Burning the Economy for Glory: Xi Sacrifices China on the Altar of Control | Digging into China

Hi, I'm Dong Shong. Welcome to Digging into China, where we explore China in depths to review unique perspectives. The recent communicate from the CCP's fourth platinum has come out. And as we all know, these standard CCP boilerplate pieces basically boil down to three parts. The achievements and the results are remarkable. Problems do exist and the outlook is once again bright and promising. Today, let's take a look at Xi Jinping's status and the power through the lens of this fourth plan's party jargon communicate. How exactly are they shaping up and where does she stand politically right now in terms of his position and the pressure he's under? Right from the start in the economic section of this fourth platinum communicate there is an affirmation of she's new quality productive forces and the domestic circulation strategy. Seeing the term new quality productive forces placed right at the opening of the whole document. The first thing I can confidently say is that overall she's grip on the big picture of political control doesn't seem to have any major issues. My second takeaway is that after this, China's economy will keep charging full speed ahead down an utterly misguided path. What does this new quality productive forces thing align with particularly well? It's eerily similar to the Soviet Union's Star Wars program in its dying days, almost identical. In fact, Paul Kennedy, the author of the rise and the fall of the great powers, attributes a huge part of the Soviet collapse to the SDI, that is the Soviets getting dragged into the Star Wars competition. Of course, there are plenty of conspiracy theories out there, too, like how the Soviets fell right into Reagan's trap, and it was precisely because of SDI that their economy got dragged under. The Star Wars program was something cooked up by US President Reagan in the 1980s. Its full name is a strategic defense initiative. It involved deploying an anti-missile system in space with the underlying aim of intercepting Soviet nuclear warheads or missiles mid-flight. On the surface, the Americans said it was for peace, but behind the scenes, this move was downright vicious. It was like a knockout punch straight to the Soviet Union's weak spot. By then, the Soviet economy was already gasping for air with a ton of internal problems piling up. But faced with America's Star Wars plan, could they afford not to respond? The answer is no. In the eyes of the communist blocks centralized system, this was a clearcut matter of national security and ideological warfare. So, the Soviets gritted their teeth and poured a massive resource into their own Star Wars program. They threw their top scientists, cutting edge tech, and the bottomless funding all into military aerospace, plus researching things like laser weapons and a particle beam weapons, the so-called highend precision stuff. And as we all know, the result was the Soviet Union disintegrating. Sure, the collapse had multiple causes, but the Star Wars program's drain on Soviet finances was absolutely one of those final straws that broke the camel's back. Those huge sums invested in military tech could have gone toward improving people's lives, developing light industry, at the very least making sure folks had enough to eat. But instead, these scarce resources got burned up in the invisible intangible realm of space and on weapons that could never actually be used. What this really created was a massive misallocation of resources and waste all under the banner of ideology. Yes, they were up against external military competition pressures at the time, but the core issue was still the rigid crisis in their internal economic structure. Communist states just love picking this whole nation mobilization path, concentrating limited resources into a few select areas they think can let them overtake on the bands. But that kind of focus usually comes with ignoring market rules, sacrificing efficiency, and squeezing out other more basic, more people centered sectors. Now, let's shift our gaze back to the CCP side and see if this new quality productive forces term doesn't sound awfully familiar. Scientific and technology innovation, strategic emerging industries, future industries, artificial intelligence, biotech, new energy. Isn't it all dripping with the same Soviet SDI high-end precision vibe? China today is facing an internal environment full of risks. Just like the biggest risk to the 1980s Soviets was the crash in international oil price. Now, thanks to she's decade of bungled meddling in geopolitics and domestic economics, I can flat out say that most of China's current export data is fudged. Some of it outright fabricated because China's accumulated trade surplus doesn't even match up with its foreign exchange reserves. They are on totally different wavelengths. Massive trade surplus is piling up, but none of it showing up in the reserves. On top of that, China's traditional economic pillars have collapsed domestically. The real estate bubble, local government debt. Under those conditions, this so-called new quality productive forces isn't some productive forces at all. It's a straight up a political footnote aimed at offsetting a whole series of policy failures at home and abroad through tech competition hype. This kind of thing lets you explain away failures while still painting a rosy future. It explains a few failures as a result of western encirclement and it whips up a populist fantasy. That's why even though she's basically nothing when it comes to actual governing, he gets the core truth of this wicked political science. Politics is about excuses. Politics is mass delusion. against that backdrop when she pushes new quality productive forces and this supposed all out push into high-tech to break through bottlenecks. Do you think that's a political strategy or economic one? Just looking at the term, it's got that obvious she style whole nation mobilization stamp all over it. Up to now we've seen the big chip fund, new energy subsidies, EV subsidies, computing power subsidies, trillions upon trillions already spent. But outcome either the money gets siphoned off by crony officials and businessmen or it creates massive overcapacity and now they are talking about cutting capacity. It's not hard to see why over capacity happens because domestically there is just no consumer power to absorb these products. What's the difference between that and the Soviet cranking out the missiles that just sit in warehouses? If the international community slams the door on China's market access for these EVs, those cars will end up rotting in warehouses, too. Same fate as those Soviet missiles. You can tell from the very opening of the fourth platinum that whenever CCP documents kick off with this kind of wording, the system slides into a state of systemic rigidity. And this rigidity in the CCP isn't the same as the Soviet systems institutional rigidity. It's a power rigidity. So in how that plays out for the CCP, you get this contradictory dynamic. The concepts they push swing with the bigger amplitude. One minute she's positioning himself as a reformer with visionary foresight. The next is an all national security narratives. But underneath it's all the same power base. The biggest difference between the CCP and the Soviet CP is that one is a systemic rigidity born from blind faith in power while the other was institutional rigidity. That said, she's position doesn't seem as rock solid as some might imagine. And you can actually spot that in this communicate because the CCP's faith in power isn't the ultimate foundation. It's the status, wealth, and interest behind that power. There is an old Chinese say even the emperor won't send out a starving soldiers. In this report, the discussion of the current environment is glossed over in just a few strokes, but it can't hide the deep anxiety the CCP feels about the status quo. It looks like they are worried about the environment, but the reality, but really it's the system they are threatening over and themselves. In the section on the 15th five-year plan, unlike the steady positive advantage packed position in the third platinum document, this one starts talking about increasing uncertain and unpredictable factors. But right after that, how do they handle the rising uncertainty with the two establishments, the two upholes, the four consciousness, the four confidence? These are core elements of Xi Jinping's thought enshrined in CCP ideology to reinforce loyalty to Shei and the centralized party control. I think the biggest uncertainty in the CCP right now is she himself. In this report, they tie uncertainty straight to Shei's political body armor, the two upholds, the two establishments, and there is a real whiff of a dialectical irony to it. Is this uncertainty within certainty or what? Then there is this passage. Maintain strategical resolve. Boost confidence in victory. Dare to struggle. Be good at the struggling. Bravely face major tests of high wind and the rough waves. Even raging storms and monstrous waves. This is still right up front in opening section. The CCP has this thing. When they talk, good omens never pan out, but the bad ones hit every time. Let's look at another indicator to really drive home what it feels like when legitimacy shifts from performance to national security. The whole documents about 5,000 words and the security gets mentioned 18 times. Financial security, internet security, economic security. These traditional ones aside, this time the meaning of security expands to food security, ecological security, industrial chain security, supply chain security. And you can see the word security threaded straight through from start to finish. Whenever the CCP ramps up the national security narrative like this, the economy is basically toast. From a statistical angle in CCP's Congress documents, if words like opening up, reform, emancipating minds are the high frequency ones, the economy usually gets a breather. But this time the frequency of security is abnormally high. What does that signal? It signals that she's forcing a hard pivot to a legitimacy narrative. But she's pushed to hard switch to this legitimacy trend is probably going be tough because what he's up against isn't some specific person or bureaucrats. It's the millennial binding of power and wealth status in the whole Chinese culture fabric. Right now she wants to coordinate security and economy everywhere. The implication being he wants to play a balancing act. What kind of balance? The free flow of capital versus unfree state of power control. A balance in that oppositional setup that'll inevitably strip away the market's main role. And if that balance falls apart, the ones who suffer the most aren't China's ordinary people. Because 80% of China's wealth is in the hands of the CCP or rather the gang of party hacks. If they force this switch to a national security political line, it will mean geopolitics gets worse. Conflicts with international community ramp up and the resource flows drop off sharply. The basic path for all CCP officials to get rich is arbitr from the gap between market priced factors and administrative powerpriced ones. There is no other way. She's bigger political pressure or the biggest roadblocks to his security legitimacy narrative doesn't actually come from grassroots resistance. is from the contradictions between the CCP's bureaucratic culture shaped by Chinese culture and she himself. You can see this contradiction as the same as the historical clashes between imperial families and other aristocratic clans in ancient China. So what we see is she having to endlessly tirelessly purge the CCP bureaucratic system over and over and over again. It's like a severe OCD patient with a power. That's actually the root of she's insecurity. So if she's power has been weakened, the sign of it is right there in the single word security. The logic simple. He's anxious about his own power because the whole bureaucratic machine won't ditch its own glory and the riches just for she's personal clout. with the sheets's track record, no charisma, no real talent or learning, always leaving things halfone. He's only got this top spot thanks to his family's legacy, plus his knack for putting on a show and enduring. Who could genuinely buy into him? China's bureaucratic click is most obedient at two times. One is when they run into a founding emperor like a Ming dynasty's Juan Jang or a Maong alled into submission by the merit of a national building. But even then it's only relatively better. Juan Jang's anti-corruption reign was all panic and fear skinning corrupt officials alive nearly wiping out the civil service group. But even someone like a Jew who had heads rolling by the thousands couldn't root out corruption or kill off that obsession with the status and the wealth behind the power. The other time when you don't go overboard and the center turns a blind eye. Classic eras like a Jang Zuming and a hu. But what they fear most is a Shi Jinping style. No real authority but obsessed with flexing it anyway. That's just a plain So the way he coordinates economy and security shows up as whoever he leans on gets swarmed by corrupt officials. Then they all get hauled off in she's purges. But in that back and forth his personal authority doesn't get stronger. It just keeps eroding. Anyone who's managed people knows when setting goals with subordinates these goals have to be crystal clear. If your goals are logically contradictory and you make your underlinings to balance them themselves, the results you will get are probably going to be a total mess. Right now, inside the whole CCP, beyond the ideological chaos, the sense of goal is a total mess, too. Why? It's not the bureaucracy's fault. It's a she's personal issue. He's not only messed up the ideology in the CCP, he's made the goal setting even more chaotic. That's why for China's specific economic problems right now, there aren't any concrete solutions proposed. You could say the entire CCP system is a staring at the current mess with total blankness for she. Then the chaos in the bureaucratic system is his top priority problem to fix. Politically, he has to stir up tension to make his security narrative hold water. But on the flip side, he has to carefully keep the economy from a second collapse because these systemic economic issues aren't something he can flip around like a cooking a big pancake in governing the country. It's like he's dug a huge pit for himself or gotten stuck in it, can't climb out, and now has to keep digging deeper just to keep going. Finally, let's check if China has any good ideas for unemployment or social stability. Nope, nothing. Just the same old tune of tightening management. The most outrageous part is the bit on people's livelihood. It's hard to imagine phrasing making the people suffer more so blatantly naked. Take a look at how they write about his own power or the so-called struggles must resolutely firmly. But when it gets to livelihoods, it turns into do our best within our means. What is that? Who is this aimed at? Private enterprises. Because simply put, China's jobs and most of its residents incomes came from the private sector. This do our best within our means is basically handing local governments political cover to legally shake down and divy up spoils on the ground. the so-called push for universal foundational stuff in the CCP's concepts and context. That's equalitarianism. And in the CCP's equalitarianism, what is boiled down to isn't the marketdriven fairness. It's the kind of fairness power brings like the great leap forward, the people's communes or the public private partnerships. Shifting that to today's contest means the CCP government's stability is way above livelihood, way above the economy. Given all that, we can reasonably predict once local governments keep facing fiscal crisis, these private enterprises are in for even harsher extortion. It looks like she's already gearing up to sacrifice China's economic base to the entire CCP bureaucratic machine and use that sacrifice to prop up his power. But this stock being sacrificed off won't sustain the CCP system for long. So to put it bluntly, she right now is burning his own life force to offer up to his power. Thank you so much for watching. If you find this video helpful, please like it, drop a comment below, and hit the subscribe button right here. It really helps you to suggest my video to others. I'll be back with more content soon. Until then, be well.