When Hu Jintao and Wen Jiabao assumed power in 2002, they immediately put a new populist and egalitarian spin on Chinese policy pronouncements. To the surprise of many, they then followed through with a systematic reorientation of economic policy in a "left" direction. Policy has shifted away from growth at all costs, and toward policies that favor regional redistribution, reduce urban bias and support rural development. Budget allocations for health and education have increased, and the commitment to the environment has been stepped up.

So far, these policies can be characterized as moderate and overdue efforts to address problems that emerged in the course of rapid economic growth. But there is implicit tension with pro-growth policies. Politically, Hu and Wen's policies balanced those of Jiang Zemin's coalition of "winners." At the 17th Party Congress in 2007, Hu will attempt to consolidate his power and redefine the policy direction.

Barry Naughton teaches at the Graduate School of International Relations and Pacific Studies at the University of California, San Diego. His new book The Chinese Economy: Transitions and Growth. was published by MIT Press this year. He received his Ph.D. in economics and M.A. in international relations from Yale University and holds a B.A. in Chinese language and literature from University of Washington.

This talk is part of the "China's Year of Decision" colloquium series sponsored with the Center for East Asian Studies