Since December 2015, China’s powerful politburo has met nine times to discuss the economy. The Political Bureau of the Chinese Communist Party Central Committee is a group of 25 top officials who control pretty much everything. The politburo’s smaller Standing Committee is the very top echelon of the Communist Party. Members of the politburo are given top jobs in the official government to carry out political policies.
In the prior eight gatherings devoted to China’s growing economic uncertainty, statements released after each signaled the party’s commitment to what Xi Jinping would later clarify as “high-quality” growth. At the 19th Party convention last fall, Xi would first etch his name in the Communist constitution before speaking forthrightly about “rejuvenation”; a term that recognized this shift in priorities.
China of the second decade of the 21st century would be unlike China in the first decade. Then, growth at all costs was the ultimate goal, though for reasons that Chinese Communists most likely will never admit publicly (having to do with their quiet assessment as to why the Soviet Union ultimately failed).
This new stage was to be “quality” growth, which represented something very different. In each of those prior eight Politburo statements, there’s was an economy “stable with good momentum.” If China had been seeking growth at any cost, that came with it an often terrible social cost.
These were, as described in December 2015, financial risks (bubbles), poverty alleviation (the old balance), and pollution. This new China had to find a way to address the first and third without giving up totally on the second.
The timing wasn’t an accident. China’s slowdown which began the year before was judged (quite correctly) a permanent condition. Despite Janet Yellen’s insistence on “transitory” factors, the Chinese leadership was no longer buying it. They foresaw a global economic “L”, not a “V.”
