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Wednesday, March 1, 2023

Spring 2023 Issue 75

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The Sudden End of Zero-Covid: An Investigation

Minxin Pei
Wednesday, March 1, 2023

China’s sudden exit from zero-Covid in early December surprised many observers. The most powerful motivations for this decision were the prohibitive costs to the economy inflicted by zero-Covid, the growing evidence of its ineffectiveness in face of a more infectious Covid variant, and the greatly diminished political incentive for maintaining zero-Covid after the 20th Party Congress. The party’s poor preparations for the exit were mainly due to the leadership’s overriding desire to stage a successful party congress. The politicization of the pandemic response continued even after the sudden end of zero-Covid as the official propaganda apparatus sought to reshape the narrative and the government refused to approve more advanced Western vaccines and to include an imported Pfizer anti-viral treatment in its health insurance program. The decisive end of zero-Covid and the subsequent pivot to the economy nevertheless reveal the party’s pragmatist side.    

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The A4 Movement: Mapping its Background and Impact

Patricia M. Thornton
Wednesday, March 1, 2023

Although not the primary cause that prompted the sudden reversal of Xi Jinping’s signature “zero-COVID” policy, the protests that swept twenty-one provinces and over two hundred college and university campuses in late November no doubt played a role in the timing of the decision. Yet, neither the excessive zeal with which the coronavirus prevention measures were applied at the local level nor the resulting rise in social discontent were surprising or unpredictable. Both were the result of an increasingly autocratic system that demands absolute adherence to an increasingly infeasible task and places downward pressures on the social grassroots. The “blank page” protests brought together three disparate groups – the urban working class, suffering economic deprivation caused by the rolling lockdowns; the middle-class urbanites and university students, suffering from “lockdown fatigue”; and an exploding solidarity movement of overseas Chinese students and members of the next-generation Chinese diaspora, who provided support via social media. Predictably, public security officials attempted to defuse, dissipate, and contain these groups, and propaganda organs appeared poised to declare the end of “zero-COVID” as a public relations victory. The ongoing search for nefarious “foreign forces,” allegedly behind the protests, highlights the inability of China’s repressive apparatus to recognize the fact that the unorganized interests behind the protests were unlikely to have been driven by a larger anti-state agenda.

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China’s Balance Sheet Challenge

Nicholas Borst
Wednesday, March 1, 2023

After a decade of rapid credit growth, China is now much more indebted than countries at similar levels of economic development. The slowdown in the economy over the past year has increased pressure on overleveraged borrowers, posing risks for the financial system. China has three main options to address these problems: using the central government’s balance sheet, readjusting the fiscal balance sheet, or selling state assets. If instead Beijing chooses to simply muddle through, it faces the risk of a Japanese-style lost decade. Policymakers should embrace the debt challenge as an impetus to reform China’s fiscal system and adjust the role of government in the economy. These changes could once again set China on a path to more rapid growth. Doing so, however, would require a major shift in the Xi administration’s ideological approach to the economy.

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China’s Struggle for Common Prosperity

Mary E. Gallagher
Wednesday, March 1, 2023

This article compares and contrasts Bo Xilai’s 2011 campaign for common prosperity in the city of Chongqing with the revival of the slogan by PRC leader Xi Jinping in 2021. While the goals of common prosperity as reducing inequality and equalizing services for rural and urban citizens are similar across the two campaigns, the 2011 campaign was more ambitious in policymaking and implementation. In 2021, Xi Jinping used common prosperity as a populist banner to crackdown on private companies and economic elites. However, policies to address redistribution and inequality were surprisingly sparse. Xi pushed a conservative agenda of “bootstrapped” common prosperity, emphasizing hard work, self-reliance, and a limited role for the government. In adopting Bo Xilai’s slogans but not his policies, Xi attempts to capitalize on a populist message without adopting redistributive policies that require increased taxation and a larger role for the central government in funding welfare gaps.

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Measuring China’s Technological Self-Reliance Drive

Jeffrey Ding
Wednesday, March 1, 2023

Assessments of China's efforts to promote indigenous innovation will be fruitless without clear metrics for technological self-sufficiency. Yet, indicators of indigenous innovation are more ambiguous than other scientific and technological indicators, which complicates such assessments. Indeed, clear-eyed evaluations of China's drive to reduce foreign dependence in information-technology domains are muddied by confusion over the definition of indigenous innovation and the widening "gray zone" between domestic and foreign companies.

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The Patriotic Education Campaign in Xi Jinping’s China: The Emergence of a New Generation of Nationalists

Suisheng Zhao
Wednesday, March 1, 2023

Xi Jinping has intensified his patriotic education campaign to reaffirm the CCP’s authoritarian rule and he has nurtured a new generation of nationalists who are intolerant of any criticism of the CCP regime and who are muscularly hostile to the Western powers and to Western values. The campaign has fueled ever-sharper demands for deference to China’s wishes by foreigners, making compromise extremely difficult if not impossible on issues China deems to be its core interests. But nationalism has been a double-edged sword. Chinese people have become increasingly disaffected, directing their anger to the regime and to Xi personally.  After the collapse of Xi’s zero-COVID policy, it has become increasingly difficult for Xi to engage young people through nationalism.

CLM Insights Interview with Susan L. Shirk on their recent book:

Overreach: How China Derailed Its Peaceful Rise

(Oxford University Press, 2022)

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