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The Bo Xilai affair will surely increase pressure on the party leadership to restore its tarnished reputation and deliver more of what most Chinese might regard as progress

What's happening in China? That's about the most interesting question on the planet just now, and the most difficult to answer.

The officially acknowledged or otherwise plausibly attested facts of the Bo Xilai affair are worthy of a political thriller. But its deeper causes go to the heart of the weird system of Leninist capitalism that has emerged in China over the past 30 years. Its possible consequences for change in that system will do more to shape the 21st-century world than anything currently happening in Washington, Moscow, New Delhi or Brussels. Behind the walls of the Communist Party leadership compound, the ghost of Hegel has somehow got mixed up with that of Robert Ludlum.

I don't know what's going on inside those walls. But outside, there's a clear pattern. Every conversation I have in Beijing turns to Bo, Bo, Bo. How did his son Bo Guagua get into Oxford and Harvard? Was the mysteriously deceased British businessman Neil Heywood a spy? Was Madame Bo, a.k.a. Gu Kailai, having an affair with him?

Then people start telling you things. Multiple sources, for example, confirm there was, indeed, an armed standoff outside the U.S. consulate in Chengdu, where former Chongqing chief enforcer Wang Lijun had sought asylum. Paramilitary forces sent by Bo Xilai from Chongqing, to snatch him back to an unpleasant fate, faced off against security forces summoned, with U.S. help, from Beijing. Talk about fact outdoing fiction.

But if ordinary Chinese netizens search for the family name Bo on the popular microblogging site Sina Weibo, they'll find this message: "In accordance with relevant laws, rules and policies, the search results for Bo are not shown here." The official media are full of exhortations to national, social and ideological stability, under the party's wise leadership. Those Bos were just two rotten apples in an otherwise healthy orchard. Now they'll face the full and famously impartial rigour of China's rule of law.

A reassuring article from the official Xinhua news agency, prominently published in the English-language China Daily, reports that "Chongqing municipal police have vowed better protection of foreigners" after Mr. Heywood's death – a likely homicide, it adds, for which Madame Bo and one Zhang Xiaojun, "an orderly at Bo's home," are suspects. But worry not, for in 2010 only 1.5 people per 10,000 visitors reported being victimized in the megacity. And the forces of order were swiftly to hand. "In October, for example, police recovered a Nikon camera stolen from a Zimbabwean student in one day, according to the municipal public security bureau." So have no fear, visiting British businessmen. Not only won't you be murdered at the behest of a Politburo member's wife, the police will get your camera back.

Beside this lurid conversation, there's a far more consequential one going on. But the two are connected. It's possible that such a horrible crime, if that's what it was, would have led to the fall of Mr. Bo anyway. But what's certain is that this has played out in the context of factional and ideological competition within the Chinese party-state-military power structures in the run-up to this year's leadership transition, in which Mr. Bo was a controversial candidate for the supreme nine-member Standing Committee. What's even more certain is that the circumstances of his fall will affect the outcome of the transition.

So far, official propaganda has been careful to distinguish between the man and his so-called Chongqing model, with its crypto-Maoist slogans of "smash black" and "sing red" and its populist claim to provide welfare, housing and work for the masses. That's understandable, given that so many party leaders, including future president Xi Jinping, were in Chongqing praising it not so long ago.

An optimistic view, however, is that this event will end up strengthening the hand of those – identified at the very top with current premier Wen Jiabao and future premier Li Keqiang – who believe that China needs further economic, legal and political reform. It needs reform for a host of reasons, from the slowing of economic growth to the cancerous spread of high-level corruption (witness the Bos' champagne-Maoist family lifestyle).

What I find so striking is that I'm now hearing such sentiments in more unexpected places, including the Communist Party's central party school and even the party-state television mouthpiece CCTV. But I wouldn't bet on it happening. The counterforces of caution, consensus and vested interests are massive, both because of the top-level family and clan intertwining of political and economic power, which the Bos exemplified, and because former leaders such as Jiang Zemin (and soon Hu Jintao) will remain very influential "behind the bamboo curtain." But the Bo affair's fallout will surely increase the pressure on the party leadership to do something decisive, both to restore its tarnished reputation and to deliver more of what most Chinese might regard as progress.

If that were to happen – if the result of the death of an obscure British businessman were to be a better China and thus a safer world – then it would be a stunning example of the law of unintended consequences.

Timothy Garton Ash is a professor of European studies at Oxford University and a senior fellow at Stanford University's Hoover Institution.

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