China Leadership Monitor
Tuesday, June 17, 2008

Summer 2008: Issue 25

PRC-Tawain-United States
PRC-Tawain-United States

After the Taiwan Election: Restoring Dialogue while Reserving Options

by Alan D. Rombergvia China Leadership Monitor
Tuesday, June 17, 2008

The landslide victory scored by KMT presidential candidate Ma Ying-jeou and the resounding defeat of the referenda calling for application to the UN have meant that Ma took office with a mandate to implement his ambitious agenda to reinvigorate the economy, restore mutual trust with the United States, and establish a broad range of relationships with the Mainland on the basis of the “1992 Consensus.” Beijing was especially relieved by the defeat of the referenda, and it welcomed the return of the KMT to power. PRC president Hu Jintao’s labeled the strikingly new situation as an “historic opportunity,” and in a dramatic step Hu met personally with vice president–elect Vincent Siew before the 20 May Taipei inauguration. The quasi-official dialogue between Taiwan’s Straits Exchange Foundation (SEF) and the Mainland’s Association for Relations across the Taiwan Strait (ARATS) was restored in mid-June, and early progress was achieved on some of the “easier” issues previously negotiated and ready for resolution.

Nevertheless, signs of caution quickly crept into the Mainland’s discussion of future cross-Strait developments, and a concerning degree of hesitation is now being voiced in the Mainland about Ma and the ambitiousness of his overall cross-Strait program. In signs of what one might characterize as “buyer’s remorse” about presidential and referendum outcomes that were universally hailed ahead of time as the “best possible” combined result, a level of ruefulness is being expressed by some people about what going too far with Ma now could mean for the question of ultimate reunification.

Military Affairs
Military Affairs

The Chinese Military’s Earthquake Response Leadership Team

by James Mulvenonvia China Leadership Monitor
Tuesday, June 17, 2008

On 12 May, China was rocked by a 7.9 earthquake, epicentered just north of Chengdu in Sichuan Province. The People’s Liberation Army was quickly mobilized to deal with the national disaster, as it has been throughout the PRC’s history. This article examines the military leadership team involved in the earthquake rescue and recovery operation, assessing the implications of the natural disaster for the PLA’s domestic image, civil-military relations, and international posture.

Political Reform
Political Reform

What Happened in Maliu Township?

by Joseph Fewsmithvia China Leadership Monitor
Tuesday, June 17, 2008

Often the pressures that generate political reforms—and the limits to those reforms—are best viewed at the local level, which is why this column has explored so many instances of local reform. In this issue, we look at Maliu Township, a poor township in Chongqing Municipality that rose to at least local fame by adopting the so-called “Eight-Step Work Method,” which introduced popular participation in decision making and oversight. But as the local political economy changed—specifically as the impact of the abolition of the agricultural taxes has been felt—it has been difficult to sustain this innovation.

Economic Policy
Economic Policy

The Inflation Battle: Juggling Three Swords

by Barry Naughtonvia China Leadership Monitor
Tuesday, June 17, 2008

Inflation has once again become a serious problem in China. While the government’s quick and effective response to the Wenchuan earthquake reassured Chinese citizens and helped consolidate support for the government and the current administration, inflation presents the opposite image of the regime. In China, inflation causes political failure. It contributes to a subjective feeling of instability and may also lead to erosion in living standards for some segments of society. Historically, inflation in China is strongly associated with a government that is losing control and with the prospect of social disorder. To fight inflation, the government has three potential weapons: tighter monetary and fiscal policy; RMB appreciation; and price controls. Facing enormous economic uncertainty and unprecedented natural disasters, the government has vacillated among these three approaches. There is no immediate prospect of breaking out of this triangular trap.

Party Affairs
Party Affairs

Xi Jinping and the Party Apparatus

by Alice L. Millervia China Leadership Monitor
Tuesday, June 17, 2008

In the six months since the 17th Party Congress, Xi Jinping’s public appearances indicate that he has been given the task of day-to-day supervision of the Party apparatus. This role will allow him to expand and consolidate his personal relationships up and down the Party hierarchy, a critical opportunity in his preparation to succeed Hu Jintao as Party leader in 2012. In particular, as Hu Jintao did in his decade of preparation prior to becoming top Party leader in 2002, Xi presides over the Party Secretariat. Traditionally, the Secretariat has served the Party’s top policy coordinating body, supervising implementation of decisions made by the Party Politburo and its Standing Committee. For reasons that are not entirely clear, Xi’s Secretariat has been significantly trimmed to focus solely on the Party apparatus, and has apparently relinquished its longstanding role in coordinating decisions in several major sectors of substantive policy.

The Provinces
The Provinces

Ethnic Minority Elites in China’s Party-State Leadership: An Empirical Assessment

by Cheng Livia China Leadership Monitor
Tuesday, June 17, 2008

Recent uprisings across Tibetan regions of China as well as purported terror plots planned by Uighur separatists seeking independence for Xinjiang have highlighted the challenges that the Chinese Communist Party faces in governing a Han-dominant but multiethnic China. How China handles the “nationalities question” will be a crucial determinant of social stability going forward. Chinese top leaders have long recognized the value to the Party of having ethnic minority cadres among the Party-state elites, both for propaganda purposes as well as to inspire minority peoples to view the system as containing opportunities for their own advancement. Yet the Party has also maintained a firm grip on power in the ethnic minority-dominant political units by appointing ethnic Hans to the most important positions. An understanding of the changing role of ethnic minorities in Chinese politics is essential for comprehending the dynamics of China’s rapidly transforming political landscape.