The rare and remarkable case of Bo Xilai, a top Chinese leader embroiled in a corruption and murder scandal, marks the biggest and deepest political scouring of China’s leadership since the Cultural Revolution and it is rippling through the polity, affecting the country’s ability to manage national security and diplomacy.

Not since the fall of the Gang of Four, in 1976, have the Chinese been so thorough in rooting out a leader’s family. Even former Premier Zhao Ziyang’s children were not targeted, although Zhao remained under house arrest from 1989 until his death in 2005.

What distinguishes Bo’s case from the run-of-the-mill Chinese political intrigue, especially in this year of succession, is that the focus is not on Bo alone, but his entire family. Bo’s brother, Bo Xiyong, has been forced to step down from the Chinese Everbright International Corporation, a Hong Kong-chartered company, while his son Bo Guagua has also been mentioned unfavorably in the Chinese press.

All this suggests that the attack on Bo was not simply a matter of political intrigue, but that he was seen as a fundamental threat to China’s Communist system. Bo, who pursued a populist line by appealing to the masses with his anti-corruption campaign, and at times emphasized regional rather than national interests, clearly overstepped internal limits on acceptable behavior and policies.

Wen Jiabao’s criticism of the Cultural Revolution, at the close of the recent National People’s Congress and just before Bo was forced to step down, is seen by many as implicitly an attack on Bo. But it should be seen as aimed, not at Bo’s invocations of Mao’s ideology, but at Bo’s attempt to recreate a personal political aura, a diluted version of Mao’s cult of personality. The Chinese leadership since Mao has been rooted in consensus building (at least among the members of the Politburo Standing Committee), and avoiding a return to one-man rule, as was practiced by the Great Helmsman.

But the fall of Bo has also thrown the power succession into disarray. There are now reports that the Chinese may delay the 18th Party Congress, currently scheduled for this fall, because of an inability to decide who should comprise the Politburo Standing Committee-the real rulers of China. The creation of an “open seat,” with the fall of Bo, likely makes the factional struggles even more desperate, as each side wants to claim that opening. That the chief of domestic security, Zhou Yongkang, has apparently had to relinquish HIS duties in the wake of the Bo incident only further complicates the picture, as it opens yet another fault line.

These fault lines are having a major effect on Chinese diplomacy, not least, the burgeoning crisis over Scarborough Shoal. Since early April, Chinese and Philippine ships have been confronting each other off Scarborough in the South China Sea. (The shoal, 124 nautical miles from the main Philippines archipelago, is distinct from the Spratlys dispute, several hundred miles to the south.)

While there have been Philippine-PRC run-ins before, recent developments suggest that the latest Scarborough Shoal situation could be dangerous.

There are reports that a Chinese naval task force may be headed towards Scarborough Shoal. The force, comprising two guided missile destroyers, two frigates, and an amphibious ship, had previously transited the southern Ryukyus near Okinawa. It is not clear whether this is a diversion from previously planned naval exercises (which the Chinese have been conducting for the last several years); but if these vessels are bound for the Philippines, they represent a major escalation in the crisis.

Already, China, the fourth largest source of tourists to the Philippines, has halted tours, and called upon Manila to safeguard the safety of those Chinese tourists already in the archipelago. At the same time, the Chinese have begun to quarantine shipments of Philippine bananas on the grounds that they may be carrying agricultural pests. Nationalist protests have been staged in both countries.

These developments might be directly linked to the Scarborough Shoal situation, but they smack of an attempt to link China’s economic relationships with its neighbors to political goals – similar to the heavier-handed economic measures the Chinese took against Japan during the 2010 Spratly Island incident. At that time, China cut off all shipments of rare earth minerals to Japan, exploiting its dominant position in that market.

With the Chinese leadership focused on their internal succession struggles, few senior leaders are likely devoting their full attention to this situation., Given the internal politics, it is even less likely that anyone would be willing to appear “weak,” by being conciliatory. This may explain the Chinese rejection of the Philippine proposal for arbitration of the dispute under the Law of the Sea Treaty (LOST), which both Manila and Beijing have signed.

Bo’s fall is likely, to cast a shadow on the course of this crisis, as well as influence any possible resolution.

[Eds note: The official Chinese newspaper, the People’s Daily, in a clear attempt to tamp down speculation, has published a story claiming there will be no delay in the Party Congress. Also, there are reports of what may be a face-saving compromise with the Philippines, with both countries agreeing to temporary bans on fishing in the Scarborough Shoal. However, the Chinese Foreign Ministry says the ban “has nothing to do” with the dispute.]

Dean Cheng, with the Heritage Foundation’s Asian Studies Center, is one of America’s most respected analysts of the Chinese military.