And I don’t know what it is. For that matter, I don’t think anybody knows what it is for sure. But unusual things are happening in China. The foreign minister, a close associate of Xi Jinping, all of a sudden disappeared and after almost a month was replaced by the man he replaced, all with no explanation.
The head of the PLA Army’s rocket force, a separate branch of the Chinese military, was replaced by a person from outside the rocket force, the first time this has happened.
And more: The economy has not taken off after the strict Covid restrictions were lifted late last year. The prices for housing, a key way of saving for Chinese, are down. Jobs for graduates are harder to come by (and the government has stopped reporting youth unemployment statistics). And the economy is suffering from a bout of retail price deflation, even though the government is saying deflation isn’t happening.
I actually think in some ways it goes back to November 3, 2020, when the public offering of Jack Ma’s Ant Group was stopped by the Chinese government, apparently on the orders of Xi Jinping himself, just days before it was set to happen. A few days before that, Mr. Ma had publicly criticized the Chinese government in a speech at a big conference. Xi Jinping did not like it, and Ant’s public offering was cancelled.
At the time it was cancelled, I thought to myself that the cancelling of the Ant Group public offering might go down in history as the most important thing that happened that day. But I never got around to writing about it, and soon Donald Trump made November 3, 2020, the date of the 2020 U.S. presidential election, into a big date in American and world history. However, even with everything former President Trump did that day and has done since, I am still not certain if history will, in final analysis, call the U.S. election the most consequential thing to happen on that date.
The cancellation of Ant Group’s public offering was the first in series of restrictions and crackdowns on tech companies by the Chinese government. The government, or should I say the Chinese Communist Party, also effectively outlawed private tutoring services. Fan groups of media stars were greatly restricted. Public dissent in Hong Kong has been shut down in violation of the 50-year agreement with the UK in 1997. In July, a number of Chinese billionaires put out editorials and published statements supporting President Xi Jinping policies on private businesses, all in a very orchestrated and obsequious way (almost kowtowing).
The common feature of all of these things, as with President Xi’s frequent campaigns against corruption in government, the military, etc., is that they are trying to shut down things that could be, or could turn into, independent power bases not under the control of President Xi and the CCP. Tech barons. Celebrities. Private tutoring. And more. All of these are areas of independence that President Xi and the CCP did not control. So they had to be put in their place – and that place was, ultimately, under the control of President Xi.
At this point President Xi is the most powerful leader in China since Mao Zedong – and he seems determined for things to stay that way. Whether he can accomplish this; what might be going on out of public view, what all of this is going to mean for China – and for the world – we don’t know yet. But it could wind up making the 2020 U.S. presidential election the second most important thing to have happened on November 3, 2020.
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