“The admiration of the present and succeeding ages will be ours, since we have not left our power without witness…We have forced every sea and land to be the highway of our daring, and everywhere, whether for evil or for good, have left imperishable monuments behind us.” – Thucydides, Pericles’s Funeral Oration, 431 BCE
“Heaven is above, earth is below, and that in between heaven and earth is called China. Those on the peripheries are the foreign. The foreign belong to the outer, while China belongs to the inner.” – Shi Jie, “On the Middle Kingdom”, 1040 CE
Where are the demonstrators in Hong Kong let alone the students of Tiananmen Square? They are irrelevant now due to Covid-19 and the Dream of subjugating every other power to Chinese supreme will. As noted below, China envisions a renaissance of a Middle Kingdom. At the epicenter of this Middle Kingdom, China will have the “responsibility” to educate the subjugated barbarians with the Chinese values and priorities, therefore “harmonizing” them for a fit into this under-heaven Middle Kingdom. That Middle Kingdom values obedience over freedom, hierarchy over human values, leadership over law, and elite governance over democracy and human rights.
This could be viewed as a polemic commentary. It should not. By no means do I imply that governments which botched their responses to Covid-19 should be absolved of their responsibilities. While I am making reference to Covid-19, this commentary is not about Covid-19. It is about how China is trying to exploit even a tragedy like Covid-19, to advance its geopolitical dream. Moreover, it would be an abomination if racism is advocated in the name of our responses to the crisis. I would rather readers view it as a reflection of needed foresight, prevention, and an effort to see the image of the world from a refiner’s fire. I have been asked numerous times, why we always hold a portion of our clients’ funds in gold, despite the fact that it doesn’t even pay any dividends. My answer always has been: “it’s an anchor which, along with hedging, keeps some balance in the portfolios and helps us to see the image of the world at the most critical moments.”
Statecraft is nothing but war by other means. Mastering statecraft advances leadership. Since the GFC (Great Financial Crisis of 2008-’09) we are in the process of a global power rebalancing and China has been manipulating events during this time in order to achieve the dream of subjugating every other power and nation to its will and power. If it is allowed to continue manipulating that game, then global leadership will be seen by historians as nothing but useful idiots at the hand of China.
The father of realpolitik Thucydides, who had a journalist’s eye for details, a researcher’s mind for truth, and a historian’s perspective to identify the root causes behind very complex events, has taught us that that when a rising power (Athens) threatens to displace a ruling power (Sparta), dangers arise, power imbalances take place, and the potential collision course could be painful (Thucydides Trap).
The rise of China pertains great dangers for the rules-based global order. China is unraveling the order that has produced a long peace and prosperity for the last 75 years. Chinese manipulations, including but not limited to the Belt and Road Initiative – let alone a possible alliance with a malevolent Russia which by default would be a lethal combination – need to be countered and stopped, as explained below. Needless to say, that China needs to be held accountable for the spreading of the Covid-19, the deaths of thousands, the infections of millions, and the trillions worth of damages that they inflicted around the world.
When the global rebalancing of power takes place things dissolve. By the end of WWI, the German Kaiser was gone, the Austro-Hungarian Empire was no more, the Russian tsar was overthrown, England had lost its prominence in world affairs, and France’s power was history. What was the cause? Germany was threatening England’s role and the supremacy of the sterling as the world’s reserve currency. When the authoritarian and fascist powers of Germany and Japan, saw the rise of the US, all they wanted was to draw it into a dual conflict in the Pacific and in Europe. The US came out triumphant and the world order established at Bretton Woods kept the peace and advanced prosperity since July 1944. The master Thucydides had seen it all.
At the end of chapter 15 of his book titled “Worthy Fights” Leon Panetta states: “But achievements cannot allow leaders to become complacent,” and in his memoirs Robert Gates states: “Rebuilding the 2010 budget gave me the opportunity not only to make ‘rebalancing’ meaningful but also to weed out over-budget, overdue, or unjustifiable programs and to turn my attention to the herculean task of reforming the defense acquisition process.” Two key words: complacency and rebalancing. Complacency and some miscalculations have allowed China to dominate in production and distribution. The latter in the geopolitical arena is the outcome of the former. That’s where the brain power of the refiner’s fire is needed in order to prevent authoritarianism, illiberalism, and the undermining of the highest values we hold dear to disappear in the name of cheapness and dialectic materialism.
The structural foundations of the world order are dynamized by preventable conditions (virus’s appearance and incompetent handling in Wuhan without notifying the world) which were not only mismanaged but now the arrogance of the Chinese leadership is trying to take advantage of the virus they allowed to spread globally by exploiting weaknesses in the health care systems and by showing hypocritical benevolence while at the same time oppressing their people! Yes, the world should demand that China pays for their complete failures to foresee the severity and the unimaginable consequences that their actions and secrecy could have.
The silversmith knows when to pull the silver from the refiner’s fire: It’s the moment when he is able to see himself reflected in the precious metal. Do we really want to see our image in the Chinese making?
By no means or stretch of imagination, China’s rise can be seen and compared to the benign rise of Athens. Philosophy, drama, democracy, architecture, and naval power represented a rebalancing of power which was misconstrued by Sparta. Over the past 500 years, sixteen times a major power has threatened to displace a ruling power. In twelve out of those sixteen cases the result has been war.
China has chosen not only to reject compliance with human rights standards and international rules-based order, but also has chosen confrontations in the South China Sea, has manipulated its currency in order to undermine the industrial capacity of other countries, has been conducting cyberwarfare, while its Belt & Road initiative has been grabbing valuable assets for pennies while undermining the sovereignty of nations around the world. Moreover, the blackmailing, the stealing and theft of intellectual property, and the means of bribing that China is using to achieve its goals are not only appalling and disrespectful of any norm but also are used in order to sustain regimes that oppress people and disrespect human life. And then they spread the Covid-19 and come with their humanitarian aid to assist nations? How could countries and leadership around the world be so fooled?
Lee Kuan Yew, the longtime stateman and Singapore’s leader who died in 2015 was China’s premier watcher and the one who foresaw China’s true intentions. Lee elaborates how China is sucking countries into its system. Every Chinese leader from Deng Xiaoping to Xi have called him a “mentor”. What does the dramatic Chinese transformation in the last 20 years mean for the global balance of power? Lee has answered that: “The size of China’s displacement of the world balance is such that the world must find a new balance. It is not possible to pretend that this is just another big player. This is the biggest player in the history of the world.” Rebalancing China’s weight requires a lion masterminding like a fox at the silversmith’s place where the refiner’s fire is purifying global powers.
The numbers of course affirm Lee’s argument. The Chinese economy is doubling in size every twelve years. The Chinese dream is that by 2049 (on the 100th anniversary of Mao’s victory in the civil war) they will be so dominant that the rest of the world will serve the master China. The West failed to contain the Chinese rise and while genuine intentions existed – as discussed in the book “The Pivot: The Future of America Statecraft in Asia” – and some steps were taken in the right direction in terms of containing China, the metrics show us that those efforts came out wanting. The pivot has been hard to find, as resources were dedicated to balance issues in the Middle East due to an invasion that took place in search for weapons of mass deception. As the pivot was failing, China kept growing and grasping valuable resources from useful idiots.
The West is naïve to believe that China will not live by Mao’s dictum: “Power grows out of the barrel of a gun.” The fact is that the Chinese are arming themselves with state-of-the-art weapons and new military technologies that can counter ships, satellites and planes. Those technologies allow for asymmetric responses. However, the new balance of power calls for military power to be balanced by economic instruments that can achieve geopolitical goals.
President Xi upon taking power declared: “The greatest Chinese dream is the great rejuvenation of the Chinese nation.” I am certain that Xi chose his words very carefully. Unfortunately, the world did not capture the subliminal message of those words. The context is the supremacy in global power. In the Chinese language the word for China means “Middle Kingdom.” “Middle” refers to the space between heaven and earth. In that space no one else fits. Here is the explanation that Lee Kuan Yew gave to Xi’s worldview: “they recall a world in which China was dominant and other states related to them as supplicants to a superpower, as vassals came to Beijing bearing tribute.”
In that worldview, the rise of the West is a historical anomaly that demands correction even if that takes 100 years. Xi Jinping has sold his people – who suffer under his autocratic rule and deprived of their freedoms- a tale that this won’t be the case anymore. In Xi’s worldview – just as all dissidents are silenced domestically – the hierarchical power politics demand that all other nations bow to the superiority of China. That’s the third lesson that Henry Kissinger learned during his crash course on China by John King Fairbank in 1969. Fairbank also taught Kissinger that the Chinese worldview is profoundly ethnocentric and supremacist. “The Chinese Emperor was conceived of and recognized as the pinnacle of a universal political hierarchy, with all other states’ rulers theoretically serving as vassals.” Order in that system derives from hierarchy. The Socratic “know thy self” is replaced by “know thy place.” Foreigners bowing down to China “constituted the natural order of the universe”, as Kissinger wrote.
Xi Jinping chose to overlook Mao’s madness. Xi’s father was a trusted colleague of Mao who rose to be Vice Premier Xi Zhongxun, but Mao ended up – in his paranoia – imprisoning him and forcing Xi Jinping to denounce his own father, while his sister hanged herself from a shower curtain. Xi chose to become “redder than red.” In 1997 despite the fact that he came 151st for a seat in the Party’s Central Committee, Party leader Jiang Zemin changed the rules and expanded the membership to 151. The West again, did not pay attention to that “insignificant” change of rules. From that point on he was appointed chief in the Zhejiang province, overseeing its spectacular growth through debt, state money, manipulation and choosing/creating “winners”, like Jack Ma who started Alibaba to rival Amazon. When corruption scandals swept Shanghai, president Hu Jintao chose Xi to clean house and put out the fire. The West again, did not pay attention. By the summer 2007 as the world was starting to sense that a financial crisis was about to burst, his name topped the internal Party lists as one of the future leaders. Xi not only was selected for the nine-man Standing Committee but was soon perceived as the heir apparent to President Hu. The West understood that the Chinese in their tradition, were choosing again a leader who was safe, sound, predictable and uncharismatic. Guess what? They got Xi who concentrated all power in his hands, and became chairman of everything. Unlike previous administrations he has no successors or deputies. His Vice Premier (who was supposed to succeed Hu) reports to Xi’s trusted colleague Liu He! Through a masterful anticorruption campaign Xi purged all internal opponents, including the head of China’s internal security services. As Xi consolidates power he took the title of commander in chief of the military, a title that even Mao was never given (despite the fact that he successfully led the revolution against the government and won the civil war).
Xi – like all Chinese leaders after Deng – sought after the mentorship of Lee Kuan Yew. According to Lee, Xi aspires to a Dream. Here is what Lee says about Xi: “paints his vision of their future to his people, translates that vision into policies which he must convince the people are worth supporting, and finally galvanize them to help him in their implementation.” Xi is mobilizing sources to achieve global supremacy by means of Party revitalization, economic growth, nationalism, and military restructuring. In Xi’s worldview the phrase “wuwang guochi” translated “never forget our national humiliation” has become the compass that leads to due North, away from American modernity, and the mantra that nurtures the victimhood in Chinese minds so that a payback can be mastered.
The invocation of a “strong national dream”, is referring to an obscure book published at the time of Xi’s rising in the ranks of power. The title of that book, “The China Dream.” The author of the book is Liu Mingfu, a colonel in the People’s Liberation Army who trains future military leaders. The book envisions the supremacy of Chinese power in world affairs. Liu borrows from Zhao Tingyang the notion of tianxia which in Mandarin implies the empire between heaven and earth, with other nations ousted in the “barbarian wilderness.” At the epicenter of this Middle Kingdom China will have the “responsibility” to educate the subjugated barbarians with the Chinese values and priorities, therefore “harmonizing” them for a fit into this under-heaven Middle Kingdom. That Middle Kingdom values obedience over freedom, hierarchy over human values, leadership over law, and elite governance over democracy and human rights.
In the unfolding rebalancing of power there is a dialectic between lions and foxes. The cynicism and corruption of the latter destabilizes order and stability. Pareto gave his name to two revolutionary ideas. The first if known as the Pareto principle, which suggested that 80% of effects came from 20% of the causes (i.e. minority of inputs is responsible for a disproportionate share of outputs, which demolishes the idea of income equality.) The second is known as the Pareto efficiency: while the masses and the people (proletariat) may be fooled that they serve a great cause/dream and a historical call of national rejuvenation, the elites are looking after themselves.
In terms of strategy planning, Pareto taught us about “logical conduct”, a.k.a. procedural rationality: action should be oriented to an attainable goal using means appropriate to that goal, hence the objective and the subjective purpose should be the same. With “nonlogical conduct” the objective goals would diverge from the subjective means (e.g. action lacked specificity and purpose, claimed purpose was out of reach using the methods at hand). Pareto identified that the roots of “nonlogical action” can be found in “residues” (what is left out when the logical is taken away). In his four-volumes he elaborates on six residues. Well into his fourth volume, the six residues are dropped to two and coincide with Machiavelli’s lions and foxes, as ambassadors of force and guile.
The residue associated with foxes – Pareto’s Class I – reflected the instinct of combinations. For example, market economy with one-party system where illiberalism and oppression reign supreme. In addition, Class I is associated with an attitude of outwitting and eliminating others by invoking ideologies, form coalitions where is needed, and eventually cheating them all.
Class II residues reflect lions, and their desire for stability and rules-based order. Lions look after the family and appeal for solidarity that preserves liberty, discipline, and order. Foxes rule by deception and maneuvering. When lions rule, they can tolerate foxes and compromise up to point. However, when the balance of power is threatened, smart lions awake and defend the higher values they represent. The useful idiots that have followed the foxes cannot survive the refiner’s fire.
In his nightmares Xi is awakened by the image of Mikhail Gorbachev. If I were him, I would also be awakened by Gorbachev’s image. The Chinese economy is a Great Wall of debt steroids. That Great Wall of steroids can be sustained as long as there is an absence of coordinated activity that will bring to the surface other significant weaknesses and threats which if materialized could shake up the whole economic, financial, political and social structure of China. The West has a higher calling and a moral obligation to preserve what has been obtained with tremendous sacrifices, while at the same time advancing its own interests and the human rights of oppressed people in Chinese regions. Therefore, the following list of potential policy responses is just this: a list of ideas that would require careful analysis, planning, and execution in order to bring maximum results.
At the epicenter of China’s threats is the Great Wall of debt steroids. To expose such threat, a number of coordinated policies should be enacted which could include – but not limited to – the following:
- Mobilize key players in the international community (hence create an Alliance Club) to understand what is at stake and what needs to be done in order to counter-balance Chinese soft and hard aggression.
- Take precautionary measures for possible Chinese retaliation after some or all of the actions proposed are implemented.
- Convene an international summit of key players where sanctions and penalties against China – for the tremendous damages that they have inflicted to the world – due to their mishandling of the Covid-19 – would be discussed, planned, and put into action.
- An energy embargo with severe penalties for those who violate it, should be implemented if China refuses to abide by the terms of the Alliance.
- In addition to the energy embargo, a grains embargo that would involve North and South America should be planned, while at the same time a compensation mechanism to be put in place for those who will be hurt by the embargo.
- A coordinated action plan should be put in place that in some cases will balance out the BRI (Belt & Road Initiative, a.k.a. OBOR/One Belt One Road) and in other cases will assist impacted countries to get rid off of the burdens imposed by the BRI.
- Coordinated plans that would not allow the Chinese takeover of companies in Asia, Africa, and the West. At the same time coordinate so that vital assistance is provided to Africa in order to control migration flows to Europe while advancing growth and production.
- An Americas industrial plan should be put into place that will target the renaissance of the industrial bases in North and South America. This will have positive effects in employment, incomes, GDP, and immigration flows.
- A coordinated plan of significant sanctions, quotas, and tariffs would be put into place along with ultimatums and carrots regarding behavioral change in the areas of cyberwarfare, industrial espionage, intellectual property rights, opening of Chinese markets to international competition, currency manipulation, and dumping.
- The above step should be accompanied by a list of demands regarding human rights for all ethnic minorities along with the freeze of Chinese assets in the Alliance Club.
- If China does not comply with the demands of the alliance, then prohibit Chinese companies from trading with the allied members, and also prohibit Chinese stocks from being traded in international exchanges.
- Coordinated action that will advance devolution and a particular timetable for the sovereignty and independence of Taiwan, Tibet, Xinjiang/Uyghur ethic group, Hong Kong, Mongolia, Manchuria, Hebei, Guangdong/Cantonese ethnic group, and Basuria.
In that wall of debt steroids one should also add the bricks of potential social instability, the zombies of state-owned enterprises, the energy demands, the unlivable environmental conditions, the challenges of demographics, the challenges of fostering innovation and competing with the West, the possibility of revolt due to suppression, the economic effects of the actions/policies outlined above, the middle-income trap, the potential involvement of the West in what Halford Mackinder – the father of geopolitics -called “World Island”, to name just a few.
Let me close by stating the obvious: Useful idiots no more! Ode to lions! The rebalancing of power can use Sun Tzu’s maxim: “Ultimate excellence lies not in winning every battle, but in defeating the enemy without ever fighting…far better than challenging the enemy on the field of battle is …maneuvering him into an unfavorable position from which escape is impossible.”
Balance of Power, Thucydides, Useful Idiots, & Covid-19: Part III, China and the Statecraft Dimension
Author : John E. Charalambakis
Date : April 14, 2020
“The admiration of the present and succeeding ages will be ours, since we have not left our power without witness…We have forced every sea and land to be the highway of our daring, and everywhere, whether for evil or for good, have left imperishable monuments behind us.” – Thucydides, Pericles’s Funeral Oration, 431 BCE
“Heaven is above, earth is below, and that in between heaven and earth is called China. Those on the peripheries are the foreign. The foreign belong to the outer, while China belongs to the inner.” – Shi Jie, “On the Middle Kingdom”, 1040 CE
Where are the demonstrators in Hong Kong let alone the students of Tiananmen Square? They are irrelevant now due to Covid-19 and the Dream of subjugating every other power to Chinese supreme will. As noted below, China envisions a renaissance of a Middle Kingdom. At the epicenter of this Middle Kingdom, China will have the “responsibility” to educate the subjugated barbarians with the Chinese values and priorities, therefore “harmonizing” them for a fit into this under-heaven Middle Kingdom. That Middle Kingdom values obedience over freedom, hierarchy over human values, leadership over law, and elite governance over democracy and human rights.
This could be viewed as a polemic commentary. It should not. By no means do I imply that governments which botched their responses to Covid-19 should be absolved of their responsibilities. While I am making reference to Covid-19, this commentary is not about Covid-19. It is about how China is trying to exploit even a tragedy like Covid-19, to advance its geopolitical dream. Moreover, it would be an abomination if racism is advocated in the name of our responses to the crisis. I would rather readers view it as a reflection of needed foresight, prevention, and an effort to see the image of the world from a refiner’s fire. I have been asked numerous times, why we always hold a portion of our clients’ funds in gold, despite the fact that it doesn’t even pay any dividends. My answer always has been: “it’s an anchor which, along with hedging, keeps some balance in the portfolios and helps us to see the image of the world at the most critical moments.”
Statecraft is nothing but war by other means. Mastering statecraft advances leadership. Since the GFC (Great Financial Crisis of 2008-’09) we are in the process of a global power rebalancing and China has been manipulating events during this time in order to achieve the dream of subjugating every other power and nation to its will and power. If it is allowed to continue manipulating that game, then global leadership will be seen by historians as nothing but useful idiots at the hand of China.
The father of realpolitik Thucydides, who had a journalist’s eye for details, a researcher’s mind for truth, and a historian’s perspective to identify the root causes behind very complex events, has taught us that that when a rising power (Athens) threatens to displace a ruling power (Sparta), dangers arise, power imbalances take place, and the potential collision course could be painful (Thucydides Trap).
The rise of China pertains great dangers for the rules-based global order. China is unraveling the order that has produced a long peace and prosperity for the last 75 years. Chinese manipulations, including but not limited to the Belt and Road Initiative – let alone a possible alliance with a malevolent Russia which by default would be a lethal combination – need to be countered and stopped, as explained below. Needless to say, that China needs to be held accountable for the spreading of the Covid-19, the deaths of thousands, the infections of millions, and the trillions worth of damages that they inflicted around the world.
When the global rebalancing of power takes place things dissolve. By the end of WWI, the German Kaiser was gone, the Austro-Hungarian Empire was no more, the Russian tsar was overthrown, England had lost its prominence in world affairs, and France’s power was history. What was the cause? Germany was threatening England’s role and the supremacy of the sterling as the world’s reserve currency. When the authoritarian and fascist powers of Germany and Japan, saw the rise of the US, all they wanted was to draw it into a dual conflict in the Pacific and in Europe. The US came out triumphant and the world order established at Bretton Woods kept the peace and advanced prosperity since July 1944. The master Thucydides had seen it all.
At the end of chapter 15 of his book titled “Worthy Fights” Leon Panetta states: “But achievements cannot allow leaders to become complacent,” and in his memoirs Robert Gates states: “Rebuilding the 2010 budget gave me the opportunity not only to make ‘rebalancing’ meaningful but also to weed out over-budget, overdue, or unjustifiable programs and to turn my attention to the herculean task of reforming the defense acquisition process.” Two key words: complacency and rebalancing. Complacency and some miscalculations have allowed China to dominate in production and distribution. The latter in the geopolitical arena is the outcome of the former. That’s where the brain power of the refiner’s fire is needed in order to prevent authoritarianism, illiberalism, and the undermining of the highest values we hold dear to disappear in the name of cheapness and dialectic materialism.
The structural foundations of the world order are dynamized by preventable conditions (virus’s appearance and incompetent handling in Wuhan without notifying the world) which were not only mismanaged but now the arrogance of the Chinese leadership is trying to take advantage of the virus they allowed to spread globally by exploiting weaknesses in the health care systems and by showing hypocritical benevolence while at the same time oppressing their people! Yes, the world should demand that China pays for their complete failures to foresee the severity and the unimaginable consequences that their actions and secrecy could have.
The silversmith knows when to pull the silver from the refiner’s fire: It’s the moment when he is able to see himself reflected in the precious metal. Do we really want to see our image in the Chinese making?
By no means or stretch of imagination, China’s rise can be seen and compared to the benign rise of Athens. Philosophy, drama, democracy, architecture, and naval power represented a rebalancing of power which was misconstrued by Sparta. Over the past 500 years, sixteen times a major power has threatened to displace a ruling power. In twelve out of those sixteen cases the result has been war.
China has chosen not only to reject compliance with human rights standards and international rules-based order, but also has chosen confrontations in the South China Sea, has manipulated its currency in order to undermine the industrial capacity of other countries, has been conducting cyberwarfare, while its Belt & Road initiative has been grabbing valuable assets for pennies while undermining the sovereignty of nations around the world. Moreover, the blackmailing, the stealing and theft of intellectual property, and the means of bribing that China is using to achieve its goals are not only appalling and disrespectful of any norm but also are used in order to sustain regimes that oppress people and disrespect human life. And then they spread the Covid-19 and come with their humanitarian aid to assist nations? How could countries and leadership around the world be so fooled?
Lee Kuan Yew, the longtime stateman and Singapore’s leader who died in 2015 was China’s premier watcher and the one who foresaw China’s true intentions. Lee elaborates how China is sucking countries into its system. Every Chinese leader from Deng Xiaoping to Xi have called him a “mentor”. What does the dramatic Chinese transformation in the last 20 years mean for the global balance of power? Lee has answered that: “The size of China’s displacement of the world balance is such that the world must find a new balance. It is not possible to pretend that this is just another big player. This is the biggest player in the history of the world.” Rebalancing China’s weight requires a lion masterminding like a fox at the silversmith’s place where the refiner’s fire is purifying global powers.
The numbers of course affirm Lee’s argument. The Chinese economy is doubling in size every twelve years. The Chinese dream is that by 2049 (on the 100th anniversary of Mao’s victory in the civil war) they will be so dominant that the rest of the world will serve the master China. The West failed to contain the Chinese rise and while genuine intentions existed – as discussed in the book “The Pivot: The Future of America Statecraft in Asia” – and some steps were taken in the right direction in terms of containing China, the metrics show us that those efforts came out wanting. The pivot has been hard to find, as resources were dedicated to balance issues in the Middle East due to an invasion that took place in search for weapons of mass deception. As the pivot was failing, China kept growing and grasping valuable resources from useful idiots.
The West is naïve to believe that China will not live by Mao’s dictum: “Power grows out of the barrel of a gun.” The fact is that the Chinese are arming themselves with state-of-the-art weapons and new military technologies that can counter ships, satellites and planes. Those technologies allow for asymmetric responses. However, the new balance of power calls for military power to be balanced by economic instruments that can achieve geopolitical goals.
President Xi upon taking power declared: “The greatest Chinese dream is the great rejuvenation of the Chinese nation.” I am certain that Xi chose his words very carefully. Unfortunately, the world did not capture the subliminal message of those words. The context is the supremacy in global power. In the Chinese language the word for China means “Middle Kingdom.” “Middle” refers to the space between heaven and earth. In that space no one else fits. Here is the explanation that Lee Kuan Yew gave to Xi’s worldview: “they recall a world in which China was dominant and other states related to them as supplicants to a superpower, as vassals came to Beijing bearing tribute.”
In that worldview, the rise of the West is a historical anomaly that demands correction even if that takes 100 years. Xi Jinping has sold his people – who suffer under his autocratic rule and deprived of their freedoms- a tale that this won’t be the case anymore. In Xi’s worldview – just as all dissidents are silenced domestically – the hierarchical power politics demand that all other nations bow to the superiority of China. That’s the third lesson that Henry Kissinger learned during his crash course on China by John King Fairbank in 1969. Fairbank also taught Kissinger that the Chinese worldview is profoundly ethnocentric and supremacist. “The Chinese Emperor was conceived of and recognized as the pinnacle of a universal political hierarchy, with all other states’ rulers theoretically serving as vassals.” Order in that system derives from hierarchy. The Socratic “know thy self” is replaced by “know thy place.” Foreigners bowing down to China “constituted the natural order of the universe”, as Kissinger wrote.
Xi Jinping chose to overlook Mao’s madness. Xi’s father was a trusted colleague of Mao who rose to be Vice Premier Xi Zhongxun, but Mao ended up – in his paranoia – imprisoning him and forcing Xi Jinping to denounce his own father, while his sister hanged herself from a shower curtain. Xi chose to become “redder than red.” In 1997 despite the fact that he came 151st for a seat in the Party’s Central Committee, Party leader Jiang Zemin changed the rules and expanded the membership to 151. The West again, did not pay attention to that “insignificant” change of rules. From that point on he was appointed chief in the Zhejiang province, overseeing its spectacular growth through debt, state money, manipulation and choosing/creating “winners”, like Jack Ma who started Alibaba to rival Amazon. When corruption scandals swept Shanghai, president Hu Jintao chose Xi to clean house and put out the fire. The West again, did not pay attention. By the summer 2007 as the world was starting to sense that a financial crisis was about to burst, his name topped the internal Party lists as one of the future leaders. Xi not only was selected for the nine-man Standing Committee but was soon perceived as the heir apparent to President Hu. The West understood that the Chinese in their tradition, were choosing again a leader who was safe, sound, predictable and uncharismatic. Guess what? They got Xi who concentrated all power in his hands, and became chairman of everything. Unlike previous administrations he has no successors or deputies. His Vice Premier (who was supposed to succeed Hu) reports to Xi’s trusted colleague Liu He! Through a masterful anticorruption campaign Xi purged all internal opponents, including the head of China’s internal security services. As Xi consolidates power he took the title of commander in chief of the military, a title that even Mao was never given (despite the fact that he successfully led the revolution against the government and won the civil war).
Xi – like all Chinese leaders after Deng – sought after the mentorship of Lee Kuan Yew. According to Lee, Xi aspires to a Dream. Here is what Lee says about Xi: “paints his vision of their future to his people, translates that vision into policies which he must convince the people are worth supporting, and finally galvanize them to help him in their implementation.” Xi is mobilizing sources to achieve global supremacy by means of Party revitalization, economic growth, nationalism, and military restructuring. In Xi’s worldview the phrase “wuwang guochi” translated “never forget our national humiliation” has become the compass that leads to due North, away from American modernity, and the mantra that nurtures the victimhood in Chinese minds so that a payback can be mastered.
The invocation of a “strong national dream”, is referring to an obscure book published at the time of Xi’s rising in the ranks of power. The title of that book, “The China Dream.” The author of the book is Liu Mingfu, a colonel in the People’s Liberation Army who trains future military leaders. The book envisions the supremacy of Chinese power in world affairs. Liu borrows from Zhao Tingyang the notion of tianxia which in Mandarin implies the empire between heaven and earth, with other nations ousted in the “barbarian wilderness.” At the epicenter of this Middle Kingdom China will have the “responsibility” to educate the subjugated barbarians with the Chinese values and priorities, therefore “harmonizing” them for a fit into this under-heaven Middle Kingdom. That Middle Kingdom values obedience over freedom, hierarchy over human values, leadership over law, and elite governance over democracy and human rights.
In the unfolding rebalancing of power there is a dialectic between lions and foxes. The cynicism and corruption of the latter destabilizes order and stability. Pareto gave his name to two revolutionary ideas. The first if known as the Pareto principle, which suggested that 80% of effects came from 20% of the causes (i.e. minority of inputs is responsible for a disproportionate share of outputs, which demolishes the idea of income equality.) The second is known as the Pareto efficiency: while the masses and the people (proletariat) may be fooled that they serve a great cause/dream and a historical call of national rejuvenation, the elites are looking after themselves.
In terms of strategy planning, Pareto taught us about “logical conduct”, a.k.a. procedural rationality: action should be oriented to an attainable goal using means appropriate to that goal, hence the objective and the subjective purpose should be the same. With “nonlogical conduct” the objective goals would diverge from the subjective means (e.g. action lacked specificity and purpose, claimed purpose was out of reach using the methods at hand). Pareto identified that the roots of “nonlogical action” can be found in “residues” (what is left out when the logical is taken away). In his four-volumes he elaborates on six residues. Well into his fourth volume, the six residues are dropped to two and coincide with Machiavelli’s lions and foxes, as ambassadors of force and guile.
The residue associated with foxes – Pareto’s Class I – reflected the instinct of combinations. For example, market economy with one-party system where illiberalism and oppression reign supreme. In addition, Class I is associated with an attitude of outwitting and eliminating others by invoking ideologies, form coalitions where is needed, and eventually cheating them all.
Class II residues reflect lions, and their desire for stability and rules-based order. Lions look after the family and appeal for solidarity that preserves liberty, discipline, and order. Foxes rule by deception and maneuvering. When lions rule, they can tolerate foxes and compromise up to point. However, when the balance of power is threatened, smart lions awake and defend the higher values they represent. The useful idiots that have followed the foxes cannot survive the refiner’s fire.
In his nightmares Xi is awakened by the image of Mikhail Gorbachev. If I were him, I would also be awakened by Gorbachev’s image. The Chinese economy is a Great Wall of debt steroids. That Great Wall of steroids can be sustained as long as there is an absence of coordinated activity that will bring to the surface other significant weaknesses and threats which if materialized could shake up the whole economic, financial, political and social structure of China. The West has a higher calling and a moral obligation to preserve what has been obtained with tremendous sacrifices, while at the same time advancing its own interests and the human rights of oppressed people in Chinese regions. Therefore, the following list of potential policy responses is just this: a list of ideas that would require careful analysis, planning, and execution in order to bring maximum results.
At the epicenter of China’s threats is the Great Wall of debt steroids. To expose such threat, a number of coordinated policies should be enacted which could include – but not limited to – the following:
In that wall of debt steroids one should also add the bricks of potential social instability, the zombies of state-owned enterprises, the energy demands, the unlivable environmental conditions, the challenges of demographics, the challenges of fostering innovation and competing with the West, the possibility of revolt due to suppression, the economic effects of the actions/policies outlined above, the middle-income trap, the potential involvement of the West in what Halford Mackinder – the father of geopolitics -called “World Island”, to name just a few.
Let me close by stating the obvious: Useful idiots no more! Ode to lions! The rebalancing of power can use Sun Tzu’s maxim: “Ultimate excellence lies not in winning every battle, but in defeating the enemy without ever fighting…far better than challenging the enemy on the field of battle is …maneuvering him into an unfavorable position from which escape is impossible.”