Hong Kong

[Hua Guofang]

How the West got Xi Jinping wrong on business

President Xi Jinping's apparent support for private enterprise has masked the reality that his Communist Party is still the ultimate authority.

 

Richard McGregor

Jul 11, 2019 — 11.32pm

 

https://www.afr.com/world/asia/how-the-west-got-xi-jinping-wrong-on-business-20190709-p525n0

 

 

In September 2018, a Chinese banker in Beijing set the local internet alight with a surprising suggestion: to phase out local entrepreneurs and allow state companies to take their place. "China’s private sector has already done its job in aiding the development of the state economy, and it should now leave the stage," wrote Wu Xiaoping in a blog post.

 

Wu’s big idea was as simple as it was outlandish. In readiness for a showdown with the United States and other hostile foreign powers, China had to consolidate its economic gains under a single, unified state banner. The blind development of the private sector, he argued, should give way to a strengthened state economy and large enterprises under the party’s control. Wu’s post was roundly attacked and ridiculed. Even the People’s Daily, the Communist Party’s official mouthpiece, weighed in to run it down. The bigger question, though, given the heavyweight criticism of the post, was why Wu’s ramblings hit such a nerve in the first place.

 

The days of anyone disputing the central role of the private sector in sustaining the Chinese economy are long gone. The Chinese use a single figure – 56789 – to describe how the private sector supports the economy. Entrepreneurs contribute 50 per cent of tax revenue, 60 per cent of output, 70 per cent of industrial modernisation and innovation, 80 per cent of jobs, and 90 per cent of enterprises. Although not entirely accurate, the figure symbolically encapsulates the core truth of modern China and the Communist Party – that the country’s economy and political system would have run aground long ago without the country’s entrepreneurs.

Wu’s blog post ignited criticism partly because of his employer, the country’s biggest local investment bank, although his co-workers at China International Capital Corporation dismissed him as something of a professional stirrer. But the real explanation for the backlash firestorm was his timing. Wu’s article landed in dry tinder, amid rising anxiety among entrepreneurs who were being deprived of capital, hurt by a slowing economy and buffeted by Donald Trump’s tariffs. They were all important factors in the gloom that was settling over private business at the time. The root of the entrepreneurs’ concern, however, was elsewhere. It was political, in the form of Xi Jinping.

By 2012, the year Xi Jinping came to power, private firms were responsible for about half of all investment in China and the bulk of GDP. Nicholas Lardy, a US economist with a long track record of studying the Chinese economy, said that Xi’s ascension marked a turning point for entrepreneurs.

 

"Since 2012," he wrote in a book released in early 2019, "this picture of private, market-driven growth has given way to a resurgence of the role of the state in resource allocation and a shrinking role for the market and private firms."

 

China watchers differ about the degree to which Xi’s leadership marks a clear break in economic policymaking. Chinese state firms have always had a predominant role in the economy, long before Xi took over the country’s leadership. In the political pecking order of the economy, the state always sits at the top. Equally, the party has always maintained direct control over state firms through the power to hire and fire senior executives, along with other levers.

 

Still, however one characterises past policies, there is little doubt that Xi firmly positioned himself on the side of party intervention and state control. In his first term, Xi spoke constantly of the need to support the state economy rather than abandon it. The party’s role in both government and private businesses was solidified and expanded. The number of industrial funds run by the government and those doling out public money soared. The central government stepped in with billions of dollars in support when the stock market threatened to melt down in 2015. Local governments took their cue from the centre, offering loans to prop up so-called "zombie companies", government-owned enterprises that would otherwise have gone bankrupt.

 

As one astute commentator on Lardy’s book noted, the general explanation for Xi’s policy stance, that he didn’t understand the benefits of free markets, was wrong. In fact, the opposite might be true: that Xi understands markets more than well enough to know the threat they pose to single-party rule.

L’Oreal, Walt Disney and Dow Chemicals in China now all have party committees and display the hammer and sickle on their premises.

Xi’s interventionist instincts have had profound ramifications in China and abroad, and solidified his critics’ narrative about him in other areas. For example, when US officials were pressed in early 2019 to provide evidence that Huawei, the Chinese telecommunications giant, had facilitated spying on the United States and its allies, they said there was no need. Beijing had already made their case for them, first with the party’s systematic infiltration of private companies, and second with the passage of a new national intelligence law in 2017. The law states that "any organisation and citizen" shall support and co-operate "in national intelligence work". The director of America’s National Counterintelligence and Security Centre, when asked about China’s entrepreneurs, cited these two policies in asserting that "Chinese company relationships with the Chinese government aren’t like private sector company relationships with governments in the West".

From such conclusions, important policy changes flow. The United States and European Union were immediately gifted an excuse to limit Chinese access to their markets, technology and companies. Australia has cited the same intelligence law to keep Huawei’s 5G technology out of its future mobile networks. Gordon Sondland, Donald Trump’s envoy to the European Union, gave such sentiment a hyperbolic spin to argue that Europe should do the same. "We want to keep critical infrastructure in the Western world out of Chinese malign influence," Sondland said. "Someone from the Politburo in Beijing picks up the phone and says 'I wanna listen in on the following conversation, I wanna run a certain car off the road that’s on the 5G network and kill the person that’s in it', there’s nothing that company legally can do today in China to prevent the Chinese government from making that request successfully."

 

Until recently, such a statement would have been laughed out of court. No longer. Nor would Washington have contemplated the policy of "decoupling" the US and Chinese economies, shorthand for the administration’s commitment, through taxes, tariffs and other punitive measures, to disentangle its companies and their technologies from China’s supply chains. As Henry Paulson, the former Goldman Sachs chief, erstwhile US treasury secretary and long-time China bull, said in a speech in November 2018: "I see more clearly than ever the prospect of an economic Iron Curtain – one that throws up new walls on each side and unmakes the global economy, as we have known it."

 

The relationship between the party and private sector companies is, up to a point, flexible and fluid, certainly more so than with state companies. The party doesn’t habitually micromanage their day-to-day operations. The firms are largely still in charge of their basic business decisions. But pressure from party committees to have a seat at the table when executives are making big calls on investment and the like means the "lines have been dangerously blurred", in the words of one analyst. "Chinese domestic laws and administrative guidelines, as well as unspoken regulations and internal party committees, make it quite difficult to distinguish between what is private and what is state-owned."

 

The answer to the question "does the party control a company?" is that it is impossible to tell. In the current environment, however, fewer foreign governments want to give Beijing the benefit of the doubt. If there was any question as to who was in charge of the economy and business, Xi’s local and overseas critics alike only had to take the Chinese leader at his word  – that in private enterprises, as with state-owned firms and every institution in China, the party was the ultimate authority.

If any Chinese leader appreciated the value of business, it should have been Xi. From 1985 to 2007, Xi served in two provinces, Fujian and Zhejiang, becoming the governor of the former and party secretary of the latter. Both provinces stand out in China as thriving bastions of private enterprise. Fujian was also the premier gateway for investors from nearby Taiwan, starting in the 1980s and accelerating after WTO accession. Like leaders of Fujian before and after him, Xi regularly hosted Taiwanese entrepreneurs and lobbied them to put money into the province. Zhejiang is home to a number of China’s most famous and successful private companies, such as Jack Ma’s Alibaba in Hangzhou and Li Shufu’s Geely, the car manufacturer that bought Sweden’s Volvo, in Ningbo.

 

In the early optimistic glow of Xi’s ascension to the leadership, the Western media naturally latched on to his provincial pedigree to talk up his appreciation of markets.

Yet a deeper dig into Xi’s past statements and writings on the economy displays an official who has been a dogged and diligent supporter of party orthodoxy on the economy at every turn. Xi might have taken big risks in domestic and foreign policy but on the economy, he was not one for ideological experimentation. In the Politburo, as vice-president from 2008 to 2013 and as the leader of the party school for most of the same period, there is little evidence of him straying from his core beliefs about the need to consolidate and strengthen party control inside businesses. Xi has always talked about development being balanced between the state and the entrepreneurial economy. In practice, though, that meant protecting the state sector to ensure it wasn’t eaten up by entrepreneurs in places such as Fujian and Zhejiang.

 

By the time Xi arrived in Zhejiang in 2002, the province was already well on the way up the economic ladder. Xi, who used to write an occasional newspaper column, headed a group of officials who became known as the "New Zhijiang Army". They embraced the use of "social capital", a euphemism for private investment, to spread the risk in funding the province’s signature infrastructure projects, such as the 36-kilometre Hangzhou Bay Bridge connecting Shanghai and Ningbo. Relying solely on government investment is not enough, Xi wrote. "It is better to walk with two legs than one."

 

But Xi’s support for mixing the duelling ownership structures was purely pragmatic. It had value, he said in another forum, because it would "improve the socialist market economic structure".  Xi’s assessment is echoed by Michael Collins, Deputy Assistant Director of CIA for the East Asia and Pacific Mission Centre and one of the agency’s most senior officials for Asia, who said that in China economic reform is not an end to be achieved itself. "The fundamental end of the Communist Party of China under Xi Jinping is all the more to control that society politically and economically. The economy is being viewed, affected and controlled to achieve a political end."

 

By 2012, when Xi came to power, the landscape had changed substantially. China was initially knocked sideways by the global financial crisis in 2008, before swiftly navigating its way back to fast growth through a giant fiscal stimulus orchestrated by the government and delivered by the big state banks. In the same year, China hosted the Olympics, with Xi overseeing Beijing’s management of the event. For the party, China’s economic recovery and the Olympics were judged to be triumphs and, as such, affirmations of the governing system’s superior qualities and China’s enhanced global status.

 

The economy was also changing shape in this period. From around 2010, after the fiscal splurge of the financial crisis, Chinese technocrats began to focus more intently on cutting debt and lifting consumption. That meant less focus on investment and exports and, if you listened to the entrepreneurs, a greater reliance on private business to generate growth.

 

"Chinese consumption is not driven by the government but by entrepreneurship, and the market," Jack Ma of Alibaba said in September 2015. "In the past 20 years, the government was so strong. Now, they are getting weak. It’s our opportunity; it’s our show time, to see how the market economy, entrepreneurship, can develop real consumption." Ma may have thought that the times suited him, and to a degree, they did. His business continued to soar. But Xi was all the time making sure that the party grew in tandem with the economy, in both the state and private sectors. In retrospect, Ma’s comments look dangerously cocky.

 

Private companies are sometimes written about as if they are a new frontier for the party, but that is only half true. As early as the turn of the century, around the time Jiang Zemin secured support for allowing entrepreneurs to join the CCP, the party began to do the same in reverse. If private businesses were coming into the party, the party always made sure it had a seat at the table in the companies as well. But under Xi, the same mindset of consolidation and expansion on display within the state sector was also evident within private companies, both local and foreign. In March 2012, a few months before taking over as general secretary, Xi delivered a speech in which he stressed the need to lift both the number of party bodies inside private business, euphemistically known as "non-publicly owned enterprises", and increase the sorts of work they supervised. Around the same time, new details for "party building" in enterprises were released, calling "for the party secretary to participate in and attend important executive-level meetings".

 

"After seeing business threaten to take over the state in Russia, Beijing has been determined to make sure that the same disaster does not befall China."

Many of the regulations issued in 2012 sounded as much like ritualistic incantations of standard propaganda as they do clear directives. They called for "uniting the masses", "building an advanced corporate culture" and disseminating the party’s policies and principles. Some reports discussed how the role of the party was to boost the firms’ profits. In Kunshan, in Jiangsu province, near Shanghai, long a hub for Taiwanese investors, officials held a national training class for party secretaries of private companies at which they described the internal committees as the "nerve endings of the CCP".

 

The point about profitability is important, though, as is the injunction to attend "executive-level meetings". The party wants to be part of business successes, not failures. It wants to sit alongside local and foreign entrepreneurs and share their wealth, not run their companies into the ground with socialist dictates. Increasingly, it also wants to do more than supervise companies. It wants to be at the table when commercial decisions are made, not just manage staff. "We should make money together," Lu Wei, then head of China’s party office for Internet Security, told Paul Jacobs, the CEO of Qualcomm, the US chip maker, in 2014. Lu’s comments to some extent reflected Beijing’s desire to acquire Qualcomm’s technology, a sector in which China was weak. The message, however, was clear – the fat of the land should be shared with the state.

 

The party’s overarching aim, though, has remained consistent: to ensure that the private sector, and individual entrepreneurs, do not become rival players in the political system in a way that threatens the single-party state. The party wants economic growth, but not at the expense of tolerating and indeed nourishing any organised alternative centres of power. In sessions on the Soviet Union ordered by Xi, officials studied not just the collapse of the Soviet Union but also its aftermath, when a new class of Russian oligarchs enriched themselves with the virtual theft of state assets. Chinese leaders watched in horror as the Soviet Union disintegrated and its assets were privatised. Having seen business threaten to take over the state in Russia, Beijing has been determined to make sure that the same disaster does not befall China.

 

The party’s efforts to place itself inside private companies have been, according to its own figures, very successful. One recent survey by the Central Organisation Department, the party’s personnel body, found that 68 per cent of China’s private companies had party bodies by 2016, and 70 per cent of foreign enterprises. Although these figures sound high, they don’t match the targets the party has set for itself. In Zhejiang, for example, Xi’s old stamping ground and ground zero for the struggle between the CCP and entrepreneurs, the province set a target in August 2018 to have cells inside 95 per cent of private businesses. There was a need, the survey said, to retain the revolutionary spirit inside the companies as their ownership was handed on to the next generation.

 

For a reliable benchmark about the power of the party in China, you only need to listen to wealthy entrepreneurs hold forth on politics. Masters of the universe in their business domains, the otherwise all-powerful CEOs go to abject lengths to praise the party. To take a few companies listed in a single article in the South China Morning Post, Richard Liu of e-commerce group JD.com predicted communism would be realised in his generation and all commercial entities would be nationalised. Xu Jiayin of Evergrande Group, one of China’s largest property developers, said everything the company possessed was given by the party and he was proud to be the party secretary of his company. Liang Wengen of Sany Heavy Industry, which builds earthmovers, went even further, saying his life belonged to the party. "They act as if they are being chased by a bear," wrote Zhang Lin, a Beijing political commentator, in response to these comments. "They are powerless to control the bear, so they are competing to outrun each other to escape the animal."

 

Jack Ma of Alibaba, the global face of Chinese entrepreneurship, has always managed to strike a quirkier and more independent stance than his fellow billionaires. "Be in love with the government. But don’t marry them," he once memorably said. Ma’s pithy aphorisms at home and abroad were mostly a plus for his business, but they had a downside. Ma’s high profile made him vulnerable. If there was a presidential election in China tomorrow, Ma might win, one of his former business partners told me, only half joking, adding that it was a dangerous position to be in. In September 2018, Ma announced unexpectedly that he would step down from a day-to-day role in the company the following year. Ma said he wanted to focus on education and philanthropy. An equally plausible reason for his resignation, the former business partner said, was Ma’s fear that his power and popularity had made him a target of the party. Ma has been in the party since the 1980s, although his membership was not declared until late 2018, after his retirement announcement, in an article in which the People’s Daily complimented him for his contributions to reform.

Whether or not some entrepreneurs were intent on taking him on, Xi pre-emptively took the fight to them. In 2017, the Xi administration began a campaign to rein in swashbuckling business leaders, starting with some of the corporate chieftains who had become the standard bearers for aggressive Chinese dealmaking overseas. There was no clear pattern in the approach the government took. Some business leaders were forced out of overheated commercial sectors such as real estate. Others were told to pull back from offshore forays either because their high profile was an embarrassment for Beijing or because the government was trying to stop capital flight. Some, such as Wu Xiaohui, the chairman of Anbang Insurance Group, went the way that communist members who fall foul of the system do, vanishing without explanation into the party’s detention system. Only months earlier, Wu had been leading negotiations to spend $US14 billion on hotels in the United States, before the deal collapsed. In May 2018, the authorities announced Wu had been sentenced to 18 years in jail for fraud and embezzlement.

China’s three dominant internet companies, Baidu (a search engine), Alibaba (e-commerce) and Tencent (messaging and gaming), known collectively as the BAT, have all felt the government’s wrath. In 2018, Tencent lost $US200 billion in its market capitalisation after regulators stopped approving new online games, pushing the company out of the world’s top 10 companies ranked by their share market valuation.

 

The rapid growth of the BAT companies and their dominance of the internet in China has given them an outsized economic status. But their political value is just as important, as they have become indispensable to China’s surveillance state. With the mountain of data they generate, the BAT trinity are in effect turning into a real-time, efficient and privately run intelligence platform. In that respect, they are ideal private companies. They both drive economic growth and also buttress the political system.

 

Foreign CEOs, too, have come under pressure to give the party a larger role in their firms. Again, this is not a trend that started with Xi. Walmart, which famously won’t allow unions in its US stores, has had party cells in its companies in China since at least 2006, and CCP-controlled unions even ear- lier. Under Xi, however, emboldened officials have pushed foreign firms harder to accommodate the party and give its representatives a role in business decisions. Companies as diverse as the cosmetics giant L’Oreal to Walt Disney and Dow Chemicals in China now all have party committees and display the hammer and sickle on their premises.

 

Executives from one European company were quoted as saying that party representatives had demanded to be brought into the executive committee and have the business pay their expenses. Like Chinese entrepreneurs, foreign businessmen and women are trying to outrun "the bear", not always with success. But the party’s persistent efforts to colonise the private sector have stoked a backlash of their own.

 

In late 2017, the EU business chamber in China formally complained about party organisations trying to extend their influence in their member companies, something they said would undermine the authority of their boards. "A fundamental change of this nature . . . would have serious consequences for the independent decision-making ability of these [joint venture] companies," the chamber said in a statement. The chamber’s argument, that an extension of the party’s functions had no legal basis, was met with indifference locally, at least in public utterances. "When you are in Rome, do as the Romans do," said Chen Fengying, an expert at the China Institutes of Contemporary International Relations, a foreign policy think tank. "Foreign investors should respect local rules and regulations in China."

On one level, Xi has been untroubled by the backlash over his treatment of entrepreneurs. The idea that the private sector is being overly politicised is upside down, according to his world view. Business leaders should "strengthen self-study, self-education and self-improvement", he said in 2016. "They should not feel uncomfortable with this requirement. The Communist Party has similar and stricter requirements on its leaders."

 

Later, in 2018, when the economy started to slow and the trade war was ramping up, Xi was much more pragmatic and solicitous. In November that year, he invited a select group of entrepreneurs, including Tencent’s Ma Huateng (also known as Pony Ma), for a meeting in the Great Hall of the People. He wanted to reassure them that they were "all part of our family". At the same time, a surfeit of stories appeared in the official media urging banks to lend private firms more money.

Not all entrepreneurs were buying the new line. One businessman, Chen Tianyong, posted a lengthy rant on social media, which he titled "An Entrepreneur’s Farewell Admonition", explaining why he had left China. "China’s economy is like a giant ship heading to the precipice," he wrote in a posting that was later taken down. "Without fundamental changes, it’s inevitable that the ship will be wrecked and the passengers will die."

 

This is an edited extract from Xi Jinping: The Backlash, a Lowy Institute Paper to be published by Penguin Random House Australia on July 16.

[Kults]

Holy wall of text

[misteraven]

1 hour ago, Kults said:

Holy wall of text

Have to appreciate when someone properly engages in a conversation, as well as provides sources and real talking points to back a position.

 

?

[Kults]

1 minute ago, misteraven said:

Have to appreciate when someone properly engages in a conversation, as well as provides sources and real talking points to back a position.

 

?

Agreed. When its their own thoughts. Not keen on reading a bunch of copypasta'd articles. The links and a description would suffice. Just layed out like that my brain checks out and I skip it.

[misteraven]

To be fair, there's been plenty of both. Likewise, there's only so many hours in the day and there's a lot of discussions going. Not to hassle the topic, but if someone has already communicated a message or concept concisely and likely in a manner more eloquent than any of us could reasonably do, makes no sense to rewrite it just for the notoriety of saying they're your own words. Sometimes it feels like school on here, but its not, so no dings for plagiarism or points for original prose.

[Mercer]

@Hua Guofang the answer is the same as always, using the words "embraced the free market" is just as accurate as any other four word phrase to describe Chinas shifts in economic policies. You've already conceded the communist party cherry pics features of free market economics to incorporate into their own state run economy. Outside of writing an essay describing in detail these individual shifts in policy. Think of a better four words to describe this shift, I'm sure you felt the assertion was too strong for your subjective taste but that doesn't mean they were wrong.

 

I assert the black markets, and unregulated/recorded person to person transactions truly free markets in existence. Every country has intrusive tax, and financial laws, a treasury of some sort, a central bank , pricing mandates of some sort, wealth redistribution, and the state always acts as a gatekeeper for large capitalists, and business institutions operating under their system.

 

There is much more state ownership in China when compared to the West, which operates under a very different set of rules if you think about when the term "free market" was originally bestowed. We can both agree the Chinese communist party has loosened it's strangle hold since Mao, and you, his successor China has encouraged, and benefitted tremendously from entrepreneurship, and shifts in policy over the last few decades. A paradox for a supposed communist country, much like America claiming it's still a "free market". 

 

These days one could make a very nice life for themselves living in China, you only need to make sure the government, and more importantly the agents of the government are getting their cut if you're on the radar. Just watch what you say, never challenge or impeded their authority, and for the most part if you're making money life is good.

 

Don't get it twisted. If you not paying taxes and get caught, or fail to grease palms whenever the opportunity presents itself (and it's lucrative) you're fucking up in both The US and Australia. Same thing goes for challenging government's authority, they can and do end lives, here on an almost daily basis. There's no minor traffic or regulation, coupled with disregard for authority that can't result in your untimely demise. Describing either market economy as "free" is totally inaccurate. That is if we're confined to the strictest literal meaning of words in this discussion. Common use of  the term "free market" more applicable to the United States than to China, doesn't matter, I never asserted either economy was the same.

 

I summed up Chinas noticeably dramatic shift in economic policy in 4 words for the sake of discussion. You may chose to use stricter definition of the term "free market" than me, ironic considering my "dogmatic" economic philosophy. So from now on I'll use the absolute strictest definition, and only refer to black markets as free markets for the sake of discussion. It's funny, unless you're breaking the law,  like buying weed where it's illegal there is probably a tax, fee, regulation, law, and license addressing, and coercing participants of almost every transaction.

 

Further demonstrating this is only an argument over semantics: Here's some links to articles written by credible economic experts, with titles outlining just how elastic the English language is, which is very useful when summarizing complex topics like an entire economy for the sake of discussion

 

Forbes Magazine)

China's, The Most Vicious Free Market on the Planet

 

The Cato Institute

 How China Became Capitalist

 

The Economist

China's Economy - Bamboo Capitalism

The Mises Institute

 The American Economy is not a Not a free market economy

Edited August 20, 2019 by Mercer

[Hua Guofang]

Happy to agree that this has devolved into semantics now, however I contend that your original comments in context overstated what was occurring in China.

 

My central point is that there were market based reforms in China under Deng in the 80s and they have continued ever since. However, to look at those reforms as any kind of move to marketisation - even in the sense that we have it in Aust and the US - would be a huge mistake. Every market reform made is counter-balanced by increased Party control of business and the economy. Second, the opening up that has occurred is very minor to the state control that exists.

 

I also think a number of the articles you've linked to are out of date. Check mine, they are all no longer than a year old, some of yours are closer to 10 years old and Xi Jinping has been rolling back the market reforms since 2012. But that is a little bit of a moot point as you're pointing to the market reforms since 1979, which are definitely real, and you are right to say that there has been market based reforms since then.

 

I agree with what you're saying about the shadow system and I thought about that as I was typing; that is actually free markets at their best. However, to get semantic again, China and the Party have NOT embraced that at all. The govt does its best to squash it because it is out of their control. More accurate to say is that the free market has arisen BECAUSE of anti-market controls by the Party. The free market may exist in spite of policy.

 

My final point is to ask why you keep making up bullshit: " I never asserted either economy was the same. "

 

I never said you did. Why do you keep on making that up? Why do you not respond when I call you out on that? Why are you making up bullshit?

 

Keen to get an answer and to see you stop avoiding that issue.

[Hua Guofang]

8 hours ago, Kults said:

Agreed. When its their own thoughts. Not keen on reading a bunch of copypasta'd articles. The links and a description would suffice. Just layed out like that my brain checks out and I skip it.

That's why I bolded and underlined the key points.

 

Just hit them and you'll be fine.

[Brink]

Reading all this made me realize how little I knew about this entire situation. Keep at it fellas, 12oz is the only trusted news source these days 

[aimer]

Every now and then, when I go about my day to day and meet and talk to idiots I start to think that I may be smarter than the average person just by the amount of spuds I meet.. and then I read through a thread like this and realise that i'm one of them and I don't have a clue what the fuck is going in in the world hahahaha

Shout outs to 12oz for keeping me educated since 2008

[Mercer]

9 hours ago, Hua Guofang said:

original comments in context overstated what was occurring in China.

I even tried to agree with you and offered "stop trying to murder" as an alternative.  Again, my admittedly "extremist views" (to some) are founded on non-violent resistance, and counter-economic warfare against the state(s). I basically view it all governmental unnecessary and feel as though the free market alternatives to the services government provides are far superior, less costly. To me very few of us even have access to a truly "free" market yet. 

 

If you follow economics, the same blunders made by the CCP, are made here regularly by the Fed, FTC, IRS, etc. Much like the CCP the government agents are not the ones held responsible/accountable for these mistakes. That burden is always shouldered by the public, much like in China.

 

9 hours ago, Hua Guofang said:

 

My final point is to ask why you keep making up bullshit: " I never asserted either economy was the same. "

 

I never said you did. Why do you keep on making that up? Why do you not respond when I call you out on that? Why are you making up bullshit?

 

Keen to get an answer and to see you stop avoiding that issue.

1. I used the words "Embraced the free market"
2. You took issue with the phrasing, countered "China isn't a free market".
3. At that point I agreed that the phrasing was a bit too strong, offered alternatives.
4. You pointed out the differences between how our two systems are run, flat out proving they're different
5. In the end, we both agreed that they've definitely shifted in the "free market" direction, basically what I tried to sum up originally.

The only reason I used "the same" is this should have stopped at step 3 above. It's an unproductive, all be it a somewhat entertaining discussion for me at least. The only examples you've offered that China hasn't actually "embraced the free market" only outlined the obvious differences between their system and "ours". Instead of outlining the increasing similarity between the two systems, I thought I'd instead just demonstrate the annoyance using an admittedly bullshit straw man argument for entertainment purposes.

[Hua Guofang]

HA!

 

That's got to be the strangest and longest bow I've seen drawn in a long time, but cool, if that's they way you saw it, I can accept it.

 

I beat dead horses like this as it forces me to update my knowledge on some of these issues that I haven't focused on in a while. For instance, I wasn't aware that the SOE sector had become more profitable (although it seems to be still under argument). So, it was fun to me too.

 

Back to HK protests:

Edited August 21, 2019 by Hua Guofang

[Mercer]

@Hua Guofangall good, what do you think the chances of another massacre going down are in HK? I wonder how long CCP can keep up the oppression. Long enough to slowly reform into something more palatable, and less totalitarian like the house of lords slowly giving way to house of commons, or will there be war/revolution like in the US? IMO it's probably never going to do either any time soon.

[Mercer]

Not as famous as the Guy standing in front of tanks, but much more accurate as to the real story.

 

Edited August 22, 2019 by Mercer

[Hua Guofang]

I was in a hospital room in Beijing once that was occupied with four other beds. They got to talking about Tiananmen and one lady went off. She lived close to the square when it happened and she verified exactly what we know happened. She said she saw people just getting mowed down and head gunfire for a day. Nobody in that room had believed the govt line, even before the older woman went off. However, the younger folk, people 30 and under, they have no fucking idea and have been so inculcated with propaganda that they autopilot to "you hate China, why do you lie about China, you want to hold China back". 

 

*Edit - actually, it's also one of the reasons why I get annoyed that people up in here trot out the "you've been sucked in by MSM". Because that's exactly what the younger generation of Chinese say "Oh, you only know what the American media says and they hate China". They never even think of asking what you know, how you know and what your sources are. Kind of like this place sometimes ! ?

Edited August 22, 2019 by Hua Guofang

[Mercer]

Agreed, the partnership between media and the government here is less one sided. The actual content being reported is voluntary on the part of the media concerning official, or legal state coercion regarding content. While there are undoubtably may incentives to tread lightly on the toes of the players running the game in some instances, fear of just disappearing one day for reporting "the wrong story" is almost non-existent in the United States. The financial incentives are off the chart.

 

On an unrelated note, a dream job of mine would be gun smuggling operation resulting in a quarter billion armed citizens. I really can't wait for 3D printed gun technology, and DIY milling of metal parts is dialed in properly. Sending files from the comfort of my desk in the US. Pretty sure the world is sleeping on this, and this is the only feasible solution to the CCP I see for a completely disarmed/oppressed population. HK is demonstrating the will power is present.

[Brink]

7 hours ago, Hua Guofang said:

I was in a hospital room in Beijing once that was occupied with four other beds. They got to talking about Tiananmen and one lady went off. She lived close to the square when it happened and she verified exactly what we know happened. She said she saw people just getting mowed down and head gunfire for a day. Nobody in that room had believed the govt line, even before the older woman went off. However, the younger folk, people 30 and under, they have no fucking idea and have been so inculcated with propaganda that they autopilot to "you hate China, why do you lie about China, you want to hold China back". 

 

*Edit - actually, it's also one of the reasons why I get annoyed that people up in here trot out the "you've been sucked in by MSM". Because that's exactly what the younger generation of Chinese say "Oh, you only know what the American media says and they hate China". They never even think of asking what you know, how you know and what your sources are. Kind of like this place sometimes ! ?

I thought Tiananmen was widely accepted as a mass murder world-wide at this point? Are there still actually younger people in China who dont believe it happened???

[Hua Guofang]

Absolutely.

 

Many that don't even know about it, at all.

 

[misteraven]

7 hours ago, Mercer said:

Agreed, the partnership between media and the government here is less one sided. The actual content being reported is voluntary on the part of the media concerning official, or legal state coercion regarding content. While there are undoubtably may incentives to tread lightly on the toes of the players running the game in some instances, fear of just disappearing one day for reporting "the wrong story" is almost non-existent in the United States. The financial incentives are off the chart.

 

On an unrelated note, a dream job of mine would be gun smuggling operation resulting in a quarter billion armed citizens. I really can't wait for 3D printed gun technology, and DIY milling of metal parts is dialed in properly. Sending files from the comfort of my desk in the US. Pretty sure the world is sleeping on this, and this is the only feasible solution to the CCP I see for a completely disarmed/oppressed population. HK is demonstrating the will power is present.

3D printing parts and hand machining won't be effective any time soon and doubtful in our lifetime. Its a great intellectual study and statement, but half the manufacturers out there can't even put a decent gun together so doubt the DIY stuff will get here anytime soon. Liekwise, only a matter of time before they mandate some sort of filtering. It'll start with the protection of intellectual property and then extend to other stuff they dont want you to make. Same with trying to scan currency on any flatbed scanner made in the last decade... It somehow detects what you're trying to do and presents a warning about it, rather than just scanning. Sure, you can hack around it if you're motivated enough, but with that kid of motivation, there will be easier paths towards attaining hardware like that.

 

And as far as media, its not even a secret how incestuous the relationship is between government and media. This is why its a huge deal to get kicked out of the media pool to the white house. Meanwhile, government feeds "off record" news to media or provides exclusive access in exchange or in parallel to stuff they want to hit the wire. That shit isn't even a secret and is just how it works.

[Mercer]

On 8/22/2019 at 2:16 PM, misteraven said:

3D printing parts and hand machining won't be effective any time soon and doubtful in our lifetime.

Beg to differ, Ghost Gunner 2 if dialed in properly has been able to produce consistently reliable AR lowers as early as 2017, and only cost's around $2K to purchase. From what I hear, people easily find a way to make it pay for itself considering a quality billet 80% lower costs $67. People also generally stock up on these 80's and milling machines just incase, anticipating these unfinished blanks might be worth more than it's weight in coins one day, under the right circumstances.

 

 

Again, these aren't the plastic pieces that only work once. Most of the tricky stuff has been done for you before you even get it. Nobody would claim they are, or really even need them to be the same quality level as a high end consumer semi auto. I question if that level of quality is really worth the cost considering most of the high quality stuff I fetishize starts at around $5k and only go up from there.

 

Considering equal levels of personal abilities & training, would you want to clear a house, or operate behind enemy lines with 1 person that has a $5000 rifle, or with 10 people with $500 guns? For me, the answer is simple. If Sun Tzu has taught us anything, conducting irregular warfare requires operating with deadly efficiency. The essence of irregular warfare centers around making sure it costs the enemy10x what it costs you to keep fighting.

 

 

This is how far along DIY lowers were back in in 2015 before the production process could be almost fully automated.

 

 

I was pissed when he turned them in.

 

 

On 8/22/2019 at 2:16 PM, misteraven said:

Its a great intellectual study and statement, but half the manufacturers out there can't even put a decent gun together so doubt the DIY stuff will get here anytime soon.

Armies all over the planet including our friends the Taliban, and the Vietcong have fought, and won wars with much less. To help illustrate the bigger picture at play here, we all agree a 2019 Corvette ZR6 is far superior to a 2013 Hyundai Elantra, but the advantages are almost purely psychological. Because of traffic, speed limits, etc. you're not getting there any faster in a Vette.

 

I'm sure to anyone who enjoys shooting, a quality federally traceable  rifle isn't even comparable to one of these ghost guns, or even comparable the mass produced guns you can pick up cheap at wall mart cheap. That ignores the reality of what fighting irregular warfare is all about, trying to remain anonymous and not get caught. The ability to cheaply arm allies, and not be traced may prove way more important than having a near perfect 3/4" grouping. 

 

On 8/22/2019 at 2:16 PM, misteraven said:

Likewise, only a matter of time before they mandate some sort of filtering. It'll start with the protection of intellectual property and then extend to other stuff they don't want you to make. Same with trying to scan currency on any flatbed scanner made in the last decade... It somehow detects what you're trying to do and presents a warning about it, rather than just scanning. Sure, you can hack around it if you're motivated enough, but with that kid of motivation, there will be easier paths towards attaining hardware like that.

This will take time, and would require a massive number of fundamental changes to the underlying rules/definitions pertaining to all the current laws. In essence it would require a review of a bunch of messy, already unconstitutional laws they've already put into place. Much like bitcoin, the decentralized genie is out of the bottle, and it can't be forced back in. While I agree this type of ban is going to happen eventually, it's not happening any time soon and is already too late.

 

On 8/22/2019 at 2:16 PM, misteraven said:

 

And as far as media, it's not even a secret how incestuous the relationship is between government and media. This is why its a huge deal to get kicked out of the media pool to the white house. Meanwhile, government feeds "off record" news to media or provides exclusive access in exchange or in parallel to stuff they want to hit the wire. That shit isn't even a secret and is just how it works.

Yes, huge difference from CCP coercion, or being forced to report/not report something for now. 

[Hua Guofang]

speaking of anti-market forces....

 

Donald J. Trump‏Verified account @realDonaldTrump

 

....better off without them. The vast amounts of money made and stolen by China from the United States, year after year, for decades, will and must STOP. Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing..

[Brink]

Honestly im trying to 3d print myself a cannon at this point

[metronome]

On 8/22/2019 at 6:15 AM, Brink said:

I thought Tiananmen was widely accepted as a mass murder world-wide at this point? Are there still actually younger people in China who dont believe it happened???

There's a vid that gets reposted to Reddit every once in a while, especially now that the Chinese investment is so high there ... and it was made by a Chinese film maker walking around the square on the anniversary of that day and trying to ask people if they knew the significance of the day.  Probably some editing license but it was very hard for him to find anybody willing to talk about it for fear that he was an undercover government agent.

[Hua Guofang]

I reckon there'd be a lot of people here who'd be surprised at how many in the national security communities of the world who would actually celebrate and encourage this:

 

 

[Hua Guofang]

This is a pretty significant escalation - molotovs and rolling brawls. I can see this having an impact in Beijing. They'll be using selective footage to prime the mainland for intervention. Check out the whole thread of footage on that twitter feed.

 

 

[Mercer]

On 8/24/2019 at 3:54 AM, Hua Guofang said:

speaking of anti-market forces....

 

Donald J. Trump‏Verified account @realDonaldTrump

 

....better off without them. The vast amounts of money made and stolen by China from the United States, year after year, for decades, will and must STOP. Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing..

Outside of the unconstitutional detention of immigrants, this has always been my biggest beef with Trump. Nobody is being ripped off here, if so, American companies wouldn't be doing business with Chineses companies. Basically, every trade/transaction is mutually beneficial or the companies transacting wouldn't transact. There's absolutely no legitimate need for, or positive benefits that can come for a trade war. Even if we imposed tariffs and China never did, it still hurts our economy. It's as if he's basing US policy on information he gathered from various Klan flyer's that were intended for the semi-literate, and people not smart enough to know this basic concept is retarded. I guess that's America now though.

 

I ask Trumper's what the end game is with China here, they have no fucking clue. Just cliche lines about putting "America first" but no real strategy for, or understanding of foreign trade.  That, and the "currency manipulation" accusations, hypocritically not realizing we have a Federal Reserve that does the exact same thing, and so does every other country with a central bank. Accusing a central bank of currency manipulation is the equivalent of accusing a person of breathing, "see look, they just inhaled, I told you".

[Mercer]

This is what "fighting for freedom" actually looks like. 

 

 

 

Freedom fighters almost always fight their own tyrannical governments locally, not overseas. They wear no uniforms (unless they're fighting a foreign invader), and in many cases they don't even possess a weapon. They only need to possess a willingness to risk their own lives for the cause. Non violent resistance is the noblest form respect one can pay to the human race.

Edited August 26, 2019 by Mercer

[Hua Guofang]

That’s a hell of a photo. 

[Mercer]

 

[Hua Guofang]

Looks like tomorrow is being set up as a showdown.

 

- Govt has banned big protest rally (the type during the day that have been peaceful, not the violent ones in the evening)

- Key activists have been arrested

- PLA/PAP have been posturing within HK and across the boarder in Shenzhen.

 

One perspective is that this is a provocation on behalf of the govt in an attempt to radicalise the peaceful mainstream of protesters by forcing them to act illegally and provoking them to escalate their behaviour in order to brand them as criminals. Same thing goes for the arrest of the activists. The military posturing is ambiguous. There have been movements that could be explained as routine and/or provocative. But that's the way the CCP works. They rarely come out and make clear and overt threats when dealing with internal security. They notion towards a position and let your (entirely rational) fears fill in the gaps.

 

The interesting part is the anniversary of the CCP is in October and conventional thinking suggests that they wouldn't do anything until that date passes as symbolism is big in Chinese culture.

 

Will be an interesting day tomorrow.