‘The regime is strong on the outside, but weak within. It relies on control, not trust.’

Roger Garside is a renowned China expert, and an associate fellow of The Henry Jackson Society, recently published a new book, China Coup: The Great Leap to Freedom. As a British diplomat, Garside studied Mandarin Chinese, served twice in Beijing, and wrote a highly acclaimed book about how Deng Xiaoping won the struggle for the succession to Mao Zedong and launched the Reform Era. Apart from diplomacy, his career gave him deep experience of the interaction between economics and politics. The Sunday Guardian met him recently, and asked him about how he views China’s future, and what has shaped those views.
Q: Roger Garside, you are predicting that China’s leader Xi Jinping will soon be removed from office in a coup d’état mounted by rivals in the top leadership, which will end China’s one-party dictatorship and launch a transition to democracy and the rule of law. This prediction has divided China specialists into two camps: those who reject it as a fantasy, and those who say it is becoming more and more plausible as the collapse of China’s property sector—30% of the economy—threatens to become a political crisis. What has led you to make this bold prediction?
A: My career and China’s political system. I first watched China through a pair of binoculars as an officer in the Brigade of Gurkhas on the Hong Kong border in 1958—63 years ago. Two questions have shaped my life since then: how do countries get out of poverty, and what makes for good government? Those questions have led me into the British Diplomatic Service, the World Bank, the London Stock Exchange, and advising transition economies on developing their capital markets. I have spent decades on the front-line of political and economic change. I have learned to look at the realities that lie behind the official narratives, the personalities and the systems.
Q: But what is China’s political system?
A: China’s political system is not authoritarian, as most people say, it is totalitarian. That difference is crucial. The Communist Party considers itself to be above the law, and to be the supreme arbiter of truth and falsehood, right and wrong. It tolerates no dissent or difference. That has led it to commit cultural genocide, first in Tibet, and now Xinjiang.
Q: But hasn’t the system produced an economic miracle and brought hundreds of millions of people out of poverty?
A: This system led to the premature deaths of over 40 million people, during the Great Leap Forward, which began when I was a soldier on the Hong Kong border, and it held the nation in poverty until 1978. Then the adoption of semi-free markets liberated the energy and enterprise of the Chinese people, who created great economic growth. But economic reform was not accompanied by political reform, and this mixture of semi-free markets and political dictatorship has produced problems that the system cannot solve, only intensify.
Q: What are some these problems, and why can the regime not solve them?
A: The regime is strong on the outside, but weak within. It relies on control, not trust. Because there is no trust between the rulers and their subjects, it has had to pump more and more credit into the economy since 2008 to maintain an artificially high growth rate and to finance vast amounts of uneconomic activity in order to keep people employed. The result is a debt mountain so high that no nation has ever reduced it without either inflation or recession. Without the trust and tolerance of short-term pain that an elected government can enjoy, the regime dares not take the measures needed to tackle this problem.
A second problem is a moral crisis, with corruption at its heart. But this corruption is a deliberate strategy to retain the loyalty of those who rule in the name of the Party. So, the regime only tackles the symptoms, not the systemic cause of corruption.
A third problem is that the one-party dictatorship has allowed Xi Jinping to centralise authority into his own hands, to an extent not seen since the rule of Mao Zedong. Unfortunately for China, he has misjudged China’s strength and over-reached in challenging the US and its allies. He has set China on a collision course with an America that is newly awakened out of complacency. Many members of the Communist Party elite are alarmed that he is blind to the reactions that China’s actions have provoked from the world’s strongest power and its allies, but the system does not permit them to voice their fears and curb his conduct of policy.
Q: But has the response of the US and its allies been effective? Has it gone beyond expressions of moral outrage and sanctions on a few second- and third-rank officials?
A: Democracies take time to respond, and the integration of China into the world economy has created strong vested interests that are opposed to rethinking our strategy to better reflect the relationship between our political and economic interests. But there has been a sea-change in attitudes and, to a varying extent, policies, in the US, Japan, Australia, Canada, the UK and, if I may say so, in India. The EU is reacting more slowly.
Q: But where is the evidence of this sea-change? And what policy-changes has it produced?
A: Already under the Trump administration, we saw the emergence of a powerful bipartisan consensus on China in the US Congress. This has produced the legislation, signed off by President Trump in his last days in office, which will lead to the suspension from listing and trading on US exchanges of all Chinese companies, over 240, with a total market value of over US$2 trillion, if by 2024 the Chinese government does not permit them to release their full audit information to the US regulators. This would be the biggest reversal in China’s international economic relations since 1978. Secondly, the consensus has resulted in sanctions on the telecoms equipment giant Huawei which have had a devastating effect on that company. Thirdly, under President Biden, a law has been made which prohibits the sale in the US of any product which has been produced in whole or in part in Xinjiang. Since Xinjiang exports 80% of its cotton that will be very damaging.
Q: But what about outside the US?
A: Your readers will be well aware of the reestablishment of the Quadrilateral Security Dialogue between the US, India, Australia and Japan to counter China’s increasing power in the Indo-Pacific region. Also in the Indo-Pacific, Australia and the UK have joined with the US to make the AUKUS agreement which will help Australia acquire nuclear-powered submarines.
Q: Those are actions by governments, but how about public opinion?
A: There is strong evidence in opinion polls and parliaments of a popular awakening to the nature of China’s Communist regime, and the threat it poses to our values, our interests, and to the more peaceful and open community of nations that emerged after the end of the Cold War. The secretive handling of Covid-19 by the Chinese Communist Party, the crushing of freedom in Hong Kong, the atrocities in Xinjiang, the escalating threats to Taiwan and the incursions and clashes on your border with China have all contributed to this.
Q: But Xi Jinping has not been forced to back-track on any part of his foreign policy. Why should foreign relations play any role in leading his domestic rivals to act against him?
A: Because they can see where all this heading. China gained spectacular economic and social benefits from global integration. Now they can see that the nation is returning to the disastrous isolation from which it emerged after the death of Mao. The fate of Hong Kong demonstrates on a daily basis how this is going to work out. Darkness is falling on Asia’s greatest international hub, a model of multi-ethnic life under the rule of law, one of the most successful cities in the world, which served China’s interests extremely well, until now. It is a warning of what could happen to the rest of China.
Q: You described some problems in China’s domestic policies, but with the present GDP growth rate of 5% or 6% per year, it is on course to overtake the US to become the biggest economy in the world. Surely Xi Jinping is guiding his nation to become the world’s dominant superpower? The nation is stable. Would political change not lead to chaos?
A: There would be risks of course, but today’s so-called stability is not based on firm foundations, either politically of economically. Politically, I have mentioned the lack of trust between the rulers and their subjects. Economically, I have mentioned the debt mountain, but look also at the financial system. It is essentially a Ponzi scheme, which has been an existential risk to the regime for years. The collapse of the highly indebted property sector, which accounts for 30% of the economy, is having very serious and far-reaching consequences, for instance on the finances of local government. As a result, its impact will be political as well as economic. The wealth and power of China’s leaders personally as well as those of the nation are gravely threatened. Xi’s rivals know that the situation demands not just a new leader but a new system of government, in short, a revolution to which Xi is implacably opposed. To save China—and themselves—from catastrophe, they must remove him and end the dictatorship he is determined to defend.
Q: And that is what you spell out in your new book, China Coup: The Great Leap to Freedom?
A: Yes, in the non-fictional three-quarters of the book, I set out why this will happen. In the other, semi-fictional one-quarter I show how it could happen, through a coup d’état led by real-life members of today’s leadership. I wrote it to challenge the intellect and arouse the imagination. It seems to be doing so, from North America to Europe, to Australia, and now to India. People are reading it and making up their own minds as to whether it is implausible or prescient.