Coronavirus – a Spark?

Feb 29, 2020 by

Fear, anger, frustration has washed over China since the coronavirus went public.

Local Chinese government officials sought to cover up the outbreak – some Chinese have even been removed and punished. The National government is valiantly attempting to pull out all the stops in order to contain, control, and eliminate this threat to the health and safety of Chinese citizens. Their efforts have demonstrated China’s unique ability to mobilize people and resources.

Yet the virus could also pose a greater threat to the Communist Party’s iron-clad control in China.

Chinese leadership seeks a ballast to improve its stability as the coronavirus and its subsequent human and economic fallout threatens the very social control and stability that the Communist Party covets.

Clearly the greatest fear of the Chinese Communist Party is losing control and throwing the country into chaos. China’s leaders fear an internal uprising more than an external attack.

There has been an unwritten trade-off between the Communist Party and the people – simply that “People’s lives will continue to prosper socially and economically as long as the Communist Party continues its rule.”

Until recently, an iron governmental fist and a rising economic tide has been the formula that has thus far kept China from being added to the list of countries in revolt. As President Xi knows and as Mao once proclaimed, “A single spark can start a raging forest fire.”

Is the coronavirus the spark?

When the “mandate from heaven” is lost, people rise up. The Chinese dragon continues to seek to maintain its “mandate of heaven” — an ancient concept similar to the European concept of the divine right of kings.

This “mandate from heaven” – keeping the masses happy – has been a magic formula for Chinese leaders to use. They will continue to use it as they attempt to manage the outbreak of anger that the coronavirus has uncorked in China.

President Xi, appearing to steal a page from his predecessor, Deng Xiaoping, whose pragmatism was used it to pull China out of the chaos of the Mao era, hopes to continue creating a better life for his people. Perhaps most importantly, he seeks to maintain the Party’s grip on the levers of total power and control. He has allowed greater economic liberalization and reform, tinkering with democratic reforms yet still clamping down hard when he thought they might threaten “The Party.”

This ebb and flow of change was characterized by Deng as: “Mozhe Shitou guo he” – “Crossing the river by feeling for the stones.”

Grandma’s Pressure Cooker

I compare the Communist Party to my Grandma’s old pressure cooker – constantly measuring the pressure and finding ways to let off enough steam so that the masses don’t explode.

Today the world is witnessing the Chinese Communist Party allowing much more venting of anger and lashing out at the government on social media than they had prior to the coronavirus crisis.

Some Chinese citizens are challenged the Party. But you can feel the Party undertow below the surface saying “if you push too far, you will be crushed”.

BC – before Coronavirus

The Communist Party has been leading change in China, attempting to stay a step ahead of the masses of people. In the past decade, they have created an economic juggernaut unlike anything the world has ever seen from China – creating thousands of millionaires and even billionaires as well as moving an estimated 500-600 million people out of abject poverty into the middle class.

What has transpired in China since the early days of the 20th century is nothing short of phenomenal. I recall my mom imploring me to eat my peas, “children are starving in China” (and they were). Today ere China seems to be eating our lunch – from private ownership of cars before the ’90s to their spot as the largest auto market in the world. China’s bullet trains and ultra-modern airports put America’s transportation systems to shame. Their e-commerce and world class technology systems – capable of hacking our own systems – make the U.S. seem more a “johnny-come-lately”, particularly when it comes to AI (artificial intelligence).

In the nearly 30 years I have been traveling to China there is no question that the lives of the average Chinese citizens have improved remarkably. Likewise, there is no doubt that China will continue to soar. Consider:

  • China has become the world’s fastest growing large economy.
  • Many Chinese students consistently outperform U.S. students on international tests.
  • China is now the world’s largest auto producer.
  • China has become a banker to the U.S., owning more than 20 percent of our total debt.
  • China has regained its lost fuqiang, “wealth and power”, ascending in economic and military power once again.

Ordinary Heroes

As a diversion, President Xi Jinping seeks to create 21st century propaganda.

During Mao’s time, Lei Feng was a model citizen, a cultural icon to emulate, representing earnestness and service, particularly, his selflessness, modesty, and devotion to the Mao and to the Party.

Xu Hui, a doctor at a Nanjing hospital died on Feb 7 at the age of 51, after working 18 consecutive days in the frontline fighting against the coronavirus. The local Party secretary is quickly praised Xu, calling her a role model for other medics.

Yet Chinese citizens have taken to China’s media saying the reasons this doctor died is a lack of medical personnel, masks, equipment, medical supplies, or a rapid response by their government to address this crisis.

Doctor Li Wenliang, who was sanctioned by local authorities after blowing the whistle on the disease in January, died of the virus early last Friday. Bloomberg News Service reports his death was immediately met with an outpouring of grief and outrage by hundreds of millions of social media users: they vented about how he was initially silenced, and mourned with the pregnant wife and young child he left behind.

China has clearly shaken off the shame of its “century of humiliation,” regaining its fuqiang “wealth and power” and brushing aside the setbacks from self-inflicted wounds of the Great Leap Forward, the Cultural Revolution and Tiananemen Square. Until the bump in the road with President Trump over tariffs and a trade war, China was marching boldly and proudly into the future.

Along came Coronavirus

The Washington Post reports that beyond the human tragedy, the immediate impact of the virus is mostly economic. The only question is how much it slows China’s economy and for how long the impact globally given the size and integration of China’s economy.

Chinese challenges abound. Their economic challenges are exacerbated by rising minority tensions (particularly among Uighur and Tibetan people), human rights issues, rising inflation and labor costs, corruption, environmental degradation. Not to mention an aging society, soaring property values/bubbles, a significant outflow of capital, a shadow banking system, and local government debt – enough to make a once-bankrupt Detroit blush.

As any American financial advisor might remind us – past performance is not a predictor of future performance. And this is true for China today.

Now the fear is that coronavirus may be a warning sign to China’s economy – along with the Communist Party’s “mandate”.

While some of President Trump hardline advisors may cheer China’s stumble, the reality is that a weakened China is more dangerous to the world than a prosperous and thriving China.

Is a bug we can’t even see big enough to topple China as we have come to know it?

Tom Watkins has a lifelong interest in China and has worked for over three decades building cultural, educational, and economic ties between our two nations. He is a former Michigan State Superintendent of Public Education.

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