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The Coming Chinese Communist Collapse

It wasn’t too long ago that the Chinese Communist Party regime – hiding for years behind the lazy and dangerous shorthand of “China” – was supposed to be the world’s leading superpower. From its apparent strength during the Great Recession to the Belt and Road Initiative, the CCP looked to be going from success to success as it poised itself to rule not just the largest nation in population but also the largest economy on Earth. It seemed to be the one exception to the rule about Communist incompetence and weakness. That was then. This is now.

Getting Old Before They Got Rich

Even during the CCP’s heydays, otherwise known as the “aughts,” the regime was in a race against time. Their hideously cruel “one child policy” had been so effective that there was serious concern of the country “getting old before it could get rich” (NPR [1], emphasis in original).

China put the one-child policy in place decades ago, when the country feared a destabilizing population boom. It benefited in the short run — the country slowed its population growth and got a boost to growth since it didn’t have as many children to support. Today, China faces a different problem: a precipitous decline in the ratio of working-age people to total population.

To be clear, the democratic world has its own concerns here, United States included. However, America’s population, while growing weakly, is still growing. Not so within mainland China (WaPo [2] – Sebastian Mallaby).

The deep cause of China’s economic slowdown — and the strongest reason to believe it will be lasting — is its demographic collapse. Last year, the country’s population fell for the first time since 1961, a landmark that had not been expected [3] until 2029 or later [4]. From here on, China’s demographic decline will accelerate: The United Nations projects that the country’s head count will plummet from today’s 1.4 billion to below 800 million by century’s end. You have to go back to the plagues and famines [5] of the late medieval period to find a loss of population so severe.

Indeed, mainland China has already lost the largest population label to India (Guardian [6]). This kind of population decline makes economic growth almost impossible. The cracks are starting to show (WaPo [2] – Catherine Rampell).

Youth unemployment has been climbing all year, with the jobless rate for those ages 16 to 24 hitting an all-time high of 21.3 percent [7] in June. Then, this week, the government suspended the data [8] series altogether.

Hiding the Truth from Itself, and Everyone Else

That last line reveals a telling, yet typical, Communist move – hide the data; hide the truth. The CCP has managed to do that in other areas for years, if not decades. We saw the effects of one example in late 2019 (WaPo [9]).

Chinese authorities had acknowledged on Dec. 31, 2019, that there were 27 cases of “pneumonia of unknown origin,” and 44 confirmed cases [10] on Jan. 3, 2020. The Wuhan health commission reported 59 cases on Jan. 5, then abruptly reduced the number to 41 on Jan. 11, and claimed there was no evidence of human-to-human transmission or any signs of doctors getting sick.

That claim was a lie. The coronavirus [11] was running rampant. Doctors at the radiologist’s hospital, and other hospitals, were getting sick. But China’s Communist Party leaders prize social stability above all else. They fear any sign of public panic or admission that the ruling party-state is not in control. The authorities in both Wuhan and Beijing kept the situation secret, especially because annual party political meetings were being held in Wuhan, capital of Hubei province, from Jan. 6 [12] to Jan. 17.

The rest is tragedy.

As the WaPo editors themselves noted, “Secrecy has long been a major tool of the governing Communist Party.” The difference now is that economic statistics (which for years were merely overstated) are now being openly swept under the rug. That’s new – and a serious problem for an economy still looking to win over data-driven investors in the democratic world.

A Blueprint for Trouble

With information like this, it’s easy to think the CCP will collapse on its own and we can safely ignore the regime. That’s a bad idea. Both Leonid Brezhnev and Vladimir Putin reacted to economic malaise with foreign adventurism. Indeed, the decaying dictators are themselves closer than ever [13]. Absent American strength, things will get worse before they get better. Even with American strength – such as being shown in Ukraine – things will still get tense before they get better.

That said, the CCP – much like their predecessors in Eastern Europe – is finding reality difficult to escape. The post-Tiananmen pact with the Chinese people – let us rule and we’ll make you rich – is breaking down. The regime’s collapse could soon go from slowly to suddenly. America and the rest of the democratic world must be ready to ensure a stable and democratic China can come out on the other side.