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Observations of an Expat: China Peak

Observations of an Expat: China Peak
Representational Image - Courtesy Freedom House

Xi Jinping, who will be crowned next week as China’s second “Great Helmsman” can claim both the success and the blame. He has substantially reduced corruption, boosted GDP, increased the military and turned China into a showcase alternative to Western democracy.

By Tom Arms

History may well record the 2022 Chinese Communist Party Congress which starts next week as the Party’s peak.

It is certainly the apex for Xi Jinping who has climbed the greased pole to become the only Chinese leader since Mao to be on the cusp of serving more than ten years in the top job.

China itself now has the second largest economy, army, air force and navy on the planet. It also has the largest population.

Beijing also has the world’s largest foreign aid budget and has invested trillions of dollars in foreign infrastructure projects for its belt/road initiative.

A third of the world’s goods are manufactured in China.

China is a super power and the Communist Party can claim credit for most of the country’s success. It united a country destroyed by ruthless colonialism, invasion and civil war and wiped out the stain of what the Chinese refer to as “the century of humiliation.”

But in the years to come the Chinese may well refer to the first quarter of the 21st century as the halcyon days for there are signs that the Communist Party is laying the foundations for serious problems for the future.

Xi Jinping, who will be crowned next week as China’s second “Great Helmsman” can claim both the success and the blame. He has substantially reduced corruption, boosted GDP, increased the military and turned China into a showcase alternative to Western democracy.

China - President Xi - AP News
President Xi – Photo Courtesy: AP News

He has also tied his country to a dangerously unreliable Russian ally; angered Chinese with his strict zero tolerance covid strategy; created an economic crisis through poor management of the property market; made China and its political credibility a hostage to the policy of Taiwanese annexation and has started the process of reversing political and market reforms. All of this at a time when the world economy in which China is now a major player is significantly slowing down.

The damage that XI has wrought to the policy of reforms is the least obvious, slowest to realize and, at the same time, the most dangerous to the long-term interests of China and the rest of the world.

Communist China started political life as a strictly-controlled Stalinist state. A major cause of the Sino-Soviet split was Khrushchev’s 1956 denunciation of Josef Stalin. The Cultural Revolution was sparked off by Mao’s refusal to countenance the proposed reforms of Deng Hsiaopeng and Liu Shaoqui.

It was not until after Mao died in 1976 and Deng was rehabilitated that “socialism with Chinese characteristics” could be introduced. Since then Chinese GDP has grown at ten percent a year—the fastest in the world.

Xi, however, is believed to think that reforms have gone too far. As examples of the dangers he points to 1989 Tiananmen Square Massacre and the 1991 collapse of the Soviet Union. As a result, XI is rolling back political reforms. The “Great Firewall of China” employs 100,000 censors to block news considered critical of China, the Chinese Communist Party and/or Xi personally. In fact, XI is proposing that the Communist Party take control of the domestic internet. He calls it “smart governance.” The party already controls all other media outlets.

China also has the largest number of CCTV cameras in the world. A total of 200 million—four times the number in the US. And its cameras are equipped with facial recognition software that allows the cameras to identify individuals by name and follow them everywhere they are within range of the cameras.

Xi has also rewritten the state constitution to say that the country operates “under the leadership of the Chinese Communist Party” which means that the party is entitled to override and criminalize freedoms enshrined in the state constitution such as free speech and right to protest.”

Economic freedoms are also being rolled back under Xi. He has introduced a raft of regulations which foreign businessmen claim are designed to increase party control of their activities. The restrictions are particularly pronounced in the IT sector. The value of Chinese tech companies listed on the Hong Kong Stock Exchange has dropped dramatically.

As of the start of 2022 there were more billionaires in China than the US– 698 compared to 642. But Xi has shown signs he is uncomfortable with China’s world-beating figure. This is because he fears that wealthy individuals—and the aspirations they embody—offer an alternative to the Chinese Communist Party supremacy. The fate of Ali Baba founder Jack Ma is the best example. Ma effectively became a non-person on the eve of a flotation which would have turned him into one of the richest in the world.

XI maintains in his published “Thoughts” that the purpose of these changes is to make the Communist Party more responsive to the needs of everyday people and that strict central control is essential to maintain order and prosperity. In short, he proposes a benevolent dictatorship. The problem is that history fails to record a single instance of a dictatorship remaining benevolent.

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  • The Chinese, according to senior diplomatic sources, have told Vladimir Putin that they will not support his use of nuclear weapons. This is unsurprising given that Beijing used a recent UN meeting to reaffirm its long-standing policy of “assured retaliation” which basically means no first use and no support for first use of nuclear weapon by other countries. The Chinese position is one of a series of mounting Russian diplomatic setbacks that are running alongside a series of battlefield defeats. On Friday there was a Cold War echo when the Nobel Peace Prize was awarded jointly to jailed Belarussian activist Alex Byalyatski, banned Russian dissident organization Memorial and Ukraine’s Centre for Civil Liberties. The award was clearly meant to undermine Putin. Meanwhile 44 European heads of government (all of them except Belarus and Russia) met in Prague to present a united Euro-front against Russia. At the same time, NATO defense ministers gathered in Brussels with arms manufacturers to discuss beefing up assembly lines. And finally, because success breeds success, the US Congress voted another $542 million in economic and military aid to Ukraine.
  • NATO’s investment in Ukraine is starting to pay intelligence dividends. Any war scenario provides opportunities for testing equipment and ideas as well as learning about the strengths and weaknesses of the warring parties. European military chiefs learned the rudiments of trench warfare during the American Civil War. There are also coups from captured equipment such as the T-90M tank which I wrote about last week. But of even greater significance is Ukrainian success in the signals war. Modern warfare depends hugely on the ability of a warring state to 1- send and receive signals 2- block homing signals from the opposition’s guided missile and artillery systems and 3- deploy effective homing signals so that your ordnance reaches its target. The NATO equipment supplied to Ukraine is scoring high marks on all three. This is playing a major role in hobbling the Russian military and providing NATO with vital battlefield SIGINT (signal intelligence).
  • “Look at me. Look at me. Don’t forget about the problem of North Korea.” That appears to be the message that Kim Jon-un is firing off along with missile after missile after missile—40 of them so far this year. The latest one had the capability to reach the American-owned Pacific island of Guam where the US has a large military presence. The missile test caused a mini-panic in Tokyo which evacuated parts of the country and suspended some rail services. It also prompted US and South Korean forces to retaliate with military exercises in the Sea of Japan and Yellow Sea. None of these responses appear to have phased Kim in the slightest. He now has an arsenal of tested missiles capable of carrying nuclear-tipped warheads with ranges of 1,200 to 10,000 miles. His economy is a disaster zone. North Koreans are starving. He runs a gangster pariah state. But Kim Jong-un is the power in a nuclear power which means other world leaders have to listen to him. Or, at least, that’s what he thinks.
  • The US—and by extension the wider Western Alliance—used to depend on Saudi Arabia as a staunch ally in the Middle East. That is no longer the case as this week’s two percent cut in OPEC production shows. A production cut, of course, means a rise in oil prices at a time when Putin-induced high energy prices are threatening to bring European economies to their knees. In an attempt to justify the move, Saudi oil minister Abdulaziz bin Salman, said that a primary purpose of the oil cartel (which now includes Russia as a de facto member) is to provide a “stable energy market.” He added that OPEC was providing that stability by being proactive in adjusting supply ahead of a likely downturn in demand as the world economy slows down. Of course, the “stable” prices at a high level enables Putin to continue funding the war which is a major reason for the downturn in the world economy. It also helps to fund Crown Prince Mohamed bin Salman’s war in Yemen and grandiose infrastructure projects. MBS, by the way, has just been promoted to prime minister.
  • It is difficult to find people opposed to economic growth. Expanding the economic pie is generally regarded as a good thing. So, Liz Truss has her work out cut out for her in identifying and vilifying the “anti-growth coalition” at which she took aim in her first big speech as British Prime Minister. Of course there are different kinds of growth. There is sustainable and unsustainable growth. There is also socially uneven growth that benefits one group at the expense of another. And finally there is growth at all costs. Liz Truss appears to be going for unsustainable, social uneven growth at all costs. Wealthy bankers will now be earning two or three times their previous incomes to entice them back into the City of London. A raft of regulations that protected workers, children, the environment… will be thrown onto the political bonfire. An under-financed government will be subjected to more spending cuts. It is unsurprising that the market, the IMF, the Bank of England, Conservative backbenchers and even some of the prime minister’s own cabinet colleagues have condemned Trussonomics and joined the anti-Liz-Truss-growth-coalition. On second thoughts, she should have no problem identifying targets.
  • Florida is called the “Sunshine State”. It is where New Yorkers flee when winter-snows hit. It is said that the second highest circulation figures for the New York Times can be found in winter time Miami and the second highest circulation figures of the Miami Herald can be found in New York during summer. The lure of sun, sand and a bit of sex has been driving people to the southernmost state since the 1920s when the railways arrived and engineers started draining the swamps. It is now the third most populous state in America and the home to Disneyworld. It is also the state most ravaged by hurricanes. The latest one—Hurricane Ian– left 110 people dead and caused an estimated $57 billion in insured losses. It is the loss to American pocketbooks that is likely to have the biggest long term effect. The insurance premiums of the average Florida homeowner are four times the national average. Ian has so far forced six private insurance companies into insolvency. Hurricane insurance is also provided by the state government which has a vested interest in keeping homeowners paying property taxes in Florida. But as climate change threatens increasingly destructive storms, the state is facing the same problems as the private sector.


Tom Arms Journalist Sindh CourierTom Arms is foreign editor of Liberal Democrat Voice and is currently working on a rewrite of his “Encyclopedia of the Cold War”. He is also author of the recently published “America Made in Britain.”



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