With the 19th Party Congress galloping towards us, Those in Command are getting ever-busier making arrangements for the big moment. In the last week, we have had a top candidate for the new leadership team being toppled. Chongqing party chief Sun Zhengcai got the heave-ho to be replaced by Chen Min’er, who said his predecessor had been too slow to weed out the influence of his own predecessor Bo Xilai. There have to wheels spinning within wheels here, because Bo was always the most likely front guy for any challenge to the current leadership team. We’re unlikely to find out any more on that front for a while.
Next, we have firm statements out of Beijing about financial sector reform, which has bucked up the Shanghai stock market, and raised the hopes of people who would like to think that Those in Command are preparing for more sweeping reforms after the Congress, once the leadership has been swept clean of people from alternative factions. The need for a bunch of transitions has been clear for years, but it is the interests of interest groups, it is assumed, that has made it impossible to implement them. One of the core changes, a shift in the proportion of the economy under the control of the SOEs, seems if anything less likely than it was last year, and it remains to be seen whether the system is capable of fundamental changes when the purpose of the system is to serve the interest groups. We’ll see. These are fraught times in Beijing as well as Washington, one presumes. But it’s just a guess.
Have good weekend.