China has entered a new era, where the communist party has changed its contract with the people, says economist Arthur Kroeber, according to Bloomberg. The new iteration? It’s called values-based legitimacy.
Bloomberg:
China’s recent economic performance and policymaking have prompted a slew of economists—Bloomberg’s included—to lower their estimates of the country’s trend growth rate for coming years. But don’t count on this to undermine the Chinese Communist Party’s grip.For decades, the CCP encouraged the idea that its legitimacy flowed in large part from stoking rapid growth. Deng Xiaoping, the Chinese leader famous for his “reform and opening up” mantra, declared that development is the “hard principle” driving policy. Year after year, China’s leaders have touted GDP figures showing how the party was delivering on this mandate.
Go back further than Deng and you’ll find a different contract between Beijing and its people. Mao Zedong’s initial version was ensuring the common people won the “class struggle” against land-owners and businesspeople (in part through mass killings).
These days, Xi is writing up another contract, says Arthur Kroeber, a China economist and founding partner at Gavekal Dragonomics. In a recent lecture, he said “there’s a fairly extensive propaganda effort going on to shift away from that old social contract,” in part to avert mass criticism of a slowdown in Chinese growth.
The new iteration? It’s called values-based legitimacy.
What are the components of this new contract? They include culture, history, nationalism and an anti-corruption drive aimed at easing concerns about rising inequality.
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