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China's Peripatetic Xi Jinping Still Must Mind His Es and Cs at Home

The new jet-setting president may be giving the impression that China's eyes are firmly fixed outward. But the co-authors of a recently revised book on the country in the 21st century insist that now, as forever, all politics remains local.
Xi Jinping greeting U.S. President George W. Bush in August 2008. (PHOTO: PUBLIC DOMAIN)

Xi Jinping greeting U.S. President George W. Bush in August 2008. (PHOTO: PUBLIC DOMAIN)

Xi Jinping has been racking up the (metaphorical) frequent flyer miles. Since formally becoming China’s new president in March, he’s visited Russia, various African and Caribbean countries, Mexico, and now the United States. Xi’s extensive travel schedule reflects China’s interest in elevating its presence on the world stage, as does the country’s increasingly aggressive stance in the South China Sea. But are Xi and China now primarily concerned with their country’s global relationships and global reach?

No. Domestic concerns still loom larger.

Xi, no less than his predecessor Hu Jintao, helms a Chinese Communist Party (CCP) whose number one priority remains simply staying in power in an era when so many groups that share its Leninist roots have disappeared and authoritarian regimes keep tumbling. This is a mission that begins at home when we, as Marketplacelikes to put it, “do the numbers”: Beijing keeps allocating more money annually to policing efforts aimed at “maintaining stability” domestically than to the Peoples Liberation Army, whose purpose is to project force abroad.

Many Americans might imagine Xi and his colleagues filling their days with strategy sessions on ensuring Chinese control over the Spratleys and launching new cyber-attacks against U.S. targets. In reality, though, much of their time is spent worrying about problems in their own backyard, from environmental protests, like the one last month that brought hundreds of people to the streets of Kunming to demand the closure of a petrochemical plant, to deep disenchantment in Xinjiang, where some 20 people died in a clash between police and civilians in April, and Tibet, where a rash of self-immolations that began in 2009 has resulted in 117 deaths.

The good news for China, as it continues to industrialize, is that it has a good supply of two sources of power: coal and water. The bad news is that coal mining and hydraulic projects have their dangerous sides.

Xi can’t be voted out of office, but he is no less subject to the maxim that “all politics is local.” China’s international position is undeniably important to the country’s officials, since summits and such burnish a sense of national pride, a feeling that the country has recently regained its place of importance in the world, which the CCP depends on for its legitimacy. Still, we think it’s not events beyond their borders that have the most potential to keep Xi and Co. up at night pacing the floors of the leadership compound at Zhongnanhai, but rather an intertwined set of domestic issues. These can be summed up—à la the party’s penchant for numerically themed slogans and campaigns—as “the three Es and two Cs.” Here, a brief rundown of this five-part worry list, beginning with Economy, Energy, and Environment, and ending with Corruption and Credibility:

The CCP has become dependent on high growth rates. It needs the economy to perform not just well, but very well. While the economic boom has produced winners and losers, the losers have been able to content themselves with the idea that their turn will come. A severe leveling off of growth would be deeply unsettling, frustrating the rising expectations of those who have been doing well and engendering a sense of outrage and desperation among those who have been thinking that their good times might be just around the corner.

Hu Jintao’s administration tried to do some advance damage control by shoring up social services in the countryside, where so many live who have missed out on the benefits of the boom and feel the negative effects of a shift away from state support for social services. Xi’s administration will likely continue these efforts. But they are only likely to do much good if paired with an overall sense that the economy as a whole is moving in a positive direction. Whatever its failings may be, the party remains legitimate in public eyes if it is overseeing economic development and an overall rise in living standards.

The good news for China, as it continues to industrialize, is that it has a good supply of two sources of power: coal and water. The bad news is that coal mining and hydraulic projects have their dangerous sides. With coal, the dangers include staggeringly high injury and death rates for miners; there were almost 2,000 mining-related fatalities in 2011, and on May 11 of this year, a single explosion in a Sichuan killed 28 miners. When coal is used for heating, it creates filthy air—a health issue and potentially also a political one, given the increasing tendency for concerns about pollution to generate protests. The bad news with hydraulic energy is that massive dams have been controversial, triggering protests by locals directly affected by the projects, which almost inevitably require villages to be flooded in a land where corners are often cut in big development projects.

The bigger bad news is that demand for oil and electricity keeps rising. Each year, China becomes a country with more and more drivers and more and more people living middle-class lifestyles.

China has oil reserves, but not enough to meet its growing needs. This increases Beijing’s determination to have access to foreign suppliers. As with the United States, this shapes international behavior, hence the CCP’s desire to extend Chinese influence in Africa and South America and keep on good terms with Iran. Dams and nuclear plants partly help meet electric demand, but coal-burning plants still generate three-quarters of its electricity. And over the longer term, given how addicted to development the government remains, even more of these greenhouse-gas-emitting plants will be needed.

Perhaps the biggest resource-related concern, though, is water. Due to polluted rivers, melting Himalayan ice caps, and a declining North China water table, shortages of drinking water and water for irrigation are already serious problems and likely to get much worse going forward.

In his last official work report, Hu Jintao warned, this past November, that corruption posed the biggest threat to the party. He had good reason to say this; 2012 had been a trying year: First, charismatic politician Bo Xilai fell from power, accused of graft and extortion, and his wife, Gu Kailai, was convicted of murder in a scandal that made headlines around the world. Then Bloomberg News and the New York Times published exposés documenting how rich the extended families of Xi Jinping and outgoing premier Wen Jiabao have grown through their use of connections and influence. For most Chinese the exposés merely confirmed things they had assumed, but the reports nonetheless damaged the credibility of the CCP, which once promised to reduce inequality and has long insisted that initial rise was aided by its cadres being far less corrupt than those of the rival Nationalist Party.

High-profile cases of corruption might not seem to affect the lives of ordinary people. But they reinforce a sense of lack of transparency and rot that is reinforced at the quotidian level by food safety scares, shoddy construction scandals, and environmental degradation—issues that stir up anger that cuts across geographic and class boundaries. The cumulative effect is that the Chinese government seems to have little credibility among the people it rules.

Disgust with official corruption, a key factor in the protests of 1989, has not been strong enough to date to galvanize nationwide protests on par with Tiananmen. One reason is that the central government has succeeded, for now, in convincing people to accept that local officials should bear the brunt of criticism. Another is that the general economic trend has been upward, which suggests that, as bad as corruption is, it is not hindering development. Circling back to the first of the Three Es, a major economic downturn—or even an extended slowdown—would undermine the sense that corruption is not a roadblock to the achievement of a level of relatively widespread prosperity.

The CCP has repeatedly proven wrong those forecasting the party’s imminent demise, but this should not blind us to major threats to its continued longevity. Patients with terminal illnesses who outlive predictions about how many years they have left in the end do expire. The CCP has, as seemed unimaginable when the Berlin Wall fell, managed to make it through the 24th anniversary of the June 4th Massacre not only still on top, but without drastic overhauls in its political structure. And we won’t bet against it being around next year to go through its usual strange motions—banning an ever-growing list of potentially troublesome words from the Internet as the big day arrives—when Tiananmen’s quarter-century anniversary comes.

How much longer the CCP can survive will depend, however, less on what it does globally than on how it deals locally with those sleep-depriving Es and Cs.