Dynasty

Peter Harcher writing in the Sydney Morning Herald  characterizes the protests  rocking Hong Kong as "apparently out of nowhere, China's communist party confronts the most serious test to its authority since it massacred student protesters in Tiananmen Square in 1989."

An upsurge of mass democratic protest in Hong Kong presents Beijing with a choice that will illuminate starkly the very heart of modern China. And Geremie Barme, the director of the Australian Centre on China in the World at ANU, doesn't think it's going to illuminate anything very cheering: "Something unpleasant is going to happen," he says. "Anything like this does touch on the big issues of freedom in China itself; it's very serious indeed."

One telling sign of deep anxiety in Beijing is that it has imposed strict censorship within the mainland on news of the protests in Hong Kong."

But Urs Schotti, the the Far East correspondent of Swiss daily Neue Zurcher Zeitung, says Hong Kong protests are only the latest chapter in the long running Chinese soap opera titled: Who's in Charge of China? Socialism, he astutely observes, is simply a new name for feudalism which is inevitably riven by a crisis of succession to the throne and a rivalry among the great vassals.

In Communist feudalism, as with all other kinds, powerful barons routinely arise to challenge the center.  There is always a threat to the ruling Chinese Communist dynasty from somewhere in that vast country.

First of all, the fundamental task of the party leadership, which on its highest level consists of the seven-member standing committee of the politburo of the CPC, is to ensure the survival of the current Chinese “dynasty”, the dynasty of the Communist Party of China that was established on October 1, 1949.

Ever since the death of chairman Mao Zedong in 1976, China has embarked on a course of collective leadership. ... At present, the country and the CPC are run by members of the fifth leadership generation with president Xi Jinping and prime minister Li Keqiang being most prominent ... if everything goes well, they will get another five years in office.

It is no secret that in the run-up to the change of leadership, there was a power struggle with the charismatic and overly ambitious Bo Xilai, then party chief in the important city of Chongqing, losing out.

Recently the danger came from Chongquing. No sooner had the dynast Xi Jinping met the challenge from the Baron of Chongquing than he had to take on the dukes of the Chinese oil empire. Bo Xilai was a princeling who tried to turn a huge Chinese city into an independent power base by purging his rivals.  No sooner had he succeeded than Bo became the target of a purge from the Party Center when they realized he was becoming too big for his britches.

It is ironic that President Xi Jinping has deployed the Maoist model of ‘rectification’ to revitalise and impose his will over the world’s largest and most powerful political party. This is the model of ‘self-purification’ that Mao applied to instil discipline and consolidate personal power from the early 1940s. It requires tight control of an internal security apparatus, to forcefully extract confessions, and it works by rooting out the patronage networks of perceived rivals. More recently Bo used such stratagems to transform the Communist Party in Chongqing city and build a formidable power base, in ways that are not widely understood. Now Xi is applying the same underlying political logic to establish his own authority across the country, with some important innovations. And he is doing it by purging Bo.

The Politburo Standing Committee then had to take on Zhou Yongkang, who was both China's internal security chief and the leader of its oil empire. He was even more formidable customer than Bo Xilai. Such men controlled billions of dollars in slush funds, commanded  tens of thousand of armed retainers and had proteges in all parts of the bureaucracy. So Zhou and his henchmen had to go down under charges of corruption.  Otherwise the Dynasty would not survive.

Oil executive Jiang Jiemin rose to power in Communist China in time-honored fashion: by hitching his star to a mighty mentor.

In Jiang's case, that patron was another oil man, Zhou Yongkang, who went on to become the chief of China's internal security apparatus and one of the country's most powerful men.

Like Zhou before him, Jiang rose to the top of country’s biggest oil producer, China National Petroleum Corporation. In return, say people familiar with his career, Jiang helped Zhou build power by using the oil giant to dispense patronage. In March last year Jiang ascended even higher, when he was named to run the agency that oversees all of China's biggest state-owned companies.

Which bring us to Hong Kong.

In classic feudalism, a special title and powers were reserved for counts who lived on upon a kingdom's borders. Such nobles were styled marquess because they ruled the marches. "In times past, the distinction between a count and a marquess was that a marquess's land, called a march, was on the border of the country, while a count's land, called a county, often wasn't. Because of this, a marquess was trusted to defend and fortify against potentially hostile neighbors and was thus more important and ranked higher than a count. The title is ranked below duke, which was often restricted to the royal family and those that were held in high enough esteem to be granted such a title."

Hong Kong is China's equivalent of a march. It lies on China's border with the world, not just in the maritime geographical sense, but in terms of interface with the outside world.  As the current capital of China's financial industry, information (which is all money is) has to flow in and out of its computers under more or less the same rules as its correspondent financial markets.  The Hong Kong protesters know finance is their trump card and are leveraging this fact. The protests are designed to disrupt the financial markets. "Hong Kong’s stocks fell to a two-month low, its currency dropped and equity-market volatility surged amid the biggest police crackdown on protesters since the city returned to Chinese rule."

That would quite naturally suit the book of the princes of Shanghai, who aspire to Hong Kong's financial mantle. "A Chief Economist for Deutsche Bank echoed this sentiment suggesting that not only could continued unrest in Hong Kong lead to conflicts with Western financial centers, but a breakdown of openness in the former British colony could also risk Hong Kong losing its role as the primary financial hub to Asia, and perhaps allow Shanghai to wrest this position and bring Asian finance and trade under a stronger umbrella of Chinese control."

But that would only shift the Beijing's problem of the marches from Hong Kong to Shanghai, not solve it.  For as Time Magazine's Michael Schuman points out "on the Chinese side of the border, capital flows are restricted, the banking sector is controlled by the state and regulatory systems are weak and arbitrary. Meanwhile, in Hong Kong, financial regulation is top-notch, capital flows are among the freest in the world, and rule of law is enshrined in a stubbornly independent judicial system."

The reason why the question of who governs Hong Kong is so important is that it determines the objective function.  In Beijing's formula, the Hong Kong residents can elect anyone that Beijing chooses.  What the Hong Kong protesters want is the right to choose the list of candidates.  If Hong Kong wins,  the former colony will be run for the benefit of its financial industry, but if Beijing wins it will become just another fiefdom to loot.

Adrian Wan of the South China Morning Post writes that the ruling Dynasty seems prepared to sacrifice Hong Kong rather than relax its own grip on power. They are ready to send in the troops. "The mainland’s armed police force is ready to help if Hong Kong police cannot control protesters, according to a signed commentary in the Global Times."

“The armed police force is part of the People’s Republic of China’s armed forces, and comes under the national law. Although the Hong Kong Special Administrative Region is protected by the Basic Law, there would not be any legal barriers to let the armed police execute certain tasks in the SAR, if the development [of the protests] worsens,” wrote Wang Qiang, identified as an assistant professor at the Political College of Armed Police Force.

“Without any doubt, the Hong Kong SAR police is a highly efficient law enforcement force. Faced with the mobs’ constant and unrestrained disturbances, it has shown a high level of professional attainments. But if the situation changes, I’m afraid the Hong Kong police will not be able to handle it. At that time, if it gets the assistance from the armed police, the Hong Kong society will get a more reliable protection in restoring stability,” he wrote.

Beijing's behavior not at all unusual in today's world. In every country and continent the elites seem to prefer Ruling in Hell if the alternative is Serving in Heaven. European and American elites, are just like their Chinese counterparts,  bent on pursuing policies that maximize power at the center rather than the growth, prosperity and security of the whole. Feudalism is back.

The Kings are dead. Long live the Kings.


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