To Each Their Own

China and America are focusing more on guarding what they have instead of expanding the global economic pie

- Tom Orlik

Imagine there are two types of policymakers in the world: those who are looking to increase the size of the global economic pie and those who are focused on fighting for their own share of it.

For most of the past few decades, pie-expanding economists were the major force pushing reforms in China and shaping US-China relations. That's no longer the case. China's recent Communist Party Congress saw a generation of pro-market officials pushed out-and a former president who gave them room to operate literally ushered offstage. In the US, meanwhile, it's now pie-protecting national security hawks calling the shots.

For China's development, and for relations between the world's two largest economies, these shifts have profound consequences.

The leadership group unveiled by President Xi Jinping last month looks vastly different from those who helped helm the economy in decades past. Premier Li Keqiang, who has both economics training and long experience steering macro policy, has been replaced as Xi's No. 2 by Shanghai party boss Li Qiang, who has mostly provincial experience and a thin résumé on national economic matters. Other economic reformers are also headed for retirement, and there's no next generation to replace them among the allies Xi has promoted.

That's a long way from the situation more than a decade ago under then-President Hu Jintao-whose abrupt and seemingly involuntary exit at last month's meeting has become the defining image of the transition. Back when he was in charge, Hu allowed his second-in-command, Premier Wen Jiabao, to manage day-to-day affairs. And smart technocrats were empowered to experiment with reforms to the economy and financial system.