One of the things I always tell my smarter students is that the best time for them to be in government is during a crisis, when there is a lot of pressure to give power to the technically proficient rather than the politically connected.Given the increasing anxiety in the leadership about the accelerating economy and inflationary pressures, this may be such a time.Perhaps because policy conflicts seem so deep, there are now rumors that Wang Qishan may be appointed governor of the PBoC and Vice Premier.I am not by any means a political insider and have no idea if these rumors are good ones, but it is worth pointing out that Wang, a protégé of hard man and uber-reformer Zhu Rongji, is reputed to be a smart, tough, problem solver.
One benefit of multiparty parliamentary systems which China doesn't have is that you can blame whatever problems exist on the previous adminstration and whatever pain is needed to fix things, you can also blame on the previous administration. That gives you about a year to basically do whatever you need to do, before you get blamed for things.
China can't do this to extent of multiparty systems, but there is starting to be some of this psychology. Even though the Party stays in power, the fact that there is musical chairs every five years is a good thing.
Yes, the psychology seems to be developing. Outside the party it is difficult top blame your predeccesor for mistakes but within the party I suspect that happens.
Michael Pettis is a professor at Peking University's Guanghua School of Management, where he specializes in Chinese financial markets. He has also taught, from 2002 to 2004, at Tsinghua University’s School of Economics and Management and, from 1992 to 2001, at Columbia University’s Graduate School of Business. He is a member of the board of directors of ABC-CA Fund Management Co., a Sino-French joint venture based in Shanghai.
Pettis has worked on Wall Street in trading, capital markets, and corporate finance since 1987, when he joined the Sovereign Debt trading team at Manufacturers Hanover (now JP Morgan). Most recently, from 1996 to 2001, Pettis worked at Bear Stearns, where he was Managing Director-Principal heading the Latin American Capital Markets and the Liability Management groups. He has also worked as a partner in a merchant banking boutique that specialized in securitizing Latin American assets and at Credit Suisse First Boston, where he headed the emerging markets trading team. Besides trading and capital markets, Pettis has been involved in sovereign advisory work, including for the Mexican government on the privatization of its banking system, the Republic of Macedonia on the restructuring of its international bank debt, and the South Korean Ministry of Finance on the restructuring of the country’s commercial bank debt.
Pettis is a member of the Institute of Latin American Studies Advisory Board at Columbia University as well as the Dean’s Advisory Board at the School of Public and International Affairs. He is the author of several books, including The Volatility Machine: Emerging Economies and the Threat of Financial Collapse (Oxford University Press, 2001). He received an MBA in Finance in 1984 and an MIA in Development Economics in 1981, both from Columbia University.
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Comments (2) for "New leadership?"
- 1/10/2008 8:57 PM
December, 2007