This will be the first plenum of new President Xi Jingping’s time in office.
His two predecessors used this meeting to details the reforms that drove their presidential terms.
The historical precedent has analysts all over the world trying to predict what will come out of the meeting.
President Xi and senior officials have raised hopes by saying this meeting will bring about “unprecedented reforms.”
In the minds of the optimistic observers this means China will finally liberalize its state run monopolies, land ownership and a variety of other “pie in the sky” type hopes that are totally unrealistic.
Less optimistic analysts are pointing to Xi Jingping’s leadership group accelerating relatively minor liberalization of the nation’s interest rates and extending local municipality borrowing powers.
The truth is probably closer to the pessimistic.
Xi Jingping has been seen as a massive reformer since coming to power yet the last six months have also seen concerning reports of his attitude, rhetoric and management style brining back a modern day “Maoism.”
What the new leadership has specialized in is big splashy actions that they claim to be evidence of broad ranging reforms with minimal evidence of macro impacts.
The anti-corruption drive is the most obvious example of this.
President Xi has passed off limiting the amount party officials can eat at banquets, cutting back on official entourages and investigating a few high ranking officials (notably more than a few of whom have been political enemies) as true nationwide progress.
These splashy actions have caught headlines and got people talking about anti-corruption but have avoided real verifiable changes to the systemic abuse of power present in every facet of Chinese public and private sectors.
This plenary session will follow this trend by leading with high profile changes that seem to be brave but mostly shift the deck chairs around.
Some officials will be the sacrificial lambs to the public demand for accountability, some agencies may have to rearrange their power structures but the big stuff will be left largely left alone.
These headline grabbing actions will be paired with minor liberalizations in the economy.
A real test of the outcomes will be how the Chinese leadership handles the growing national debt problem.
China hides a substantial pile of debt at the municipal level and has tied it up into the national banking system.
The bet is that local municipalities will be allowed to offer bonds to pay back the loans and thus reduce pressure on controversial land sales that were the only source of revenue in the past.
The unaddressed problem this will leave is that bonds won’t actually reduce the debt.
At best they will shift the structure of the debt from commercial loans to midterm bonds, at worse they will become a largely unregulated source of money that local government all too focused on boosting short term growth will use to fuel their continued gluttony of spending.
The next few days of meetings are incredibly important for China but the much heralded changes that will be announced will not change the country enough.