Because they exhausted all the demographic dividend of China. During their charge, the corruption was rampant, their silence feed those guys like Zhou Youngkang. The land finance brought huge fiscal revenue but making people's living cost higher. At that time, the whole Chinese governments were selling lands as crazy as hell, the boom of real estate makes GDP looking better, everyone is investing in real estate, they didn't do the real business like factory or trade, people and organizations from the private to SOEs, all crazy falling in speculation. We all know the real forces behind GDP growth should be innovation, the upgrade of industries, because they can generate employment, to really elevate general welfare. Hu and Wen were to blame, they indulged this.
Xi has only done one thing - to reduce the corruption. True, because this is the only thing he could do at this time around. I thought I had explained this before, like I said, the demographic dividend is over, thanks to Hu and Wen, the local government debt can't be endured any longer, the red line is approaching. Many provinces are issuing new debts to repay the old debt. The old pattern of stimulation growth, like 4 trillion investment plan, isn't persistent any more, it could only make the debt burden heavier, plus the labor cost is higher, the output of traditional industry is too low. You know the effect of diminishing marginal benefit, any further investment in the old pattern couldn't yield the same benefit like before. For example, you raw material factories produced too much concrete and steels, but the cost of investment hasn't received the expected return, because government policy cools the real estate market down, so as an investor, would you go on? Of course not, so there is a gap, the chain is broken, so there is over capacity of production. So Xi suggested trans-Eurasian railway investment, and Asia development bank, to provide infrastructure investment to other countries, not only for them, but good for China, to export the over capacity production, to save Chinese business....It's too early to say Xi has only done one thing. China is still amid the mid stage of industrialization, innovation has less important contribution to the real economy growth. China is facing a serious and deep structural adjustment, with the cost of stagnant PMI and labor shortage. Time is different, so the method should adapt to the new changes. All I can see Xi is doing is to clean the mess of his predecessor. You still underestimated the corruption, it exists in any field of such authority system, it could affect any good policy's application, only a thorough clean could diminish the consequences.
I agree with the second. But China is basically a centralized country based on elites throughout the history. I'm wondering if a westernized administration will suit this land and continue bring about development.
True. China has been what it looks like now for centuries, the centralized elite governance. Can't say it's good or bad now. Rule 2 is the basis of Rule 1 and 3. As for rule 1, the general election from top down is unlikely to happen at least before the mid of this century. I think we could expect elections for county level government leaders in about 30 years from now.
