To China watchers, the development leading to the 19th Chinese Communist Party Congress, a once every five year affair, which is set to begin on October 18, has been nothing but amazing.
Before Guo Wengui (a.k.a. Miles Kwok) started his exposé early this year from his $67 million apartment in New York, CCP was already facing unprecedented challenges. For instance, the real-estate boom, which supported the local government spending for a couple of decades and kept inflation low, has reached its limit, as it is no longer possible for a graduate of Tsinghua University, the best engineering university in China, to buy an apartment in Beijing with his salary.
With CCP’s ever expanding demand of money, whether for its military expansion or its effort to “maintain stability,” which is already exceeding the defense spending (the massive great firewall of China does come cheap), CCP needs a way to have the Chinese people hand back the money they earn. For a generation, real-estate has been the answer. Subsequently, the generation is known as the colony of ants. To feed the investing appetite, the total constructed residential areas has reached more than 40 square meters per capita, or 430 square feet per person. Early this year, in order to prevent price crash, CCP started to restrict real-estate transactions. Thus, many of those who have invested in real-estate are no longer able to cash out.
For a generation, Chinese manufactures, making all those made-in-China products, which earned the foreign currency for the Chinese government, were supported by the peasants, to whom a few dollars a day represent an enormous opportunity, even when many industries paid salaries annually. In other words, if the companies failed at the end of the year, all bets were off. Now, with the first generation aging, the new generation are more picky, reducing the profit margin for manufacturers. To hold everything up, they are allowed to pollute air, water, and soil. Since many trucks do not have even the most rudimentary exhaust system, the worst air in Beijing is in the early mornings. In order to hold up the value of RMB, the Chinese government has aggressively limited the Chinese people from exchanging their RMB into foreign currencies.
Since the start of the economic reform, the deal with the party officials had been that as long as they got the GDP increase, a certain level of corruption was tolerated, partially as a reward for the hard work of the rank and file. When Xi Jinping took over, due to his pretence of being a nice boy throughout his career, few officials were personally devoted to him. For CCP, the structure did not permit massive official replacement. Since almost all officials were corrupt, Xi put Wang Qishan in the position of CCP’s disciplinary chief to massively purge officials. The problem is that terror has not attain loyalty for Xi. After five year, the scale and speed of purging are picking up, not slowing down as expected, indicating the approaching of crisis state. Now, Xi has made CCP official a high risk occupation.
Xi Jinping moved everybody’s cheese. As Wang Qishan himself and his deputies touring the country purging again and again, the entire official system is mutilated. One of the unintended outcome is that talented young people no longer want to take the official path, making it even harder for CCP to get things done.
It is at this time, when Xi Jinping did not need any trouble, that Wang Qishan and his lieutenants offended one Guo Wengui, who, for the first time in the CCP history, was gutsy enough to openly take a stand against CCP.
When Voice of America announced that it would broadcast a three-hour interview of Guo, CCP made the extraordinary move as it put Guo on the Interpol’s Red Notice at the night before the interview; officials of Ministry of Foreign Affairs summoned VOA’s Beijing correspondent to threaten him of canceling his visa if the interview went ahead; the officials from the Chinese Embassy in Washington called VOA management directly to protest; and rumors has it, Beijing ordered its agents and infiltrations in the U.S. to stop Guo “at all cost,” resulting in massive exposure of its infiltration. The swift multi-agency move could only be ordered by Xi himself.
As Guo focused on Wang Qishan by exposing more and more corrupt details of Wang and his lieutenants, the China’s elite was shaken, although CCP’s internet control appeared to be effective enough that the low level people was not aware of his exposé according to my unscientific polling of Beijing taxi drivers in August.
Now, Xi Jinping has a problem. Most officials outside the Central Commission for Discipline Inspection and his most intimate circle have lived in fear for five years. Now, they know that Wang Qishan and the disciplinary/law enforcement apparatus are the most corrupt. If Xi Jinping want to have any legitimacy, he needs to address the issue. At minimum, he needs to investigate Guo’s allegations. Nothing happened.
For a while, Wang disappeared, as the media rumored that the summer Beidahe recess, which actually decide all matters for the Party Congress, decided to handle the matter by letting Wang Qishan retire. Since Guo repeatedly declared his loyalty to Xi, that appeared to be a sensitive move.
However, lately, things appeared to have changed, as Wang conspicuously met with Steve Bannon who was in China supposedly passing a Trump message to the Chinese officials. When he met with Singapore Prime Minister Lee Hsien Loon, Wang made it clear that he met Lee with the permission from his superior (none other than Xi). At present, the message appears to be that Wang would not retire.
After his first five-year term, Xi has worked himself into several problems. According to the CCP tradition since Deng Xiaoping, those 68 or older would retire and 67 or younger be promoted at the top level. Wang is 69 already.
If Xi let Wang stay, Wang would remain his biggest problem as the move will remove all pretense of CCP legitimacy. However tight the internet control, the salient, at times pornographic, exposé of Wang Qishan and his lieutenant by Guo Wengui will spread to all corners of China. If Xi force Wang to retire, his entire disciplinary and legal apparatus would be under attack by everyone in the country, not something he wants or needs.
Also according to the rule, the top leaders are appointed by alternate leaders, as Deng Xiaoping appointed Hu Jintao, and Jiang Zemin appointed Xi Jinping. According to that tradition, Hu Jintao put Hu Chunhua and Sun Zhengcai in place to take over after Xi Jinping. In July, Xi Jinping purged Sun by having the decision made by the politburo as he could not wait for the plenary session to purge that politburo member. Sun was sent from the CCP disciplinary apparatus to the government’s legal apparatus at record speed. Seeing the purging of Sun and many others who were already “elected” delegates of the Congress, Hu Chunhua was rumored to have made it clear to Xi that he did not wish to be promoted.
With Xi’ rule by terror for the past five years, and his continuous incapability to get his repeated reform promises going, system-wide frustration has turned into system-wide resentment, although no official would admit that publicly. To make sure the situation gets worse, Xi has just started another round of purging, from military commanders to university professors who dared to speak outside the lines (of things that are neither related to the Party Congress nor directly against Xi).
When I visited China in August, the internet blackout was complete. With all VPNs shut down, the U.S. companies are having trouble communicating with their Chinese subsidiaries, while Xi Jinping staring at the fatal date moving toward him. To have Wang, or not to have Wang; that is the question, first and foremost. Either way, the true mess would only start after the Congress. For now, Xi does get to choose which way he wants to go down. That makes this Congress one of the most interesting.
By Pujie Zheng
Pujie Zheng is an attorney in Los Angeles.
First published on October 7, 2017
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