A senior state leader has confirmed the depth of anxiety and shock within the national leadership about Hong Kong's situation in the wake of the July 1 demonstration. And though Xu Kuangdi is at the margins of the communist power hierarchy, there is no doubt the former mayor of Shanghai is plugged in to the mainstream views in Zhongnanhai. He used his non-executive position to say what senior party and government leaders find hard to utter in public. Mr Xu's remarks showed Beijing has drawn its conclusion from the demonstration and begun to tackle the aftermath. The depth of opposition to Chief Executive Tung Chee-hwa, aggravated by the protracted economic downturn, has prompted more active help for Hong Kong. The central leadership has promised more privileges under the Cepa free-trade deal, allowed more mainland visitors to arrive and given its blessing to the construction of a bridge linking Hong Kong, Zhuhai and Macau. The role of Hong Kong as the 'dragonhead' of a Pearl River Delta superzone has been affirmed. Communist Party leaders know very well the links between economics and politics. They have stepped up political dialogue in Hong Kong and, it appears, feel the need to shore up support for the Tung administration. Never mind the sensitivities about central government interference. They hope to foster prosperity and stability. Most Hong Kong people, however, believe it is a cause for concern that the rationale behind the post-handover principles of 'one country, two systems' and 'Hong Kong people administering Hong Kong' is being eroded.