Does China Have a Succession Plan

Opening and question-time announcement

Peter Zeihan (Speaker 1): 00:00

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Hey everybody, Peter Zeihan here, coming to you from Colorado. Today we’re taking a question from the Patreon page.

The question about Xi Jinping’s health

00:50.760

Specifically, at the recent summit between U.S. President Donald Trump and Chinese Chairman Xi Jinping—

UNKNOWN: 00:58.820

Uh.

Peter Zeihan (Speaker 1): 00:59.760

Xi didn’t look that good. How bad is he, and what’s the succession plan in China? It’s like, well, let’s start with the first part there.

Yeah, he looked bad. He was in the White House for quite some time, but over two-thirds of the time he was there, he was in a separate room with just his wife, basically recovering. Of course, none of that made it into Chinese media. Everyone just talked about how Xi outsmarted and outlasted Trump in every possible way, because that’s what propaganda looks like.

Anyway, of the hours that he was at the White House, they had very little contact. There was the dinner, there was the tour, and then there were a couple of short meetings. And honestly, that was it. Not a lot was discussed because there wasn’t a lot of time to discuss it, and the deals that came out on the other side were pretty milquetoast.

Then he was hustled back onto his plane and flown home. I think he might have gone via Canada. Anyway, he didn’t have a particularly robust social schedule. Whether you want to view that as a repudiation of Trump, which is fair, or you can review it as the fact that he’s physically just not up to it, which is also fair. Remember, this guy’s 80, so to think that he’s in there for the long haul is probably a stretch.

Anyway, the problem we’re going to have in China is that there’s nobody to take over.

Centralization, regional autonomy, and dependence on the world

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China’s a big place, bigger than the United States. Lots of people, lots of different geographic subregions, and lots of barriers between them. So historically speaking, China’s kind of fallen into two categories.

Either it hyper-centralizes like it is now, to the point that the bureaucracy is damaged beyond repair, the military stops functioning, and eventually this over-centralization leads to a broad political, economic, and social breakdown, which we’re headed for. Or the regions grab as much autonomy as they can swallow and basically start functioning like independent states. Eventually you get a widespread civil war where the center tries to reassert control, or the regions go to war with one another. It’s another viable option for where we’re headed.

The difference this time is because China is so dependent on the rest of the world for the inputs for, say, its food supply, but also its manufacturing system, also to keep the lights on, we’d be facing a deindustrialization breakdown at the same time.

The only way you might, might, might, might be able to hold that off is to have a strong ruler, somebody kind of like Xi, who can hold the system together. Here’s the problem.

The succession gap and possible consequences

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Ever since he came in 14 years ago now, Xi has gone after those people: put them in prison, executed them, exiled them, intimidated them to silence. So whether you’re looking at the educational system or the media or the business community or the military or the state apparatus, all of it has had its teeth ripped out to the point that all it can do is offer milquetoast praise of their great leader.

So if Xi were to keel over tomorrow, there simply isn’t an institution, much less a personality, who could potentially step forward and take over his role. And even if there was, so much competence has been deliberately bled out of the system that whoever this person is probably wouldn’t be able to rule competently anyway.

Think of China as a ball that’s been tossed up, and it’s at that moment at the high. We’re just kind of rotating, and everyone’s kind of looking around like, “Oh shit.” Historically speaking, when China loses a ruler who’s of the centralized type, it’s a generation of freefall and a civil war and a famine before the system starts to stitch itself back together.

You’re doing that today in a backdrop where Chinese industrial dependency and agricultural dependency is so huge that the population adjustment, conservatively, will be half the population. That assumes it can recover on the other side of this.

So the leadership issue is just one more problem the Chinese have that they have to deal with over the next 20 to 30 years.

Best-case scenario and limits on information

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The best-case scenario is that Xi becomes the new Yeltsin or Brezhnev and remains just alive enough that he can be propped up in a chair and wave to the crowd every once in a while, while everything slowly disintegrates around him.

The problem, of course, is that information control in China is very, very tight. And if we can’t get reliable population numbers or GDP numbers, we sure as shit can’t get an accurate read on Xi’s health. So all of this is reading between the lines and looking at historical examples, and not one of them looks positive.