Welcome to China's political gamble of the century

President Xi Jinping has put the burden of modernisation squarely on the single ruling party. It is quite an experiment

Timothy Garton Ash in Beijing

The Guardian, Sunday 30 March 2014 20.30 BST

A model during China fashion week. 'There is conspicuous consumption, high fashion and cosmopolitan lifestyle – but also national pride and a sense of ­historical optimism.' 

As export-hungry Europeans have feted president Xi Jinping on his imperial progress across the continent over the past week, how many have realised just how extraordinary is the political experiment he is leading back home? In essence, he is trying to turn China into an advanced economy and three-dimensional superpower, drawing on the energies of capitalism, patriotism and Chinese traditions, yet all still under the control of what remains, at its core, a Leninist party-state. He may be a Chinese emperor but he is also a Leninist emperor. This is the most surprising and important political experiment on the face of the earth. No one in the 20th century expected it. No one in the 21st will be unaffected by its success or failure.

Back in 1989, as communism was trembling in Warsaw, Berlin, Moscow and Beijing, who would have predicted that 25 years later we would be poring over the 60-point Decision of the 3rd Plenum of the 18th Party Congress, so as to understand exactly how the party leadership proposed to keep China both economically growing and politically under control? After the trauma of the Bo Xilai affair, Xi has moved decisively to strengthen central party power and his own position. Besides taking the traditional commanding heights of the military as well as state and party more rapidly than his predecessors, he has created at least four other central command committees or "small leading groups" – on economic reform, state security, military reform and, tellingly, the internet. "More than Mao!" cries one disgruntled party reformer.

His anti-corruption drive is widely thought to be about to take down a former boss of the whole state security apparatus and member of the highest party leadership, Zhou Yongkang. They must, says the party's Aesopian propaganda, tackle the tigers as well as the flies. Seen from one point of view, this may be taken as a token of seriousness about tackling rampant corruption at the highest levels of the party-state. Seen from another, it is part of the traditional manoeuvres of a new leader securing his power over real or potential factions inside the party. It is a purification, but also a purge. Meanwhile, critical bloggers have their accounts deleted, dissidents are imprisoned and unhappy provinces kept under security lockdown.

But, you may exclaim, Beijing in 2014 is light years away from Moscow in 1974, let alone 1934! Of course you are right. For every bit of the old there is a byte of the new. In Beijing or Shanghai, you wander through glitzy shopping malls to meet super-smart, sophisticated business people, journalists, thinktankers and academics who talk freely about almost everything. Executives and internet millionaires speak Californian. Successful entrepreneurs turn to ancient Chinese history, Confucianism and Buddhism for post-materialist meaning. There is conspicuous consumption, high fashion and cosmopolitan lifestyle – but also national pride and a sense of historical optimism. Bright, ambitious students flock to join the Communist party, not from egalitarian conviction but for reasons of personal advancement mixed with patriotism. "In what sense, if any, is this a communist country?" I asked one such young party member. "Well, it is run by the Communist party," he replied. This seemed to him an entirely sufficient answer.

That party explicitly recognises that it needs more market forces. It has announced a bonfire of the red tape holding back small and medium-sized enterprises. Li Keqiang, the party-state's able premier, clearly understands the daunting economic challenges identified by both Chinese and foreign experts, such as a burgeoning debt burden, a real estate bubble and too little demand coming from domestic consumption.

So my point is not for a moment that there is nothing new under the Chinese sun (when you can see it through the smog). On the contrary, there is a fizzling cocktail of new and old. My point is that we should not lose sight of the old inside the new, and imagine that the politbureaucratic language of a 3rd Plenum is purely formalistic. Wherever you turn, whether in the factory, the newspaper, the farm or the university, the party secretary retains a decisive voice. There are Communist party committees or cells inside private companies, including foreign-owned ones.

As Xi and his colleagues in the politburo's standing committee have moved to consolidate their power and set their course, it has become clear that his "comprehensive deepening" of reform will be implemented through reinvigorated party control. For years now, many of my friends, both Chinese and foreign, party members and outspoken critics, have been looking for evolutionary steps towards a greater separation of state and party, more genuine rule of law (as opposed to mere rule by regulation), a larger space for NGOs and more open public debate. A few shards from those hopes remain in the current reform package, but there is not much. In a party directive known by the wonderfully Orwellian title of Document Number 9, seven supposedly subversive ideas are listed which the good comrade is not to countenance. The so-called Seven Don't-Mentions include constitutional democracy, universal values and civil society.

Since the next few years are crunch time for the Chinese economy, the Chinese question is now sharply posed. It is no longer: could evolutionary political reform, gradually increasing transparency, constitutional-type balances, freedom of expression and civil society dynamism be used to complement and reinforce economic reform? Rather it is: can a reinvigorated party-state, harnessing in unprecedented fashion the energies of capitalism, patriotism and older Chinese traditions, succeed in mastering the ever more difficult challenges of continuing modernisation?

And the answer is? Within the space of a few hours, I spoke to two of the most experienced foreign correspondents in China, both of them formidably well informed. Their diagnosis of the problems was almost identical, and their predictions spectacularly different. One thinks the party can still keep the show on the road, with skilful management of state-led development. The other foresees economic meltdown, social revolt and political upheaval. In short, nobody knows. But at least we should be clear about the question.