Chinese President Xi Jinping’s secret in Giving Priority to mass line campaign


President Xi Jinping has repeatedly called for curbs of bribes and government spending. Photo: Xinhua

This is the article I promised to write in my previous post “Xi Jinping’s Balancing Art” to elaborate on Xi’s secret goal in conducting his mass line campaign.

CCP’s Real Crisis of Survival
“Being divorced from the masses of the people” is Xi Jinping’s euphemism for local officials turning CCP into the people’s enemy. Local despots’ infringement on people’s rights and interests gave rise to tens of thousands of people’s protests each year. There is statistics from investigation that before Xi took over the reign there were in China more than one hundred thousand incidents of mass protest to protect their rights every year.

CCP has set up agencies of letters and calls at various levels for petitioners to submit their complaints and provide remedy for them, but local agencies failed to provide remedy for people’s petitions. On the contrary, they mostly shielded the officials whose misconducts had been exposed by petitioners and tried hard to silence complaints and even persecuted petitioners. That was why lots of petitioners went to central agency of letters and calls to lodge their complaints.

Local despots set up black jails in Beijing to round up petitioners and persecuted them to silence them. If a petitioner persisted in petitioning, they imprisoned him in a local reeducation-through-labor camp without any legal procedures. People were forced to take to the streets to protest. However, instead of understanding and making allowance for people’s complaints, local governments sent armed police to suppress protesters with the excuse of maintaining stability. The masses of the people, though silenced by violence, remained indignant. Their indignation might erupt any time and would be impossible to suppress like volcano eruptions. That was the greatest threat faced by CCP at that time; therefore, for CCP, rectification of the malpractice of “being divorced from the masses” was instead the most important.

That was why Xi closed black jails and rectified CCP’s letter and calls agencies as soon as he took over the reign. He said that his second task was to abolish the reeducation-through-labor system. In spite of strong resistance from police and local governments, he succeeded in abolishing the system on December 28, 2013, one year after he was elected CCP general secretary.

Xi has thus removed the obstacles to people’s fight against local officials’ malpractices including corruption. Xi knows well that he shall not entirely deprive officials of their authority as the official system will be unable to operate without authority, but there must be people’s power to balance officials’ power, i.e. people shall have the power to inspect officials so that officials have to perform their obligations without abusing their authority.

In addition, Xi has been improving China’s legal system for the rule of law so that people have the last resort to use law to protect their rights and interests. That is why Xi wants China’s legal system to be independent. Some China watchers have insight that China’s legal system cannot be independent from CCP. Certainly, Xi only wants it to be independent from officials so that the legal system can help the masses of people inspect officials.

From the above we can see that Xi Jinping’s mass line education campaign is in fact a campaign of democratic supervision. However, Xi avoided the use of the wording that despotic officials have turned CCP into enemy of the people as that will be too sensational. Nor did he mention democracy as due to the Tiananmen Protests most conservatives hate the mentioning of democracy and regard it as what the West exploits for regime change. Xi is wise to avoid debate with conservatives over democracy. What he cares is the actual result instead of the wording in that campaign.

From Xi’ closing of black jails and abolishment of the reeducation-through-labor system, we must already be aware that Xi had a plan long ago to use the power of the masses of people to balance that of the vested-interest group of officials. With such a balance, he can make his official system serve the masses of people satisfactorily.

The mass line campaign has indeed brought fundamental changes to China’s official system. Before the campaign, people waited in long queue to go through some official formalities in government offices but the officials dealing with the formalities worked slowly while chatting joyfully. There were no such scenes in government offices now. Having been severely criticized by the masses of people, government staff now has to work diligently without chatting or doing anything else.

That is but the work style of lowest ranking officials. Can Xi touch the work style of high officials? High officials were criticized much more severely and the inspection teams sent by Xi to local governments focused on the work style of high officials especially top province-level officials. Most of the top officials were taken by surprise as they believed that Xi would instead conduct a nationwide anti-corruption campaign. Most of them did not worry as they were not corrupt. Xi however conducted a mass line education campaign that focused on their work style such as dealing with masses of people’s petitions and protests, extravagance in the ceremonies, receptions, visits, etc. such as the use of red carpet, decoration of lots of flowers, let alone the attending of luxurious banquets and drinking of expensive liquors.

A provincial head had great trouble when he had been seen having a subordinate holding an umbrella to keep rain away from him during his visit of a work site in the open. Such irregularities were very common but high officials found themselves in great trouble for such minor issues. As a result, Xi’s mass line campaign became a real purgatory for officials ranking high and low.

In this way, Xi has attained his secret goal of removing official despotism that he calls being divorced from the people and regards as the greatest threat to CCP’s survival. In addition, he has broken officials’ resistance to the nationwide anti-corruption campaign he was to carry out after the mass line campaign. The greatest secret goal he has achieved is the establishment of democratic supervision of officials by the masses of people. Only democratic supervision can provide long-term insurance for removal of corruption and purification of China’s official system.

Certainly, what Xi has done is but a beginning. There shall be lots more efforts to consolidate masses of people’s power of democratic supervision.

Article by Chan Kai Yee


Xi Jinping’s Balancing Art


In my previous article on Xi Jinping fighting corruption “Xi Jinping’s huge surprises”, I promised that I will elaborate in my next article Xi’s way to make officials go through the purgatory he set for them.

I have mentioned that for a sovereign the most important skill is the art for being an emperor, of which the most important is the balancing art.

Now, the large number of corrupt officials is a very strong group of vested interests in power, Xi must have some strength at least as powerful and preferably more powerful than it. Where is the balancing strength?

In my article “The Conundrum of Xi Jinping’s Chinese Dream” on April 16, I said that Bo Xilai exploited Hu Jintao’s omission of Mao Zedong Thought to rally all conservatives around him to form a large and powerful conservative faction in order to challenge the reformists. Bo began a fierce power struggle over the evaluation of Mao with his real goal to grab from Xi Jinping the right of succession to Hu Jintao. Xi lobbied Jiang to punish Bo severely and has thus deprived the conservatives of their very shrewd leader.

Jiang held an expanded Politburo meeting and made the decision to punish Bo severely, but he did not deal with the fierce struggle between conservatives and reformists over the evaluation of Mao. It was Xi Jinping who exploited conservatives’ popular slogan “Chinese dream” to put an end to the power struggle and bring back unity to a deeply split nation.

Bo exploited the conservative faction in order to grab from Xi the right of succession to Hu Jintao and to oppose further reform that Xi wanted to carry out. Xi should have regarded the conservatives as his enemy, but Xi’s mastery of the art for being an emperor has enabled him to turn his enemy into his ally in fighting corruption.

The conservatives have not been benefited from the reform capitalist in nature. Most of them are honest and adhere to the old communist values of economic equality. They hate corruption bitterly. There, on the contrary, were quite a few corrupt officials in the reformist faction as the reform makes the country rich so that there is wealth in the state for them to steal.

Hu Jintao, the reformists’ leader, fell into the trap mentioned in my previous article of forming and relying on his own CYL (Communist Youth League) faction as his powerbase. Just like Emperor Qianlong, he employed a very corrupt official Ling Jihua to be in charge of CCP’s daily affairs. Ling corrupted China’s official system and gave rise to rampant corruption.

Has Hu gained supreme power through his very large and powerful CYL faction? No, he appointed some talented officials but also quite a few officials who either were corrupt or pursued hefty economic growth for promotion resulting in serious pollution, over investment and excessive production capacity.

He did not obtain the status of CCP core leader though he was CCP top leader for a decade.

Xi’s use of Mao’s words about mass line pleased the conservative faction who had lost their leader Bo Xilai, but now Xi can lead them to be pioneers in fighting corruption.

A sovereign has real power because he has power in himself for others to rely on him instead of his relying on certain factions or powerful officials for power.

Now, the conservatives rely on Xi’s power to fight corruption while the reformists rely on him for further reform so that Xi has the support of both conservatives and reformists.

Xi knew that the greatest strength lies in the masses of people but it was very difficult to mobilize them as they had been oppressed by officials for a long time and thus had their traditional fear of officials, especially powerful corrupt officials. When corrupt officials have deprived them of their means of survival, they will rise up to overthrow the corrupt officials along with CCP those officials belong to. Xi certainly could not wait for that to happen.

Xi had first to rely on the strength of the conservatives to balance the strength of the group of officials with vested interests. As conservatives cherish nostalgic love for Mao, Xi used Mao’s mass line to give them the impression that he himself was a conservative and shared conservatives’ hatred of officials’ malpractices and corruption.

That worked wonderfully. Due to his wording quite a few China watchers outside China regarded Xi as a conservative and even a Maoist at that time. By so doing, Xi Jinping succeeded in using conservatives to be the vanguards in opposing the malpractices of being divorced from the masses of people. The number of conservatives is large and they are supported by lots of retired high officials. They have long been indignant at officials’ misconducts. Now, they have the opportunities to attack officials for their irregularities. They have thus given rise to some heat in the mass line campaign and make officials conduct self-criticism humbly. Officials had thus lost their prestige and dignity. As a result, the masses of people no longer feared them and became bold to join the conservatives to denounce official despotism.

By making officials undergo the purgatory of the conservatives and masses of people, Xi Jinping gained overwhelming strength over corrupt officials and subdued the entire corrupt official system to ensure that there will be no united strong resistance to his anti-corruption campaign.

You may wonder that Xi could have first launch an anti-corruption campaign with the support of conservatives and mobilization of the masses of people. Why did Xi put his second priority dealing with the malpractice of being divorced from the masses of people above his first priority dealing with corruption?

Xi had his secret goal in doing so, which will be elaborated in my next article.

Article by Chan Kai Yee


Xi Jinping’s huge surprises


Clothes hang from the entrance of a single-story brick house, known as a “black jail” in Beijing. Photo: AP

An Unpredictable Leader
A great leader must be unpredictable in dealing with tricky issues in order to have surprise when he attacks his targets. As a result, the targets are not prepared when he attacks. If they know what his next step will be, they will be well prepared to resist the attack.

Xi’s First Surprise: Blitzkrieg in Shutting Black Jails and Freeing Illegally Detained Petitioners
Xi Jinping does not look shrewd or fearful. In the five years when he was a Politburo Standing Committee member and Vice President, he only did what he was told to do without any exceptional performance. He had thus given the impression that he was but a good boy that will faithfully follow his predecessors’ steps without any creation or innovation.

True, Xi talked about his priority to deal with corruption as soon as he was elected, but his predecessor Hu Jintao has talked much and sent inspection teams to various provinces and organizations to fight corruption with little achievement. Xi’s words were but CCP jargon to please the people. The vast number of corrupt officials simply disregarded Xi’s talks.

However, on December 4, 2012, less than three weeks after he was elected, Xi Jinping took lightening actions to close the “black jails” set up by local governments in Beijing to imprison petitioners who came to Beijing to seek remedy for local injustices. Xi freed all the prisoners of the black jails.

That shocked powerful local officials as six months before Xi’s surprise actions Hu Jintao, the ten top leader, held a national conference on dealing with petitioning attended by high officials including some Politburo Standing Committee members and gave the instruction that local governments should shut their representative offices in Beijing as Hu was clearly aware of local officials’ malpractices in rounding up and persecuting petitioners. However, local officials simply ignored Hu’s instruction and maintained their offices and black jails till Xi suddenly closed them six months later.

CCP has a system to accept people’s letters of complaints and petitions at State Bureau for Letters and Calls in order to remedy local injustices. To prevent local malpractices especially corruption from being known by central authority, local governments have set up their representative offices in Beijing to intercept the petitioners. The petitioners rounded up by local governments were locked in illegal detention centers referred to as “black Jails” by media and web users.

The thugs employed by local governments used threat and violence to make petitioners promise that they would stop petitioning and then sent them back home. Petitioners were often tortured if they were disobedient. If they persisted in petitioning, they would be sent to local labor camps to receive reeducation through labor for one to four years. According to the reeducation through labor system at that time, police had the power to imprison people in reeducation camps for as long as four years without undergoing any legal procedures. Xi abolished the system later.

Xi’s action opened the channels previously blocked by local officials for informing against local corruption through China’s petition system.

Previously people did not dare to expose officials’ crimes of corruption as when someone informed about a corrupt official, in order to shield the official, the authority first examines the background of the informer instead of the official exposed. The informer would be punished if anything irregular had been found in the investigation. Even if nothing irregular had been found in the thorough investigation, the informer would have gone through lots of trouble during the investigation. If the official exposed was powerful, he might order his subordinates to frame up the informer and persecute him.

However, Xi’s abrupt move made people believe that Xi really wanted to fight corruption. As a result, people began to report officials’ crimes of corruption on the Internet and media. Under Xi’s rule, the exposed official was immediately investigated. If the official was found guilty, he would be punished severely while there was no investigation of the informer at all.

Xi’s severe punishment of the corrupt officials exposed by informers greatly encouraged people and scared corrupt officials. There was expectation that Xi would soon begin a nationwide anti-corruption campaign, but for months Xi remained inactive till people almost lost confidence and officials were no longer scared. Then he gave people a huge surprise.

Xi Jinping’s Mass Line Campaign, the “Purgatory” for Officials
Instead of the much expected anti-corruption campaign, in July 2013, Xi Jinping launched a nationwide seemingly Maoist campaign, the year-long national mass line campaign. He used Mao’s wording on mass line but his mass line is in fact entirely different from Mao’s. It precisely proves how clever he is in manipulating the application of Mao Zedong Thought.

In fact, there are three different mass lines: CCP’s traditional, Mao’s and Xi Jinping’s mass lines, the purgatory for officials.

CCP’s Traditional Mass Line
CCP’s mass line jargon is “working entirely for and relying entirely on the masses of people; from the masses and to the masses”. It means that CCP works entirely for the masses of people; therefore, it shall learn and understand the opinions and aspirations of the masses of people so as to formulate popular policies. CCP relies entirely on the masses of people; therefore, it shall make the masses of people understand its policies and mobilize them to carry out the policies. There is democratic ingredient in this mass line.

This was the mass line implemented by CCP, with which CCP was able to mobilize the masses of people to help it win the Civil and Korean Wars with an army much inferior to its enemies in funding and equipment.

Mao Zedong’s Mass Campaign Complex
The victories of the two wars caused Mao to have an inflated ego. He believed that he was always correct and did not need to know or understand the opinions and aspirations of the masses of people. On the contrary, it was the masses of people who had to study and obey his instructions and do whatever he told them to do because he was always correct.

The victories caused Mao to believe that he could succeed in anything as long as he had mobilized the masses of people. As a result, Mao’s mass line was no longer the CCP’s mass line of “from the masses of people and to the masses of people” but a mass line of mass campaigns, i.e. the full mobilization of the masses of people to act 100% in accordance with Mao’s instructions.

Mao’s mass campaign for fast economic growth – the Great Leap Forward ended up in his disastrous grand famine. It was followed by his great mass political campaign the Cultural Revolution that put the Chinese nation in chaos.

Contents of Xi Jinping’s Mass Line Campaign
Xi Jinping calls his campaign mass line education practice activities. It differs from both CCP’s and Mao’s mass lines in its goal to make people rectify officials’ work style and impose strict discipline on them through the mass-line purgatory. His mass-line supervision of officials aims not only at overcoming for the time being corruption, being divorced from the masses of people and the four malpractices of formalism, bureaucratism, hedonism and extravagance but also ensuring that officials really become public servants and work for people’s welfare.

For officials, the campaign was in fact a typhoon of purgatory. Xi conducted his nationwide mass line education practice campaign for one year to overcome the malpractices of being divorced from the masses of people, formalism, bureaucratism, hedonism and extravagance.

Those were the mistakes that almost official from top to bottom had to a certain extent committed; therefore, Xi Jinping calls his campaign an education campaign, i.e. a campaign to educate the officials in order to overcome those mistakes and implement his mass line. In that campaign, all officials had to examine themselves before the masses of people. As they had acted as lords and masters for a long time, they found it very hard to conduct self-examination and self-criticism before humble mass of people, lose dignity and face and promise that they would reform and become the mass of people’s servants.

Did that work? Could officials really be made to examine and criticize themselves? Would the masses of people come out to expose officials’ mistakes openly in spite of being used to be scared by officials? The higher officials’ ranks, the more serious their mistakes. Who dare to expose high officials’ mistakes? Take care that there may be retaliation!

I will elaborate in my next article Xi’s way to make officials go through the purgatory he set for them.

Article by Chan Kai Yee


China: Help to Keep People Employed Better than Unemployment Relief


Chinese leaders are creatively wise in dealing with potential unemployment. They provide subsidies and tax breaks to help enterprises keep redundant workers and encourage creating jobs. They know people are happier being employed than being idle though able to survive with unemployment relief.

Reuters says in its report “China pulls out stops to avoid lay-offs as economy cools” today, “State firms are encouraged to keep idle workers employed, subsidies and tax breaks are given to companies that do not fire their workers, and some businesses are even enticed into hiring despite the slackening economic growth.”

Western media believes that the Chinese Communist Party (CCP) fears rising unemployment may lead to uprisings that ultimately overthrow its rule (which I refer to as the rule of CCP Dynasty in my book) because the Dynasty lacks legitimacy and cannot last. There have been lots of failed predictions about the collapse of the CCP Dynasty.

They believe that Chinese leaders are afraid that unemployment because of that. Why is it impossible for Chinese leaders to really care for the people and take measures to keep people happy without being fired?

Most Chinese believe Confucian sage Mencius’ idea that people are born good, In China’s long history, most elite Chinese intellectuals follow Confucius’ teachings to pursue moral integrity. That was the cause for the emergence of a new generation of talented intellectuals with moral integrity during the Cultural Revolution. I described in my book Tiananmen’s Tremendous Achievements how they worked hard to be well-educated, prepared and succeeded in seizing dominance of CCP to enable the success of reform and turn the CCP into a party of the whole people.

Now, Chinese President Xi Jinping and those under him are risking their lives in carrying out a mass-line campaign that deprives officials of their unauthorized perks and an anti-corruption storm that offends lots of powerful officials and generals in spite of the threat of retaliation they have received.

China does have lots of problems, but with such wise leaders with moral integrity, China will be able to solve them and maintain fast economic growth because those leaders are carrying out Hu Jintao’s Scientific Outlook on Development with putting the people first as its key part.

If CCP really puts the people first, it will allow people to have the democratic right to choose their leaders. As a result, China will not collapse but will conduct further political reform to establish a democracy with Chinese characteristics, i.e. to have a government of the people, by the people and for the people.

It will not be a kind of Western democracy that often produces a government by the people but unable to serve the people due to the incompetence of the leader elected or the obstacles set by the congress that represents various vested interests.

Let’s return to the problem of unemployment. In fact, China’s ambitious construction of infrastructures, including massive land reclamation in the South China Sea, also help maintain people’s employment in various related industries.

Chinese local governments are heavily in debts now. There is prediction that China will collapse due to the debts. However, some of the debts were incurred due to official corruption and pursuit of luxuries. However, most of the debts have been incurred in ambitious infrastructure projects such as railways, roads, power stations and grids, etc. Local governments may raise lots of funds to repay the debts by privatization of some of such assets. Chinese people have lots of savings to invest in the privatized assets.

Source: Chan Kai Yee Tiananmen’s Tremendous Achievements Expanded 2nd Edition

Source: Reuters “China pulls out stops to avoid lay-offs as economy cools”

Full text of Reuters report is available at http://www.reuters.com/article/2015/05/06/us-china-economy-unemployment-idUSKBN0NR0IV20150506


The Agony of China’s Reforms


Few reforms succeeded in China’s thousands years of history mainly due to the agony caused by the reform. Shang Yang’s reform was the greatest. It made the State of Qin strong both economically and militarily and finally able to unify China.

However, due the agony caused by the reform, Shang Yang was cruelly killed by conservatives. Fortunately, in spite of strong conservative opposition, the sovereigns of Qin wisely carried on the reform. Pressure from other powerful states was one of the major factors that forced the sovereigns of Qin to gain the strength through the reform to counter the threat from them, especially its powerful neighbor, the State of Wei to which the State of Qin had lost quite a large part of its territory.

In a sense, Qin should be grateful to those states for the pressure placed on it by them.

The situation is being repeated in China’s current reforms.

Due to the agony caused by the reforms, major reform leaders Hu Yaobang and Zhao Ziyang fell into disgrace.

Due to the agony caused by the reforms, there was mass protest in 1989 that almost overthrew the communist regime.

Jiang Zemin led the new generation of talented intellectuals with moral integrity to exploit the panic caused by the mass protest and carry out a silent peaceful coup d’etat to substitute intellectuals’ dominance of Party and state for uneducated workers’ and peasants dominance. (See my book Tiananmen’s Tremendous Achievements Expanded 2nd Edition). He was thus able to carry on Deng Xiaoping’s reform.

However, the reform seemed to be at a dead end. It seemed that no one knew how to conduct the trickiest reform of China’s state owned enterprises. There were the popular predictions that China will soon collapse so that American Chinese writer Gordon Chang’s book The Coming Collapse of China became a best seller in early 2010s.

I said in my book that Gordon Chang knew China well and his prediction was well founded. He saw the problems China faced at that time, especially the trickiest problem in China’s state-owned sector. No one in the world has ever resolved the problem satisfactorily. The Soviet Union tried to solve the problem by privatization but collapsed as a result.

However, Jiang’s talented assistant Premier Zhu Rongji smoothly carried out the reform of China’s state-owned sector and turned it from a source of huge losses into a lucrative sector.

I said in my book that Gordon Chang failed in his prediction because he underestimated Chinese talents.

While carrying on Jiang’s reforms and economic development, Hu Jintao saw the problem of corruption, pollution and over-reliance on export and investment and put forth the Scientific outlook on development as a remedy. He had to conduct another round of economic reform for thorough economic liberalization, but he was unable to overcome the resistance from vested interests and conservatives.

Hu left Xi Jinping a legacy of rampant corruption, a stagnant economy with overinvestment and excessive local government debts and fierce power struggle between conservatives and reformists.

I have described in my book how Xi launched his anti-corruption storm, put an end to the power struggle and was happy that economic slowdown facilitated his thorough economic reform.

Now, seeing the economic slowdown, quite a few China watchers have predicted the coming collapse of China again. A typical article is Linette Lopez’s “ANALYST: China’s ‘Long-Awaited Day Of Reckoning’ Is Almost Here” at Business Insider (it can be viewed at http://www.businessinsider.com/credit-drying-for-chinas-soes-2015-1).

Ms. Lopez does not know China so well as Gordon Chang. She failed to see the huge assets Chinese central and local governments have for resolution of the debt problems. However, if Xi’s thorough economic reform fails, economic slowdown will be a prolonged reality.

Xi and his assistant Premier Li Keqiang repeatedly said that China’s reform is now in deep water due to the strong resistance of vested interests. The State of Qin successfully carried out Shang Yang’s reform as its sovereigns were able to overcome the resistance from powerful aristocrats. Now, China’s problem is whether Xi and Li are able to overcome the resistance of powerful vested interests. (As described in my book Xi has overcome powerful conservatives’ even greater resistance.)

Xi and Li are now carrying out their thorough reforms step by step smoothly. When Jiang Zemin met Henry Kissinger, he told Kissinger that China needed a strongman and Xi was strong enough. He was happy Xi was the right choice as China’s leader.

Xi has proved himself as a sufficiently strong leader by his mass line campaign and anti-corruption storm. However, according to Chinese history, a leader has to master the art for being the emperor, in which discovery, wise use and creation of bondage with talented assistants is the key for a Chinese emperor’s success. (I have described in my book that China’s current political system is the CCP (Chinese Communist Party) Dynasty with a core like an emperor.)

Only when Xi has found and appointed to high posts his loyal protégés can we be sure he is able to carry out his reforms successfully to make China the richest and strongest nation in the world.

The following is the full text of Reuters report today on China’s economic slowdown:

China’s imports slump, capping dismal January trade performance

China’s trade performance slumped in January, with exports falling 3.3 percent from year-ago levels while imports tumbled 19.9 percent, far worse than analysts had expected and highlighting deepening weakness in the Chinese economy.

Largely as a result of the sharply lower imports – particularly of coal, oil and commodities – China posted a record monthly trade surplus of $60 billion.

The data contrasted sharply with a Reuters poll which showed analysts expected exports to gain 6.3 percent and the slowdown in imports to slow to 3 percent, following a better-than-expected showing in December. The poll had also forecast a trade surplus of $48.9 billion.

The slide in imports is the sharpest since May 2009, when Chinese factories were still slashing inventories in reaction to the global financial crisis. Exports have not produced a negative annual reading since March 2014.

The dismal trade performance will increase concerns that an economic slowdown in China – originally considered a desirable adjustment away from an investment-intensive export model toward one based on domestic consumption – is at risk of derailing.

The government is expected to lower its GDP target to around 7 percent this year, after posting 7.4 percent in 2014 – the slowest pace in 24 years.

Chinese economic indicators in January and February are typically viewed with caution given the distortions caused by the shifting week-long Lunar New Year holiday, and while the analyst median estimate was for a rise, the range of estimates was extremely wide.

However the data – in particular the import data – is worrisome even after accounting for cyclical factors; last year the new year holiday idled factories and financial markets for a week in January, but this year the holiday comes in late February and January was a full month of business as usual.

“It’s a very strange data print,” said Andrew Polk, economist at the Conference Board in Beijing, noting that exports tended to be less effected by the holiday than other indicators, but added he was more concerned by the implications of the startlingly negative import figure.

“The import data suggests a substantial slowdown in the industrial sector. The first quarter looks to be pretty horrible.”

Investors had hoped that the announcement of domestic stimulus spending plans, combined with moves to ease monetary policy, including a reduction in banks’ reserve requirement ratios on Wednesday, would restore confidence and boost demand in China’s struggling manufacturing sector.

However, many analysts believe measures taken so far to boost yuan liquidity are insufficient to do much more than offset surging capital outflows. Advocates of more aggressive action will seize on the weak January trade data to support their case.

Chinese imports have fallen every month since October, seen as reflecting weak domestic demand, and the scale of January’s drop was mostly due to an across-the-board fall in import volumes of major commodities.

For example, coal imports dropped nearly 40 percent to 16.78 million tonnes, down from December’s 27.22 million tonnes, and China also appeared to cut back on its strategic stocking of crude oil imports, which slid by 7.9 percent in volume terms.

Imports from Australia and the Russian Federation, both major fuel and commodity suppliers, slid by 35.3 percent and 28.7 percent, respectively.

EUROPEAN HEADACHE

Chinese officials had predicted that monetary easing measures in Europe would boost demand for Chinese goods, and analysts polled by Reuters had also been optimistic that signs of economic strengthening in the United States would support exports.

However, the data showed that while exports to the United States rose by 4.8 percent year-on-year to $35 billion, exports to the European Union slid 4.6 percent to $33 billion in the same period.

Exports to Hong Kong, South Korea and Japan were also down, with exports to Japan slumping over 20 percent.

During 2014, China’s total trade value increased by 3.4 percent from a year earlier, short of the official target of 7.5 percent, and some analysts have raised questions about whether export data was inflated by fake invoicing as firms speculated in the currency and commodities markets.

Source: Chan Kai Yee Tiananmen’s Tremendous Achievements Expanded 2nd Edition

Source: Reuters “China’s imports slump, capping dismal January trade performance”


Thoroughness, Chinese President Xi Jinping’s Work Style


Yesterday, I reblogged China Daily Mail’s post of Newsweek article “Is This the End of China’s Economic Miracle?” The article points out with insight that the reforms Xi Jinping needs to carry out are not the one or two sweeping changes that Deng initiated more than 35 years ago. They are far more numerous and in some ways far more complicated.

The article says that Xi has launched a tougher than expected crackdown on corruption, projected Chinese power abroad, cracked down viciously on dissidents at home and evoked nationalistic themes and ancient Chinese literature in trying to unite his citizens behind his own “China Dream,” which he defines as “the rejuvenation of the great Chinese nation.”

It says that Xi’s critics believe all of that has obscured the pursuit of reform, which is what the party needs most. They have even drawn unflattering comparisons of him to Mao and the cult of personality he created.

That was similar to people’s failure to understand Xi when Xi conducted his mass-line education campaign soon after he took over the reign instead of conducting a fierce campaign against corruption. At that time, people believed that corruption had to be his priority instead of mass-line education. Some people even thought that Xi was unable to really fight corruption.

I point out in the section “No Cyclone with Respect to Corruption at First”, Chapter 19 of my book Tiananmen’s Tremendous Achievements Expanded 2nd Edition that Fighting corruption is Xi’s first priority, but Xi had “no intention to make widespread national efforts for that soon after he took over. In fact, it is understandable. Xi did not have trustworthy teams of assistants necessary for doing the job.”

Moreover, there was official despotism in most areas. People were afraid of officials and did not dare to expose officials’ despotism and malpractices of formalism, bureaucratism, hedonism and extravagance.

Xi’s mass-line education campaign is in fact what I call “Xi Jinping’s Typhoon of Democratic Supervision” (the subhead of the section on it in Chapter 19). The following is excerpts from the section:

Those are the mistakes that almost everybody from top to bottom has to a certain extent committed; therefore, Xi Jinping calls his campaign an education campaign, i.e. a campaign to educate the officials in order to overcome those mistakes and implement his mass line. It means that all officials shall examine themselves before the masses of people so that it is a campaign that will make them all lose their dignity and face.

Does that work? Can officials really be made to examine and criticize themselves? Will the masses of people come out to expose officials’ mistakes in spite of being scared by officials? The higher officials’ ranks, the more serious their mistakes. Who dare to expose high officials’ mistakes? Take care that there may be retaliation!

Xi Jinping takes the measures Chinese dynasties were accustomed to—sending imperial commissioners. The central authority sent 45 supervision teams to 15 provinces, autonomous regions and municipalities including Beijing, Shanghai, Tianjin, Jiangsu and Zhejiang, 7 ministries and commissions including the National Audit Office, Ministry of Human Resources and Social Security, State-owned Assets Supervision and Administration Commission and National Health and Family Planning Commission and 7 central enterprises including Sinopec and State Grid and key colleges at vice minister-level including Nanjing University to ensure that the mass line education practice campaign will be carried out in an “orderly and effective manner” without being just for show, remaining in words only and or being deviated from the right course.

From the above we can see that Xi Jinping’s mass line education practice campaign is in fact his typhoon of democratic supervision.

It makes us see his super wisdom. Through this campaign, he wants to establish the foundation for eradicating corruption—democratic supervision. He pays attention to each and every aspect of the campaign in his arrangement.

When his mass line education had enabled the general public to conduct democratic supervision, he began his nationwide anti-corruption campaign. I predicted the campaign in my post “Severe Anti-corruption Storm on the Horizon” on August 31, 2013 as follows:

When initial success has been achieved in the mass line education practice campaign in September, a national struggle against corruption will be carried out with the suddenness of a thunderbolt after a harsh verdict is given to Bo Xilai. By that time, the 45 central mass line supervision and guidance teams and 10 Central Corruption Inspection teams are working with full steam and have gained some working experience and established their authority. Xi Jinping will take advantage of the universal awe caused by the severe verdict to switch the teams’ focus onto fighting corruption.

I describe Xi’s secret in turning the anti-corruption campaign into a storm in my book as follows:

Rights are indispensably accompanied with duties
Another clever move in Xi Jinping’s mass line education practice campaign is that he wants to guide the masses of the people to perform their duties of supervision in more actively exposing malpractices, making criticism and putting forward suggestions. In pursuing democracy, people often lay particular stress on people’s rights while neglect their duties. Xi Jinping is wise in advocating that the education campaign will not only grant people the rights of democratic supervision but also teach people to perform their duties of supervision. If in spite of the democratic rights of supervision people have, they have no sense of responsibility to exercise their democratic rights and turn a blind eye to the corruption they personally see, what is the use to have their rights?

Newsweek article wonders whether Chinese people will be patient enough to endure the hardship caused by the economic slowdown before Xi has carried through his reforms to put an end to the slowdown.

The blogger has to point out that like his mass-line education practice campaign that made preparations for his anti-corruption storm, the success of Xi’s fight has been making preparations for Xi’ economic reform. People will have the patience as Xi’s success in his mass-line campaign and anti-corruption storm have made them confident in the success of Xi’s reform. That’s Xi’s work style: making sufficient preparations for what he will do and carrying through to the very end what he is doing.

Readers may find the full text of Newsweek article “Is this the end of China’s economic miracle?” in my post of the same title reblogged from China Daily Mail yesterday.

Source: Chan Kai Yee Tiananmen’s Tremendous Achievements Expanded 2nd Edition

Source: Newsweek “Is This the End of China’s Economic Miracle?”

Related post at tiananmenstremendousachievements.wordpress.com:

  • Severe Anti-corruption Storm on the Horizon dated August 31, 2013
  • China’s Economic Slowdown Is Precisely What Xi Jinping Wants dated November 17, 2014

China Rare Busy Appearances of Retired Top leaders Forebode Something Great?


Retired leader Hu Jintao visits Yuelu Academy. Photo: SCMP

Retired leader Hu Jintao visits Yuelu Academy. Photo: SCMP

I describes China’s faction politics in my book “Tiananmen’s Tremendous Achievements” as follows:

China’s Faction Politics
There are always various factions in CCP, but the establishment and development of factions have become vital for Chinese politicians since Mao’s Cultural Revolution because those who were in a faction with substantial strength suffered less persecution and regained their positions sooner during and after the Cultural Revolution.

As mentioned in Chapter 7, a high-ranking official usually appoints and promotes quite a lot of his people to official posts when he is in power. Those people together with the officials appointed and promoted by them are bound together by comradeship, friendship and common interests and aspiration. They become a faction led by the high-ranking official. When the high-ranking official has retired, he still has his faction under his control and thus becomes an elder with great influence. He will interfere for the interests of his faction whenever possible if necessary.

When it comes to the decisions at a Party Congress on candidates for members of Central Committee, Politburo and its Standing Committee, Central Military Commissions and Party Secretariat and other senior posts, all the retired elders who have been dormant, will come out to take part in the bargaining behind the scene because it affects the balance of strength among various factions and concerns the interest of not only them but also the large number of their faction members.

Just as described in the book, before and during the 18th Party Congress, those dormant elders were quite active and made quite a few appearances, but when there is no such grant event as the Party Congress, they all keep a low profile and seldom appear.

Therefore, it is quite unusually that recently quite a few dormant retired elders were busy making appearance.

The most prominent was former general secretary Hu Jintao. He visited Yuelu College and Hu Yaobang’s former residence respectively on April 9 and 11. Then he toured famous scenery spots Zhangjiajie and Fenghuang Ancient City. Finally on April 17, he visited Guizhou Province he was in charge of before rose to the top.

In my post “China’s Powerful Elder Former President Hu Jintao Came Out to Support Xi Jinping” on April 11, I said, “influential politician’s move must have some political intention.”

Hu’s travel obviously aimed to express his support for Xi Jinping’s mass line and anti-corruption campaigns and ambitious reform. Why?

I said, at Yuelu College, “Hu had a small entourage in accordance with Xi Jinping’s regulations and he refused to write an inscription at despite of repeated requests in accordance with Xi’s instruction that leaders shall not write inscription without central authority’s approval. He finally agreed to give his signature”.

“Therefore, the open support for Xi Jinping’s mass line campaign and anti-corruption storm by Hu Jintao, the head of the powerful Youth League faction with 8 Politburo members, gives a clear message to CYL Faction members that it is no use to complain to Hu when they are the targets of Xi’s campaign and storm. They had better behave themselves.”

Jiang Zemin, the core of CCP (Chinese Communist Party) Dynasty, in addition to his praise of Xi when he met Kissinger, has made three appearances recently: He visited his niece in Shengzhen at the end of March, toured Shouxihu Lake in his hometown Yangzhou on April 19 and visited his cousin in Shanghai on April 22.

His appearances were also regarded as aiming at showing not only his support for Xi but also his good health at the advanced age of 87. It gave the signal that that those who have been touched by Xi’s campaigns had better behave themselves.

However, it seems their appearances were not simply expressing their support. There must be something great being planned, perhaps an important meeting of top leaders and powerful elders on some important issues.

Not only the two top elders respectively being the leaders of the most powerful Shanghai and CYL factions, other retired elders including Wu Bangguo, Jia Qinling, Li Changchun, He Guoqiang have all made recent appearances.

Some analysts believe that they appeared to show support for Xi or that they have not been affected Xi’s campaign, but I would rather believe that they want to show that they are healthy and strong able to take part in the coming great meeting or occasion.

Source: Chan Kai Yee “Tiananmen’s Tremendous Achievements”

Source: SCMP “Jia Qinglin joins growing parade of retired leaders”

Source: World Journal “Elders showed support for Xi Jinping: Jiang Zemin appeared in Shanghai”

Related posts:

  • Top Elder Jiang Zeming Healthy, Vital for Xi’s Success in Reform, Fighting Corruption dated April 24, 2014
  • China’s Powerful Elder Former President Hu Jintao Came Out to Support Xi Jinping dated April 11, 2014
  • News Confirms Xi Jinping Chosen by Jiang Zemin as Successor to Jiang as the Core dated August 30, 2013
  • Jiang Zemin, 86, Shows He Remains the Core by Punishing Bo Xilai dated October 2, 2012