What’s the Matter With China?

As we look at all of the problems in the United States and wonder how we are going to deal with them, perhaps we should give a thought to a country with just as many problems: China.  Recently, I have been watching shows and reading articles about the economic problems in China.  Experts and pundits have been asking what China should do about economic growth, the stagnate real estate sector, youth un- and under-employment, deflation, etc.   And then they go on to offer all kinds of proposed policies and solutions, most of them straight out of standard Western economics theory. 

Which means they won’t be implemented because they miss the main point.  The most important thing to Chinese President Xi Jinping is not solving this problem or that.  It is keeping control.  It's maintaining, and strengthening, the power and role of the Chinese Communist Party – and his own control over the CCP.  President Xi may be a committed Communist and dedicated Marxist-Leninist, but more importantly, he wants to keep control. 

No policy that creates or allows the growth of independent centers of power is going to be adopted.  This means market-oriented ideas that are not under the control of the CCP will not be adopted.  Similarly, independent entrepreneurs, in the style of Jack Ma, will no longer be allowed.  The CCP has even shut down fan sites for popular entertainers.  Why are they going to allow businesses to grow free from state control?

The lens through which to look at any proposed solution to a problem in China is not whether it will solve the problem.  It is, rather, whether it will enable the CCP to maintain its power and President Xi to maintain his control.  It doesn’t matter if it works.  It’s all about power and control,