contradictions in national security
Xi Jinping's choices
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The concern businesses feel about trending behaviour in China are mounting significantly. I have not been there for four years so I have heard nothing in four years from the U.S. Chamber of Commerce discussions which invariably provided optimism or pessimism about the bilateral ties. The repeated stories, however, of PRC government officials scrutinizing, if not harassing, foreigners and their companies operating in China no longer appear random oddities. Surprise visits by PRC regulators are routine occurrences with menacing implications rather than targeting businesses engaging in questionable activity. This appears designed to unnerve foreigners still seeing China as the future for their benefit.
Xi Jinping’s welcomed overseas companies following the Party meeting seven months ago. The brief honeymoon is turning instead into a full-scale anti-western campaign, the recent thawing of conversation between government officials notwithstanding. The message strikes me as clear: China will continue to allow you to operate in country but only under increasingly regulated and monitored conditions entirely bending to host nation needs, fears, and concerns rather than economic growth.
Both German Chancellor Olaf Schultz and French President Emmanuel Macron visited Beijing earlier this year, reminding many of China’s fading hope to separate Europe from the United States where skepticism about CCP behaviour rises in many sectors. Yet the relative calm outcomes Schultz and Macron left obviously did not satisfy Xi who has long lectured his people about the evils of western threats to the Middle Kingdom. His fear is the pervasive views promoted by the United States and its friends.
Xi is using actions against business, the mechanism facilitating China’s from wretched underdevelopment and relative economic and technological backwardness half a century ago, in broad specter of anti-U.S. moves. Clearly Xi fears the AUKUS deal proclaimed in March, the increases in national defense budgets in Japan and South Korea of late, and Biden’s broadening network of collaborators pursuing steps which will thwart Beijing’s actions in the Asia Pacific, if not elsewhere. He and other leaders have criticised encirclement of China which these anti-western steps intend to break.
Xi Jinping, however, fears even more greatly a different danger of national security: he primarily worries about the internal survival of the Communist Party of China at the hands of his own people. The Party of 95 million fears the remaining nearly 1.3 people. Xi is continuing, as did his predecessors, to spend more on domestic security than it does on the People’s Liberation Army but he is more open in warning that western ideas threat to undermine China’s rise which the Communist Party alone can bring to fruition. It’s as if the world were returning to the 1840s as the Century of Humiliation began with British and other states violating Chinese sovereignty.
Yet, Xi simultaneously argues the Party alone could have brought good it has to Chinese nation. By focusing on internal security, he is tacitly acknowledging that bringing back respect, a nationalist argument Party cadres use frequently, is insufficient to satisfy the expectations of the nation.
Xi sees a future relying on security over economic growth, a risky choice in a country where the population expects economic opportunity in exchange for political rights. Fearing that economic growth can enhance the forces trying to overthrow the CCP rule, because of links overseas, may satisfy the 95 million Party members fearing the loss of their privileged position in society but it won’t work for those finding employment options dwindle in the country.
In particular, what economist Keyu Jin calls ‘China’s young adults’ are increasingly educated with degrees and certifications their parents and grandparents never would have imagined. Yet the economy is failing them with unemployment for those 16 to 24 now at 20%, double the rate merely five years ago. The education so many of these youngsters pursued does not sync with the job market while the graduates’ expectations, now two generations into the modernising period with double digit growth rates, were unlimited. The young are frustrated the jobs don’t meet their anticipation while they have little, if any, leverage with which to forcing the General Secretary to address their priorities over his primary goal of keeping the CCP in power in perpetuity.
This disjuncture in expectations and priorities is the heart of what keeps Xi awake at night. This is the reason he deeply fears for western ideas of participatory politics. The Party leadership may argue it uniquely provided China with the Four Modernisations which led to such improvement in the standard of living and rise in the nation’s respect around the globe but every interaction Chinese citizens have abroad raises the germ of a doubt about why the Party alone calls the shots for 1.3 billion people. What if the Party is wrong, they might ask.
Xi’s conscious choice to harass foreign companies, thus potentially driving away jobs is risky and he well understands that. For the young who pursued education, often at great sacrifice by their parents, Xi’s path is a frustrating one. Nationalist sentiments about foreigners humiliating China does not pay bills over the long term. Indeed, Xi may well regret playing a nationalist card as he tries propping up a system with little support once economic opportunities diminish further.
The current generation of educated and ambitious youth has no memory of the Cultural Revolution (1966-1976) with its perpetual chaos and personal sacrifice. They most definitely have no memories of the Great Leap Forward (1958-59) or the utter poverty in the 1950s after the nation suffered through three decades of one form of war or another. Expectations of unfettered, sustained growth have been the norm until recently and yet would have been difficult to satisfy under the best of circumstances as China continues through the stages of a maturing economic system albeit one with Chinese characteristics. It was never going to mirror western economies but Xi is showing the economy is merely another tool in keeping power rather than an instrument in improving the lot of his citizens.
How will it end for Xi and the CCP? An economist friend, and hardly one who favours anything about China, said to me years back that the CCP finds a way to muddle through against all odds but there is not guarantee they can continue doing that forever. I prefer recognising that Xi actually is using one of the oldest Chinese tricks in the book, characterised by the phrase ‘Crossing the river by feeling the stones’. Xi wants to get past the challenges at home and abroad to maintain Party control but he takes various actions as individual challenges arise rather than having a firm plan he is executing. In the west, we might say he is addressing the nearest alligator to the boat. The recent shift from courting foreigners in late 2022 to sending in investigators with no notice is a perfect example. He is willing to try lots of steps to keep the system off balance rather than allowing it to threaten his control. He sees unpredictability as his friend, something business hates.
Can he do this for decades? Can the youth lash out at him, undermining this system? Are the overall growing inequalities between rural and urban China going to overtake any benefits he is offering?
George Kennan observed in the 1947 ‘The Sources of Soviet Conduct’ Foreign Affairs article that the Soviet system would fall under its own weight. While many laud only outside pressures for that fall, the Gorbachev ‘perestroika’ was a response to internal inconsistencies too large to survive.
I suspect Kennan would say the same about the Chinese system today: it will fall under its own weight. I think Xi wants to argue the problems are driven by foreigners while understanding fully that he confronts so many contradictions that are becoming increasingly difficult to ignore or manage. That does not mean things will end well for all.FIN
George F. Kennan, ‘The Sources of Soviet Conduct’, Foreign Affairs, July 1947, 25 (4): 566-582
David Pierson, ‘In Xi’s China, ‘Economy May Need Take a Backseat to Security’, nyt.com, 12 May 2023, retrieved at https://www.nytimes.com/2023/05/12/
Katrina Northrup, ‘Sheena Chestnut Greitens on China’s National Security Focus under Xi Jinping’, thewirechina.com, 12 March 2023, retrieved at https://www.thewirechina.com/2023/03/12/sheena-chestnut-greitens-on-chinas-national-security-focus-under-xi-jinping/
Keyu Jin, ‘China’s Economy is Leaving Behind Its Educated Young People’, wsj.com, 11 May 2023, retrieved at https://www.wsj.com/articles/chinas-economy-is-leaving-behind-its-educated-young-people-f742c23d