CHINA´S WEAK DICTATOR / GEOPOLITICAL FUTURES

China's Weak Dictator

The need to rein in diplomats speaks volumes about Xi's power.

By George Friedman 



Most observers take Xi Jinping’s ascension from president to dictator as a sign of China’s national strength. But I see things differently – to the chagrin of even some members of my staff.

Dictatorships are not imposed on healthy systems – especially in China. Historically, as China rises, it loses stability. When it loses stability, it installs a dictator. The dictator may take the form of an emperor or party chairman, but he is a dictator nonetheless. It is in this context that I have begun to form a tentative theory: that Xi Jinping’s strength is a facade.

One of the hallmarks of the Xi administration is his anti-corruption campaign. In truth, it is a good old-fashioned political purge, meant to remove those adversely affected by Xi’s efforts to settle the financial system and those who remain committed to the policies of Deng Xiaoping. In other words, moderate liberals and internationalists. These factions see Chinese integration into the international economic system as a necessary component of modernization and prosperity.

And no component of the Chinese political system is more attached to this internationalist posture than China’s diplomats – the very same diplomats Xi personally warned on Tuesday about straying from Communist Party directives.

Beneath the facade, China’s reality is far grimmer. Much of the population still lives in poverty. A significant component of the Chinese economic elite stand to suffer from Xi’s reforms. And China’s professors, diplomats and local government officials, especially on the coast, are nervous about the direction in which Xi is steering the country. Combined, these three groups could threaten Communist Party rule. To stop the threat from materializing, Xi must prevent a coalition from forming against him. This means a constant shifting of economic policy and political purges that aim to rectify China’s structural economic problems without creating revolutionary discontent. We therefore expect the government in Beijing and the opposition, such as it is, to undertake constant and apparently incoherent actions, popular demonstrations, inconsistent economic moves and threats against Beijing’s grip on the country. 

Indeed, we’ve had two examples of this in the past week alone. Random demonstrations like the recent protests by veterans of the People’s Liberation Army must be contained locally before they can spread throughout the country. Hence, they are put down by police, violently if necessary. As for diplomats and local government officials, they must be subjected to institutional intimidation so that they don’t stray from the party line. Vigilantes in Chinese foreign policy cannot be tolerated.

Complicating the situation are trade tensions between China and the United States. Trade tariffs are a tremendous threat to China. In just 10 years, China's export-to-gross domestic product ratio has gone from about 32 percent of the economy to 20 percent. This is less a reflection of China’s very urgent strategy of de-emphasizing exports and more a function of lower demand abroad. The decline, brought on by the 2008 financial crisis, destabilized a vast part of the Chinese economy. Protectionist measures by the top destination for Chinese exports – the U.S. – threaten to further destabilize the system.

The proper diplomatic approach to this new challenge would be a policy of accommodation, one that assuaged the U.S. and allowed trade to continue unencumbered. But Xi cannot be seen as weak. He must retaliate, even if his ability to inflict damage on the United States is limited.

This is all part of the facade – to get Chinese citizens who will be hurt by Xi’s moves to feel a sense of embattlement and loyalty to Xi’s regime.

The instinct of the diplomats Xi lectured Tuesday is to bridge the gap with the United States.
From a purely economic standpoint, they are right. But politically they cannot grasp the dilemma the emperor faces. It’s for that reason that Xi made the loyalty of this faction of China’s bureaucracy a public issue. He needs to make sure that they will follow his lead. The very fact that he is insecure about whether they will speaks volumes.

To be clear: This is just a theory. Xi may well be calling all the shots, and this may have been a simple stunt designed as filler for a slow news day. But unlike in the West, where the media follows the daily melodrama like a dog, the media in China are directly controlled by Beijing, and Xi’s recent moves suggest he knows the danger he and his country are in – and that he is moving with all necessary haste to prevent opposition from rising. Remember, Xi is just one man. Make enough enemies and stifle enough opportunities and eventually even the most powerful dictator’s position becomes untenable.