The psychology of Chinese decline

The strategic community is in awe of China. They marvel at its visionary leaders like Mao, Deng and Xi. They gush over books like the 100-Year Marathon: China’s Secret Strategy to Replace America as the Global Superpower. They quote from it extensively. The very thought that Xi Jinping has laid down timelines for the PLA to become a fully modernised force by 2035 and China to be a well-off modern socialist society by 2049 sends tingles of envy down their spine. One can almost feel it. They quote how China is a superpower. They reel out the technologies it is mastering including space, quantum, cyber and AI. They talk of its nuclear expansion. They explain how the Yuan is replacing the Dollar. They point out the rate at which China is deploying exotic weapons – stealth aircraft, powerful naval vessels and other military capabilities with its ever-expanding military budgets. They look at those who talk of China’s decline as halfwits.  

In all the gushing about China, it will do good to remember that a nation is made of people. Not robots, AI or cyber! It is people – good, bad or ugly who make any nation into what it is. Unfortunately for China, the people are declining irreversibly. If the people are in an irreversible decline, the nation declines. Is it not? Sabe? China’s decline actually started with Deng’s ‘one child policy’. When implemented, it seemed really farsighted. Today it looks sort of idiotically myopic. As per a Chinese writer, China faces many “grey rhino” risks. However, population decline is China’s biggest and its time is running out. 

When did the demographic grey rhino appear? A decade back. However, the eternally lying communist machinery explained away the demographic decline. As per them, it was known, anticipated and under control. After all the two-child policy was already under implementation with the usual communist gusto! Their propaganda was that the problem would only appear in the next decade. By then China and Xi Jinping would be chugging smoothly on their way to superpower status. Except that the farsighted liars were hiding the reality from the world, their people and themselves. The Chinese farsighted myopia sold the grey rhino as a silver unicorn!  Many believed it! by TaboolaSponsored LinksYou May LikeSee How a $249 Amazon Investment Can Benefit You (Apply Today)CPXDiscover the cost of your dream kitchen instantly.HomeLaneGet Quote

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A couple of years back when I started writing about China’s decline, the Chinese bandwagon looked at me in resigned amusement! Here was Xi Jinping talking of Global Security, Development and Civilisational Initiatives and leading China on its way to a Sino-Centric Global Order. Here I was talking of population decline – a trifling issue which might occur. By then China would be rich, prosperous and powerful. It would have the capability to divert the runaway express train bearing down on it. In 2023 the Chinese were jolted when the population dropped by 2.08 million and births by 9.02 million. The lowest level in 74 years. It was like erasing the populations of Salem and Ambala from the map. Panic! But the lying Jinping and his believers are still selling rat poison of China’s great power status, new technologies, civilisation and all that junk.  

Why is China declining at such a fast rate?  Simple. Its people are ageing at the fastest rate in human history! People matter after all. China might or might not be rich as per Xi Jinping’s plan. It will get old and that is for sure. In 2023, China had around 21.1% of people above 60. By the time PLA modernises fully by 2035 this will be about 30-35%. By 2049, this figure will be above 40 %! This data is derived from official UN figures. However, the official UN figures are based on falsified Chinese figures! The situation must be actually worse. So that’s our fully modern China – a superpower of the aged! 

While Xi Jinping and his gang are talking of modernised China leading mankind to a common destiny through new productive forces, the common Chinese on the streets are seeing kindergartens being closed and hoping that they will be repurposed into old age homes! A simple matter of adjusting the declining child population to an increasing ageing people. This is just one issue. More profound and intractable social issues are just coming to light. The Chinese society we will see going ahead will be far different from the one in which the ‘one child policy’ was implemented or the one of today’s generation which grew up in boom times.  

In the past one year, there has been a growing awareness that China has sleepwalked into a situation where the clock has stopped ticking. People write that the worst curse for any nation’s future would be if prosperous people have become “the last generation”. They talk of parents, raised during China’s gravy time who had high hopes for their children’s success. They see them already crumbling with ‘Tang Ping’ and ‘Bailan’ when their children might not land a decent job after graduation. Imagine the psyche of an ageing people when their two main investment avenues – property and stock are in a blind alley of an unfinished building in a ghost city. 

Deng’s “one-child policy” provided free condoms and other contraceptive products to limit births and population. However, it also enabled ‘sex for pleasure and broke the traditional institution of marriage’. Marriages and births – both declined. Remember, China does not encourage childbearing outside marriage. Further, when the cost of child-rearing went up with prosperity, births declined. Overall the Chinese Communist Party has let loose a jinn out of the lamp. That jinn has already led China to a birth rate far below replacement levels. In fact, the Chinese society stands reshaped in a manner which will make Deng turn in his grave. Imagine the psychology of a country where there are no brothers or sisters or uncles or aunts. That is what is China today. What will it be tomorrow? Anyone’s guess. 

An erudite demographics professor at a reputed Chinese university opines that a “dearth of childbirths would be a horrendous social and economic crisis since childbirth is the largest industry chain driving the economy”. Another good professor points out that even if all Chinese have three children, “China’s population would still continue dropping until the end of the century, due to a shrinking number of women of childbearing age as well as a rapidly ageing population”. Xi Jinping has a lot of work to do. At the age of 71, he might be better off if he attempts to produce his third child in the time he has left on this good earth rather than building the largest navy on god’s acre and making trouble for all his neighbours.

Turn to another aspect – pension. In March 2024, China has indicated that it will introduce a private pension fund. Something like NPS which has been around in India since 2014! When a headline screams ‘China’s private pension push marred by weak financial literacy, as people still have no idea’, one needs to wonder at Chinese foresight! People are hesitant to participate since the scheme is not attractive in economically difficult times. This is about the general pension scheme. The old age pension scheme is running out of funds anyway by 2035 and no solutions are in sight. Can you imagine the mental state of Chinese – old and young? 

People argue that Chinese productivity can be kept up with automation and robots despite its population decline. I scratch my brain and wonder how can robots consume.  After all the biggest economic problem is their consumption gap. Don’t agree with me? Ask Michael Pettis, the renowned expert on the Chinese economy. Another Chinese writer states ‘Beijing’s ambitions of building a powerful socialist country by the middle of this century will be out of reach if the population keeps shrinking and ageing at the current rate’. Yet another opines that ‘China’s frequent and abrupt policy changes during the pandemic undermined the government’s credibility. Beijing should start by trying to restore its credibility. The credibility problem between the government and its people is only growing. 

One might say that such things are normal in a society under change. The difference is that a few years back Chinese demographic issues were discussed only by academics and researchers in journals that no one read. The issue is now being debated in every news portal in China regularly. New facets one could not dream of are coming up. To put it in perspective, the problem will bloom big time past 2030 in geometric proportion. The Chinese know it and they do not have answers. They are worried and probably scared stiff.

The China one sees has three layers today. One sees China economically stagnating since the hole in the property, infrastructure and debt-ridden finance sector cannot be replaced by EVs, solar panels or energy appliances. With investment staying away, the economy will become even more problematic as the steel sector is about to fall off a cliff. The second layer is an ageing Xi Jinping and a power-hungry communist party which has eschewed all paths to peace and growth through their greed and flawed policy. This dangerous layer is surging ahead militarily and technologically to seek a pinnacle in global affairs. It is doing so without a full stop – sinking buckets full of Yuan drawn from the hard-earned savings of the citizenry. The returns can only be assured through mercantile chicanery or war since all its policies have failed spectacularly. The third layer is a shrinking and ageing population who know this but have no other alternative. Some are putting their life savings in gold and many in shaky banks, worried about their future which seems bleak compared to their past. They have no choices left. All they can do is bring to the fore new aspects of the psychological stress they are coming under on an almost daily basis. No wonder that the demand for psychological counselling has increased in China as anxieties have mounted. It is a complex pressure cooker situation. 

This in effect is the psychology of a nation in decline. All this is not my original thinking. If the Chinese accuse me of plagiarism, it will prove my case. The decline has started and the down hill slope will only be steeper as time goes on. One has to just wait for the Sino-Centric World Order to disappear into the horizon. It is a matter of time. 

(Disclaimer: The views of the writer do not represent the views of WION or ZMCL. Nor does WION or ZMCL endorse the views of the writer.) 

Lt Gen PR Shankar (Retd)

Short Bio. Lt Gen PR Shankar (Retd) is a former Director General of Artillery. He is currently a professor in the Aerospace Department of IIT Madras. He has a popular YouTube Channel and Website named Gunners Shot.