China’s staggeringly long history reaches back well at least 3,000 years, and possibly more, depending on who’s asked. If any single pattern can be pulled from so much history, it’s this: no Chinese dynasty lasts forever, and when they fall, it’s always catastrophic for China in general.
Chinese political thinkers underpin much of their ideology with Dynastic Theory. Simplified, Dynastic Theory is cyclical: one dynasty grows old and corrupt, corrodes Chinese power and society, and is eventually overthrown when it grows too weak and is replaced by a new dynasty that reforms the country and returns it to past glories. Over time, the new dynasty commits the sins of the old, once more growing corrupt, and is in turn overthrown.
This is not a distinctly Chinese phenomenon; all governing systems need to refreshed, reformed, and occasionally replaced. Democracies do this through regular elections, which allows change to be relatively predictable and incremental.
Autocracies, dictatorships, and authoritarian governments, however, do not. When such systems change, it’s rarely very pleasant for anyone involved.
And China’s ruling Communists are acting like they’re running out of time before they too succumb to Dynastic Theory.
The myth of dictatorships dispelled
A common mistake when discussing the stability of dictatorships is that, because an absolutist government is unaccountable, it can shoot, torture, and arrest its way through any unrest. The presiding assumption when thinking about China’s future is that the Politburo can deploy its loyal, dependable army to crush any dissent, much as it did in 1989 at Tiananmen Square.
But dictatorships are more fragile than they appear. They rely heavily on low-level corruption to function: in exchange for loyalty, authoritarian regimes let officials take bribes, produce fake licenses, and generally do shoddy work. This behavior can have disastrous blowback: witness the explosion at Tianjin that killed up to 114 people, where initial investigations indicate that safety regulations were disregarded by officials to please well-connected people.
In the ruthless power calculations of a dictatorship, such accidents are unfortunate but preferable to alienating the millions of corrupt officials who make up the backbone of their power base.
Moreover, in dictatorships, promotion for competency is rare, even impossible: the currency of such realms is loyalty. In capitalist and/or democratic societies, top jobs are often rewards for loyalty as well, but the caveat is that officials keep such jobs only so long as their political party manages to win elections. Should they harm their bosses’ ability to win votes, they are sacked; additionally, should their bosses lose power, they’re also sacked. Turnover is higher; ineffective officials are replaced more often.
But authoritarian regimes expect to stay in power forever. When they give a job as a reward, the social contract states its for life.
Which is why anytime such a regime embarks on a far-reaching economic or political reform, it’s a sign the regime believes it’s in deep trouble. China’s yuan devaluation is one such reform.
A corrupt bargain gone sour
China’s corrupt bargain with its bureaucracy has gone hand-in-hand with another social contract with its vast population: in exchange for loyalty, the Politburo delivers wealth. This is the deal by which the Politburo commands both nation and state: the state is allowed to plunder its way to prosperity while the nation reaps the profits of new industries and economic change.
With Communist ideology a dead letter, this formula has worked quite well since 1989. Protests are localized; separatism in Tibet and Xinjiang remains weak and disorganized; civil society is stunted, since so many are engaged in trying to grab a slice of the ever-expanding economic pie.
But China cannot escape the pitfalls of development. Having industrialized to much success, China is rapidly running out of easy growth. This isn’t all that far off from the experience of nearby Japan, which from the end of the American occupation to the 1980s enjoyed a surge of prosperity and growth. Some speculated that Japan would one day end up owning much of America.
Instead, Japan has had two “Lost Decades” of flat economic growth. Accompanying it has been unprecedented upheaval in Japanese politics. Since the 1950s, Japan’s Diet has mostly been occupied by the Liberal Democratic Party, who won easy elections so long as growth remained constant. But twice now the LDP has been ejected from power, and elections in Japan are far less predictable than they’ve ever been.
China too has invested heavily in infrastructure, real estate, and heavy industry. It produces the largest amount of steel in the world, but is finding it increasingly hard to secure buyers. China has raised living standards so well that its own labor force is being too expensive for markets it once dominated. Much like the U.S. in the 1970s, which wobbled when confronted by competition from resurgent Japan and Germany, China is no longer the land of endless cheap factories and easy-to-build mega-projects.
The yuan devaluation as social salve
Unpinning the yuan from the dollar is intended to cheapen Chinese manufacturing yet again while modernizing its economy. It may have that effect, but it will not soften the social blow coming to China. The corrupt bargain could never last forever; eventually, corruption in government would grow intolerable, while the more capitalist China grows, the more it must live by capitalist rules, including suffering occasional painful recessions.
China’s current government is unprepared to solve either problem. Recessions will inspire protests, especially from the middle class. To stifle such protests, the Communists will need a reliable state they can deploy against such forces. This will undermine any incentive to reform the current state of official corruption: to do so will alienate those the regime needs the most to stay in power.
Worst of all, the most ambitious party members will need to indulge corruption even further to advance their careers. This behavior already inspires small protests throughout China, but should China’s economic miracle slow, even end, hatred of official corruption will merge with resentment over stagnating living standards to create a social force potentially more powerful than the People’s Liberation Army.
There are many signs China’s economic miracle is coming to an end. The next decade will be trying for Beijing.
Ryan Bohl was born in Phoenix, Arizona, and studied Middle Eastern modern history and politics and international relations at Arizona State University, graduating in 2007. He earned a Master’s in Education in 2009 and worked for five years in the United Arab Emirate in a government school teaching English. During that time, he carried out original research into Emirati culture, history, and politics, and carried out fact-finding missions to Egypt and Bahrain during the Arab Spring in 2011. In 2013, he moved to Qatar to work in an international school, emphasizing international relations and geopolitics and monitoring the rise of the Islamic State and participating in public political discussions in Doha. That same year, he founded Geopoliticsmadesuper.com, a website dedicated to distilling foreign policy and geopolitics in manageable chunks for the average Internet user. He’s been interviewed for Emirati political outcomes in education and cited in Stratrisks, the Atlantic Sentinel, and Occupy Corporatism. He currently lives in Brooklyn, New York, with his wife.