For the last three months, the village of Wukan in Guangzhou, China, has been the scene of unrest. Locals were outraged that, for years, their lands were often being sold from under them by village officials. When petitions to provincial-level authorities brought no relief, they began to stage public protests, which in turn were met by baton-wielding police, causing villagers to surround the local police station and burn several vehicles.

To placate the situation, the local authorities agreed to meet with a delegation of residents—but then several of the delegates were seized while they were eating at a local restaurant. One of those detained, Xue Jinbo, died in custody. The public, not accepting officials’ claims of a heart attack, protested and demonstrated, leading both Party and government officials to flee the town. Since then, police have cordoned off the village of 20,000, and there is growing concern that Beijing may choose to use force to resolve the standoff.

For Beijing, the issue is likely to be coming to a head, for a number of reasons. In the first place, Wukan is now effectively no longer governed by the Chinese Communist Party—an enormous blow to the Party’s prestige and authority. This highlights the growing number of “mass incidents (qunti shijian)” underway in the People’s Republic of China (PRC). The growing number of such mass incidents, as one Chinese study observed, is threatening social stability. Wukan would seem to bear out this gloomy assessment.

Even more disturbing: This incident is likely to have ripple effects in China’s impending power transition next year. Such a massive protest in Guangdong province raises real questions about the future of its Party secretary, Wang Yang. Wang has been tagged as a possible member of the Chinese Communist Party’s Politburo Standing Committee (PSC), the nine people who actually run the PRC. Wang has been seen as a possible rival to Bo Xilai, Party Secretary of Chongqing, who is himself campaigning for a seat on the PSC (which is itself a break with tradition).

Ironically, among other roles in the multiple overlapping dimensions of Chinese factional politics, Wang is thought to be an economic reformer. If he is discredited to some extent at this crucial time in the political transition, it could leave the economic reform camp without a major voice at a time when the U.S. is likely to be pushing harder for reform. While it is the expanding state, and attendant opportunities for corruption and abuse of power, that is causing the problem in Wukan, reformers are often accused of under-emphasizing political and social stability when making their proposals. Wang and, by extension, his allies and supporters have now been made more vulnerable to that charge.

Indeed, the incident at Wukan underscores the brittleness of the Chinese leadership transition process. For the first time since 1949, there is no revolutionary-era hand at the helm to guide Chinese political succession—and lend legitimacy. It is arguably no accident that, with less than a year until the 18th Party Congress, outside observers cannot be certain which personalities will assume which key leadership positions. Domestic incidents such as Wukan are likely to exacerbate the struggles among the various leadership factions and elements.