China's President Trades One Set of Risks For Another

By Stratfor

When China's Communist Party Congress revealed no clear successor to President Xi Jinping in October 2017, it only fueled suspicions that Xi might be intending to outlast the traditional 10-year, two-term limits that come with China's presidency and vice presidency. On Feb. 25, these suspicions were confirmed when the Party moved to abolish those term limits, paving the way for 64-year-old Xi to potentially stay in power beyond 2023. Removing presidential term limits is one of the final steps in the Chinese leader's plan to consolidate political power. Though Xi could have followed in the footsteps of his predecessor, Jiang Zemin, and exerted his power indirectly through other Party members, he has made the decision to avoid the substantial political costs that come with that. Instead, Xi is using China's legal foundations to strengthen state functionality and legitimize his attempt to recentralize bureaucratic authority. Ultimately, Xi may be aiming to reshape the role of the state in China and continue the lengthy process of rebalancing the country’s unsustainable economic model. But in his efforts, Xi is inviting resistance and, in many ways, trading one set of risks for another.

Shifting Political Structures

Xi's rapid ascendance to power as both Communist Party general secretary and Chinese president rewrites the political structure that defined China's ruling elite for the better part of 30 years. It also erodes a trend of relatively faceless Chinese presidents known more for their role in consensus leadership than for their individual personalities or passions.

Historically, China's president has had a less prominent leadership role than counterparts in the United States and other countries, typically serving as no more than a proxy for or subordinate to the Communist Party institution. During former Chairman Mao Zedong's authoritarian rule until his death in 1976, this function was taken to an extreme, with the president being almost completely abandoned in the wake of Mao’s powerful presence. When former Chairman Deng Xiaoping took over in 1978, he, too, remained the primary decision-maker, but he adopted a more behind-­the­-scenes role. During Deng's era, the president served primarily as a figurehead while sharing power with other Party leaders. After Deng, the function of the president became somewhat standardized.

Two prominent features have characterized Chinese politics in this time. The first is a consensus-based collective leadership model in which key decisions are made through internal compromises and informal bargaining. This approach was implemented to avoid the instability wrought by highly charismatic and impulsive individual leaders such as Mao. Second, China dedicated itself to shifting political power from the central government to local governments. Provinces, bureaucracies and industrial entities were given a high degree of autonomy in their economic decisions, incentivizing locals to take responsibility for their own economic prosperity and thus facilitating China's broader strategy of generating growth.

Enter Xi

Both political mechanisms served China well during its period of economic growth in the latter decades of the 20th century, preserving the Communist Party's power while allowing for a booming economy. But as the 20th century shifted into the 21st, economic and social change began to outpace political evolutions. Various problems began to emerge, including huge social and regional economic disparities, excessive speculative investment, industrial overcapacity and environmental degradation. The global economic slowdown in 2008 hit China particularly hard, and the country began recognizing its need to shift from a growth-driven economy to a more balanced and sustainable development model. Its consensus-­based political system, however, was not designed to implement changes quickly. Furthermore, the political and elite networks in China were so intertwined with the underlying economic system that any changes would affect patronage networks and regional self-interests. As Beijing embarked on a broad effort to rebalance its economy, it found that the disparate power bases it had spent 30 years establishing now not only conflicted with its nationwide restructuring plan, but also increasingly threatened the central government's political authority.

Xi entered this political landscape in 2012, and has spent the past five years trying to remake it in such a way that China can tackle its new challenges. Externally, he has cultivated an image as a global leader and shown a commitment to enhancing China's presence and influence on the world's stage. Internally, Xi has ruthlessly clamped down on his political opponents and disparate power bases across the Communist Party, the government and China's industrial sectors. He has established and led several advisory and working groups that oversee aspects of economic reform and military development. And with institutions such as the National Supervision Commission, he has encouraged more oversight over local governments and bureaucracies. All these moves have shored up his personal authority, while also strengthening the central government and redefining its relationship with various entities across the political spectrum.

Taking Risks

In these efforts, Xi has simultaneously generated new risks while he aims to resolve others, encountering backlash from the public — particularly intellectuals — and from various interest groups for local, industrial and bureaucratic power bases. But Xi, at least for now, has been savvy in his ability to institutionalize and thus legitimize his attempts in order to try to offset this resistance. He pushed to enshrine the National Supervision Commission into the state constitution and has worked to undermine informal systems and purify the party by removing opponents. Xi's move to extend presidential term limits in the state constitution follows this trend.

Scrapping the two-term limit for presidential service could provide a sense of political continuity for the country's major reform efforts, limiting the ability of various interest groups and opponents to simply bide their time for the next five years and jeopardize Xi's agenda. After all, with a size and population as large as China's, no substantial reforms can be achieved within a short time span. The decision could also skyrocket the role of president in China to a position of authority more analogous in public perception to the U.S. president — both inside China as a symbol of the nation and abroad as the leading voice for China's interests on the world stage. The latter plays a critical part as China attempts to portray itself as a real global player on equal footing with the United States.

Despite amassing so much power, Xi does not necessarily have more freedom to exercise it. There are massive, inherent risks in Xi's ongoing push to entrench his own political power and strengthen the role of the state, and the move does not come with a guarantee of success. It took 30 years for China to see the impacts of economic reforms; correcting the consequences of those efforts could take even longer. Moreover, the ongoing path to centralizing power will inevitably come with controversies and resistance. By amassing the Party around himself, Xi raises the stakes should he falter. If his policies fail — whether because of internal causes or external disruptions — it could easily erase the support Xi has worked five years to gain. Simmering resentments could be brought to a boil within the Communist Party, challenging the state's ability to enact the changes it has worked so hard to implement.

A Stratfor Intelligence Report.

Reprinted with permission from Stratfor.