AMAC Exclusive – By Ben Solis
During what appears to be China’s most vulnerable economic moment in decades, President Joe Biden is offering the communist country a vital lifeline by lifting sanctions in response to empty promises from Xi Jinping.
A number of factors are contributing to China’s increasing economic instability – the most basic of which is Xi Jinping’s commitment to failed Marxist-socialist principles and the teachings of Mao Zedong. Xi Jinping’s mother Qixin, one of the most important figures in Xi’s life, ingrained a love of Mao in her son from a young age. When Mao’s regime punished and exiled Xi’s father, Qixin did not blame Mao, but rather other high-ranking Chinese Communist Party (CCP) officials.
Qixin once told a party media official that among the first songs Xi heard as a baby was the cultural revolution anthem, “The Sun is Reddest, Chairman Mao is Dearest.” Xi’s future wife, Peng Liyuan, a singer, sang that song on her first date with Xi. In a recent edition of the CCP’s party newspaper, Xi was quoted as saying, “Mao Zedong Thought is the crystallization of the revolutionary will and practice of hundreds of millions of people. It was, is, and will be the guiding ideology for all our work.”
Dr. Wen Yuhang, who defected from China in the early 1980s and advised European and Latin American governments, told me in an interview that under Xi, within the CCP, family ties are less important than devotion to the CCP like during the Mao era.
Harry Wu, a former political prisoner in China, told me in 2008 that “Xi genuinely and fervently worships Mao, since he is his god.” Xi’s worldview revolves around principles entirely contrary to Western political and economic philosophy. “Xi’s encounters with the West have only solidified that cult,” Harry added.
Just as it has in every other communist regime throughout history, Xi’s devotion to Marxist economic principles due to his love for Mao has led China to the brink of ruin.
China is also facing a looming population collapse that is wreaking havoc on their national economy. The National Health Commission reported in October that China saw just 9.56 million births in 2022, the lowest figure since 1949. As a result, the population declined for the first time in six decades last year.
However, the interpretation of such news in China differs from the Western perspective. The demographic crisis, double-digit youth unemployment, and drying up capital are merely “an interim period of educative hardships” rather than a sign of any crisis, according to the Chinese state media. “The ‘self-pursuit of hardship’ is the most important thing I ask of myself,” Chinese television has quoted Xi as saying.
Chinese officials have done their best to hide the country’s economic struggles, but contradictory information paints an alarming picture of the real economic situation. Questions abound.
For instance, how could firms listed in the Shenzen stock market report $2.1 trillion in revenue in the first nine months of 2023 when both the Chinese economy and worldwide economic growth lagged?
Moreover, how could such a stagnating economy finance massive imports of foreign oil, and where was that oil going? Recent reports indicated that in the first half of 2023, China imported 12 percent more crude oil per day than the year prior.
The answer is that the CCP is desperately trying to mask the country’s deep economic struggles. But some signs are impossible to hide.
According to preliminary data on China’s balance of payments, foreign direct investment crashed by 34 percent in September after recording double-digit falls every month since May. Direct investment liabilities, a gauge of foreign capital flowing into the country, were at a deficit of $11.8 billion in the second quarter of 2023, the lowest of any quarter since 2000 and down from $21 billion in the first three months of the year.
Yet at this moment of vulnerability, the CCP appears to be getting a boost from the Biden administration.
Biden has reversed or suggested that he might reverse many Trump-era sanctions on the communist nation, including ones that resulted in the delisting of Chinese companies from U.S. stock exchanges. In a recent interview, Cassandra Seier, the Head of International Capital Markets at the New York Stock Exchange, suggested changes favorable to China in the coming months. Seier spoke specifically about “opening” and observing “healthy revival signs of Chinese companies” after a “two-year” freeze. “Now, we’re waiting for the right market timing for those companies to come and list on the NYSE,” she said.
In October, the Biden administration also trumpeted its “sweeping” new limits on advanced semiconductor technology to China. But a month later, China’s Commerce Ministry website said that Minister Wang Wentao was set to welcome California-based microchip producer Micron Technology to the Chinese market. Micron’s CEO Sanjay Mehrotra expressed his willingness “to continue to expand investment in China.”
Following his face-to-face meeting with Xi earlier this month, Biden also announced that he was lifting sanctions on China supposedly in exchange for Beijing’s cooperation in cracking down on fentanyl production. But as critics have pointed out, China has never followed through on such promises in the past, and this move only incentivizes Xi to allow more drugs to flow into the United States to use as leverage in future negotiations.
While Biden portrays himself as “tough on China” in public, indications are that his administration has actually offered a vital economic lifeline to a struggling Chinese economy.
As China continues to threaten world security and Western civilization, Americans may now have to face the troubling fact that their own president is enabling the United States’ greatest strategic adversary.
Ben Solis is the pen name of an international affairs journalist, historian, and researcher.
