Asia Pacific

The West Struggles to Understand China’s Common Prosperity

China’s crackdown on capitalism — Xi Jinping’s “common prosperity” drive — worries Europe.
Peter Isackson, daily devils dictionary, China news, China welfare, China culture news, China collectivism, Western individualism, Chinese economy news, Xi Jinping news, China common prosperity drive

Elderly people in front of a social welfare home, Dali, China, 7/8/2013 © Hung Chung Chih / Shutterstock

September 24, 2021 09:14 EDT

For most of the 20th century, Westerners had one word to sum up any thoughts they may have had about China: inscrutable. Several decades of globalization have radically changed that perception. Fully integrated into the world economy, China plays a dominant role today and is expected to become the world’s largest economy by the end of the decade. Westerners may find it worrisome, but they no longer see China as inscrutable.

For Western thinkers, when an entity finds its place in a system, the system’s structured categories serve to situate and ultimately define the substance of the entity. Now that China is subjected to the rules of the global economy, analysts believe they understand it. Influenced by the analytical model inherited from Aristotle’s metaphysics that distinguishes between substance (or essence) and accidence (or variable features), today’s analysts dismiss anything that the system cannot account for as accidents. Accidents can always be corrected in the name of efficiency. 

Despite its manifest peculiarities, for Westerners China has become a member of the tribe. Analysts assess its behavior according to the rules and laws of the tribe. For the past two centuries, beginning with David Ricardo and Karl Marx, Western thinkers have tended to reduce their understanding of social reality to economic relationships. In so doing, they fail to build into their model two dimensions they relegate to the category of Aristotelian accidence: culture and politics.

Does the World Need to Contain China?


At best, the analysts attribute to culture and politics a supporting role in the great cause of economic organization. They fail to notice that cultures not only differ in the way they treat time, space and social relations but also in how they measure value. In particular, they neglect the value cultures attribute to the individual and collective patterns of behavior that form the basis of political systems. This leads to major errors of interpretation. We can see the result in failed military campaigns, from Vietnam to the Middle East. Similar failures occur in the domain of economics.

As if to illustrate the principle, the European Chamber of Commerce has just produced a report expressing its severe critique of what it sees as the erroneous path China’s President Xi Jinping appears to be taking. The august institution, focused on the logic of trade, believes that some of Xi’s salient measures violate a totally rational rulebook that members of the global economic community must always abide by.

Reuters reports the chamber’s recommendation that “China should abandon a top-level strategy promoted by President Xi Jinping to increase self-reliance, or risk harming innovation and growth prospects,” which clearly implies its opposition to policies such as “common prosperity.”

Today’s Daily Devil’s Dictionary definition:


In Western thought, a virtue for individuals and a vice for nations

Contextual Note

Addressing the same topic, Stephen McDonell, the BBC’s correspondent in Beijing, offers a slightly different analysis, one that seeks to explore certain cultural factors. McDonell cites some of the salient features of  Xi’s “common prosperity” program. “Under this banner,” he writes, “targeting tax evasion by the wealthy makes more sense, as do moves to make education more equitable by banning private tutoring companies. The ongoing crackdown on the country’s tech giants can also be seen as part of the plan.”

Unlike the European Chamber of Commerce that worries about the violation of capitalist orthodoxy, McDonell acknowledges a certain coherence in the Chinese plan. He cites the historical reality of the “chasm of income disparity” that has provoked Xi’s initiative.

Embed from Getty Images

It’s a criterion that has meaning even in the West, where people have been grappling with the realization that modern capitalism, refashioned by the neoliberals since the 1980s, has produced an increasingly obscene and unmanageable wealth gap that appears built into the system’s logic.

Economists such as Thomas Piketty have focused on that question while going beyond mere economics to take on board the cultural and political (or ideological) underpinnings of the phenomenon.

The thought of most commentators on the economy typically stumbles over its own cultural logic. Like the European Chamber of Commerce, McDonell himself fails to make the cultural leap and relies on Western criteria to complete his analysis. He notes that Xi’s authoritarianism allows him to rewrite the rules at any given moment.

Then he asks the $64,000-question Western analysts always consider fundamental: “How can anybody reliably make investment decisions if they don’t know what the ground rules will be in a month’s time?”

Historical Note

McDonell’s question makes immediate sense for his Western readers since the notions of investment and risk are at the core of all thinking about the economy. But in his own potted summary of the history of communist China’s economic ideology, the BBC journalist offers a number of clues that would explain why this question troubles the Chinese far less than anyone in the West. 

McDonell points to the Chinese government’s management of the narrative around its “concept of socialism.” During its phase of integration into the global capitalist economy, the government “put its faith in trickle-down economics.” McDonell then raises a serious question. “So does Xi Jinping really believe in this idea of a communist project?”

In other words, China painfully shifted from Mao Zedong’s totalitarian version of Marxist doctrine to Milton Friedman’s trickle-down economics under Deng Xiaoping, inaugurating a period of prosperity. Does it make any sense to imagine it might shift again, this time to a new version of Marxist egalitarianism?

Embed from Getty Images

To answer this question, McDonell delves into the history of Xi himself and that of his father, who was jailed in 1978 for his commitment to economic liberalization. This allows him to puzzle over the question of whether Xi’s apparent conversion to communist ideals is sincere or merely opportunistic. 

In August, the Daily Devil’s Dictionary suggested that Xi’s motivation might simply be the desire to “remake his image as a populist hero at home” in an effort to consolidate his power and ward off the risk of a future winter of discontent. Most commentators now agree that the “common prosperity” reforms are the real thing and not just political rhetoric.

That explains why the European Chamber of Commerce appears worried. It also explains why the BBC is dedicating a three-part series to elucidate “how Beijing is rewriting the rules of doing business and the global implications of this.”

Earlier this month, The New York Times quoted former US government analyst Christopher Johnson, who pertinently observed that “Xi sees doing something on income inequality and the wealth gap in China as vital in this struggle of global narratives with the U.S. and the West in general.” This dimension of the question adds interest to the drama currently playing out in the US Congress concerning President Biden’s $3.5-trillion infrastructure bill.

Some Republicans see this as proof that Biden is a Marxist. If adopted, the bill would contribute to limiting the huge and widening wealth gap, but it would not attempt to reign in the power of finance and Big Tech, as Xi’s plan intends to do. There is a strong likelihood that Congress will reject the Biden plan. Democracy seems to be having trouble competing with autocracy.

There is another irony in this story about China’s goal of self-reliance. In US culture, self-reliance is a core value. It has come to be identified with capitalism itself and has spawned the culture of individualism that dominates the Western world. The myth of the self-made man sums up the spirit of individualistic capitalism.

Chinese culture has always rejected self-reliance. While it values prosperity as a goal, Chinese culture sees it as the result of a collective effort, not of individual initiative. One achieves prosperity through one’s family and guanxi, or network of relations, but never on one’s own.

The European Chamber of Commerce fears that a nation representing 20% of humanity might decide to go it alone, not because that would be a bad thing in itself, but because it would remove one-fifth of the world’s trade from the global marketplace. They claim it would stifle innovation. But its effect would more likely be to disrupt the thinking of those who see humanity as collections of individual consumers of standardized products. After all, for Western economists, every self defines itself by what it consumes and how it produces profit for others.

*[In the age of Oscar Wilde and Mark Twain, another American wit, the journalist Ambrose Bierce, produced a series of satirical definitions of commonly used terms, throwing light on their hidden meanings in real discourse. Bierce eventually collected and published them as a book, The Devil’s Dictionary, in 1911. We have shamelessly appropriated his title in the interest of continuing his wholesome pedagogical effort to enlighten generations of readers of the news. Read more of The Daily Devil’s Dictionary on Fair Observer.]

*[An earlier version of this article mistakenly labeled the chamber’s recommendation a reaction to Xi’s policy. Updated: February 15, 2022, at 09:30 GMT.]

The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.


Only Fair Observer members can comment. Please login to comment.

Leave a comment

Support Fair Observer

We rely on your support for our independence, diversity and quality.

For more than 10 years, Fair Observer has been free, fair and independent. No billionaire owns us, no advertisers control us. We are a reader-supported nonprofit. Unlike many other publications, we keep our content free for readers regardless of where they live or whether they can afford to pay. We have no paywalls and no ads.

In the post-truth era of fake news, echo chambers and filter bubbles, we publish a plurality of perspectives from around the world. Anyone can publish with us, but everyone goes through a rigorous editorial process. So, you get fact-checked, well-reasoned content instead of noise.

We publish 2,500+ voices from 90+ countries. We also conduct education and training programs on subjects ranging from digital media and journalism to writing and critical thinking. This doesn’t come cheap. Servers, editors, trainers and web developers cost money.
Please consider supporting us on a regular basis as a recurring donor or a sustaining member.

Will you support FO’s journalism?

We rely on your support for our independence, diversity and quality.

Donation Cycle

Donation Amount

The IRS recognizes Fair Observer as a section 501(c)(3) registered public charity (EIN: 46-4070943), enabling you to claim a tax deduction.

Make Sense of the World

Unique Insights from 2,500+ Contributors in 90+ Countries

Support Fair Observer

Support Fair Observer by becoming a sustaining member

Become a Member