Is China's Xi Jinping riding for a fall?
I agree with President Trump that China is our greatest geopolitical opponent. I also haven't missed the fact that China's Belt and Road initiative has seen it buy up important properties and industries around the world. Currently, Xi Jinping seems poised to become the new Roman emperor, a single man controlling the world's vastest territory and largest population. However, there are signs that both Xi and China itself may be more Potemkin village than an unstoppable force for world domination.
There are growing numbers of articles pointing to serious instability within China. In August, I took note of the mortgage boycott in China that's occurring because China's real estate boom, which was really a pyramid scheme, is collapsing.
Last week, Gordon Chang, a veteran and knowledgeable China watcher, wrote that China's entire economy is headed for a massive meltdown:
The big story is not that the Chinese economy is falling apart. It is, at least apart from the export sector. The big story is that China's stimulus efforts, so successful in the past in jumpstarting growth, are no longer working. The country's economy is, in a word, exhausted.
In the past, when the economy look fatigued, China's business community could count on the central government to create growth with massive stimulus programs. That is, after all, how former Premier Wen Jiabao avoided contraction in China as the rest of the world suffered during the 2008 downturn.
The country has been exponentially incurring indebtedness, perhaps creating debt about seven times faster than it has been producing nominal gross domestic product.
Nobody knows how much debt China has accumulated, but total country indebtedness could be an amount equal to 350% of GDP. Because of the infamous "hidden debt" and Beijing's misreporting—exaggeration—of economic output, the percentage could even be higher.
There's more, but the above quotation gives an idea of the fact that a government can bail out a broken economy only so much. It is, after all, precisely the same as if you were trying to lift a bucket in which you are standing. It turns out that top-down, government-managed "capitalism" will take you only so far.
Image: Xi Jinping. YouTube screen grab.
It's not just Chang observing China's problems. Writing in Australia's News, Alexis Carey suggests that the systemic problems are so grave that Xi himself is suddenly the one possessed of that uneasy head that wears the crown.
Since Xi convinced the CCP to do away with the constitutional two-term limit for presidents, everyone has assumed he'll be a dictator for life. After all, China is a behemoth.
China is the world's manufacturer (never mind that just about everything it makes is poor quality), and, as noted, Xi's Belt and Road initiative — which "loans" money to countries that can't repay those funds so that China can build, then own, ports, dams, factories, etc., around the world — has seemed Borg-like in its conquest ability. But China wouldn't be the first totalitarian country to hide behind Potemkin walls:
China's aggressive Covid-zero strategy has been disastrous for the economy, with draconian lockdowns and restrictions lingering while most of the world moves on.
Meanwhile, a record-breaking heatwave and drought is also wreaking havoc, leading to factory closures in a bid to save power, which in turn have also battered the economy.
At the same time, Chinese homeowners continue to take part in unprecedented mortgage boycotts as the property industry also tanks.
In addition to the challenges Xi is already facing is the potential threat posed by Premier Li Keqiang, who has recently sparked rumours of an internal rift after voicing frustration at the economic impact of Covid lockdowns — an incredibly rare example of mixed messages among China's elite, Zheng reports.
Carey writes that even George Soros has soured on Xi, for he says, "Xi Jinping is bound to fail" because of his COVID policies and the fact that he has many enemies.
I don't wish for China's downfall. We in America are, unfortunately, extremely dependent on China's manufacturing. If China implodes, that hurts us. I also have no ill feelings toward the Chinese people.
However, I'd like to see China's wings clipped so that it no longer poses a threat to other East Asian countries, dominates ports and dams around the world, has the world's largest (although possibly also Potemkin) military, controls the world's industrial minerals, and manufactures most of our medicine.
In other words, I want it to be one country among many, not the world's rising superpower — and maybe, because Xi's lust for power saw him flying too close to the sun, China will be forced to withdraw again into its own borders, and then work honestly and peacefully with the rest of the world.