The scale of corruption is significant, with a leaked and as yet unconfirmed People’s Bank of China report stating that between 1994 and 2008 18,000 corrupt officials fled the country, taking with them an estimated US$120 billion in plundered assets. The costs of domestic public order have also rapidly grown, in part over concerns about corruption and the need for weiwen — ‘keeping stability’.

Since late-2012 new President Xi Jinping has intensified the CCP’s fight against corruption, vowing to crack down on both ‘tigers’ and ‘flies’ — corrupt powerful leaders and bureaucrats. So far, the most high-ranking tiger to fall is Bo Xilai, the former Chongqing party chief and member of the elite 25-member Politburo. The fall of Bo became China’s foremost political scandal since the 1989 purge of Zhao Ziyang and eclipsed that of former Minister for Railways Liu Zhijun, who was arrested after the 2011 Wenzhou train collision.

Bo Xilai, the son of one of the ‘Eight Elders’ of the Communist Party, was widely recognised as a promising leader. As part of his ‘Chongqing Model’, Bo launched two campaigns: the ‘sing red’ campaign, which promoted ‘red’ culture; and the ‘strike black’ campaign, Bo and police chief Wang Lijun’s crackdown on organised crime. The latter targeted ‘red-black collusions’ (between officials and gangs) that monopolised markets through violence. From October 2009 to November 2011, 5618 suspects were arrested, including 77 government officials for protecting criminal groups and entrepreneurs.

The strike black campaign was condemned because it used torture and falsified evidence against political enemies as well as criminals. Tong Zhiwei, a leading law scholar, criticised the trials of Chongqing gang members for neglecting due process and discriminating against private businesses. The liberals characterised Bo’s ‘red colour movement’ as a ‘Maoist revival’. Furthermore, Bo’s charismatic leadership style and his close ties to the People’s Liberation Army as well as the party hierarchy presented a challenge to China’s collective leadership system, which discourages ‘cults’ of personality.

The trigger for the scandal was a personal dispute between Bo Xilai and Wang Lijun. In February 2012, after reporting the involvement of Bo’s wife Gu Kailai in the murder of the British businessman Neil Heywood to Bo, Wang was assaulted and threatened. He fled to the US consulate in Chengdu, where he offered evidence implicating Bo’s family in the Heywood murder. His request for political asylum was denied and he was taken into custody by China’s state security ministry. The incident led to an investigation of Bo’s family and associates, and Bo was removed from his party posts soon after.

Gu Kailai admitted to poisoning Heywood at her trial in August 2012, and she received a suspended death sentence. In September 2012, Wang was sentenced to 15 years in prison for bending the law for selfish ends, defection, abuse of power and bribe-taking. A year later, Bo was sentenced to life imprisonment for taking RMB20 million (US$3.3 million) in bribes, embezzlement of RMB5 million (US$817,000) and abuse of power because of his role in covering up the murder of Heywood.

The CCP leadership depicted the case as a simple criminal matter and the People’s Daily, editorialised ‘… the resolute punishment of Bo Xilai according to law has fully shown that there are no exceptions in the face of party discipline and state laws’. Yet the Bo family’s financial associations with the murdered Heywood and the extent of Bo’s corruption remain unclear.

The trial of Bo showed how corrupt officials achieved promotion without fear of investigation. This intertwinement of corruption and promotion originates from China’s bureaucratic culture. Political factions in China usually form around senior officials’ guanxi or inter-personal networks. In a guanxi network, members follow the informal rules of reciprocity and equality. These unspoken rules encourage high-ranking officials to distribute opportunities and promotions among those in their network. Money for power exchanges are normal or even necessary within the guanxi network, but may fall within the sphere of corruption and nepotism when viewed from the criminal law. These unwritten ‘rules of the game’ pose challenges to China’s anti-corruption efforts when enforced by the hybrid ‘party-state’.

Cracking down on corrupt senior government officials requires the government to destroy the guanxi networks that may shield officials from investigation. However, the principle of reciprocity and the essence of mianzi (face) in the guanxi network result in attempts to divert punishment away from the network. So far, tigers caught in the latest anti-corruption crusade have been Xi’s political rivals.

Bo’s downfall suggests that politics in China is as contested as ever. The inner-party factional struggles reflect long-term disputes over how to undertake economic and political reform, and anti-corruption campaigns are vulnerable to manipulation in these power struggles. Bo’s case revealed the extent of the corruption among senior officials but also showed that a centralised approach is needed because local authorities lack the capability to suppress symbiotic and systemic corruption involving elites.

Wen Jiabao criticised Bo Xilai’s ‘singing red and smashing black’ campaign as evocative of the tragedy of the Cultural Revolution. Ironically, Xi has since re-launched the Maoist model of ‘rectification’ (self-purification, self-improvement, self-innovation and self-awareness) to tackle the evils of the ‘Four Winds’ (formalism, bureaucracy, hedonism and waste). However, the ‘masses’ have reacted with ridicule and cynicism, and the cadre with fear of another ‘anti-rightist’ purge.

The question remains, will the current generation of leaders be able to ‘move heavy things as if they were light’ (juzhong ruoqing) and transform China’s political institutions and sustain its extraordinary resurgence? Pressing financial economic reforms foreshadowed in the working report at the Third Plenary Session of the party’s 18th Central Committee (aimed at reducing the distortions in resource allocation to state-owned enterprises and banking risks) are crucial to retaining legitimacy. The growing middle class is no longer played off with assertions of democratic centralism and campaigns against corruption.

Xi may have positioned himself as a ‘tiger-fighting hero’ through the purge of Bo, but tigers are dangerous and stability remains the key priority. Much may depend on how well the sixth-ranked Politburo Standing Committee member Wang Qishan (an experienced finance expert) can manage to transform the Central Commission for Discipline Inspection (CCDI) and improve the transparency of its processes, and with it confidence in the CCP. The secondment of experienced police investigators to assist the CCDI in complex and sensitive cases, such as former politburo member Zhou Yongkang, may presage the strengthening of anti-corruption efforts. An important step would be to strengthen the independence of the courts and procurators by reforming the political–legal committees.

President Xi’s emphasis on the threat of corruption may serve to conceal the real problem the CCP confronts: the failure of the party-state political system in an environment increasingly characterised by economic and social interdependence and opening-up. Elite corruption is a by-product of the CCP’s political system, and anti-corruption acts like a dose of ‘antibiotics’ that maintains short-term solidarity but also leads to resistant strains of bacteria. Weiwen alone will no longer suffice and the solution is to stimulate political reforms initiated from within the government and the party.

Roderic Broadhurst is a professor at the Regulatory Institutions Network, ANU College of Asia & the Pacific.

Peng Wang is a PhD candidate at King’s College, London

An extended discussion of the Bo Xilai case and its implication can be found in a working paper here.