Thursday, October 02, 2003

Kunchin Lin has agreed to be named in these discussions (thank you KC). He recently sent me this question:

Yeah, well, we know that "intra-party democracy" is
likely a means to the end of political struggle
between Hu and Jiang. So Victor, according to your
argument in dissertation, both Hu and Jiang are
"Party" factions that shouldn't affect banking
decisions and main policy
(decentralization-recentralization) directions right?

and my answer was:

Okay, I know I am not supposed to make exceptions to an argument, but here I am. I think that on average, there are these two tendencies in the Party with respect to monetary policies. But things go a bit crazy when there is intense factional struggle. For example, when Deng was fighting Hua, he cooperated with Chen Yun until Hua was completely defeated. Then, Deng and Chen returned to their fight over monetary centralization. I think the intense struggle between Hu and Jiang now is causing the formation of another temporary alliance between Hu and Wen. In these sorts of alliance, the Party leader basically receives political support from the technocrat in exchange for support for more centralization policies. My prediction is that once Jiang (or Hu) is defeated, there will be more tension between Wen and the survivor on the Party side.

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