machinery of state. Will they succeed or not? I can’t tell you. But if you want to know what he’s doing and what the game plan is, it’s to restore party legitimacy. INTERVIEWER: Kevin, there isn’t a single example in history (correct me if I’m wrong) of a country that has ascended to China’s level of being, on equal footing, a superpower without having a pluralistic society. We’ve seen more consolidation of control in a one-party system in China than we have in previous administrations you could argue. I mean, that’s scaring people in Hong Kong. That’s why this place was paralysed for three months, because they’re scared about what they’re seeing. Can it go on like this? KEVIN RUDD: Here is the really interesting point, all of us who have grown up with the study of Western political science assume, what’s called the $14 000 income per capita threshold. That once you get to a certain point in development the models follow which is people then demand greater civil liberties and what follows is the emergence of one form of democratic governance or another. Xi Jinping does not have that as his game plan for China. Furthermore, he is in the business of actively trying to construct an alternative model, for a political model and for the political economy of China for the future. I would best describe it as a state capitalist model. If you look at what he’s doing with the economy, frankly, most market economists would give it the tick in that you see a further widening of the role of the market across most sectors of the economy. Still a long way to go as most of your foreign businessmen will tell you, but let me tell you, two years ago when they decided that the market shall be the decisive factor in deciding the future of Chinese economic policy direction, of ‘The Decision’ of the 3rd plenum of the 18th Central Committee, that’s the culmination of 30 years, 35 years of work since Deng’s return. But, simultaneously with that you see not only the efforts to restore the party’s legitimacy but, on top of that, a further effort to entrench the political control of the Party. So what Xi Jinping is doing, if you like, is seeking to defy what folks in the West would describe as history. Frank Fukuyama’s point, we end with capitalism and that’s the end point – Frank wrote that book some 20 years ago at the end of the Cold War. Xi Jinping and those around him are actually seeking to advance what they describe as the ‘China Model’ which is, frankly, a radical alternative. I think we need to be very cautious about the assumption that this is inherently unsustainable. We need to take a very careful look at how they are doing this, because the folks I know at the centre are determined to prosecute this model. I can’t predict if it will work or not, but that’s what they’re seeking to and that’s the reason why.