The grinding and creaking of structural metal fatigue just keep getting louder behind the Chinese facade. This 2021 post (by a respected econ blogger) has aged very well. Worth a read. Beyond “what he said” I’d add…
- There is an instinctive appeal in the image of the decisive autocrat. Especially for people who subscribe to the “hero CEO” narrative of MBA case studies and the business press. Back in 2021, I remember a lot of “serious businesspeople” were still clinging to their man-crush on China’s CCP and Xi as the facts turned against them. They really wanted to believe in an “other” more effective and decisive than the weak, woke, befuddled USA. This piece is a great antidote.
- More generally, the US right wing really fell for autocracy over the past decade. Victor Orban, Putin, Xi, and (of course) Trump. As the contrary evidence piles up, I see/hear a lot of people doubling down on that “strong man” faith. Everyone likes that clever “when the facts change, I change my mind” quote, but not so many people like to practice it. I wonder what breaks the fever?
- What is the real China risk at the many companies who do high volume business there – Apple, Tesla, Volkswagen, BASF, Airbus… Is that intelligently priced in given the tendencies above?
But other than turning a bureaucratic oligarchy into a personalistic dictatorship, what are Xi’s accomplishments, exactly? In my experience, people tend to assume that Xi is hyper-competent because:
- There’s a general impression that the Chinese government is hyper-competent, and Xi has made himself synonymous with the Chinese government, and
- Under Xi’s watch, China has arguably become the world’s most powerful country.
But this doesn’t mean Xi actually deserves his reputation as a one-man engine of Chinese greatness. Much of his apparent success was actually inherited from his predecessors. He has taken absolute control of the apparatus built by people such as Deng Xiaoping, Jiang Zemin, and Hu Jintao, but I think it’s hard to argue that he has added much to that apparatus.
In fact, I think there are multiple signs that Xi has actually weakened the capabilities of the Chinese juggernaut. So far, China’s power and general effectiveness are so great that these signs seem to have gone largely unnoticed, but I think they’re there. The three big ones are: Slowing growth, an international backlash against China, and missteps related to the Covid pandemic.
It’s time to consider the possibility that for all his self-aggrandizement, Xi Jinping is just not that competent of a leader.