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November 8, 2017

America, China and Xi Jinping

By Frank Li, Econintersec

I was in China from October 21 to 29, during which a significant event happened: the CPC (Communist Party of China) held its 19th Congress, with two big changes against the tradition:

There is no named successor to Xi Jinping, who entered his second, and supposedly last, term of five years.

Xi's name has been entered into the CPC's Charter.

Both were obviously noticed not only at home, but also abroad, especially in the U.S. (China's leader elevated to the level of Mao in Communist Pantheon). Is this a big deal for China? Yes and no.

Yes, it is a big deal, because the Chinese are very worried that Xi may become the next Mao, who caused tremendous suffering in China from 1949 to 1976.

No, it is no big deal, if you understand China's history as well as the world. Let me explain ...

1. Ancient Chinese history

Bottom line: While one written language and one culture made China much easier to govern as compared with Europe, for example, China’s ancient prosperity depended on wise emperors (or kings) at the top!

2. Modern Chinese history

Mao Zedong was China's de facto last Emperor. He deserves huge credit for unifying China in 1949, but was a total disaster after that. In other words, he was a brilliant military leader, but not a wise "king"!

Mao died in 1976 and China changed for the better, hugely, thanks to a wise "king" named Deng Xiaoping. Specifically, here is what Deng did:

  • Economic reforms: Deng introduced capitalism to China, massively. 
  • Political reforms: Deng preserved the CPC, with three major changes: 
  • Collective leadership (vs. Mao's one-man show): The CPC's Political Bureau Standing Committee was a body of nine (now seven) persons, with its head entitled "General Secretary", instead of "Chairman".
  • Age limits: 7 up and 8 down (七上八下). Here is what it means: at the CPC Congress every five years, if you are age 67 or below, you are eligible to become a member of the Political Bureau. If you are age 68 as a current member, you must exit.
  • Term limit: The Chinese Presidency, which is typically occupied by the CPC's General Secretary, is limited to two five-year terms.

Has Deng’s system worked out well for China over the past four decades? Yes! For example, China has lifted some 600 million Chinese out of poverty, and is now well on the way to becoming the largest economy on earth by 2030.

It is for this reason that I consider Deng to be the greatest peaceful transformational leader in human history.

Bottom line: While China’s renewed prosperity still depends on wise kings (or emperors) at the top, China seemed to have finally found a formula that would generate a wise king every 10 years, guaranteed … Enter Xi Jinping.

3. Xi Jinping

Xi became the CPC's General Secretary on November 15, 2012. How has Xi been doing over the past five years? Very well, overall! Specifically, two highlights:

  • In contrast to his predecessor Hu Jintao, who fashioned a loose-loose management style, Xi has proven to be a strong man. For example, his anti-corruption campaign has been widely popular among Chinese people, although it is becoming increasingly questionable whether he has over done it as a tool to crush his political opponents. 
  • He has also proven to be a skilled statesman internationally.

Nevertheless, he might have been overly ambitious, especially in his apparent effort to theorize Chinese government in terms of Marxism and [American] democracy ...

4. Discussion

I was not at all surprised by the two big changes out of the CPC’s 19th Congress (i.e. no successor named and Xi’s name has been inserted into the CPC Charter). Two main reasons:

  • A king can do almost anything and everything. Xi is a de facto king!
  • For mankind, the search for an ideal form of government continues. 

More specifically, Deng’s system must evolve over time. Two examples:

  • What if Xi changes the term limit from two to three? Is it desirable? No! Is it acceptable as an exception? Yes, possibly for now at least!
  • What if Xi wants to be the king for life (like Mao)? That would be very bad for China (and himself)! Many Chinese are deeply worried about it, with valid reasons, such as the disastrous Cultural Revolution (1966-1976) – Been there, seen that!

Bottom line: The China model (i.e. capitalism + autocracy) is still very young (i.e. less than 40 years). It’s up to the Chinese to make the model better over time.

Yet, the China model, with many endemic problems of its own, not only provides a valid alternative to the U.S. model (i.e. capitalism + democracy), but also is actually slightly better, in my humble opinion. It is certainly driving China’s continued growth and success, even as we falter.

Unfortunately, most people do not understand. Worse yet, they try to develop one wrong system with reference to another wrong system. Two examples:

The Chinese [leaders] are trying to develop and explain their system in terms of Marxism and [American] democracy, which are eminently incompatible.

Americans are trying to defend their failing “democratic” system against a succeeding [Chinese] “communist” system.

As a result, the world is in total confusion!

Bottom line: Everything is relative. As the two largest economies on earth, neither the U.S. nor China can truly understand itself without truly understanding the other!

5. Closing

I wish the best for China. Hopefully, President Xi will ultimately prove to be a wise king, judged by history.

Courtesy of Frank Li, Ph.D, Author of The GOP Bible for 2016 and American Democracy, via Econintersect.com

The views and opinions expressed herein are the author's own, and do not necessarily reflect those of EconMatters.

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