Great To See You, Chairman!

“This is not the fundamental interest of our two countries and peoples and it’s not what the international community expects of us,” Xi Jinping, newly coronated, told Joe Biden in Bali on Monday.

The first in-person meeting between the two men since Biden became president had an air of farce. Were it not for the size of the Chinese economy, the heft of its military and the scope of its influence, Xi’s consolidation of power last month at the Party’s twice-per-decade leadership reshuffle might’ve garnered international condemnation and left the country isolated. China is, for all intents and purposes, a totalitarian state.

I suppose some readers will chafe at that. Here’s the definition of totalitarian:

of or relating to a political regime based on subordination of the individual to the state and strict control of all aspects of the life and productive capacity of the nation especially by coercive measures (such as censorship and terrorism)

With apologies, that’s Xi’s China. Recall the scene when Xi spoke, dressed in a Mao suit, at the Communist Party’s 100th anniversary in July of 2021. Tens of thousands gathered in rows to hear him in person. Everyday Chinese used their cell phones to take videos of the speech as it was broadcast on giant screens across Beijing (imagine every billboard in Times Square simultaneously running a Joe Biden speech, and everyone staring up, transfixed, with their iPhones out, taking a video of the video). The festivities included a 100-gun salute and thousands of performers chanting “Listen to the party, be grateful to the party and follow the party,” as Xi looked on.

During that speech, Xi delivered a stark warning to what he called “foreign forces.” “Whoever nurses delusions of oppressing or enslaving us will crack their heads and spill blood on the Great Wall of steel built from the flesh of 1.4 billion Chinese people,” he said.

This is a different Xi than the Xi Biden’s known for years. Or, actually, this is the same Xi, only now, having purged every moderate element not just from the Standing Committee, and not just from the Politburo, but from the Central Committee too, he’s free to be the man he always wanted to be — namely, Mao.

Biden, donning the signature top-teeth grin that the right-wing media so love to deride, grasped Xi’s hand enthusiastically on Monday. Xi smiled in some pictures, pursed his lips in others and was reserved in all.

“We share a responsibility to show that China and the United States can manage our differences, prevent competition from becoming anything ever near a conflict and to find ways to work together on urgent global issues that require our mutual cooperation,” Biden said, at the outset of a two-hour meeting. “The United States stands ready to… work with you, if that’s what you desire.”

Biden was referring specifically to “global challenges,” including climate change and food insecurity. There’s no indication that the US is prepared to “work with” China on other issues. In fact, the Biden administration adopted a harder line than Donald Trump on China’s AI and supercomputing ambitions, and Biden has repeatedly (and explicitly) said the US would defend Taiwan militarily in the event Xi decides to seize it. Officially, “strategic ambiguity” is still US policy towards Taiwan. Biden’s words tell a different story, though. And he’s uttered the same words too many times to plausibly write them off as gaffes. At the same time, US officials have repeatedly visited Taiwan in a flagrant effort to convey to Xi that the US effectively recognizes Taiwan as an independent state. When taken in conjunction with the long list of measures adopted by the US in response to Xi’s crackdown on Hong Kong, it’s obvious the US doesn’t, in fact, subscribe to “one country, two systems,” let alone respect it. Which I suppose is apt, since China doesn’t either.

Biden raised much of that, as well as US concerns around human rights abuses in Xinjiang, in the closed-door session Monday, but frankly, you’d be forgiven for asking what the point is. Notwithstanding their history (unlike Trump, Biden actually does have some nominally plausible claim on being “friends” with Xi), the evolution of Xi’s rule casts considerable doubt on the notion that he views Biden (or anyone else, for that matter) as an equal.

Xi’s lens is different. Westerners don’t understand it because they haven’t read any Marx and don’t know anything about Mao. Xi may well be sincere when he praises multilateral institutions and talks up China’s commitment to cooperation aimed at solving problems common to humanity. Indeed, you could argue Xi’s more committed to that than many US lawmakers. But make no mistake: All of that is secondary. If you want to know what’s primary, you have to read Marx or, if that’s too much to ask, you could also just read Xi. He’s written and said plenty.

It’s important that everyday market participants understand this simple fact: The number of Western analysts and strategists who’ve studied Marx or read Xi’s “thought” isn’t materially different from zero. I assume (I hope) that analysts based in Hong Kong have at least some vague familiarity with Party ideology and the extent to which Xi has succeeded in effectively rolling back the ideological clock.

Everyday I see someone, somewhere, suggest that now’s the time to buy Chinese tech. Saying that without an understanding of Marx is a leap of faith.

In fact, trusting Xi at all is a leap of faith. He’s a dictator presiding over a totalitarian state that arrests dissenters, executes officials for crimes that wouldn’t constitute capital offenses in any Western nation, disappears critics, monopolizes traditional media, censors social media such that no serious criticism is wittingly countenanced and operates a network of forced labor camps the sole purpose of which is to compel an entire ethnic group to disavow its cultural heritage under implicit threat of violence. If China were a non-nuclear, inconsequential state, the US might’ve invaded it by now on human rights concerns.

That’s the reality. I’m sorry to put it so bluntly, but — well, actually I’m not sorry. Not even a little bit.

No analyst or strategist is going to tell you any of that, in part because they don’t understand it, but also because Western banks are keen to retain access to the lucrative opportunities afforded by Mainland Chinese markets. If you’re reading this in Hong Kong, I’d suggest you erase your browser history. I’m not joking.

Similarly, the US government (under both Trump and Biden) continues to say one thing, but do another when it comes to international summits and bilateral meetings. Every other week the State Department or someone from the Pentagon regales the public or Congress with tales of China’s “dangerous rise,” but in person, US presidents feel compelled to pretend Xi somehow isn’t what he is: An iron-fisted dictator who’ll work with you if it’s convenient and advantageous. He’d also be fully willing to shoot you under the same conditions.

With that in mind, Xi told Biden on Monday that, “I look forward to working with you, Mr. President, to bring China-US relations back to the track of health and stable development for the benefit of our two countries and the world as a whole.”


 

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9 thoughts on “Great To See You, Chairman!

  1. this is consistent with our ever increasing love of snackable headlines with simplistic explanations of anything complicated – grab a headline, make an inference, self declare intelligence … while all the while the more complex, nuanced (or in your face) understanding takes more effort, so too few try. sadly, macro-economic and geo-political decisions / discussions too oft revolve on that snackable level of understanding … what could go wrong?

  2. Stephen Kotkin is a very good Russia expert . He also has clear things to say about China and his view is similar to yours. There is a podcast called Goodfellows on youtube from the Hoover Institute at Stanford. The latest one is with Stephen. I recommend it.

  3. I don’t know that Marx explains Xi. Outside of a fairly well constructed but trying-too-hard to be scientific criticism of the capitalism of his days, Marx is excessively vaporous. Who knows? If technology really progresses, we may end up in fully automated luxury communism… 🙂

    OTOH, I really doubt that Xi is interested in abolishing the state at any point in time. His ideology seems mostly passé-ist small time conservative fascism, on par with Salazar, Franco or Mussolini.

  4. The idea that the US could successfully invade any foreign country is totally laughable. Since Normandy, we have been unable to successfully invade any country except Grenada for a couple of weeks and Panama City, also briefly. Korea ended with a divided country and a rogue state. We fled Vietnam after significant losses and increasingly this Communist country we hoped to crush has become a successful trading partner. We did push Sadam out of Kuwait, and then left quickly. Iraq is now a failed nation-state and the same thing happened to us that happened to Russia in Afghanistan, lots of our boys killed, even more wounded and the Taliban took over just days after we left having spent trillions. Invading China for any reason would be unspeakably stupid in the same way it was for Napoleon invading Russia; the country would absorb and kill us. Thankfully, I suspect the Chinese powers that be say the same thing about invading us. So we wrestle. BTW, remember, Marx was an economist.

    1. The US military is undefeated in conventional wars and winless in asymmetric wars of attrition. That’s the ultimate irony of US military prowess. America was founded in an asymmetric war of attrition. We created and perfected modern asymmetric warfare, then immediately forgot how to do it.

      1. A war with China would be, initially anyway, a conventional war assuming no nukes. The PLA has never been tested. I doubt seriously that Xi wants its first test to be the US military.

        That’s like building a great NBA team during the summer of 1997 and saying, “Well, this looks great on paper! And the Bulls are old, after all…”

        1. Xi doesn’t have much of a choice, though.

          He wants Taiwan. Either there’s enough of a gap between Taiwan and the US to hope to attack and conquer Taiwan without triggering the US or there isn’t.

          In which case, either he puts off the Great Rejuvenation of the Chinese People or he takes on the US military.

          I agree those are shitty choices but, to be fair, no one asked him to box himself with wanting to conquer Taiwan.

  5. The dream of 1949 still burns brightly in Xi. In his new role, in my opinion, he is the 2022 manifestation of Mao. Given what we know about Xi’s conversations with Putin, prior to the invasion of Ukraine, Xi’s desire is to surpass western military power and obscure the legacy of collective political power and culture realized through the alliances manifested in NATO. But we don’t tend to sit on our hands and just watch as the world falls apart.

    To quote Volodymyr Zelensky on Veteran’s Day (Friday last week):
    “For almost 250 years the men and women of the United States armed forces have prevailed against tyranny, often against great odds. ?Your example inspires Ukrainians today to fight back against Russian tyranny. Special thanks to the many American veterans who have volunteered to fight in Ukraine, and to the American people for the amazing support you have given Ukraine…”

    Xi Jinping, in his role as Premier of the Chinese Communist Party, enables him as an all-powerful tyrant, placing him in the same league as the all-powerful one-man rulers of modern history. I’m thinking Lenin, Stalin, (certainly) Mao, and, of course, Putin. But in the light of the world’s history during the twentieth century, and to the present day, I believe the level of Xi’s power and role – and Putin’s role as well – is quite the anachronism.

    The world has certainly changed since Kissinger worked with Mao Zedong, Chou En-Lai, and Deng Xiaoping to shape the “great opening” of China. The Chinese leadership today seems to long fondly for the good old days, not unlike Putin expressed verbally at the time just before the invasion of Ukraine, when he was hoping that the added land mass between Russia and Europe would enable a buffer on their western border.

    The dynamic of the Chinese landscape is interesting. If Xi plays his cards too aggressively, as he seems want to do, western countries could well find other interested and capable countries to manufacture goods, as I expect they will. I’ve heard India suggested as an alternative, among other countries.

    From the perspective of the west, it will take time to find other partners. But the idea of a totalitarian manufacturing partner will not wash over the long term. My guess is the Chinese will try to create the impression that the so-called “great opening” never closed. But their western partners have already seen otherwise.

  6. A frightening, but largely unreported, Chinese military aggression that has been and continues to occur – is China’s accumulation of over 95 foreign shipping ports, through which 27% of the global commercial container shipping occurs.
    Accumulating this network would make it much easier for China to service their naval ships in the occurrence of a global confrontation- let alone wreak havoc with global shipping.

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