During President Joe Biden’s address to the nation about his withdrawal from running for re-election this week, he claimed one of his foreign policy accomplishments was that China’s economy was no longer on pace to surpass the U.S. economy. The truth is the Biden administration’s China policy has been a failure and China’s economic decline has been self-inflicted.
Many people have been conditioned to think China would soon surpass the United States as the world’s dominant economic power. But that scenario seems less likely now due to Chinese leader Xi Jinping’s economic policies.
Deeply suspicious of entrepreneurs and economic reform, Xi has deliberately forced China back toward the socialist economic model envisioned by Mao by placing the Chinese Communist Party and himself in the driver’s seat and managing China’s economy through central planning. Xi also prioritizes national security over economic growth and values loyalty to him over competency.
Minxin Pei, a Claremont McKenna College professor and well-known China watcher, pointed out: “Xi’s centralization of power has caused a crisis of confidence in China’s economy not seen since 1978, after Mao Zedong’s death.” Consequently, China’s economic growth rates have started declining from double-digits in the ’90s and early 2000s to single-digits since Xi took control in 2013, long before Biden became president of the United States.
Investors and Intervention
China’s economic woes have deepened in recent years due to several factors. Xi’s crackdown on tech companies and the unsettling “disappearances” of prominent Chinese tycoons have not only dampened entrepreneurial spirits but also
