Platt Perspective on Business and Technology

China and its transition imperatives 18: Xi Jinping’s emerging China, and the challenge of his country’s emerging future 1

Posted in macroeconomics by Timothy Platt on May 16, 2015

This is my 20th installment to a new series on China and its most recent Party and government leadership transition, looking back over the past two years and more since that formally and officially took place and to now and China’s current situation, and forward. See Macroeconomics and Business, postings 154 and loosely following for Parts 1-12 and for a supplemental posting: Part 12.5. And see Page 2 to that directory for a second, continuation supplement Part 12.6 and for Parts 13-17.)

I continued a discussion in Part 17 of this series, on how Xi Jinping has been building and consolidating his power as China’s new supreme leader. And in that regard, I add here that:

• I have been systematically building a case for concluding that Xi seeks to secure and define his own power and authority in China in ways and to a degree that none of his predecessors in power have attempted, at least since Mao Zedong himself,
• And that Xi in fact seeks to supplant Mao as the defining voice and image of what Chinese Communism is, with his voice and vision coming to serve as the sole permissible guide to permitted belief and action throughout his country.

I have, I admit, written in this blog about how one of Xi’s post-Mao predecessors in supreme power: Deng Xiaoping attempted more fundamental reform, but only achieved a level and type of change that was in many respects more cosmetic than it was fundamental. Ultimately, everything that he did and attempted to do took place in and was constrained by the context of a largely unyielding defining system that Mao had built. Every change and reform that he attempted was shaped by and limited by what orthodox adherence to Mao’s vision could permit.

Deng sought to build something of a cult of personality around himself as he sought to bring change to this system, at least mirroring Mao in a small way in that. But he was no Mao himself. And Deng did in fact succeed in carving out a very special place for himself in China and in Communist China’s history; he is still remembered and revered as a great reformer there, even as he was the leader in charge on June 4, 1989 when elements of the People’s Liberation Army moved into Tiananmen Square to crush the voices of dissent that were speaking out there during China’s abortive pro-democracy movement of that year.

Deng is remembered and revered for opening a door between China and the West, and in ways that made much of China’s subsequent globally reaching business and economic strength possible. But he also recapitulated one of Mao’s earlier disastrous anti-reform mistakes in his effort to support and sustain Mao’s system and its underlying power base; Mao first encouraged and even actively fomented the outspoken diversity of his “let a hundred flowers bloom” campaign and then crushed it and all who had entered into it for speaking out in what he saw as dangerous dissent. And then Deng first encouraged the openness of his generation’s counterpart to that adventure, just to crush his test experiment in opening up too – literally with tanks.

Deng’s changes and reforms were cosmetic insofar as they could not significantly challenge any of the here-and-now political realities that he faced as to where power resided in China or who wielded it, and throughout the Party bureaucracy. So an argument can be made in support for this position. But today’s Xi Jinping and the China that he seeks to govern and control in his image suggests a very different narrative as to what Deng actually accomplished.

• Even when Deng’s day-to-day actions were in most part entirely supportive of the Mao-imaged Communist reality that he inherited as his mantle of power,
• His opening up of China to the West planted seeds of change that have now come to fundamentally challenge and threaten Chinese Communist hegemony as a sole owner and arbiter of power in his country
• While providing sources and levels of value that have become so deeply ingrained and so fundamentally important to China that threatening them would undermine the Party just as completely and definitively as any diversity-based ideological assault ever could.

China now has a large and growing middle class and a large and growing entrepreneurial class that sees open connection with and collaboration with the world, and both inside of and outside of China as their inalienable right. And this brings me back to Xi Jinping and his attempt to capture China in his own image, much as Mao did when leading China into communism as its one true government and its one true religion.

I have been following the news in China for a long time now and have a long list of possible news stories and events that I could add in here to this narrative, and certainly in the context of how Xi is shaping and consolidating his power in what is becoming his China. But with the lessons learnable from Deng in mind, and certainly for their longer-term and still emerging consequences, some specific recent events come strongly to mind as essential to make note of now.

The first of these news stories revolve around how Xi Jinping is developing and actively promoting his own “man of the people, but still supreme leader” cult of personality. This is the path that Mao himself took in being both the perfect, ideal Chinese peasant communist, and an all but godlike incarnation of the spirit and values of his country as a whole. No, I am neither saying nor trying to imply here that Xi is trying to become a god in China, but he is seeking absolute power and an absolutely unquestioned voice of authority there, just as Mao held. The first news story that I would cite here is of how Xi as a man of the people has become “Papa Xi” and an all but cult figure for many in his country (see for example Move Over Mao: Beloved ‘Papa Xi’ Awes China.)

Many of Papa Xi’s predecessors in supreme power since Mao have had collections of their thoughts and says assembled for public distribution. Mao set an authority defining precedent there with his Little Red Book that few of his successors in power have been able to ignore for its influence and reach. Most of his successors’ efforts of this sort have come and gone with little if any real impact, and even just short-term impact while they were still actively in public office. Xi has embraced online social media and the online conversation and has made his counterpart to Mao’s book of sayings go viral in China, available as a free app as well as in print there (see Xi Jinping’s Sayings Now Available in ‘Little Red App’.) And this is now freely available globally too (e.g. in the West from the Apple App Store.)

In this increasingly important context and certainly within China I cite a second news story that is also still just emerging and certainly for its impact. I have written many times over the years about China’s Great Firewall: their Golden Shield Project and how this is used to block access to and the sharing of online information that China’s government and its ruling Party would see as dangerous. And the basic spirit of this blocking of diversity and its potential threats can be seen as a direct continuation of the blocking and more of diversity that Mao displayed when he closed down his Hundred Flowers Campaign, and again in 1989 when Deng Xiaoping crushed the voices of Tiananmen Square.

The line between defense and offense can be blurry in a cyber-security context. And it is certainly possible to argue the case that large amounts of data gathered by China’s government through its Golden Shield Project as to who is putting what information and opinion online and where, and who is accessing this, has been used in directing action against online content providers and users. But at least most of the Golden Shield Project: the Great Firewall of China itself, has simply been developed and used as an information gathering and blocking agent. While this blocking and the deletion of files from servers in China can legitimately be seen as offensive action, up until now at least the infrastructure of the Great Firewall has not actively been used to launch attacks on computer systems or on the businesses and other organizations that own them. The key words there are “up until now.”

There is direct and compelling evidence that functional elements of China’s government run Golden Shield Project computer network have been used to launch highly organized and carefully planned denial of service attacks against a specific web-based distributed software revision control system (or Git repository) hosting service company, based in the United States but operating globally (including in China), called GitHub (see China Appears to Attack GitHub by Diverting Web Traffic and Attack on GitHub Appears to Have Ended.)

That is not to say that China’s government owned and managed cyber-systems have not been used in both covert espionage information gathering and in launching at least select attacks on other computer network systems. There is definitive evidence of that and particularly for cyber elements of their military. But this event marks a turning point where China seems to have taken a qualitatively more active role in internationally projecting its national power – in ways that would reflect the same types of fundamental policy changes that would lead to their efforts to take effective ownership of the South and East China Seas, as I have been writing about in this series and in my series: Vietnam, Doi Moi and the Search for Business and Economic Strength and Global Relevance (see the UN-GAID directory, postings 34 and following for its Parts 1-10.)

And closer to home, China’s cyber-security and defense systems have also taken similarly direct if short-term actions against some of their own entrepreneurial business success stories too, that collectively comprise its bridge to the West and to the global economy and the global community of nations, and that are essential to China if it as a nation is to achieve its goals of becoming a leading member of that community.

Recent action against GitHub and similar warning actions against some of their own largest internationally reaching new entrepreneur-led companies can all be seen as part of an attempt both to project strength and power, and an attempt to block challenge to their one Party system and its ideologically based status quo. And this leads me to a question that I would finish this posting with. When Deng Xiaoping instituted his earlier reforms, he opened a door to change that he could not fully close, and even with the tanks of Tiananmen Square: an event that still cannot be publically discussed in China without risk of grave repercussions. Xi seeks to rule China as his country’s new Mao, and of necessity a big part of that in both goal and action has to be an attempt to limit if not block the ongoing opening up that Deng in effect started and that earlier false starts had shown to address deeply felt need among the Chinese people. But the fruits of that opening up are also both China’s and his own greatest assets and sources of strength. Can he succeed in balancing opened with controlled in all of this, and avoid taking the types of draconian actions that led for Mao to the disasters of the Great Leap Forward and the Cultural Revolution while preserving his Party power base?

I am going to turn direction in my next series installment to consider China’s newly forming Asian Infrastructure Investment Bank, and how that country is reshaping its overall foreign policy under Xi’s leadership. Meanwhile, you can find this and related postings at Macroeconomics and Business and its Page 2 continuation.

Addendum Note: There is a significant amount of uncertainty and disagreement as to how, and how fully China’ Golden Shield Project and its leadership bureaucracy are involved in managing and running cyber-offensive initiatives now, as I have cited above with the recent attack on GitHub. I just claimed above that this event came out of that agency. Others see this offensive action more as a product of China’s cyber-military programs. I will at least briefly discuss this in my next series installment too, in the context of discussing China’s governmental and Party bureaucracies and how their back-pressures and Xi’s shaping responses to them, have served to shape his agenda and his timetables for achieving it.

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