On 1 July the Standing Committee of the Chinese National People's Congress passed a new national security law. The draft summarises all kinds of domestic and international risks, and the text was kept vague, inviting international analysts to presume a legal basis for more international assertiveness by Beijing.

But the timing, broad-brush content and assertion of Party control hint at the fact that domestic purposes were the main rationale behind the document. More precisely, in view of power shifts between factions and institutions in the recent past, the Communist Party has attempted to strengthen the central role of the president in the security sector. At the same time, the leadership anticipates greater social problems and instability. The slowdown of economic development and necessary structural reforms will increase social hardship.

When facing challenges to internal stability, it has almost become a tradition in China to wall the country in and keep foreign ideas out, and this document is no exception. But by putting regime stability ahead of social development, the Party is putting at risk China's transformation towards a knowledge society and innovation-based economy.

Why is this happening now?

When the fifth leadership generation came to power under President Xi it inherited a difficult situation. During the past 20 years, economic growth of over 9% was believed to be the threshold to guarantee social stability. Earlier this year the party corrected the target down to 7.5%. Factors weighing on China's economy include hidden public debt, an unbalanced finance system, rising production costs, environmental costs, and low levels of innovation. Moreover, pending reforms will bring increasing hardship, particularly to the poorly educated elements of the labour force. 

As well as these policy challenges, Xi's leadership faced political challenges in the form of an alternative power centre, the same one that hamstrung President Hu Jintao during the second half of his tenure. The imprisonment on corruption charges of former public security tsar Zhou Yongkang brought to an end one high-level power struggle. But the largest chunk of work is yet to come. The adoption of the new national security law heralds phase 2 in the consolidation of Xi's leadership.

The document clearly re-emphasises the traditional power structure of the one-party system. Articles 31 and 32 of chapter 3 in particular focus on the central role of the president. Why is reestablishing the primacy of the party and president so important?

During Zhou Yongkang's time as a member of the Politburo, he headed the Political and Legal Affairs Commission including its sub-commission on counter-terrorism, which became the single most powerful body in China's public security system. Due to its coordination powers among the security agencies, Zhou wove a nationwide web that strengthened the power of the public security apparatus.

In the lead-up to the 2008 Beijing Olympics, considerable efforts were made to strengthen China's counter-terrorism apparatus. Besides inter-agency cooperation and modern surveillance equipment, old socialist grassroots control structures were revived. After the 2009 Xinjiang unrest, Zhou saw his chance. Xi Jinping, who was then vice-president and in charge of the military and police while President Hu attended a G8 summit in Italy, failed to respond to the situation on the ground. So in the aftermath, Zhou cemented his power with his masterstroke: the Social Management Campaign (shihui jingli). It promised great things in the public security sector such as greater closeness to citizens and communities, greater transparency and efficiency in administration, and working-level innovation. In fact, it solidified the influence of the public security apparatus and gave it the upper hand over party leaders at the grassroots level.

The new law is an attempt by the party to take back some of the control it lost to the security sector. The law is not specific about the Party entities that are supposed to be in charge of its implementation, but the key fact is that the Party's powers far exceed those of state institutions.

The goal is to regain control at any cost, and as such the Party's approach ignores social and economic development. It puts at risk freedoms that were already achieved in the media and civil society, thus targeting parts of society which have learned to express social needs and conflicts but which have the same interest in stability as the Party. Stricter control of information and the public sphere will also disaffect educated strata with international experience and lead to another brain-drain. Restrictions on the exchange of ideas and information, and an inward-looking China, will hamper the development of an innovation-based economy.

Most seriously, the generation gap with those born in the 1990s will widen immensely. Whereas it was possible to satisfy previous generation with material gains and economic opportunities, the Party faces a new generation that is increasingly basing its worldview and social values on ideas. The Party risks losing the open-minded and informed generation that is crucial for its development.

Photo by Flickr user Shawn Clover.