Cautious enforcer to be China's next premier

[November 12, 2012]  BEIJING (AP) -- The man in line to oversee China's massive but rapidly slowing economy for the coming decade speaks English and comes from a generation of politicians schooled during a time of greater openness to liberal Western ideas than their predecessors.

But Li Keqiang also has been a cautious bureaucrat who rose through, and is bound by, a consensus-oriented Communist Party that has been slow to reform its massive state-owned enterprises while reflexively stifling dissent -- and he has been an enforcer keeping a lid on bad news.

Li, to be promoted within the leadership's top council after a pivotal party congress closes later this week and expected to take the economy-focused post of premier from outgoing Wen Jiabao next spring, was governor of the agricultural province of Henan in 1998 during an unusual explosion of AIDS cases.

Tens of thousands of people had contracted HIV from illegal blood-buying rings that pooled plasma and re-injected it into donors after removing the blood products. But Beijing hadn't acknowledged the problem yet, and Li oversaw a campaign to squelch reporting about it, harass activists and isolate affected villages.

When the government finally did go public four years later, Li showed canny political instincts with a rapid course reversal, channeling government assistance to victims and making public shows of compassion.

"He just tried to escape from this crisis" at first, said Wan Yanhai, a prominent Chinese AIDS activist who fled to the United States with his family in 2010 following increasing police harassment. "He's probably not a bad guy, but he's not shown himself to be very capable of managing crises in a strong and responsible way."

Li's formative years are typical of the fifth generation of communist leaders. He was introduced to politics during the chaotic 1966-76 Cultural Revolution, then entered the prestigious Peking University. In contrast to the current leadership crop of engineers, Li studied law and economics, during a time of great liberal influence in the party and optimism in China.

After graduation, Li went to work at the Communist Youth League, an organization that grooms university students for party roles, when it was headed by now-President Hu Jintao.

After Beijing erupted in the 1989 pro-democracy protests centered on Tiananmen Square, Li originally tried to build bridges between the league and student activists. However, after martial law was declared, he quickly abandoned such efforts and within four years rose to head of the league at a time when it was becoming irrelevant to young people amid increasing choices and a growing market economy.

Li had been seen as Hu's preferred successor, but the need to balance party factions prompted the leadership to choose a consensus candidate, Xi Jinping, who's expected to take over as party chief after a pivotal party congress ends Wednesday and later as president.

Li's relationship with Xi remains ambiguous, although the two are expected to follow the existing model under which Hu stayed somewhat aloof as head of state while Wen acted as the public face of the administration.

Both are seen as part of a generation of leaders more comfortable with the West than their predecessors, said Ding Xueliang of Hong Kong University of Science and Technology.

"Their reference for great power status from Day One was the United States, unlike Hu Jintao and Wen Jiabao, who looked toward the Soviet Union," Ding said.

After Henan, Li's next posting was in the northeastern rustbelt province of Liaoning, where he oversaw a revival that drew foreign investment from BMW and Intel. One of the province's largest cities, the port of Dalian, even attracted the glitzy World Economic Forum, where global tycoons mixed with top Chinese leaders and captains of industry.

In a U.S. State Department cable released by the Wikileaks organization, Li is quoted telling diplomats that Chinese economic growth statistics were "man-made," and saying he looked instead to electricity demand, rail cargo traffic and lending as more accurate indicators.

Married to an English literature professor, Li and his family have largely steered clear of the webs of corruption surrounding other leading Chinese officials, although questions have been raised over whether his brother's powerful position at the government tobacco monopoly clashes with Li's role in making health policy.

Since his 2007 appointment to the Standing Committee, Li has overseen modest progress in his areas of responsibility, including public health, food safety and housing, which have long been plagued by funding difficulties, lax supervision and soaring prices.

He's maintained a steady, if low-key, schedule of meetings and speeches, with a visit last year to the Chinese autonomous region of Hong Kong attracting the greatest attention -- though not necessarily for the right reasons. The stifling security surrounding him and his unwillingness to meet with political critics seemed to cast him as a typical Chinese leader, tone deaf to public opinion in the former British colony that has maintained its own legal system and political freedoms.

In an April speech to the Boao Forum, a gathering of government officials and business leaders in southern China, Li made the case for structural reform of China's economy, citing the need for greater balance, coordination and stability. China wants to create an "open, transparent, fair, competitive, and predictable marketplace and legal environment," he said.

Yet similar pledges have been made many times before, including in China's latest Five Year Plan, and questions remain about Li's willingness to take on vested interests, particularly in the state-owned enterprises, said Patrick Chovanec, a business professor at Beijing's Tsinghua University.

"It remains to be seen whether Li will come out as a leader, or just follow a weak, watered-down consensus," Chavonec said.

That demand for consensus severely constrains the scope of any administrative reform, even though Li and the party say they are necessary, said U.S. Naval Academy China scholar Yu Maochun.

"You can't change the key parts of China's economic structure without fundamentally changing China's political structure, so I don't expect much" from Li, Yu said.

[Associated Press; By CHRISTOPHER BODEEN]

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