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China’s Economy, Freedom and the Threat of War

2017 October 18
by Ian Welsh

This article from NPR is useful for context.

The 2008 financial crisis hit Chinese exports. Approximately 20 million people lost their jobs, and had to go back to their villages, so the Communist party did a huge stimulus, but since China is vastly corrupt, that lead to vast corruption.

The Communist party, and Xi in particular, saw that the economy was unstable, and that scared them, so they started suppressing dissent even more fiercely.

For a long time my analysis of China has been simple, the Communist party stays in power as long as they keep the economic growth going.  If they don’t, the members of the party (and remember, it is a family affair, with high officials passing power to their incompetent children), are at risk of death.

The Chinese are very violent. There are riots all the time. Villages confront police and even the army, by which I mean, fight them, regularly. I recall one ethnic riot in a factory, where the workers ripped apart the beds in the dorms to get iron bars to beat each other with.

These people are on the edge, and they are still used to hard manual labor. They are not particularly scared of violence.

This is is also a great danger to everyone else. If China’s economy goes truly south, and the Chinese Communist party leadership is scared, they will use jingoistic nationalism even more than they do already, which is a lot.

And if blaming foreigners and going to war is required to keep Chinese minds from blaming who’s really at fault (their own leadership), well, they’ll do that. Millions of ordinary citizens dying, to the leadership of almost all countries in history beats the leadership dying.

This is exacerbated by two things: that Chinese leadership is about to run out of people who didn’t grow up powerful and comfortable, meaning truly competent people, and that China will be hit massively hard by aquifer depletion and climate change.


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For quite a while China has basically, despite rampant local corruption, been run more or less competently. But as the old leaders aged out, that became less true. It’s soon going to be almost completely true (as it is in the US and most of Western Europe.)

Russia is probably the country which needs to worry most. Yes, they have nukes, but they also have a vast amount of land right north of China which is virtually unpopulated, and when the Chinese think they might start to starve, nukes, exactly because it is mutually assured destruction if they are used, may not be a deterrent.

But other Chinese neighbours should worry as well, especially those that don’t have nukes.

It’s going to be an interesting time.

Note that China will be hitting incompetence about 5 to 10 years before Western demographic and political trends will give the West a chance to replace its incompetent leadership.

Not healthy for China, or for anyone else, really.


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9 Responses
  1. Synoia permalink
    October 18, 2017

    The Chinese have to repeat 24 bright cheerful words about their country.

    And the US people sing the start spangled banner.

    NPR, a mouthpiece of the US believes:

    “They’re all bright, positive ideas, but they don’t exist in China. I think they’re there to craft a dream for the people.”

    Judging by current trends, he says, that dream won’t likely come true. Liang says he hopes he’s wrong.

    NPR, as US organ, is calling China’s people misled? Have they looked in the mirror recently?

  2. godfree Roberts permalink
    October 18, 2017

    \”since China is vastly corrupt, that lead to vast corruption\”

    China has, observably and measurably, one of the least corrupt governments on planet earth at the policy formation and implementation level. And that\’s where corruption really matters.
    .

    Government policies have not only raised 800 million people out of poverty, but doubled wages and pensions every decade for 70 years.

    .
    The Chinese are smarter than us, and far more sophisticated about government than we will ever be. After 2,000 years, they\’re connoisseurs of governance.
    .

    According to a recent World Values Survey, 96% of Chinese expressed confidence in their government (compared to 37% of Americans). Likewise, 83% of Chinese thought their country is run for everyone’s benefit rather than for a few big interest groups (36% of Americans thought the same). http://www.wvsevsdb.com/wvs/WVSData.jsp?Idioma=I+(http://www.wvsevsdb.com/wvs/WVSData.jsp?Idioma=I)
    .

    And according to the Edelman 2016 Report, 80–90% of Chinese trust their government, the highest trust level of any national government. https://www.slideshare.net/EdelmanAPAC/2016-edelman-trust-barometer-china-english?qid=c13f229d-8a8f-4a93-bce8-aeb779e8cc70&v=&b=&from_search=1 .
    .

    That is not the profile of a corrupt government.

  3. Larry Roberts permalink
    October 19, 2017

    “For quite a while China has basically, despite rampant local corruption, been run more or less competently. But as the old leaders aged out, that became less true. It’s soon going to be almost completely true (as it is in the US and most of Western Europe.)”

    I think you mean “…almost completely false.”

  4. V. Arnold permalink
    October 19, 2017

    godfree Roberts & Larry Roberts

    The Chinese are smarter than us, and far more sophisticated about government than we will ever be. After 2,000 years, they\’re connoisseurs of governance.
    “For quite a while China has basically, despite rampant local corruption, been run more or less competently.

    That above encapsulates my understanding.
    I find it the height of absurdity to badly analyze a culture rich in science, philosophy, and governance going back more than 2,000 years; and it’s still here; with it’s rich history.
    We’re mere infants; crawling while still learning to walk (and doing that badly).

  5. RobotPliers permalink
    October 19, 2017

    Ian: You mentioned in your fundraising goals that you might write an article about survival in the coming era. I think that would be a very helpful essay for many and hope you get to the $10,000 level. I’m going to keep spreading the word for donations.

    I’ve been trying to think about just how bad its going to get and how far any future war US vs. China will go, especially with any eye toward survival for my family and friends. My thoughts are that the most likely conflicts between the two will be by proxy, so direct military strikes on the US mainland and/or territories by Chinese military are in the lower probability category–but still far from 0%. In the event of a direct engagement, a limited conventional war would directly impact the Pacific region of the US, mostly Hawaii, Alaska, overseas territories, and CA, OR, WA. Economic impacts would be widespread, and I still have to do the thinking on where it will be better/worse. In the event of a limited nuclear war, I would guess military targets would be most vulnerable and population centers generally avoided–because striking major population centers would immediately escalate to a total nuclear war given the insanity of leadership on both sides. In the event of a total nuclear war… I don’t know. Insanity rules at that point. More rural, and further away from military installations will be best, plus away from likely fallout spread patterns. But this scenario is still remote by my thinking.

    As for internal strife in the US, I live in Northern VA and I suspect that any guerrilla warfare, heightened domestic terrorism, etc. would be particularly intense along the Richmond to DC axis, as that is a major political, cultural, and economic gradient. The biggest threats to survival in the US will be generated in the US–cutoffs of Chinese imports will have a huge impact, but our reaction to this will make it much, much worse.

  6. RobotPliers permalink
    October 19, 2017

    V. Arnold:

    Genotype only provides a general blueprint for phenotype. There’s plenty of mediating biology in between, and environmental effects greatly impact gene expression and individual attributes. And those further impact actions/directions taken during life. Across generations.

    Or, you may be able to trace origins going back thousands of years, but that tells you only a little about how a particular group of people will act right now in the current environment. There has been a succession of “Chinese” governments ruling the eastern lands of Asia for a long time, but the current incarnation is largely a product of the past century, and has undergone drastic change in the past couple decades.

  7. October 19, 2017

    The greater the population the more likely to anticipate its behavior.

  8. Daniel permalink
    October 19, 2017

    Re: Russia and MAD with China.

    Russian nuclear doctrine allows for the use of first-strike tactical nuclear weapons in the case of invasion.

    No more repeats of 1812 and 1941.

    MAD is not really applicable here with Russia/China, whereas it makes some sense between US/Russia.

  9. Hugh permalink
    October 19, 2017

    The last time the Russians and Chinese had border tensions, the Russians had a joke that the Chinese were trying to sneak small groups of a hundred thousand or so at a time across the border so no one would notice.

    The idea that the Chinese are better at governance than us seems to come from people who have either never read or understood nothing of three thousand years of Chinese history.

    Currently, the Chinese are juggling multiple bubbles, even more than us. They have largely failed to transition their economy away from export driven production to one of domestic consumption. They have, as Ian says, a princely class concerned with its own entitlement, wealth, and privilege and large amounts of provincial corruption. It’s an explosive mixture and China has an explosive history.

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