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Wen Pledges to Curb Graft, Income Inequality as Police Head Off Protests

Chinese Premier Wen Jiabao pledged to punish abuse of power by officials and narrow the growing wealth gap as police blanketed Beijing and Shanghai to head off planned protests inspired by revolts in the Middle East.

The root of corruption lies in a government that has too much unrestrained power, Wen said in a two-hour online interview with citizens yesterday. He promised to curtail food costs and tackle surging property prices. Wen also cut economic growth targets and said the government would focus on ensuring the benefits of expansion were more evenly distributed.

Wen’s comments came as hundreds of police deployed in Beijing and Shanghai at the sites of demonstrations called to protest corruption and misrule. At least seven people were bundled into police vans near Shanghai’s People’s Square, while in Beijing several foreign journalists were forcibly removed from the Wangfujing shopping district.

China’s leaders have emphasized the country’s economic successes in their response to demonstrations both in China and in the Middle East. While the country’s economy has expanded more than 90-fold in the past three decades, Wen said rising inequality is threatening social stability.

“The party leadership needs to reassure the people that in the absence of political reform they can nonetheless meet the people’s rising expectations,” said Chinese University of Hong Kong’s adjunct professor of history Willy Wo-lap Lam. “The expectation for what the government should do for the people has increased” as a result of protests sweeping Arab nations.

‘Deeply Disturbing’

Unrest in China is on the rise. “Mass incidents,” everything from strikes to riots and demonstrations, doubled from 2006, rising to at least 180,000 cases in 2010, Sun Liping, a professor of sociology at Beijing’s Tsinghua University, the nation’s top academic institution, said in a Feb. 25 article in the Economic Observer.

U.S. Ambassador Jon Huntsman said in a statement today that foreign journalists had been “illegally detained or harassed as they attempted to do their jobs” and that this type of behavior was “unacceptable and deeply disturbing.”

The government has set an annual economic growth target of 7 percent for the five-year period through 2015, Wen said. China’s target was 7.5 percent for the period from 2006 through last year, with actual growth exceeding that each year.

Quality Growth

“The new five-year plan will be more about quality of growth,” said Kevin Lai, a Hong Kong-based economist at Daiwa Capital Markets. “The government is going to pay more attention to sustainable growth, environment, better distribution of income, rather than pure GDP pursuit.”

An August report by Zurich-based Credit Suisse AG put income inequality in China at levels not seen outside of sub- Saharan Africa. High food prices, unemployment and anger over corruption helped spark the protests that toppled Tunisian President Zine El Abidine Ben Ali, Egypt’s Hosni Mubarak and have fueled rebellion against Libya’s Muammar Qaddafi.

Oil prices in New York have surged on concern the unrest will continue to spread, disrupting supplies. Crude for April delivery rose as much as 5.4 percent to $103.41 a barrel on Feb. 24, the highest intraday price since September 2008. Libya is the largest holder of oil reserves in Africa.

“China is a rich country, yet food prices are sky high,” said a 23-year-old university student in Shanghai who declined to be identified because he feared arrest. “We can’t afford to buy property, yet all the corrupt officials gamble our money away in Las Vegas.”

Fight Corruption

An open letter on the U.S.-based website Boxun.com called for people to gather in at least 27 sites around the country yesterday from Tibet to Manchuria for “jasmine” rallies, named after the uprising last month in Tunisia. “Come out and take a stroll at two o’clock on Sundays to look around,” the letter said.

The letter called for the ruling Communist Party to fight corruption, create an independent judiciary and reduce income inequality or else “exit the stage of history.” The letter said economic booms in Taiwan and South Korea were accomplished with much more equitable income levels.

In Shanghai yesterday, at least 23 police vehicles were stationed around Shanghai’s Peace Cinema in the shopping area of People’s Square. Police in Beijing, which included paramilitary units and patrols with Rottweiler and German Shepherd dogs, forcibly removed several foreign journalists from Wangfujing Street at about 2:45 p.m. Police were stationed at every entrance to Wangfujing today.

Protest Sites

The street, most of which is closed to vehicle traffic and is one of Beijing’s busiest shopping districts, did not appear more crowded than on a usual Sunday. No demonstrators were seen.

“You see how the police try to control the crowd? They spend so many resources on this, yet why does the government do so little to improve people’s livelihoods?” said a 72-year-old retired car mechanic in Shanghai, who didn’t want to be named because he feared being detained.

The China rallies were first called for Feb. 20. That day, scores of Chinese police gathered at the protest sites, which included a Beijing McDonald’s Corp. restaurant, to quell demonstrations. Hundreds of people were present at the rally, though only a handful actively participated, the Associated Press reported at the time.

On the corner of Jinyu Hutong and Wangfujing Streets, police officers yesterday asked for passports of people who appeared foreign. Journalists were asked to show their press cards and their information was taken down in a notebook and they were reminded about the rules on interviews.

Jasmine Notions ‘Absurd’

Zhao Qizheng, who heads the foreign affairs committee of the Chinese People’s Consultative Conference, said the idea that there would be a Jasmine Revolution in China was “absurd,” Xinhua reported on Feb. 24.

The government’s reaction reflects its decades-long effort to keep unrest in check through a combination of economic growth, social reforms and political repression, said Nicholas Bequelin, a China researcher for Human Rights Watch in Hong Kong.

“One of the key aspects of the Chinese system is that it does not try to suppress social demands as much as to respond to them before they turn into political ones,” Bequelin said. “Everyday politics is about how to handle social demands -- which ones to accept, which ones to channel, which ones to suppress, which ones can be ignored.”

To contact the Bloomberg staff on this story: Bruce Grant in Hong Kong at bruceg@bloomberg.net

To contact the editor responsible for this story: Bruce Grant in Hong Kong at bruceg@bloomberg.net

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