Can China change?

China’s ruling Communist party faces a strategic dilemma: the regime needs economic reform to maintain the growth that sustains its performance-based legitimacy. But party leaders recognize that changes won’t materialize without political reforms that could ultimately undermine its monopoly on power.

In any event, the status quo is unsustainable.

“The sense of fragility in China right now is almost palpable,” says a leading analyst. “There’s the sense that it has been defying gravity for a long time.”

But old habits die hard.

The country’s Justice Ministry today ordered lawyers to take a loyalty oath to the Communist Party, in an unprecedented move that appears to be aimed at human rights advocates, but which will also undermine prospects for consolidating the rule of law needed to underpin economic reform.

To maintain current growth trends, China must “revive economic reform and start political change,” says Minxin Pei, an analyst at Claremont McKenna College. But the party lacks a consensus on reform strategy, as the inner-party divisions evident in the recent ouster of neo-Maoist Bo Xilai demonstrates.

“The rift is over power, not necessarily over ideology,” Pei tells the Council on Foreign Relations. “From the party’s point of view, they want unity.”

China’s current economic system is not sustainable, according to a recent World Bank report, in the latest indication that the luster of the China model is fading.

“The case for reform is compelling,” the bank’s president, Robert Zoellick, said recently. “China has reached a turning point in its development path.”

But the country’s wealthy elite is not convinced that the ruling party is able to implement the required reforms, judging by recent surveys that large numbers of the rich want to emigrate to the decadent West.

“Right now, there is a feeling of an exhaustion of hope,” said Andrew Nathan, a China specialist at Columbia University.

The ruling party is confronting both top-down and bottom-up challenges that pose a threat to the post-Mao consensus, notes one analyst.

“Post-Mao, China has instead built a meritocratic collective leadership that rules by consensus…. There is even a place, up to a point, for public opinion,” notes the FT’s David Pilling:

The Communist party leadership is highly sensitive to criticism, these days voiced mainly in cyberspace, whether it be related to corruption, pollution, incompetence or inequality. Sometimes it chooses to crush dissent, certainly when it challenges the legitimacy of the party itself. But in other instances – for example, anger over a petrochemical plant in Dalian or a train crash in Wenzhou – it can be surprisingly receptive to public outrage.

But the party is also being challenged by an increasingly vocal and rights-conscious middle class prepared to expose and protest against endemic regime corruption, as in Wukan.

“These are just some of the pressures that the party faces as it tries to negotiate a once-in-a-decade political transition and a once-in-a-generation economic elision from an investment-led to a consumption-led model,” Pilling notes. “Bo’s great crime was to expose the illusion of party unity in the face of such momentous challenges.”

Today’s decision to require lawyers to take a loyalty oath to the ruling party reflects an attempt by the regime to reinforce its authority, but also betrays its realization that it does not command the authority that emanates automatically from moral or political legitimacy.

The oath demands that lawyers “pledge to faithfully fulfill the sacred mission of a legal worker under the socialist system with Chinese characteristics” and to “be loyal to the motherland, loyal to the people, uphold the leadership of the Chinese Communist Party and the socialist system.”

“It is ridiculous for such a thing to occur in modern society,” said Jiang Tianyong, a rights lawyer detained by state security last year. “It’s unimaginable that any other country would like to ask lawyers to pledge allegiance to a party. Lawyers should respect laws and uphold the rights of their clients,” said Jiang, who advocates for AIDS activists and freedom of worship.

A newly revised Criminal Procedure Law may be “a significant step forward” in extending rule of law “if its provisions are implemented in practice,” writes Stanley Lubman, a specialist on Chinese law and is author of “Bird in a Cage: Legal Reform in China After Mao,” (Stanford University Press, 1999).

But the law remains subject to politically-driven interference and arbitrariness, he notes, citing human rights researcher Nicholas Bequelin’s observation that government officials use vaguely defined offenses like “endangering state security” or “terrorism” in order “to crackdown on dissidents, human-rights lawyers, civil-society activists and Tibetan and Uighur separatists.”

The new oath requirement is designed to undermine the growing network of activist lawyers, but it also threatens to undermine rule of law.

“I don’t see the legal basis for adding these procedures. On what basis is the ministry of justice doing this?” said Pu Zhiqiang, a Beijing-based lawyer and rights advocate. “If I don’t take the oath, are you not going to give me a license?”

“In my opinion, the biggest destroyer of the rule of law in China is the Communist party,” he said.

The oath demand also suggests a regime unsure of its own legitimacy and the much-vaunted China’s model’s longevity, analysts suggest.

 “The elite, who almost by definition are politically connected, are uneasy and have questions about the system’s sustainability,” says Thomas Fingar, a China specialist at Stanford University who formerly served as chairman of the National Intelligence Council.

China’s imminent implosion? Heard it all before, says China watcher Gideon Rachman:

In 2003, I purchased a much-acclaimed book, Gordon Chang’s, The Coming Collapse of China – which predicted that the Chinese miracle had five years to run, at most. So now, when I read that China’s banks are near collapse, that the countryside is in a ferment of unrest, that the cities are on the brink of environmental disaster and that the middle-classes are in revolt, I am tempted to yawn and turn the page.

Prime Minister Wen Jiabao last week urged the party to take the path of political reform, but his leadership colleagues appear paralyzed by the prospect of a scenario recently raised by Tsinghua University sociologist Sun Liping: “During the process of social transition, how can we avoid the emergence of serious social disorder?”

Bo Xilai’s dismissal “has clarified the strategic choices facing the party,” writes Minxin Pei. “One is to stay the course, maintaining one-party rule and trying to sustain economic growth under the state-capitalist model. The other is to revive reform, not just economic reform but also democratization:”

The first path seems increasingly untenable. One reason Bo’s leftist populism had so much appeal was not that ordinary Chinese people were yearning for a return to the dark Maoist era, but that they were fed up with the status quo…… If the party’s new leadership doesn’t alter the country’s present course, such frustrations will continue to grow and create opportunities for ambitious politicians like Bo to exploit in seeking power. The difference is, of course, when such opportunities occur in the future, people like Bo could be leading a radicalized opposition with mass popular followings – a nightmarish scenario the Communist Party should do everything to avoid.

The regime may be facing profound challenges, but not necessarily a terminal crisis.

“I agree that China is a cauldron of turmoil and dissatisfaction,” says Nathan, a National Endowment for Democracy board member. “And I don’t see the current system as forever. But I also don’t see an imminent collapse.”

On the other hand, China’s rise as a growing global power is threatened by its failure to reform, says Pei:

Because if China doesn’t do anything, if it simply coasts along, as the World Bank report has warned, China’s growth is not sustainable. That means the current political system will not be sustainable. There will be no social stability in China either. For China, reviving reform, not just economic, but also political, is its most urgent task.

“China has very difficult political and economic transitions ahead,” notes Rachman, author of Zero-Sum World. But while Beijing can learn from the “encouraging precedents” of South Korea and Taiwan, which “both moved from fairly brutal one-party states to functioning democracies – and from low-cost manufacturing to high-tech consumerism,” it faces distinctive challenges of its own;

The sheer scale of China – and its uniquely traumatic history – will make the country’s political and economic transformation that much harder. In particular, if China were to move towards free elections, it would almost certainly see the rise of separatist movements in Tibet and Xinjiang. Given the depth of Chinese nationalism, it is unlikely that these would be treated with subtlety or sensitivity. As well as struggling to preserve the country’s territorial integrity, a more democratic China would find itself coping with all sorts of barely-suppressed social tensions.

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