by Thomas Lifson
Xi's hope of playing off other advanced economies against Trump's trade war will crash and burn if Hong Kong is bloodily repressed.
A full-scale military crackdown on the Hong Kongers resisting imposition of mainland-style tyranny may be in the cards, but President Xi and his supporters must understand that they will pay a monumental price for any bloodbath. From Xi's perspective, this is terrible timing, all the more painful because it was a change in Hong Kong's extradition law pushed by Beijing that set off the protests.
A pair of videos on YouTube appear to show columns of military units moving into Hong Kong (hat tip: Conservative Treehouse):
And the regime has ended the three days of protests (video here) at Hong Kong International Airport by shutting down the facility, one of the biggest nodes in the world's international air travel network. Low-profile, this is not. And that is one huge problem for the tyrants.
At this very moment, President Trump is fighting a lonely battle with China over its massive theft of intellectual property, currency manipulation, and trade barriers. Beijing has been hoping it could play off other advanced economies — currently noncombatants — against Trump, offering them the export markets that it would deny to the United States in retaliation for Trump's tariffs and pressure. But if China brutally cracks down in Hong Kong as it did in Tiananmen 30 years ago, public pressure in Europe, Japan, South Korea, and Canada (among others) will make it difficult for their governments to side openly with China. The very last thing Xi wants is a united front on trade. For almost two decades, China has enjoyed all the fruits of membership in the World Trade Organization without being held to account for its behavior that violates the agreement.
But the other party watching Hong Kong is even more important: the Chinese public. Almost nobody in China buys into the rhetoric of communism anymore. The Chinese Communist Party's rule is accepted because it has been delivering a massive increase in prosperity and constructing the sorts of facilities that make people proud of their nation's ascent. But now, that prosperity is faltering, making the ongoing discontent with authoritarianism and endemic, massive corruption harder to dismiss.
There is a mixture of envy of Hong Kong's prosperity and freedom and outright jealousy. The regime will portray the unrest there as the product of sinister Western forces trying to undermine the motherland, and no doubt there will be many believers. And patriotism sparked by anger at foreign powers has a long and well justified place in the Chinese collective memory. So Xi and his faction within the Party may well decide to crack down and mobilize the public's patriotic fury.
But that would exacerbate China's trade difficulties and destroy a lot of wealth domestically. That would make even more political enemies among the elite and create more discontent. The Chinese economy rides on a huge amount of debt. We don't know how much economic activity the economy can afford to lose without triggering a wave of insolvencies that would throw enough people out of work to trigger a threat to the regime.
I think it is fair to call this an "existential crisis" for Xi and his regime.
Photo credit: YouTube screen grab.
A pair of videos on YouTube appear to show columns of military units moving into Hong Kong (hat tip: Conservative Treehouse):
And the regime has ended the three days of protests (video here) at Hong Kong International Airport by shutting down the facility, one of the biggest nodes in the world's international air travel network. Low-profile, this is not. And that is one huge problem for the tyrants.
At this very moment, President Trump is fighting a lonely battle with China over its massive theft of intellectual property, currency manipulation, and trade barriers. Beijing has been hoping it could play off other advanced economies — currently noncombatants — against Trump, offering them the export markets that it would deny to the United States in retaliation for Trump's tariffs and pressure. But if China brutally cracks down in Hong Kong as it did in Tiananmen 30 years ago, public pressure in Europe, Japan, South Korea, and Canada (among others) will make it difficult for their governments to side openly with China. The very last thing Xi wants is a united front on trade. For almost two decades, China has enjoyed all the fruits of membership in the World Trade Organization without being held to account for its behavior that violates the agreement.But the other party watching Hong Kong is even more important: the Chinese public. Almost nobody in China buys into the rhetoric of communism anymore. The Chinese Communist Party's rule is accepted because it has been delivering a massive increase in prosperity and constructing the sorts of facilities that make people proud of their nation's ascent. But now, that prosperity is faltering, making the ongoing discontent with authoritarianism and endemic, massive corruption harder to dismiss.
There is a mixture of envy of Hong Kong's prosperity and freedom and outright jealousy. The regime will portray the unrest there as the product of sinister Western forces trying to undermine the motherland, and no doubt there will be many believers. And patriotism sparked by anger at foreign powers has a long and well justified place in the Chinese collective memory. So Xi and his faction within the Party may well decide to crack down and mobilize the public's patriotic fury.
But that would exacerbate China's trade difficulties and destroy a lot of wealth domestically. That would make even more political enemies among the elite and create more discontent. The Chinese economy rides on a huge amount of debt. We don't know how much economic activity the economy can afford to lose without triggering a wave of insolvencies that would throw enough people out of work to trigger a threat to the regime.
I think it is fair to call this an "existential crisis" for Xi and his regime.
Photo credit: YouTube screen grab.
Thomas Lifson
Source: https://www.americanthinker.com/blog/2019/08/china_moving_mainland_military_units_into_hong_kong_as_airport_totally_closed_down.html
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