Domestic Institutional Challenges Facing China's Leadership on the Eve of the 18th Party Congress

Executive Summary

China's institutional weaknesses, often misperceived as strengths, provide the principal challenges to the new, fifth-generation leadership and its ability to execute its policy preferences and meet the growing complexity of state and societal expectations.

Main Argument

Casual observers of China often interpret unexpected Chinese domestic and foreign policy behavior as a sign of China's growing strength. But oftentimes the opposite is the case: such behavior is symptomatic of state weakness in the face of growing and increasingly complex demands. As China convenes its 18th Party Congress and the fifth generation of leaders led by Xi Jinping takes the helm, China faces a number of difficult challenges on multiple fronts. Although these issues can have far-reaching international implications, they are domestic in nature and require China's leaders to adapt state institutions to growing demands from a diverse collection of actors within the state and in society. These challenges include the economic and political restructuring of center-local relations; management of military command and control; the creation of channels to satisfy societal expectations, particularly among the post-1989 generation; and a solution to the escalating crisis in Tibet.

Policy Implications

• • To establish realistic expectations of Chinese capabilities, policymakers should understand and appreciate the degree to which economics and politics have become fused in China.

• • Policymakers should make it difficult for China (or the United States) to terminate military-to-military relations so that both states can engage in a long-term professional and mutually beneficial dialogue at pre-1989 levels.

• • The West should avoid becoming an easy target for a negative variant of Chinese nationalism among the younger demographic by understanding and appreciating the breadth, depth, and dynamism of the Internet in China, instead of focusing on censorship and the "great firewall," which are easily subverted by users in China.

• • The acute Tibet issue differs now from the chronic problems of the past, and resolution of it is imperative for regional stability. A Chinese occupation scenario in Tibet after the passing of the fourteenth Dalai Lama will resemble a situation more akin to contemporary Afghanistan than, for example, postwar Japan.

In spring 1993, I arrived in Beijing after an absence of several months. I immediately noticed some dramatic changes in the landscape: there was virtually no pollution, the surrounding mountains were visible from downtown, light traffic moved at a steady clip, and even the highway dividers seemed to glisten in the bright sunlight. The credulous part of me took over, and I believed that Beijing had turned an important corner in confronting its pollution and traffic problems. I was later informed, however, that the International Olympic Committee was in town that same week to evaluate China's Olympic Games bid and that Beijing had pulled the plug on factory emissions, ordered a traffic-rationing plan, given workers a holiday (as long as they remained indoors and off the street), and had even taken elementary schoolchildren on field trips to apply fresh white paint to the highway dividers in anticipation of the committee visit. Not for the first time or the last, I had been taken in by Beijing's ability to stage-manage reality.

Until only a few months ago, it seems as if the world had settled into a similarly official-controlled narrative of China but on a grander scale: an orderly if opaque leadership transition at the 18th Chinese Communist Party (CCP) Congress slated for the fall, a moderate downturn in economic growth figures, a foreign policy promoting increased commercial engagement between China and the developing world, and a partial smoothing-over of tensions between China and the United States from a few years before. In China, this narrative was even more complacent and uncritical. In a widely read report by Kenneth Lieberthal and Wang Jisi, the latter summarized the conventional wisdom among Chinese foreign policy elites. According to Wang, not only had China disabused itself of the notion that the Washington consensus was infallible, but many Chinese intellectuals and even some leaders were...