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The World’s Most Indispensable Man

Xi Jinping
China's President Xi Jinping.
Photo by U.S. Navy Petty Officer 1st Class Dominique A. Pineiro, courtesy the Chairman of the Joint Chiefs of Staff.

Politicians who accumulate unrivaled and unchecked power usually refuse to give it up; they often assert – and some may truly believe – that they are indispensable.

As leader of the world’s most populous nation and one of its fastest-growing (and already second-largest) economies, Chinese strongman Xi Jinping is getting ready to declare himself the most indispensable man of all. Apart from a few brave souls who are prepared to risk disappearing into the black hole of China’s justice system, hardly anyone within reach of Xi and his secret police is likely to argue with him.

Although the writing has been on the wall for some time, two surprise moves 48 hours apart have made Xi’s intentions crystal clear. First, Chinese regulators last week seized Anbang Insurance Group Company Inc. The company’s chief executive officer, Wu Xiaohui, had already been held incommunicado on unspecified charges for some eight months. Then, on Sunday, the Communist Party that Xi heads announced that it would propose a constitutional amendment that would allow Xi to continue in office as China’s president after his second five-year term expires in 2023. While the country’s legislature technically still needs to ratify the change, the state of Chinese politics is such that there is no real question over whether it will do so.

Since first taking power in 2012, Xi has used an ongoing anti-corruption drive to systematically remove potential rivals from positions where they could challenge or even succeed him. Last year’s party congress departed from customary practice of the past few decades by failing to promote an heir apparent to the leader who was being granted a constitutionally final term. And while the presidency wields no executive powers, it seems certain that by signaling his plans to stay on as president, Xi is signaling that he plans to retain his position as the Communist Party’s general secretary as well. The party does not impose term limits on this position, though traditionally leaders have not accepted new terms after age 68; Xi will be 69 in 2022, the start of his likely third term as general secretary.

As is often the case with government action in China, the legal and policy basis for the move against Anbang is unclear. The Beijing government has been transparent enough about wanting to constrain the excessive and fast-growing levels of debt in the country’s economy, and to limit the expansion of risky investment products being sold to Chinese households and businesses. Anbang could easily have gotten on the wrong side of regulators on either or both points. The government action against the real estate and financial conglomerate – taking control of the company’s management for what is supposed to be a one-year period, before returning it to unspecified private hands – is unprecedented and unexplained, but not necessarily unwarranted.

Wu’s treatment is another matter entirely. It was only when his company was seized that the government indicated he has already been prosecuted – using the past tense. The nature and outcome of such prosecution was not detailed, nor were any further charges. But given the history of Chinese justice, it is fair to expect that the next time Wu is seen in public, assuming he is ever seen at all, it will be to make a widely advertised confession and apology for whatever offense the government says he committed.

Not to be forgotten in this picture is that Wu is married to the granddaughter of Deng Xiaoping, the most revered Chinese Communist leader next to Mao Zedong. Deng and Mao form the pantheon of party leaders to which Xi is busy elevating himself. So while Anbang may or may not have been one of China’s most pressing regulatory problems, its CEO’s domestic connections and increasing economic clout (and, not incidentally, his growing contact with foreign leaders) likely made him a domestic political threat that Xi could not abide.

It was Deng who instituted the policy of Chinese leaders voluntarily passing their power to successors. He had suffered in the internecine fighting that marked the later years of Mao’s rule, and wanted to head off future battles that could sunder party unity and threaten the Communists’ grip on Chinese power altogether. Now Xi seems intent on rolling back the clock to a time when one man spoke and all of China listened.

The graveyards, as they say, are full of indispensable men. Xi’s swagger can only end in one place, but what happens along the way remains to be seen. It usually isn’t anything good.

Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s most recent book, The High Achiever’s Guide To Wealth. His contributions include Chapter 1, “Anyone Can Achieve Wealth,” and Chapter 19, “Assisting Aging Parents.” Larry was also among the authors of the firm’s previous book, Looking Ahead: Life, Family, Wealth and Business After 55.

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