There’s always an air of predictability about China’s annual “lianghui” — a series of high-power political meetings held in Beijing in early March each year. But this year there is a certain frisson in the air, and it’s not just the pollution — though that has been front and centre this week due to a searing new online anti-pollution documentary, Under the Dome, released at the weekend, which has already been seen by a stunning 200 million or more Chinese.

China is facing serious and still-mounting economic challenges, continuing its military build-up, and its leader, Xi Jinping, is beginning to push his unprecedented anti-corruption campaign into more dangerous waters as he tightens his grip on power. Those waters are the military and state-owned enterprises, which are closely allied to the families of former senior party officials who still wield behind-the-scenes power.

The lianghui is the meeting of China’s rubber-stamp parliament: the 3000-member National People’s Congress and its sister organisation, the China Political People’s Consultative Conference. The NPC’s job is simple: it ticks off legislation formulated by the Communist Party’s annual Central Economic Work Conference, which sets the nation’s economic course for the year ahead. Nothing, unsurprisingly, ever gets voted down. The main event is the annual “work report” on the economy by Premier Li Keqiang, nominally the party’s No. 2.

Yesterday, Li elucidated what everyone observing the Chinese economy already knows — that the outlook is soft and likely to get softer. His target of “about 7%” for GDP growth is the lowest for 15 years.

“The downward pressure on China’s economy is intensifying,” Li said, a refreshing admissions of what has been patently obvious for some time.

“Deep-seated problems in the country’s economic development are becoming more obvious. The difficulties we are facing this year could be bigger than last year. The new year is a crucial year for deepening all-round reforms.”

Most economists believe that the country will struggle to hit 7%, hence the use of “about” by Li. It will be fascinating to watch what the leadership plans to do about this.

The CPPCC’s job, on the other hand,  is to promote the fiction that China’s 54 ethic groups live in harmony. Hill-tribers wearing colourful traditional dress are paraded across the stages of the Great Hall and hundreds of millions of Chinese television sets, like exhibits in a human zoo.

Yet smuggled reports from the north-west province of Xinjiang — where ethic Muslim Uighurs are increasingly engaged in deadly skirmishes with government authorities — suggest the level of violence has escalated, but is going unreported in state media, at the same time as Western journalists are increasingly being blocked from troubled areas (a recent report by the ABC’s China correspondent Stephen McDonell, for the network’s Foreign Correspondent program, was one of only a handful to have managed to slip through the censors net).

But the party’s way is not resolution, it’s suppression. And the chairman of the CPPCC Yu Zhengsheng, member of the elite seven-man Politburo Standing Committee and a key ally of Xi’s, issued his annual report on Tuesday, which contained a defiant poke in the eye to the Western world, declaring that China would never conform to foreign countries’ “political models”.

This year’s NPC marks the second anniversary of the elevation of Xi Jinping, party chairman, to President — a meaningless title designed to put him on par with the US President.

And it’s the anti-corruption campaign being conducted by Xi and his chief lieutenant, Wang Qishan — widely seen as  Xi’s real No. 2 — that remains front and centre of his policies.

This week, state media revealed that a further 14 senior officers in the People’s Liberation Army are now publicly under investigation. This brings the number of senior military men under investigation to at least 30, and the whole process fits with Xi’s opinion that a corrupt military cannot fight battles, much less win wars.

Despite this, spending on China’s military remains in line with spending across the whole government and will rise by 10.1% in 2015 to a level of US$145 billion. While down on last year’s increase of 12%, the quantum rise is being maintained and leaves China’s defence spending a clear number two behind the United States. It is still, at least officially, only about 25% of what the US spent, although China does not have expensive wars and forces in the Middle East to maintain.

The continued build-up of China’s military is causing rising tensions across the region and has triggered something of a low-level arms race in the Asia-Pacific, Australia’s top brass will be taking note.

But none of this — the economy, ethnic tension or, by and large, the expansion of China’s military power, matters nearly so much to ordinary Chinese people as the day-to-day conditions in which they and their children live. These days, that means pollution. Because as the propaganda meisters have been trying desperately to focus the attention of the country’s citizens on the things their rulers are doing to improve their lives, Chinese people have  instead been turning to the Under the Dome documentary. With about 650 million Chinese connected to the internet, according to officials numbers, the figures show that about one third of them have, as a very rough gauge, watched the documentary. It’s tapped into a visceral fear. George Lucas, eat your heart out.

The Environmental Protection Agency says that any measurement of more than 150 on the air quality index — which measures dangerous airborne particles — is deemed unhealthy. For the record, at the time of writing (last night at about 11pm China time) the measurements in major China cities were as follows: Beijing 207, Chengdu 174, Guangzhou 194. Unhealthy, life-shortening numbers.

Forget the GDP forecast, this is where the action now is for the Chinese government targets.