In August, the Chinese state-run paper Economic Information Daily ran a scathing 6,000-word article that condemned the country’s online gaming industry as promoting “spiritual opium,” raking in billions while creating a “new drug” addiction among the people, especially the youth. The article was republished in dozens of outlets and was followed by similar commentaries in state media and official social media posts.
The onslaught by the press and authorities against the gaming industry came on the heels of significant incidents involving other major players in China’s massive tech sector. On June 30, rideshare app Didi Chuxing debuted on the New York Stock Exchange without Beijing’s approval, earning it a swift punishment.
On Aug. 17, Xi chaired a meeting of a CCP economic commission that focused on the promotion of “common prosperity” across the Chinese population. The program called for a “universal” system of socialist redistribution to ensure the “people’s livelihood.”
Control Versus Chaos
It’s often said that Xi’s heavyhanded approach to governance—summed up by his frequent declarations that “the Party leads everything”—takes direct inspiration from Mao Zedong, the founding leader of communist China. Many of Xi’s moves, and especially the recent clampdowns, have been likened to Mao’s infamous Cultural Revolution, which plunged China into a traumatic decade of deadly political fanaticism between 1966 and 1976.Similarities between Xi and Mao run deep, but so do differences.
Mao had launched the Cultural Revolution in a bid to retake power after being sidelined for his role in the disastrous Great Leap Forward campaign that resulted in the starvation deaths of an estimated 45 million people. One of Mao’s short essays, “Bombard the Headquarters,” captured the spirit of reckless violence and rebellion that soon gripped the country and swept him back to primacy.
Instead of condemning China’s ancient past, as was the theme of the Cultural Revolution’s slogan of “smashing the four olds,” the CCP under Xi has rolled Chinese culture and history into a narrative of national greatness. Private businesses and financial services are to be brought under official management rather than attacked outright.
The political shifts under Xi have a strong social and ideological motivation, particularly as crises such as the COVID-19 pandemic, food shortages, and overheated real estate markets threaten instability and perhaps even endanger the CCP itself.
‘Common Prosperity’
The Aug. 17 meeting of the CCP Central Financial and Economic Affairs Commission produced 10 key points reported by state media, with most of the points focused on the goal of achieving “common prosperity.”The meeting summary calls for wealthy Chinese individuals and enterprises to “give back to society more.” The Party also plans to “clean up and standardize unreasonable incomes, rectify the order of income distribution, and resolutely ban illegal income.”
“This is not a program to aid the poor, but to aid the CCP,” Ming said on “Era Money,” a Taiwanese talk show.
A variety of factors have severely impacted the Chinese economy, from the U.S.–China trade war to the global economic downturn caused by COVID-19 lockdowns.
“Foreign trade has shrunk. The unemployment rate is high. All this weighs on the national budget,” Ming said.
The lack of electricity will prove highly arduous—and perhaps deadly—as China enters winter, especially in areas such as the northeast, where subzero temperatures and heavy snowfall are common.
Ming said the turn to “common prosperity” by the CCP reflects Xi’s inability to push through the economic reforms needed to foster healthy free-market growth.
In the beginning, Xi didn’t want to impose socialist-style redistribution policies, the academic said, “but after being in power, he found that China had gotten to the point where it was basically impossible to enact reforms.”
SinoInsider, a New York-based risk consultancy firm that specializes in Chinese political analysis, wrote in an Aug. 19 newsletter that common prosperity is a convenient “feel-good” catchphrase that the CCP hopes will help it weather the economic crisis.
The newsletter noted that Xi had previously championed a strategy of “dual circulation,” which called for the country to spend less on foreign exchanges without giving up profitable exports. However, global economic shocks, plus the regime’s alienating behavior, have cooled foreign trade. Now the regime is desperate to shore up its coffers—and direct public outrage to the ultra-rich.
“Should financial risks explode, the CCP has laid the groundwork to sacrifice the wealthy elite and emerge as the ‘people’s savior,’” the analysis reads.
“But ’redistribution' runs the risk of further stifling economic activity and engendering fierce elite pushback against Xi.”
Political Showdown
Beyond bringing society more firmly under CCP control and bracing for hard times ahead, much of Xi’s recent activity reflects a longstanding struggle between him and political rivals within the Party itself.While communist regimes tend to present a monolithic “united front” to the public, they’re given to complex infighting among different factions, a dynamic often overlooked in Western mainstream media reporting. These intra-regime struggles can play a crucial role in driving policy and rhetoric.
According to Wei, would-be stakeholders who “stood to gain” included those with ties to Jiang Zemin, the former CCP leader who was general secretary from 1989 to 2002, but who “remains a force behind the scenes.”
Ming said even the clampdowns in the entertainment industry have played a role in the Xi–Jiang feud, given the influence of Zeng Qinghong—former Chinese vice president and a close ally of Jiang—over the government offices that manage the entertainment industry.
Factional struggle in the CCP has come to a head as Xi prepares for the 20th Party Congress scheduled to be held in late 2022. While Xi is expected to take a norm-breaking third term as general secretary, the SinoInsider analysts believe he faces challenges in this endeavor.
The article notes that the leader’s nine years in power have seen many setbacks for the regime—such as the COVID-19 pandemic and the rallying of democratic nations to oppose Beijing and support Taiwan—and few victories that Xi could claim as “legitimate political achievements.”
Without taking stronger measures, Xi could see his bid for a third term jeopardized, according to the article.
Recent moves by the CCP’s Central Commission for Discipline Inspection (CCDI) have targeted more Jiang affiliates in the regime’s security apparatus.
Just two days earlier, the CCP expelled Sun Lijun, also a former deputy MPS head, from the Party, with authorities accusing him of “holding improper discussions about the central government” as well as “forming gangs to take control of key departments,” in addition to the same accusations leveled against Fu.
While most officials have been officially charged with corruption, the Party has occasionally hinted at more serious offenses. For instance, the RFA piece notes that Liu Shiyu, Chinese securities regulator, said in 2017 that senior figures in the regime had “conspired openly to usurp party leadership.”
