December 2, 2022 - 7:00am
In the space of a few weeks, Xi Jinping has gone from an acclaimed leader to a man under pressure to restore public order and defuse anger over Zero Covid policies. A generation brought up on a politically sanitised version of history seems to be experiencing an awakening in increasingly fractious times. Chinese anger over Covid policy has acted as a lightning rod for accumulated angst about rising repression and even for opposition to Xi and the ubiquitous control of the CCP. The recently announced death of former leader Jiang Zemin, who was associated with happier times in China, couldn’t have come at more precarious time for Xi and the party.
This month’s Politburo meeting will have to steer China through the current upsurge in Covid cases over the winter, with the Chinese New Year holidays looming in just two months. Premature easing of policy could lead to an outbreak of infection and deaths, especially in a population that remains under-vaccinated and that has had relatively little exposure to the Covid pandemic. Repressive lockdowns, on the other hand, will surely fuel further unrest.
Though the CCP has important public health and social control reasons not to abandon Zero Covid policies as such, it will likely try to make it more sustainable. This week, the National Health Commission said it would speed up the roll-out of vaccinations for older citizens and of initial boosters for two-thirds of over-80s. This followed the slight easing of Covid restrictions in the 20-point plan announced in early November.
For all the focus on Covid, though, we should also remember that these protests have activated frustrations extending beyond the virus. Recently, workers, students, and the middle class have been articulating slogans on subjects ranging from working conditions and unpaid wages to democracy and free speech, extending to outright opposition to Xi and the CCP.
Two things could further inflame the unrest. The first, still open to conjecture, is whether Zero Covid might divide the CCP. Local government party officials, for example, are under huge pressure to carry out an impossible array of tasks under major financial constraints. They bear the brunt of unpopularity for carrying out Beijing’s Zero Covid policies, and they also foot the bill for expensive mass testing programmes — estimated to cost about 1-1.5% of China’s $17 trillion GDP. Local tax revenues are dwindling as the property market sinks; welfare obligations will only rise, and policy choices are limited to even more debt issuance, public spending cuts, or sales of public assets and services.
The second, already a feature, is the weakness and latent instability in the wider economy, even without the effects of Zero Covid policies. China’s GDP growth has pretty much stalled, having halved first to about 5-6% a year during the 2010s, but, worryingly, is set to halve again in the 2020s. Periods of ‘recession with Chinese characteristics’ are starting to become common. Unemployment, which is improperly measured, may be significantly higher than the official rate of 5.5%, and youth unemployment, estimated at around 19%, carries the risk of significant adverse social consequences.
At the moment, it is hard to see how conditions will improve in the short or medium term. Growth will remain under pressure from the deadweight of excessive indebtedness; the real estate market has to shrink; there is no strategy to boost consumption and services; a more Leninist governance regime is stymying private enterprise and initiative. Meanwhile, geopolitics is pushing economic decoupling or disengagement in supply chains, and in key areas such as semiconductors.
The nature of the CCP system is being revealed to citizens through a Covid lens, but the platform on which unrest might evolve is determined by other, more systemic, factors. The economy is in a poor state, with a rising risk of instability; the government and its critics are in a quandary over Zero Covid with a bias towards restraint; none of the policy options have favourable outcomes; and the entire economics and finance leadership team will be out of office and replaced primarily by loyalists next March. Stay tuned.
George Magnus an economist and author of Red Flags: Why Xi’s China is in Jeopardy. He is an Associate at the China Centre at Oxford University.
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SubscribeYou say:
” the CCP has important public health … reasons not to abandon Zero Covid policies as such”
thus invalidating your whole argument and making Xi’s. I suggest you read the article published yesterday here on UnHerd.
That casual “as such” at the end is very telling.
Yesterday’s article was indeed more balanced. Really, the whole thing depends on whether you believe in the efficacy of vaccinations.
If you believe that hundreds of thousands of deaths in the world have been saved by vaccination, then China’s control of its population has just a little sense but we do tend to disapprove of their methods. They don’t allow, for example, the existence of a Chinese UnHerd and, in so doing, they are treating the people as they would treat young children (or worse).
If you believe that vaccinations are a waste of time and money, China’s leaders have only one motive – how to control and bully the people.
I honestly think that vaccines do help but they’re not a silver bullet. Now, apart from China, everybody has reopened and we have not seen death left right and centre so I’m not sure how you can make the argument that backs vaccinations as a must. Even in the UK their efficacy must be waning but here we are; we are not in the middle of the zombie apocalypse.
For some reason I can’t edit my own comment… Anyway, I wanted to add that we have now seen in the west the excess non COVID deaths we have to deal with, and they are not happening for no reason out of the blue. Can you imagine how many non COVID deaths will china have in the next few years?
The western world has been quite extensively vaccinated. On the other hand, a lot of ‘vulnerable’ people have already died, so they can’t die again. I would say that if we have a few years with less-than-average deaths there will still be no pointer as to whether the vaccinations have really helped.
But we are not, that’s the whole point. We are seeing MORE deaths now than we did even last year, only we don’t have a peak, but they are spread out. It has been reported extensively here too.
In addition, the world is not made only of “the western world”. A good example can be the USA or India.
Your frame of comparison needs to be wider – a longer time (10 years say). Statistics are only useful over longer periods.
Your frame of comparison needs to be wider – a longer time (10 years say). Statistics are only useful over longer periods.
But we are not, that’s the whole point. We are seeing MORE deaths now than we did even last year, only we don’t have a peak, but they are spread out. It has been reported extensively here too.
In addition, the world is not made only of “the western world”. A good example can be the USA or India.
For some reason I can’t edit my own comment… Anyway, I wanted to add that we have now seen in the west the excess non COVID deaths we have to deal with, and they are not happening for no reason out of the blue. Can you imagine how many non COVID deaths will china have in the next few years?
The western world has been quite extensively vaccinated. On the other hand, a lot of ‘vulnerable’ people have already died, so they can’t die again. I would say that if we have a few years with less-than-average deaths there will still be no pointer as to whether the vaccinations have really helped.
I honestly think that vaccines do help but they’re not a silver bullet. Now, apart from China, everybody has reopened and we have not seen death left right and centre so I’m not sure how you can make the argument that backs vaccinations as a must. Even in the UK their efficacy must be waning but here we are; we are not in the middle of the zombie apocalypse.
Exactly. These “public health reasons” are no such thing. Concern for health doesn’t weld people into apartments. This is about saving face and crushing dissent.
Yesterday’s article was indeed more balanced. Really, the whole thing depends on whether you believe in the efficacy of vaccinations.
If you believe that hundreds of thousands of deaths in the world have been saved by vaccination, then China’s control of its population has just a little sense but we do tend to disapprove of their methods. They don’t allow, for example, the existence of a Chinese UnHerd and, in so doing, they are treating the people as they would treat young children (or worse).
If you believe that vaccinations are a waste of time and money, China’s leaders have only one motive – how to control and bully the people.
Exactly. These “public health reasons” are no such thing. Concern for health doesn’t weld people into apartments. This is about saving face and crushing dissent.
You say:
” the CCP has important public health … reasons not to abandon Zero Covid policies as such”
thus invalidating your whole argument and making Xi’s. I suggest you read the article published yesterday here on UnHerd.
That casual “as such” at the end is very telling.
It’s fascinating that the two great powers of our age, USA and China, are threatened more by their own internal politics–progressivism in USA and totalitarianism in China–than by each other.
It’s fascinating that the two great powers of our age, USA and China, are threatened more by their own internal politics–progressivism in USA and totalitarianism in China–than by each other.
The CCP has surveillance and identification capability that will almost certainly ensure it crushes this dissent. It won’t be Tanks in Tiananmen. Your smart phone and the CCTV camera with facial recognition means they already have your name and the knock on the door will follow. It is truly an Orwellian nightmare.
But the author is right – there are many further problems on the horizon for the CCP. Which is what makes it so dangerous.
The CCP has surveillance and identification capability that will almost certainly ensure it crushes this dissent. It won’t be Tanks in Tiananmen. Your smart phone and the CCTV camera with facial recognition means they already have your name and the knock on the door will follow. It is truly an Orwellian nightmare.
But the author is right – there are many further problems on the horizon for the CCP. Which is what makes it so dangerous.
Fantastic article. Thanks for sharing this post.
Fantastic article. Thanks for sharing this post.