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Engineers of the Soul: Ideology in Xi Jinping's China by John Garnaut

Regular Sinocism readers are no doubt familiar with John Garnaut, one of the top journalists covering China before he joined the Australian government, first as a speech writer for Prime Minister Malcolm Turnbull and then as a China policy advisor. John led the Australian government’s analysis of and response to PRC/CCP interference and influence efforts in the country, and his work has since had significant influence in other Western capitals. 

John is now out of government and has allowed me to share with you a speech he gave at an internal Australian government seminar in August 2017.

I knew John a little in Beijing and besides having tremendous respect for his work, and especially his access to Princelings at a level I am not sure any other foreign correspondent has ever had, I always found him to be a reasoned and thoughtful chronicler of the PRC. 

Some now say he has become a China hawk, but I see it as more the evolution of a sophisticated China watcher who believes in seeking truth from facts, no matter how difficult it may be to accept the reality of the direction Xi and the CCP appear to be taking China. This is a trajectory I have found myself on, along with many of the most experienced foreign China watchers I know. 

I wish I could say I find John’s arguments unconvincing, but in fact they only seem more accurate now, over a year after the 19th Party Congress, than they did when he gave this talk in 2017.

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On to John’s thought-provoking talk:

Asian Strategic and Economic Seminar Series

Engineers of the Soul: what Australia needs to know about ideology in Xi Jinping's China

As some of you know I’ve just spent the past eight months as a model public servant on my very best behaviour: biding time, concealing opinions and strictly respecting the bureaucratic order. 

Now I get to go unplugged. 

Before doing so however I want to thank you very much for coming today and particularly Paul and Sam for giving me this opportunity. It’s an honour to be here at the creation of what promises to be an important seminar series. 

This seminar series is itself an audacious act of social engineering. The idea is that by placing economists and security strategists in the same room we could promote dialogue and maybe even peace between the tribes of Canberra - with the long term aim of integrated policy making. 

We’ll see about that. 

But in the meantime I’m here as someone who was born into the economics tribe and has been forced to gradually concede ground to the security camp. This retreat has taken place over the course of a decade, one story at a time, as I’ve had to accept that economic openness does not inevitably lead to political openness. Not when you have a political regime that is both capable and committed to ensuring it doesn’t happen.  

Politics isn’t everything but there’s no country on earth where it is more omnipresent, with the exception of North Korea. And there is no political system that is as tightly bound to ideology. 

In the work I was doing upstairs in this building I went out of my way to remove ideology from my analysis of how China is impacting on Australia and our region. It was simply too alien and too difficult to digest. In order to make sense to time-poor leaders it was easier to “normalise” events, actions and concepts by framing them in more familiar terms. 

This approach of “normalising” China also served to sidestep painful normative debates about what China is, where it is going and what it wants. It was a way of avoiding a food fight about who is pro-or-anti China. Taking the “Communist Party” out of “China” was a way of de-activating the autoimmune response that can otherwise kill productive conversation. 

This pragmatism has worked pretty well. We’ve taken the China conversation to a new level of sophistication over the past year or so. 

But by stripping out ideology we are giving up on building a framework which has explanatory and predictive value. 

At some point, given the reach that China has into Australia, we will have to make a serious attempt to read the ideological road map that frames the language, perceptions and decisions of Chinese leaders. If we are ever going to map the Communist Party genome then we need to read the ideological DNA. 

So today I’m stepping into the food fight. 

I want to make these broad points about the historical foundations of CCP ideology, beyond the fact that it is important: 

  1. Communism did not enjoy an immaculate conception in China. Rather, it was grafted onto an existing ideological system - the classical Chinese dynastic system

  1. China had an unusual veneration for the written word and acceptance of its didactic value.

  1. Marxism-Leninism was interpreted to Mao and his fellow revolutionaries by a crucial intermediary: Joseph Stalin

  1. Communism - as interpreted by Lenin, Stalin and Mao - is a total ideology. At the risk of being politically insensitive, it is totalitarian

  1. Xi Jinping has reinvigorated ideology to an extent we have not seen since the Cultural Revolution. 

I’ll hold off on the practical contemporary implications of all this until we get to the subsequent discussion. 

A Dynastic Cosmology

It was clear from my work as a journalist and writer in New China - to use the party speak - that the formal ideology of communism coexists with an unofficial ideology of old China. The Founding Fathers of the PRC came to power on a promise to repudiate and destroy everything about the dark imperial past, but they never really changed the mental wallpaper. 

Mao and his comrades grew up with tales of imperial China. They never stopped reading them. The Dream of Red Mansions, The Three Kingdoms - the Chinese classics are all about the rise and decay of dynasties. This is the metanarrative of Chinese literature and historiography, even today. 

Mao in particular was obsessed, as Mao’s one-time secretary Li Rui explained to me. He told me: “He only slept on one third of the bed and the other two thirds of his bed was covered by books, all of which were thread-bound Chinese books, Chinese ancient books. His research was the strategies of emperors. That was how to govern this country. That was what he was most interested in.”

And the Founding Revolutionaries passed these same tales down to their children. The daughter of Mao’s leading propagandist, Hu Qiaomu, told me that her father raised his voice to her only once: when she confessed that she hadn’t finished the Dream of Red Mansions (which by the way runs to a million characters). Hu Qiaomu was furious. He told her Chairman Mao had read the book 25 times. 

So this is my first observation about ideology - ideology in the broadest sense, as a coherent system of ideas and ideals: the founding families of the PRC are steeped in the Dynastic System. 

Admittedly, communism and feudal imperialism are uneasy bedfellows. But they are not irreconcilable. The formula for dynastic communism was perfected by Chen Yun: their children had to inherit power not because of privilege but because they could be counted upon to be loyal to the revolutionary cause. Or, as he put it: “at least our children will not dig up our graves”. 

Xi Jinping has exercised an unwritten aristocratic claim to power which derives from his father’s proximity to the founder of the Red Dynasty: Chairman Mao. He is the compromise representative of all the great founding families. This is the starting point for understanding the worldview of Xi Jinping and his Princeling cohort. 

Interview with James Mann on engagement and US-China relations

In 2007 James Mann published The China Fantasy, a short book arguing that Western elites misrepresented the benefits of engagement with China and that prosperity and capitalism might not, as they claimed, eventually bring the PRC closer to the Western liberal order. 

Mann lays out three general scenarios for China. In the first, the “soothing scenario”, trade and engagement with China brings capitalism, political liberalization and eventually democracy. In the second, the “upheaval scenario”, China is headed for chaos, disintegration and collapse.

His third scenario was the most prescient:

What if China manages to continue on its current economic path, yet its political system does not change in any fundamental way? What if, twenty-five or thirty years from now, a wealthier, more powerful China continues to be run by a one-party regime that still represses organized political dissent much as it does today, while at the same time China is also open to the outside world and, indeed, is deeply intertwined with the rest of the world through trade, investment and other economic ties? Everyone assumes that the Chinese political system is going to open up—but what if it doesn’t? What if, in other words, China becomes fully integrated into the world’s economy, yet it remains also entirely undemocratic?

It looks like the third scenario is the reality of China today. 

I first wrote about Mann and his book in April 2011 while I was still living in Beijing:

Mann wrote this before the 2008 crash and the near bankruptcy of most major developed economies. China’s relative rise has occurred much faster than even Mann expected.

James Mann deserve a lot more credit than he has gotten for this work, and given the current state of affairs I hope he and his publisher are working on a new edition. The world needs to understand and prepare for the political, security, and economic ramifications of the third scenario.

I interviewed Jim over email in December 2018. Axios ran a shortened versioned of the interview; here is the full verison.

Bill: In the last year we have seen lots of discussion and handwringing about the “failure” of the engagement policy. Why has it failed, and why were you treated as almost a pariah in the China-watching world when you wrote this book?

Jim: To answer that, we have to start with the history of  what “engagement”  is, or was. Does an “engagement” policy mean simply having contacts with China — going to meetings, talking? Or does it mean a policy based on the belief that those contacts would lead “inevitably” (that was the word Bill Clinton used) lead to political change in China?

It is often forgotten now, but at first, “engagement” just had the meaning of contacts. The word first began to be used by George H.W. Bush in the aftermath of the Tiananmen crackdown. The debate was over whether to stop meeting with high-level officials. Bush said he wanted to “engage” China, because isolating it would lead to a hostile China. (Later, retroactively, the word “engagement” in this narrower sense was applied to the Nixon opening, too, and the meaning more or less fit; even before Nixon took office, he had written about bringing China out of isolation.)

It was only in the 1990s, mostly in the Clinton years, that “engagement” came to take on this new additional meaning of opening up China’s political system. Clinton needed that argument because he was trying to persuade Congress to renew China’s trade benefits. But this redefinition of “engagement” also fit with the spirit of the 1990s, after the fall of the Berlin Wall, when Francis Fukuyama was writing about “the end of history.” Indeed, Clinton used to say that China was on "the wrong side of history."

Now — to come back to the China Fantasy: I’d lived in China in the mid and late 1980s. I’d been there for the crackdown in 1989. When I saw in the early 1990s, back in Washington, that Clinton and others were saying that China would  open up as a result of trade, investment and prosperity, it struck me as simply out of contact with the China I’d so recently lived in and covered. Why did China have to open up and liberalize? Just because Taiwan and South Korea had?

China was different. It took me several years to put it all together in my mind — that what people comforted themselves by saying inside the U.S. was just at odds with the reality of China on the ground. So why did engagement (in this second sense) fail?  It failed because the political change vaguely held out as a prospect was never in the running. The Communist Party wasn’t going to give up power. And the idea that the party would reform itself from within was precisely what had been rejected, with violence, when Zhao Ziyong was ousted from power in 1989.

Finally, you asked why was I treated as  “almost a pariah.”  The short answer is simply that people disagreed with what I was saying. But there was a human dimension to this, too. In the late 1980s, when I returned to Washington from China, most people covering foreign policy in Washington spent their time on either the Soviet Union, the Middle East, or both.

I was one of the few reporters covering Asia on a full-time basis. So of course I talked a lot with the  China-watching community. Yet  for most of that decade, I was a reporter, and I tended to keep my views to myself. I mostly just asked questions, rather than volunteering opinions. Indeed, it wasn’t until 2005, on a fellowship away from Washington, that I began to collect my thoughts and write a book. So when the book came out, some of the people I’d been dealing with for years were taken by surprise. After the book, one China hand I’d talked to amicably probably 50 times in the past once walked across the street so he didn’t cross paths with me. But all that’s mostly passed now.

The assumption that things would gradually open up in China turned out to be harmful American policy. It provided comfort to American officials and prevented them  from focussing on or preparing for  other possible scenarios — that, in fact, China could become more tightly controlled and less interested in integrating in the existing international order


Bill: Does the US risk an overshooting of China policy from engagement to containment/decoupling?

Jim: Well, I hope the ongoing changes in policy towards the Chinese government, most of which I think are  justified as a direct response to Chinese government actions, do not also lead to a general prejudice against ordinary Chinese people or all things Chinese.So far, we haven't seen that, at least not much.

For example,  Trump, who's been utterly shameless in provoking racial and ethnic tensions when it comes to African-Americans, Latinos, Mexicans, Africans -- maybe I'm missing something, but I haven't seen the same sort of thing on China yet.

Trump seems to put China mostly into the trade/jobs economic section of his brain, rather than the "chaos/social upheaval/white nationalism" section of his brain. (And that's one reason why, so far, lots of Democrats and independents have supported his policies, along with the Trumpists.)


Bill: Who do you see as the key drivers of China policy in the Trump administration, and how are they doing?

Jim: Not necessarily the faces you see on TV. If you watch, or read the news coverage, you'd think that under [President] Trump, the main drivers of China policy are people like [U.S. Trade Representative] Robert Lighthizer and [White House trade adviser] Peter Navarro — essentially the trade agencies and constituencies. 

But that coverage is misleading. I do think Lighthizer is important — Navarro not so much, except as a convenient demon for those who oppose the policies.

New round of US charges against Chinese state hackers; Bullets on the Belt & Road as "fine brushwork" begins

The Central Economic Work Conference is apparently underway and we should have details from the meeting by this time tomorrow. While Xi’s speech earlier this week appeared to give no hints of movement towards trade concessions with the US, there is always chance that speech, tailored for a domestic audience, was not the place to look for signs anyway. Perhaps there will be more positive signals from the CEWC, or at least clearer directives from the top for the Chinese officials tasked with talking to US negotiators.

The US has announced a new set of charges against MSS hackers, but the actions are weaker than expected. There has been talk for a while of sanctions and naming of SOE beneficiaries of the cyberthefts and as the Washington Post reported a couple of hours before the announcement today:

Sanctions related to the cyber economic espionage effort also are expected to be announced. 

No sanctions were announced, and I hear from multiple people that the Trump administration backed off on any sanctions because Treasury Secretary Mnuchin was worried about Beijing's reaction and a possible impact on the trade talks. That is an interesting assessment of leverage…

I will not be back until January unless something really big happens.

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Thanks for reading, and for all of your support.

Happy Holidays!

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The Essential Eight

1. US moves again against Chinese hacking

A "United Front" approach could be interesting

U.S. and more than a dozen allies to condemn China for economic espionage - The Washington Post:

The Trump administration and more than a dozen international allies are expected to call out Beijing on Thursday for what they say are China’s persistent efforts to steal other countries’ trade secrets and advanced technologies and to compromise sensitive government and corporate computers, according to Western officials.

The unprecedented mass condemnation marks a significant effort to hold China to account for its alleged malign acts. It represents a growing consensus that Beijing is flouting international norms of fair play to become the world’s predominant economic and technological power.

The action comes as the U.S. Justice Department is expected to unveil criminal charges against hackers affiliated with China’s main intelligence service who allegedly took part in a long-running cyberspying campaign targeting U.S. and other countries’ networks...

Top Justice Department officials are expected to announce indictments of the alleged Chinese hackers, who are affiliated with the Ministry of State Security (MSS), China’s intelligence and security agency

DOJ charges Chinese nationals for 'extensive' global hacking campaign - CNBC:

They are accused of stealing information from at least 45 U.S. tech companies and government agencies. 


Agencies targeted included the Department of Energy’s National Laboratory and NASA’s jet propulsion lab. 


The hackers also allegedly targeted defense industrial companies and managed service providers, as a way to gain entry to U.S. corporations and agencies through their suppliers. 


The two defendants, Zhu Hua and Zhang Shilong, were allegedly members of a group known as “Advanced Persistent Threat 10,” or “APT10.” The group was also known within the cybersecurity community as “Stone Panda,” “Red Apollo” and “POTASSIUM.” 


APT10 allegedly hacked into more than 40 computers connected to the U.S. Navy and stole confidential data, including “the personally identifiable information of more than 100,000 Navy personnel.” 


They’re also accused of hacking three communications technology companies, three companies “involved in manufacturing advanced electronic systems,” a maritime technology company, an oil and gas company, and at least 25 other technology-related companies.

The DOJ charging document is here.

US and UK accuse China of sustained hacking campaign | The Guardian: 

The UK Foreign Office and the US indictment allege that a group of non-state employees was operating under the direction and protection of China’s main intelligence agency, the ministry of state security. The hackers stole data from 100,000 US navy personnel, the US indictment says.


2. US-China trade

China Is Willing to Make a Deal - The New York Times Opinion - Eswar Prasad:

In private, Chinese officials admit they are worried. During a trip to Beijing last week, I encountered varying degrees of concern about the economy among bureaucrats, academics and business executives. Most of them agreed that the Chinese economy is slowing down, although some view this as better than the breakneck growth of the past...

With significant support inside China, the prospect of a trade deal early in the new year is real. The United States won’t get all it asks for. China is not about to abandon its state-owned enterprises, although it may be willing to subject them to greater market discipline. The best outcome for negotiations is that tariffs imposed by the United States won’t get higher and broader. So the expectation is that any deal will lead to a cessation of further hostilities but not a rollback of trade sanctions.

Such an agreement would give the United States and Mr. Trump a major victory. But if American negotiators refuse to settle for anything less than total capitulation by China, his administration will squander an opportunity to help the United States and the world’s economy.

Comment: This message jibes with what appears to be Beijing's best outcome in the talks with Trump--a ceasefire that buys the PRC time without imposing too many difficult conditions?

Ex-U.S. Treasury Chief Thinks Trade War Will Last Past March Deadline - Caixin:

The U.S. and China are unlikely to negotiate an agreement that could end the trade war by their March deadline, former U.S. Treasury Secretary Lawrence Summers said on Tuesday, warning that the possibility of the U.S. slipping into a recession in the next two years would put even more strain on the relationship...

There's a “strong political imperative” in the U.S. to keep frictions going, as Trump can continue to present himself as pressuring China on behalf of his voters, said Summers, who is an advisor to Caixin’s board of trustees...

“Even if an agreement is reached in principle, there are all kinds of questions as to whether it can be circumvented or avoided,” Summers said.

China poised to buy more U.S. soybeans soon: sources | Reuters:

China is poised to buy another round of soybeans from the United States, two sources familiar with the matter said on Thursday, amid a truce in a trade war with the United States.

One of the sources said China could buy more than 2 million tonnes of U.S. soybeans, likely before the Christmas holiday on Dec. 25.

China’s Censors Give Anti-Trump And Anti-US Rhetoric A Pass On WeChat-Buzzfeed:

The Chinese government exercises strict control over content posted to WeChat and all other online platforms, and citizens know that running afoul of government censors can have serious consequences. But right now Beijing is happy to let people freely express their anger on WeChat — so long as it’s directed at the current US administration and Trump in particular.

The platform is today home to a range of snarky and often mocking content about the US, according to a BuzzFeed News review of a sample of public WeChat posts about Pence’s speech, the recent midterm elections, and the ongoing US–China trade war. Now that things are bad between the US and China, censors are allowing plenty of Trump administration bashing.


3. China-Canada

Sounds like the third detainee unrelated - Third detained Canadian is Alberta teacher working in China who could be returned home – National Post:

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