Tuesday, April 1, 2014

Jiang warns Beijing on graft drive

This short FT article must be read together with the one on Gen Gu Junshan in the NYT.

A couple of years back I told friends that the big problem with China is that the economy, the fastest growing in the world could never grow quickly enough for the rapacious appetite of its corrupt leaders. Besides more and more people climbed on board the train over time creating a situation with too many appetites to satisfy. Then they also cannot resist boasting and comparing the wealth and influence (not direct power) over each other. The rate money is squirreled away accelerates and the masses must eventually suffer. They were working themselves toward an epic train wreck. The only problem is we don't know when and too many people has called for their denouement too soon.

Xi Jinping faces some hard choices. China could not carry so many greedy officials along. Money that is locked up is hard to steal. Cash flows are most vulnerable and that happened when the Chinese opened the tap to full during the 2008 financial crisis. Therefore stop them from spending on luxuries, i.e., stall the flow of cash because these kleptocrats are bleeding China to death in a hurry.

Xi Jinping have no choice. It is either he take down some people or everyone in the leadership would be taken down. Of course everyone is fighting tooth and nail to stay alive. Wonder what weapons and strategies he has against the tigers.

Nothing except the number of corrupt officials will change at the end of this exercise because there are simply too many of them to feed.

Update: April 2 12:15 pm

This is way beyond the pale. How not to prosecute the general? To Gu Junshan this ferreting him out should never have happened and so he is dragging others down the gutter with him especially his boss Xu Caihou who had recently retired from the Politburo. These are Jiang's men, no wonder he is so unhappy.

Update: April 3 10:10 am

An epic power struggle on in China which we cannot affor Xi Jinping to lose. China has never changed and we just need more time to prove it.

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