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20210411 – The China Nightmare

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MAIN IDEA:

The main idea of this book is to use author’s extensive experience in China to provide information about current situation, direction of Chinese development, and threat that it increasingly presents to America and the World overall due to its ideology of Chinese supremacy. Until now this thread was ignored in hope that China would grow out of this primitive attitude, but due to its rapid economic, technological, and military growth it should be taken seriously. The idea is also providing recommendation on how to deal with this threat.

DETAILS:

Introduction
Author begins with obvious statement that USA vs. PRC is the main geopolitical rivalry of XXI century so far. He then states that China’s objective is at least:” carve out an authoritarian sphere of influence that it can control, making Asia repressive and closed.” He also points out that Chinese leadership feels insecure being surrounded by USA allies and bases:

Author then discusses changes in Chinese startegy and objectives that became obvious with coming to power Xi Jin Ping. Author dicusses not only various communications by Xi and oficialdom about these objectives, but also such actions as military buidup. He also looks at Chinese insecurity and fear of potential crisis that impacts their leadership and define their actions. Finally author stresses his main point:” The theme of the book is that, while China is acting to further ever-grander ambitions, it is also facing profound internal problems and increasing rot in the party. This makes China even more dangerous than many assume. Indeed, one reason China has acted more aggressively in recent years is because the CCP is searching for legitimacy through grand schemes such as “the Chinese dream of national rejuvenation.”

1. Big Ambitions
The first chapter outlines China’s ambitions under Xi, drawing from leadership speeches and party documents.

Here is how author defines Chinese objectives based on variety of leadership statements and official documents:” in Beijing’s view, the struggle for geopolitical mastery will not be limited to Asia. Rather, China wants to lead a new world order centered around Chinese power and governed by Chinese-made rules. Beijing has now detailed a set of requirements for achieving global leadership. These include (1) building a worldwide network of strategic partnerships to expand its international influence, which it will use to shape and change the way the world is governed; (2) increasing other nations’ dependence on China through Chinese-led “integration”; (3) becoming the most technologically advanced nation in the world by leading in innovation and creating a stronger defense-industrial base; and (4) obtaining military superiority. These accomplishments will help China achieve preeminence in what the CCP calls the global “community of common destiny.” The concept of a community of common destiny has been part of Chinese strategic thought for years, but, at least regarding foreign affairs, this report was centrally focused on China’s global aspirations to build a China-friendly world order.”

Then author looks in detail on specific initiatives such as “Belt and Road”:

Another initiative is more open and aggressive technological competition. Finally a big part of everything is ideological offencive designed to present Chinese dictatorship as much better solution to all real and invented world problems than old and tired Western democracy.

2. Why Global Centrality?
Chapter 2 takes us from the Qing empire to Mao’s establishment of Communist China.

Author reviews this history and its impact on contemporary thinking of Chinese leadership about what is China territorially, what is its place in the world, and what kind of relationship with other countries it should have. This thinking is pretty much based on pseudo-history of China as super nation and state, which was temporary in decline and now is coming back to take its proper place in the word. Therefore, the answers are:

  • territorially China should encompass everything previously conquered by Qing Empire
  • globally it should occupy the central place in the world
  • relations with other should be built as with tributaries to superior Chinese nation and culture.   

3. Deng’s National Rejuvenation
Chapter 3 discusses Deng’s reforms. Here author discusses how Deng managed to get out of rigid communist ideology that put country in economic neverland and on the brink with war against top dog of communism at the time -USSR. Both objectives: revival of economy and prevention of war were achieved by moving along the same line: establishing nearly allied relations with United States, implementing market economy reforms, that removed key, but non-workable parts of communist ideology, and enforcing more than workable totalitarian part of communist ideology by all means necessary. Finally, carefully develop and maintain Western illusions about China’s future democratization, while massively implementing transfer of supply chains and production facilities from developed West to China by luring business investment with cheap labor under dictatorship that excluded possibility of unions and need to deal with labor movement. Also, the big part of the process was massive increase in Western environmental and other regulations combined with absence of this expensive staff in China.

4. Closing the Curtain
Chapter 4 explores what happened when Hu came to power and began reversing Deng’s policies.

The main point of this chapter is that China’s turn back to dictatorship, away from free market, and initiation of external aggression actually occurred during Hu’s tenure in power. Author recounts multiple incidents from undiplomatic treatment of Obama to maritime aggression against neighboring states, to internal political crises and corruption.

5. Recentralization of Dictatorship
Chapter 5 describes Xi’s bid for power and China’s techno-military buildup. Here author starts by describing Xi’s consolidation of power via campaign against corruption that helped Xi to remove whatever competition he had at the top levels of CCP. Then author describes formation of high-tech police state with implementation of the system of Social Credits in order to control population. Finally, author reviews military implications of newly expanded efforts to build powerful military based on leapfrog in technology, especially AI.  

6. Expansion
Chapter 6 details China’s current geopolitical behavior, using the strategic framework implied by the 19th CCP Congress report and similar documents. In this chapter author reviews geopolitical situation of China starting with Russia, which find itself in unusual role of junior partner to another dictatorship. So far, these two dictatorships were able maintain quasi-alliance against common enemy – USA, but it is relatively shaky stability because China is expanding military, therefore removing Russia’s last remaining source of claim to be the great power. It is also fragile because China’s geopolitical expansion directed at Central Asia that used to be under firm Russian control, and it could potentially raise claims against scarcely populated Russian Far East and Siberia. Another potential rival of China is India, which just started its economy growing, has population that is increasing and soon will overtake Chinese, and finally could become very attractive place to shift supply chains to democratic state, which even if exceedingly corrupt, nevertheless has something more open legal and government system than China with its theft of intellectual property, unfair trade practices, and constant thread of confiscation. Author also goes through all other areas in Asia, Europe, and elsewhere.    

7. Weak Points
Chapter 7 examines obstacles facing Xi and looks at China’s weaknesses.

In this chapter author finally gets to discuss China’s weaknesses. These include economic downside of National Security state when any economic considerations are subordinated to the need of keeping CCP in power. This means advance of state enterprises and author provides some relevant data:” These measures have produced the largest state sector in the world. In 2013, an estimated 150,000 SOEs in China held combined assets of almost $16.8 trillion, which amounted to a staggering 177 percent of GDP.4 By 2018, this figure had risen to more than 230 percent of GDP.5 Along with the resurgence of the state’s involvement in the economy, resource allocation has become severely skewed in unambiguous favor of SOEs. The most trenchant indication of this is the shift of bank loans from the private to the state sector. In 2012, the private sector accounted for 52 percent of bank credit, while the state sector received 32 percent. By 2016, this dramatically reversed, with the state sector receiving 83 percent of bank loans, while the private sector received only 11 percent.”

Another important issue is poor compatibility of technological innovation and suppression of individual freedoms. Author also provides a whole list of sources of the future problems: Shrinking Coffers, Social Problems, Capital and Human Flight, Internal Threats, Decay of population and ideology, Obsessions with Stability, and even potential emergence of currently unpredictable threats.

8. Implications for America
Chapter 8 addresses implications for long-term strategic competition and offers recommendations for future American policy. Here author contemplates on current and future American response to Chinese challenge that comes not only from raise of China, but from its potential failure, or at least stagnation. Author advocates stronger stance for USA and provides some recommendations:” A truly competitive strategy would target the Chinese weaknesses detailed in this book. Some of China’s greatest potential vulnerabilities include (1) the expanse of its empire, which includes borders with unfriendly neighbors; (2) its desire to become a maritime power even as its land borders are not pacified; (3) a stagnating economy that could become worse thanks to a demographic nightmare; (4) a potential elite split; and (5) popular blowback against repression. The CCP is struggling with legitimacy and geography, trying to deepen control over Hong Kong and spread its control to Taiwan, and seeking an order in Asia to which few would want to be subjected. It faces tremendous fiscal stresses, an aging society, and a highly indebted country.”

Author also recommends that Americans should go around CCP whenever and wherever possible: “Working with Chinese people outside the CCP has practical benefits. Something could go wrong inside the CCP, especially around 2022, as Chairman Xi has canceled succession plans. This makes it all the more important that the US has a relationship with all sectors of Chinese society and non-CCP leaders who could potentially fill a void created by an acute crisis in Beijing.”

In short – China is the threat, which is current and serious, but not overwhelming yet.

MY TAKE ON IT:

In my hamble opinion as long as China is under control of Communis party, which for all intention and purposes is pretty much National-Socialist entity ideologically pretty close to German Nazis, albeit with much less openly pronounced ethnic superiority complex. The stress should be on “less openly pronounced” with understanding that this superiority complex is as intense as Nazi’s. The reason for this difference comes down to a few issues: Chinese CCP does not have clear technological and military advantage at this point and still depends on Western investment, transfer of technology, and trade. In addition, CCP must have serious doubts in regard to loyalty of population, which does not strongly adhere to communist ideology, or any defined ideology for that matter. None of this was the case for German NSDAP in late 1930s, which had best technology and military in the world and could easily compensate for economic decline by readiness of population to suffer hardship and even war in support of revenge for Versailles and humiliation of defeat. However, these differences should not conceal ideological similarity of these two political entities, which both hellbent on domination by all means necessary, and could be stopped only by overwhelming power. The German NSDAP did not expect use of such power against them and had to be eliminated by actual hot war with tens of millions resulting deaths. Hopefully the West and especially USA find backbone to demonstrate such overwhelming power that would make continuation of aggression impossible, which in turn ideologically undermine CCP and could lead to internal change beneficial to China and the World. However, considering extremely low intellectual level of American leadership and its general corruption, it would not be surprising that aggression will not be challenged. Consequently, situation will continue deteriorating until it gets out of hand. What will happen next is everybody’s guess.


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