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Will the global economic system be saved by...Xi Jin Ping? [1]

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Date: 2025-04-11

Watching the churn around the misbegotten US tariff plan whose travails we will soon be living through, I’ve been wondering when the breaking point will come. An article in the BBC News website has got me thinking: will the stability of the global economic system be saved by...Xi Jin Ping?

Here’s my train of thought:

1) That the so-called “Liberation Day” assault on global trade was going to cause huge problems was obvious, and emerging instability in the Federal bond market quickly got someone to convince the current president that he had to cancel most of them. (Probably, one team worked to keep Peter Navarro, Stephen Miller, and other hazards away from the president while another team went to praise him for his incredibly brilliant plan to first announce absurd tariffs without justification, but then take them back).

2) But the president’s fragile ego needed a “win”, so he was pointed at China: since China had already retaliated, the President showed his manly strength by raising tariffs on China to dizzying heights.

3) The “this will force them to negotiate” (not to say, to kiss his a**) narrative is also in play. It seems highly likely that some major forces (political and economic) are leaning on the unstable president, because of the huge costs these dizzying tariffs will impose on them and on consumers (raising inflation). So, in reality, another fold on this policy is in the making and almost inevitable, because the policy is absurd. But, but, but: the president’s fragile ego is still in the way. The BBC article (“Trump had five tariff goals - has he achieved any of them?”) suggests strongly that even the president himself is eager to notch a win by having the Chinese ask for negotiations, and willing to back off once he’s “won”.

The White House thus has been signaling loudly that it is ready for a man-to-man call between Xi Jin Ping and Donnie -- but to salve the president’s fragile ego, China has to request the call. As the article describes, the messages has been getting louder, and started sounding a little desperate: “White House press secretary Karoline Leavitt said the president would be "incredibly gracious" if China reaches out to make a deal.” That sure doesn’t sound like someone speaking from strength! But the White House is still holding out on one point: Xi has to request the call, and show deference and submission, and then all can be fixed.

4) But Xi is not calling. And I suspect Xi sees no need, and has no interest in starting the conversation that the White House keeps fantasizing about. On the contrary, the longer the bizarre tariffs are applied to China, the more it will hurt the president and weaken the US around the globe — exactly what Xi and the Communist Party want. Why would they call, given reality the way it is? Yes, there will be costs in China, but those have been assessed and prepared for. Anyway, Xi is busy re-negotiating trade with Ursula van Leyen and the EU, and making new trade deals with much of the world, so he’s busy.

5) This gets me to the next level: As Josh Marshall has been arguing, for a leader like our current President, his power is primarily personal, and thus also largely unitary (since he has a very poor grasp of institutional power, in notable contrast to Xi). It is his visible dominance over some people that increases his power over others. Correspondingly, if our president appears weak on one front, that will weaken his personal power, which is fundamentally fragile, on other fronts too.

6) The reality is therefore that Trump cannot “win” the tariff fight with China that he has started, because Xi is not going to make any gestures that would look like Trump “won”, and because China can hold out far longer than the US (not least because of its authoritarian regime). Trump will lose, and the US will lose (and many others as a result, since the Chinese regime is not in any sense a ‘virtuous actor’ on the global stage). My hunch is that the Chinese regime has a full-time expert team of psychologists, business historians, sociologists, and so forth who have been studying Trump — especially how he behaves when things fall apart, like during his casino bankruptcies — and they have good guesses as to how he is going to twist and turn, with contingencies in place for various dodges he may try (up to and including “dog-wagging” military adventures by the US, which we must consider possible).

6) Outcome: if the president is ultimately humiliated by Xi, which I am convinced is Xi’s intention as an autocratic authoritarian power-person*, our president will also be weaker vis-a-vis the Congress, the courts, the Democrats, the EU, and all the rest. Weakness on one front degrades personal and charismatic power on all fronts.

7) Thus, while this whole episode will cause lasting economic damage around the globe, just as the president’s domestic rampage is going to cause lasting damage within the US, I think it’s going to end with the current president losing much of the personal, arbitrary, and indeed tyrannical power that has been asserting and, with only slowly growing opposition, has been exercising, both domestically and internationally. He won’t be powerless, of course, but many more people across society are going to feel safer opposing, blocking, suing, resisting, or ignoring him, and that’s all for the good.

Yeah, I know, I’m an incurable optimist! And seriously: making the Chinese regime under the personal control of Xi Jin Ping the arbiter of the global economy, with all of the power in other areas that flows from that, is not a good thing for our world. But at this point, it seems less bad than a world dominated (in a very conscious and intentional way) by a mad narcissist with major grievance issues and only a loose attachment to reality.

* Footnote: German has the lovely word “Machtmensch” to describe those absorbed and focused only on power, which sure describes Xi Jin Ping. I doubt Xi’s a “megalomaniac”, just a man for whom gaining, exercising, and displaying power are the core of his being. And unlike Trump, Xi also understands institutional power and has been masterful at gaining it and using it to destroy his more attractive and charismatic rivals throughout his career.

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