Is the end of China’s era of prosperity?

If it wasn’t clear already, Xi is willing to stop at nothing to consolidate his grip on power.

Without Hu Jintao, there would have been no Xi Jinping. Not as we know him today.

Rewind to 2012. There were two factions in Chinese politics each backing their own favored candidate to be China’s next top leader. The Youth League faction or “Tuanpai” pushed then-Vice Premier Li Keqiang forward, a pragmatic and economy-focused choice. Meanwhile, the Shanghai Clique that circled around former General Secretary Jiang Zemin favored the charismatic but scandal-prone ‘princeling’, Bo Xilai. Xi’s name was nowhere. He had no base of support or even any particular distinguishing characteristics. Maybe that is why he was chosen.

Outgoing leader Hu Jintao, who surely could have backed Li Keqiang from his own faction, decided instead to champion Xi Jinping as a way to break the stalemate. Not only did he pave the way to leadership for Xi, he went a step further by voluntarily “retiring naked,” not hanging on like his predecessor Jiang to a powerful post like Chairman of the Central Military Commission after vacating the top job. This gave the then-unassuming Xi an accelerated path to consolidating control.

Of course, had Hu known even a fraction of what would come to pass there was no way he would have been that magnanimous. Perhaps he thought by elevating a nobody like Xi he’ll calm the rancor between the factions, and by being so scrupulously clean about handing off power, he’ll reinforce the norm of the orderly transfer of power from leader to leader after serving two terms which has been observed from the Deng to Jiang to Hu.

Even as he was forcibly escorted out of the 20th Party Congress, Hu still looked to Xi, as if in disbelief that this could really be happening.

It’s happening.

The end or an era

“Hu built a China I could live in” was the reflection from an American businessman I know who has long bailed for Japan. This was a common sentiment amongst that set, who considers Hu the best leader China has ever had, even above Deng Xiaoping. He presided over more GDP growth than anyone and kept things sailing smoothly. He stood for peace, stability and prosperity. In fact, I’m quite sure people in China area already nostalgic for the era of “bù zhē teng” (不折腾), which I will translate as “not torturing the people with pointless fuss.”

Those three little words, a familiar little northern saying, caused a ripple of understanding laughter amongst the audience at the celebration of the 30th anniversary of China’s reform and opening-up. Other common catchphrases from that era: “Rise abruptly”, “Go in for Business”, “Be laid off and re-employed.” The suppressed entrepreneur spirit of the Chinese people sprang forth and it felt inevitable and unstoppable.

Let’s not get it twisted, Hu was not a benevolent figure to all and cracked down quite hard on Tibet. But internationally there was no whiff of the “Wolf Warrior” diplomacy that was to come. China hawks would say Hu lulled us into a false sense of complacency about China. I would say there was genuinely much less to be alarmed about when China was led by broadly-speaking sensible leaders. But at some point our luck inevitably ran out.

The Statistical Inevitability of a Strongman

This situation is reminiscent to the Paradox of Tolerance as outlined by Karl Popper:

Just as a democratic institution will inevitably be taken over by fascist if the intolerant are tolerated, it’s only a matter of time before an authoritarian technocracy is taken over by a single strongman if there’s no ironclad mechanism in place to check the ambition of its top man. And it will only take one to destroy decades of order.

We have a bad habit outside of China to align the interests of the country with the interests of its leader. This might have been a fair first-order approximation back when we were dealing with a Deng or Jiang or Hu. But Xi is obviously only looking out for one man: himself. In his quest to consolidate power, he does not mind kneecapping an ascendant economy, trashing any semblance of decorum. “Why would he do this? It doesn’t make sense for China” is no longer a valid line of reasoning.

Now what?

It really grinds my gears when fmr. President of Taiwan Ma Ying-jeou boasts about the years of excellent cross-strait relations he presided over. 2008 to 2016 was the end of the Hu era, and before Xi popped out the cloven hooves.

Now we must be prepared for what Xi has already professed to be his heart’s desire: the invasion of Taiwan. For the most part, whether or not the hostage is treated well or slaughtered does not depend on the behavior of the hostage, but the logic of the hostage-taker. No amount of Stockholm syndrome will get Taiwan out of this fix. Instead, Taiwan and its allies must work on coordination and readiness.

The lesson from Ukraine is this: When a Strongman is surrounded by Yes Men, expect him to turn into a Madman.

The lesson from Ukraine is also this: If this really has to go down, Taiwan can win.

The world has been at peace for so long we really don’t have any idea of what might happen if world-class armies clash. But if Ukraine is a preview, then the David with the best technology can take on Goliath. I am also counting on even more international support for Taiwan (home of something like a third of the world’s advanced semiconductors), especially the US, which has rightly targeted China as its main adversary, not Russia.

This is not to say that war will for sure happen, but if it does, I don’t want to see any surprised Pikachu faces.