'Something big happened in Beijing'

I wrote last week about the removal of the popular Chinese Communist party up and comer Bo Xilai from his post as party boss of Chongqing, and his clashes with the old guard.

Those clashes may now have turned into a power struggle in the leadership of the Chinese Communist party. Isaac Stone Fish writing at FP Passport:

Speculation is rife: A Canadian Chinese news portal quoted Deutsche Welle quoting the Hong Kong newspaper Apple Daily quoting a netizen that a group of citizens unfurled a banner in a main square in Chongqing that said "Party Secretary Bo, We Love and Esteem You," and were subsequently taken away by plain-clothes security forces. A controversial Peking University professor Kong Qingdong, a 73rd generation descendant of Confucius, said on his television show that removing Bo Xilai is similar to "a counter-revolutionary coup;" one news site reported his show has since been suspended.

The Wall Street Journal reports that searching for Bo Xilai's name on Baidu, China's most popular search engine, lacks the standard censorship boilerplate ("according to relevant rules and regulations, a portion of the search results cannot be revealed") that accompanies searching for top leaders like Wen Jiabao and Hu Jintao. A recent search for other Politburo members like Bo rival Wang Yang and People's Liberation Army top general Xu Caihou were similarly uncensored. Conversely, searching for Bo's name on Sina's popular Weibo micro-blogging service now doesn't return any relevant results. A censored fatal Ferrari crash on Sunday night has raised suspicions of elite foul play, possibly realted to Bo. The bannedbook.org reports that Hu and Zhou "are currently fighting for control of China Central Television, Xinhua News (the official Communist Party wire service), and other 'mouthpieces,'" which have been eerily but unsurprisingly taciturn about Bo Xilai.

What we do know, as one message that bounced around Sina Weibo said, is that "something big happened in Beijing."

In a one party dictatorship, there is no smooth transfer of power to the next generation of leaders. The aging Central Committee was set to hand off power to a younger group of leaders later this year. That is now up in the air as it appears possible that the old guard is not quite ready to step aside yet.

For what it's worth, this unsettling news from China has triggered a sharp jump in credit default swaps on Chinese government bonds. Some smart money is betting on big changes coming soon.


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