In what many observers have termed a “regulatory crackdown,” a wave of new legal restrictions and bans on business, technology, and entertainment has broken across China over the past several months, with what appears to be escalating velocity and force. Most recently, new rules have hit companies involved in everything from how Chinese consumers can borrow, invest, and spend their money to how they educate their children, travel around their cities, and shop for insurance, and even what they watch on TV. Some of these new rules have been in the making for some time, some seem designed to address quite divergent government goals, but their rapid enactment has led many analysts—including those connected to the Chinese state—to view them as part of a single campaign.
What is the best way to understand the connections among these new strictures? How do they relate to Xi Jinping’s leadership, how should they be understood to relate to governance goals in China more broadly, and to what extent will they succeed in achieving their intended ends? —ChinaFile Editors
After years of accumulating power, President Xi Jinping appears to be prescribing painful detox to a society addicted to capitalism’s excess. He vows to achieve “common prosperity” by reining in private capital, redistributing wealth to the people, clamping down on social ills ranging from ill-gotten gains to the wrong form of entertainment, while also promoting traditional moral values. Xi vows to push China toward a formidable goal: a high-income country that is held firmly by one-party rule. In other words, the rejuvenated nation in his “China Dream.”
Demonstrating respect for fundamental human rights should be central to any campaign to improve people’s lives, though. That would mean promoting labor rights, such as by allowing independent unions; abolishing the discriminatory “hukou” household registration system; ensuring equitable access to education and health care; and, as the International Monetary Fund recommended, increasing the progressivity of taxation schemes. But there is one problem: respect for rights and economic justice is antithetical to the Chinese Communist Party’s modus operandi, with its monopoly of political power depending on its concurrent capture of economic power.
We have few details on how Xi intends to accomplish “common prosperity,” aside from strong-arming the disfavored ultra-rich to “return more to society” (resulting in tech giants coughing up billions in charitable donations). The Party may adopt some of the above policies by attempting to find a sweet spot between reforms and deepening control, legislating greater social protections while ensuring that people work within the system instead of challenging it. Viewed this way, seemingly contradictory actions, such as new legislation to protect consumer privacy and the rights of gig workers on the one hand and the construction of a mass surveillance system and the arrests of gig worker organizers on the other, are in fact complementary in Xi’s governance model.
Some efforts to address inequality will invariably prove inadequate. It may take generations for people across China to recover from the Party’s exploitative practices: more than two-thirds of children experience discrimination as a result of having rural household registration. Many of them have little education and poor health. Some are even traumatized as they are “left behind” by parents who flock to cities for work.
Ultimately, the Party’s top-down engineering for “common prosperity” will likely fall short of its promise. Success would require the full and inclusive participation of those affected by inequality, a vibrant civil society, and a free press and Internet to expose problems and hold officials and companies accountable to the campaign goals.
The government can be expected to celebrate its success while refusing to discuss its failures, much as it did when it dubiously declared the eradication of extreme poverty. While we should take Xi’s “common prosperity” campaign seriously, it is not likely to be the kind of economic justice, respect for rights, or sustainable development that China’s people deserve.