China’s crash is imminent – and Xi is becoming a ticking time bomb

A small statue of Chinese President Xi Jinping

Western-style modernization “aimed at maximizing the interests of capital rather than serving the interests of the vast majority of the people,” Chinese leader Xi Jinping said at an event in February this year. “Today, Western countries are increasingly in trouble,” he added. “They cannot rein in the greed of capital and solve chronic diseases such as materialism and spiritual poverty.”

The president has ordered his country to undergo radical ideological cures, and several films and documentaries about Mao Zedong’s life are to be released in the coming months. “Xi Jinping’s thoughts”, it is said, a multi-part theoretical epic penned by the autocrat, should become compulsory reading for young and old in the country. What does Xi’s economic policy mean for the People’s Republic? In competition with the free world, can it really offer an alternative model?

An answer in six points:

1. Xi’s economic understanding will harm China

Xi’s criticism of capitalism has become a platitude in capitalist countries. Above all, the Anglo-Saxon variant, which differs from the continental European social market economy, is not a model for the future. Deng Xiaoping, long celebrated in China as a market reformer but pushed into a corner under Xi, actually pursued a modernization of the Chinese economy based on the US model.

His “let some get rich first” sounds like the eternal mantra of the free-market Republicans of yore, who rave about a “trickle down” effect that doesn’t exist in reality: namely, that the few who got rich lose their Passing wealth on to the less fortunate.

Alexander Görlach is Honorary Professor of Ethics at Leuphana University in Lüneburg and Senior Fellow at the Carnegie Council for Ethics in International Affairs in New York. After stints in Taiwan and Hong Kong, he has focused on the rise of China and what it means for East Asian democracies in particular. From 2009 to 2015, Alexander Görlach was also the publisher and editor-in-chief of the debate magazine The European, which he founded. Today he is a columnist and author for various media. He lives in New York and Berlin.

2. Inequality in China is higher than ever

The result of this odyssey is that the inequalities in American and Chinese society are quite similar today. On this point, the two countries are closer than Xi would ever admit. However, the current crisis in the Chinese economy can only be partially explained by the work of Deng Xiao-ping. Xi Jinping took office ten years ago to complete the reforms, and he has fully succeeded.

However, this did not happen according to economic, but according to ideological standards. Xi has managed to transform the People’s Republic into a one-man dictatorship. Nothing is decided without him anymore, posts are only given to loyalists who are always ready to pay homage to their master.

3. Xi Jinping wants to break people’s habit of thinking

Meritocracy, i.e. the awarding of offices according to merit, has been valued in ancient China since Confucius. Xi put an end to that, eliminating any motivation for a social market economy to take root in China.

As a result, productivity in China has been stagnating for years. Contrary to forecasts, the economy of the People’s Republic will not overtake that of the USA in a few years.

The reason lies in the superiority of the democratic, liberal model that Xi Jinping hates like the plague: when people think for themselves, they come up with ideas, good and bad. They are tried, the bad ideas are discarded, the good ones are kept. In Xi’s China, however, only what Xi thinks is good is good.

4. More than 20 percent of young people cannot find work

Xi’s failed ideologized economic policies have led to the highest youth unemployment rate on record. Just over 21 percent of young people are unemployed. Following Mao, Xi recommends that they go to the countryside and work hard there. This march to the country will surely be sufficiently glorified in one of the many TV and cinema films that are now being released.

This does not help an economy that can only survive if it continues to specialize and offer workers better options. Experts say China’s only chance of fighting relegation is to transform itself into a knowledge society. However, this would mean that Xi would have to jettison his entire nationalist and Marxist-Leninist theory.

5. When in doubt, blame the US

The Communist Party (CP) is notorious for turning 180 degrees overnight and pretending it was always their plan. The end of Xi’s devastating “zero Covid” policy is stark proof of this. But that will not happen in the present case of the weakening economy. Just these days, Xi Jinping has been admonishing his subjects that it takes patience to endure the inconveniences.

At the same time, he denied any responsibility and, as usual, pointed the finger at the United States. They and those responsible are solely to blame for the misery. But that’s not true: the communist party alone is responsible for the crisis in the real estate sector, for the lack of demand, for the near-collapse of the Chinese banks.

6. Xi becomes a ticking time bomb for his subjects

Conclusion: As long as Xi is in power, and that is likely to be for life, the Chinese economy will not recover. Union with the USA is a long way off. The reasons for this are manifold, among other things, more investments are still flowing into the USA, and more people want to emigrate to the land of unlimited opportunity than to Xi’s country of complete surveillance.

Xi, who likes to portray himself as a wise man in the manner of Chinese emperors, has become a ticking time bomb for his subjects. It’s always possible that, to detract from his failures, he will launch a war against Taiwan, India, or the Philippines (or all at once). For the Chinese, Xi already means a loss of prosperity. He raised a lost generation of young people. Looking to the future, these are all ingredients for a change of power. The free world can hope that this will even result in a regime change and that the People’s Republic will become a democracy based on the Taiwanese model.


Please enter your comment!
Please enter your name here