First you have to see a China without Xi at the top. And that is not going to happen this year.
From Edward Luttwak at UnHerd, August 2023:
It is hard to tell when a crisis in a dictatorial regime, such as the sudden breakdown of China’s economic model, is not about this or that, but about the regime itself. My own experience in this regard is very discouraging. In 1984, my book Grand Strategy of the Soviet Union contained many pages about nationalities I claimed were heading towards independence — not just the well-known if still very obedient Baltics, Armenians and Georgians, but others occupying vastly larger territories, the then barely known Kazakhs, Uzbeks, Kyrgyz, Tajik and Turkmen (I readily confess that it never occurred to me that Ukrainians might join them).
The response of every established Western Sovietologist was that I had foolishly confused folkloric categories with actual living and breathing nations — they were just “Soviets” who occasionally wore funny hats, and it was pure and utter fantasy that they might ever want to be independent. That was just seven years before the final and official collapse of the Soviet Union.
It is axiomatic that nations endure while regimes must collapse, but none of the easy Soviet analogies works when it comes to China. Yes, Beijing recognises 55 minority populations, but they account for no more than 9% or so of the total, and some of the nationalities really are only folkloric, unlike the Uyghur, Kazakhs and Tibetans whom the Chinese must actively repress.
As to the economy, it only broke the morale of the Soviet Communist Party after two decades of increasingly demoralising stagnation that had become obvious by 1980 even to casual visitors, who noticed a very distinctive no-hope “Soviet” look on most people’s faces. The Chinese Communist Party, by contrast, emerged from a visibly malnourished and downright dirty state — when I lived there in 1976, human waste was carted through its streets — with tentative growth from the early Eighties accelerating from the Nineties, gloriously enriching China until very recently.
Even today’s bad economic news reveals no terminal, necessarily regime-destroying diseases, as was true of the Soviet Union, which had to import wheat every few years even as it built more tractors for its farmers than the US. In China, in fact, the only wealth-destroying disease has been the very thing that every tourist and even some experts have admired immensely: the proliferation of a hugely impressive, mostly well-designed and well-built infrastructure, from high-speed trains that now reach even into Laos while connecting some 550 cities in 33 provinces, to the motorways that link every part of China, some all the way up mountains and into deserts, to the roughly 250 full-service airports (in 1976 only eight had enough runway for our small Trident jet), to the immense ports which imported 95 million metric tons of soya beans alone in 2021, when the Port of London handled 50 million tons of everything.
How do wonderful infrastructures destroy wealth? One example is sufficient. In 2018, on a drive along the North Korea border, I encountered a vast and beautiful white six-lane highway suspension bridge across the Yalu river. It was built to connect the Chinese city of Dandong with North Korea, to service the trade boom Xi expected with the promised opening of the North’s economy. Naturally, it would require a customs house, duly built as a very impressive high-rise, warehouses and more than 10 blocks of commercial offices. Yet when I visited, the bridge ended in a North Korean potato field, traffic was exactly zero, the customs house was empty and so were the office blocks and warehouses, some paid for by private border merchants who were bankrupt when I met them in Dandong (they openly cursed Xi for going along with the US-sponsored Security Council Embargo).
Savings that could have enriched many Chinese citizens, including the 180 million officially counted as “very poor” and the further 300 million or so still trapped in poverty, were instead wasted on the Yalu bridge complex, with uncountably greater waste on infrastructure all across China. The list starts with a least 100 grossly under-utilised airports and the many highways that are mostly empty of traffic even in crowded China, including the wonderful multi-lane G-214 that runs all the way from the near-tropical tourist town of Dali in Yunnan up the ever-rising landscape to Tibet.
The immediate issue now is not what might have been, had the capital been used to reduce poverty, but the way the money was found in the first place. Some was collected from taxes, but much more was found by adding to the immense debt mountain that now paralyses the investments of the private building firms that built skyscrapers and gigantic apartment blocks all over China, as well as the uniquely Chinese semi-private municipal and provincial joint ventures that built factories and infrastructural projects. The latter’s money came from the loans of the local branches of state banks, whose managers could not just say no to local party bosses, who could choose to invite them to sumptuous dinners in pretty company or to lock them up for corruption investigations as they saw fit. Back in Beijing, senior managers at Bank of China headquarters — whose role models are neither Mao, Lenin nor even Xi Jinping, but rather their Bank of England and Federal Reserve counterparts with whom many have studied in the US and England — kept trying to discipline the flood of bank loans to the chronically overambitious joint-venture companies. But they had no power at all to scare off the party bosses....
....MUCH MORE
