China: The Fake Superpower
“Chinese communism is communism.”
-Frank Dikötter
Weekly Investment Update | By Brian Schreiner
The Chinese economy is no superpower. It’s a communist-led mirage rife with inefficiencies and internal weaknesses.
Frank Dikötter is a Dutch historian specializing in modern China. He’s the author of three volumes on China known as The People’s Trilogy: Mao's Great Famine (2010), The Tragedy of Liberation (2013), and The Cultural Revolution: A People’s History (2016). And, in 2022 he published a fourth book, China After Mao: The Rise of a Superpower, (2022) which offers a revisionist perspective on China today.
In the most recent book, Dikötter urges us to look beyond the surface of its economic achievements and consider the enduring political realities and underlying vulnerabilities of the system.
In his April 1 interview with Peter Robinson of Uncommon Knowledge, Empire of Illusion: Why China Isn’t a Superpower, Dikötter dissects the common perception of China as an all-powerful, economically dominant nation. He argues that the common image of China is overstated and masks significant underlying weaknesses and contradictions.
Flower-lined highway in Hangzhou, China, photo by @naturesms
If you don’t have time to watch the interview, here are some highlights. All quotes are the words of Frank Dikötter unless otherwise noted.
“Ultimately there is at the very heart of this a failure or unwillingness to recognize something reasonably straightforward, namely that Chinese communism is communism.”
“It has always been the same story for all of these communist regimes. They spend great amounts of money into projecting an image of power, stability and wealth…They poured vast resources in building up cities that look spick and span; nice beautiful buildings, highways eliminate all the dirt, including people who don't belong in these cities… Ordinary people have the lowest share of GDP in the history of the modern world. In other words, the state is rich and the people are poor.”
Peter Robinson: “Wikipedia is a very good place to go for conventional wisdom, I think. And the number that I found over and over again was 800 to 900 million people have been lifted out of poverty since Deng Xiaoping announced his reforms in 1978.”
“That’s all propaganda… The hundreds of millions of people in the countryside have lifted themselves out of poverty… In fact, every run-of-the-mill dictatorship around the world from the late 70s or early 80s onwards, started allowing farmers to have a private plot, foreigners to invest, and private entrepreneurs to participate. This is how these dictators manage to avoid complete and utter economic collapse.”
“The World Bank has a number of statistics which I think are quite clear. If you take China in 1976, when Chairman Mao died, the GDP per capita of China ranks 123rd on the global scale. Twenty five years later in the year 2000, the World bank says that China ranks 130th. That's the delusion we have lived with. The so-called decades of double digit growth is nonsense.” (As of 2023, the IMF estimates China’s rank at 71st, still below the world average.)
“Xi Jinping profits from the wealth brought about by China's participation at the WTO from 2001 onwards, he's got more assets at his disposal. He can afford to put hundreds of thousands of cameras in every single city. He can afford to build up his army like none of his predecessors were able to do. He can afford to supervise, to surveil his citizens, he can do things that Jiang Zemin could only dream of, but the structure comes from Jiang Zemin.”
Robinson: “Here's the argument that China is very, very strong. China now has a bigger navy than that of the United States, shipbuilding capacity in China is some 100% greater than ours… In the words of Elbridge Colby, President Trump's nominee as Under Secretary of Defense for Policy, “Everything should be going to Asia to deal with the Chinese threat. We will have to deprioritize everything else. China is formidable.”
“China resembles a tanker that looks impressively ship-shaped from a distance, while below deck sailors are desperately pumping water and plugging holes to keep the vessel afloat.”
“Xi Jinping has been purging the ranks of the army from the moment he got into power 2012, a general disappears here, another one goes there. God knows what's going on and who tells you that the army is actually willing to fight?”
“Take, for instance, the Internet. The internet in China has cut off the world. It's not an open country. 0.05% of the entire population is foreign. There are more foreigners as a proportion of the overall population in North Korea than there are in the People's Republic of China. Ideas can go out, it's called propaganda. Few can go in. People can go out, but they can’t go in. Ideas are blocked. They can go in, but they can go out. Money can go in, but it can't go out. Commodities can go out, but they can't go in.”
Robinson: “It’s Hotel California.”
“You may check in, but you may not check out.”
“It is an evil empire, no doubt, but it's not a superpower... All these regimes, as I said in the beginning, are very good at projecting power. But what you find behind it is a very frail empire. Xi Jinping himself lives in fear, not just of the capitalist camp, as he calls it, but of number two, three, four, five, and everyone around him. You cannot approach him without going through a metal detector. Dictators live in fear and paranoia about everything and everyone around them. He must keep tabs on just about everyone. That's his daily routine. You think he's got time to think about grand strategy and this and that?”
“Taiwan, yes, of course, it's a threat [to China]. Imagine that during the Soviet Union, the Soviets come, take Cuba and drag the island all the way up, if it were possible, and place it somewhere between, say, New York and Washington.”
Robinson: “That's what Taiwan is doing.”
“Of course, they're afraid. Of course, they're paranoid. Of course, they believe that the Americans are hypocrites.”
Robinson: “So, Frank, you'd put your money on the United States?”
“Yes.” α
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