Heart Attack Is No Reason to Disappear in China

Sept. 14 (Bloomberg) -- What does it say about China when the man seen as the next president disappears for 13 days and leadership circles pretend nothing is amiss? The answer is that officials in Beijing still cling to their Kremlin-like ways.

It is one thing for Ethiopia, with $32 billion of output, to be mired in similar intrigue (Prime Minister Meles Zenawi was confirmed dead last month after weeks of rumors and conspiracy theories). It is quite another when it takes place in a country whose economy might surpass the U.S. this decade and whose government has designs on dominating global affairs.

No one will say where Vice President Xi Jinping is. These events should serve as a useful reminder to anyone who thought that as China advances on the global stage, the government would adopt international norms of transparency. Instead, we get fresh reminders of China’s enduring obscurantism, whether in economic statistics or ingredients in food, to the business dealings of the country’s most powerful officials and their families.

Behind the veneer of gleaming skyscrapers, Louis Vuitton shops, late-model Audis and swanky Italian cafes, the heart of Chinese power is still a fear-driven, command-and-control ideology that has more in common with 1970s Soviet Russia than with a consumer-driven 21st-century economy. China is new and flashy on the surface, but underneath it is the Lubyanka and the Gulag, driven by insecurity and paranoia at the top.

Acting Irresponsibly

This latest episode is an exercise in irresponsibility. If Xi has health problems (possibly a heart attack, according to press reports), then tell us. If Xi is fine, tell us. What we are getting now feeds a storyline from a John le Carre Cold War novel or an Alfred Hitchcock movie.

Back in 1993, there was nothing but silence when Li Peng, then China’s premier, had a heart attack and disappeared for six weeks. What if 19 years later China still hasn’t learned that it isn’t the event or deed that causes trouble, but the coverup? When Kim Jong Il, the former “dear leader” of North Korea, disappeared here and there, it was interesting though not very significant. When China’s No. 2 is AWOL, hedge-fund managers get involved.

In recent days, Xi, 59, missed meetings with U.S. Secretary of State Hillary Clinton, Singapore Prime Minister Lee Hsien Loong and other dignitaries. Yesterday, the Communist Party seemed to make efforts to downplay speculation about Xi’s absence. State-run media reported that he joined other top officials in sending condolences to the family of a party member who died on Sept. 6.

“Of course, this doesn’t allay people’s suspicions about whether he will be a physically fit general secretary,” Willy Wo-Lap Lam, an adjunct professor of history at the Chinese University of Hong Kong, told Bloomberg News.

The 10 years under President Hu Jintao have amounted to a great leap backward politically. China’s social compact with its 1.3 billion people is simple: We raise your living standards and you don’t head to Tiananmen Square with protest banners. Yet China’s institutional rigidities have deepened, leaving it ill-equipped to cope when something doesn’t go according to plan or the world shifts beneath its feet.

In such a growth-at-all-costs society, whom do you trust? China wants to become a testing ground for medical companies. Yet the flourishing trade in tainted baby powder and fake medicine gives pause. It wants to sell high-speed trains, cars, aircraft and solar panels to the world. Yet business and finance have to be based on a degree of trust in data, disclosure, the integrity of counterparties and the inviolability of contracts. This is a fundamental flaw in the China model that can’t be papered over.

Seeking Respect

China wants the world to give credence to its territorial claims in Asia. Then it becomes defensive when regional neighbors object to assertions of sovereignty that extend hundreds of miles south from China’s Hainan Island to the equatorial waters off the coast of Borneo.

The transparency time warp is unacceptable for a nation with a permanent United Nations Security Council seat and veto privileges. In 1971, when Lin Biao, then China’s heir apparent, was killed in a plane crash, the Communist Party waited two months to tell everyone. It is one thing for such black-box opacity in the days of Mao Zedong. But in 2012?

Reading from North Korea’s playbook won’t cheer investors. Speculators tend not to make lots of money betting against China. Yet China’s economic influence is advancing infinitely faster than the maturation of its political system.

Now, the world is complicating China’s efforts to maintain the economic momentum needed to avoid social unrest. There’s increasing evidence that China’s 7.6 percent growth will slow further.

Should China end 2012 at today’s pace, it would be the slowest expansion since 1990 and put the onus on Xi and China’s other soon-to-be-named leaders to act quickly and creatively. As the outlook darkens, the world would love to ask Xi for his views on China’s fast-mounting challenges. We just need to find him first.

(William Pesek is a Bloomberg View columnist. The opinions expressed are his own.)

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