Is Xi ready to roll out pro-market reforms?

As a judge sentenced him to life in prison yesterday, a smile spread across Bo Xilai’s face. Perhaps he grasped the irony. He’d lost inside the courtroom. At the top levels of China’s leadership, though, his methods have won.

Chinese state media have tried to proclaim Bo’s conviction as a triumph for the rule of law and a powerful blow in the party’s battle against corruption. Editorials have praised President Xi Jinping for his fearlessness. In fact, most Chinese understand that this was a political purge; no more, no less.

Bo’s own brutal anti-corruption campaign as party secretary of the inland city of Chongqing ― one suspect supposedly died after smashing his head into a prison wall ― thoroughly eliminated any potential rivals. But it made him too many friends and too many enemies. His swelling popularity as a corruption-buster irked Xi, while the vested interests Bo had overthrown leapt at the first opportunity for revenge.

Xi’s anti-corruption drive differs from Bo’s only in the degree of head-smashing. As John Garnaut, author of “The Rise and Fall of the House of Bo,” points out, both men eliminated their rivals by going after deputies first, then working their way closer to their intended targets. (Bo’s case broke into the open when his police chief fled to the U.S. consulate in Chengdu and revealed details about the involvement of Bo’s wife in the murder of a British businessman.) Both have sought to portray themselves as champions of the people against deep-seated patronage networks.

Another Chinese leader favored a similar strategy when he felt his grip slipping: Mao Zedong. In the 1960s, he initiated vicious campaigns aimed at rooting out potential enemies, using beatings, false confessions and bogus trials. Two of his victims were Xi’s father and Bo’s father ― both of whom were then vice premiers, and both of whom were jailed and tortured.

One might think that Xi would question the virtue of such targeted campaigns, based on the whim of a charismatic leader rather than institutions and impartial rules. Instead he has gone further with a widespread crackdown on Chinese bloggers and other potential critics.

The most positive spin one can put on all this is that Xi is securing his position before rolling out a series of pro-market reforms at the party meeting in November. In Bo, he has taken down a canny rival whose neo-Maoist supporters might have tried to sabotage the reforms. In theory, Xi can now move with more confidence to reduce the state’s role in a dangerously imbalanced Chinese economy.

Nothing about Bo’s trial or verdict, however, provides cause for such optimism. If the reforms revealed this fall are to be effective, they will have to cause pain across the state sector, which has grown inefficient and corrupt after years of abnormally cheap financing. Premier Li Keqiang has warned cadres that the experience will feel like slitting their wrists. Targeted purges, no matter how tough, won’t get the job done: As long as only certain political families and patronage networks feel the brunt of the state’s wrath, everyone else will simply seek shelter under the protection of the powers-that-be.

Xi and the leadership won’t face many more open challengers like Bo. But the rot eating away at the party’s legitimacy will continue to spread. This verdict demonstrates that Xi can be ruthless with enemies. It will be worth paying attention if and when China’s leader decides to take on his friends.

(Bloomberg)