By jacking down Jack Ma, the Dragon has started killing the geese that laid golden eggs for four decades since the People’s Republic of China (PRC) began its four-pronged modernizations in the early 1990s, at a time the Soviet Union, as a superpower, was disintegrating.
In its quest to replace Moscow as the next superpower, Beijing failed to see the ironies: the USSR had heavily invested beyond its pocket to match rival America’s Star Wars programme. It went bust soon. On the other hand, China, nearly broke by the 1980s, turned itself around at a breakneck speed as it followed its visionary leader Deng Hsiao Feng’s famous words: “It does not matter what the cat’s colour is, as long as it catches mice!”
Then came Deng’s nemesis: Xi Jinping, who came to power in 2013,and crowned himself President-for-Life five years later. He was inspired not from Deng or even Mao Zedong but from North Korea’s Lilliputian dictators.
Under him, China began to balloon out. Before him, Beijing had adopted a dual system: for Hong Kong and indigenous entrepreneurs, as it went the whole hog embracing capitalist economy. With Xi’s advent, China became expansionist overtly and covertly, collecting more enemies than friends; it tried to erase Hong Kong’s autonomy, crushed the Uighur Muslims in Xinjiang, unnecessarily provoked America, India, Japan and Australia, among others, and united them against itself.
On the socio-political front, Beijing shrunk within, like an atheistic version of Islamists. The PRC and the Arabs are both burdened by prosperity and ultra-conservatism and are the mirror images of each other.
That is why the way the Muslim world, torn between material prosperity and psychological poverty, is tearing apart, the PRC, too, is disintegrating.
Jack Ma may well become the PRC’s own Mikhail Gorbachev, not only the whistle-blower but also the magnet that would attract reformers trying to get rid of the Communist Party’s ‘ultra-Islamic’ rule.
The signs are appearing.
In six months, China has undone the work of millions of ambitious and starry-eyed Chinese youth who pushed their pauperised country to make it the world’s most enviable economy.
So what has China done? It has just punished its best-known entrepreneur and only the second best known Chinese, globally, after a revanchist President Xi Jinping. Jack Ma’s crime? He wanted the PRC to shed its archaic ways and modernize its outlook.
In October 2020, the Xi Gang cracked the whip against Jack Ma. It first stopped Ma-led Alibaba’s $35 billion IPO, the world’s biggest, and almost house-arrested him for months. Then it slapped a record $2.8 billion fine on Albaba Group Holding Ltd which, the government claimed, was abusing its monopolistic market dominance! Ironically, it is not Jack Ma but the Communist Party which has a monopolistic dominance not only over economy, but also in socio-political-academic-cultural narratives in the PRC.
With this hammer, the PRC may have readied its own coffin.
For, the miracle that is China today is not due to its fossilized Communist leadership but because of the innovations, hard work, and sacrifices made by millions of Chinese entrepreneurs who managed to create over 800 billionaires in four decades. Jack Ma is only one of them, though the most successful.
With his wings being clipped—or so China thinks!—the glorious era of China’s technology and financial giants is over.
In aping Moscow, Beijing forgot one crucial thing: despite facing challenges from America and its own socio-economic-political crises, the Soviets innovated a lot in both theoretical and practical science and technology, won multiple Nobel Prizes, even as they curbed political rebels. China, on the other hand, did little in theoretical and practical science and technology, followed corrupt practices, and shunned serious innovations that made both Moscow and Washington great powers for decades.
In contrast, China’s global ‘influence’, which began with Xi Jinping’s coronation in 2013, came to end in 2020 with its suspected role in a global biological warfare via the Covid-19 pandemic. Today, Beijing has lost trust even of unofficial Islamabad!
The full implications of China’s breakneck moves against Jack Ma’s internet empire would soon begin to manifest as other billionaires, suffocated in their country’s archaic policies within and geopolitical blunders without, gang up in rebellion: simply by doing nothing noteworthy any further!
This possibility is emerging after they witnessed how Beijing went against not only Jack Ma’s Alibaba but also ordered an overhaul of Ant Group Company’ It regulators summoned 34 of the country’s largest companies, including Tencent Holdings Ltd and Tiktok owner ByteDance Ltd, warning them all that “the red line of laws cannot be touched.”
As the world struggled with coronavirus, China managed to snatch defeat out of the jaws of victory, not only within but also without—against India, for example. Because the message Ma and other entrepreneurs got was that the decades of unfettered expansion, that created challengers to Facebook and Google, had ended.
Henceforth, China’s technology companies would shun innovation and move far more cautiously, what with their limbs tied up. Their international forays would also stop and their exponential growth will become subject of world lore. China’s billionaires, who elevated the lives of hundreds of millions of Chinese people, will now enjoy the fruit of their labour rather than taking any more risks via-a-vis their unelected dictatorial government.
Growth of startups, modern era’s economic miracles, may also come to a halt. The likes of Alibaba and Tencent, who became Chinese industry’s kingmakers by investing billions of dollars into hundreds of startups, may hardly show any interest in continued investment in new startups.
With individual entrepreneurship and enthusiasm being suspected, these billionaires have also learnt a hard lesson in the last few months. The unprecedented series of regulatory actions has proved that Beijing will go all out to rein in its internet and fin-tech giants who have already seen how $200 billion were wiped off Alibaba’s valuation since October 20
This week, media reported that Chinese titans from Tencent to Meituan are next up in the cross-hairs because they’re the dominant players in their respective fields. “The days of reckless expansion and wild growth are gone forever, and from now on the development of these firms is likely going to be put under strict government control. That’s going to be the case in the foreseeable future,” said Shen Meng, a director at Beijing-based boutique investment bank Chanson & Co.
“Companies will have to face the reality that they need to streamline their non-core businesses and reduce their influence across industries. The cases of Alibaba and Ant will prompt peers to take the initiative to restructure, using them as the reference.
The most amorphous yet dire threat lies in the simple principle implicit in regulators’ pronouncements over the past few days: that Beijing will brook no monopolies that threaten its hold on power.
Clearly, Xi is scared that Jack Ma might replace him as President of China!