Is Anyone Listening?

Once upon a time, the powerful pronouncements of Beijing held sway over the economic actions of the nation. Those heralded speeches carried a weight that drove the population towards grand goals and great endeavors.

Yet, today, those times seem like distant memories. The playbook of old has lost its relevance in a country that has evolved into nearly 90% independence, with private industry and consumer-driven forces guiding its course. The days of automatic obedience and unwavering action have come to an end.

The challenge facing the Chinese government now is to revise that playbook, to adapt to a changed landscape where national directives no longer capture the hearts and minds of the people. In a country where private enterprise flourishes, and innovation is a driving force, traditional proclamations fall on deaf ears.

In the midst of the 2008 financial crisis, former Chinese Premier Wen Jiabao delivered a powerful message to a group of U.S. government officials and business executives in New York. He emphasized the value of confidence in the face of economic difficulties, claiming it to be more precious than gold.

At that time, the Chinese economy teetered on the brink of uncertainty. Today, it faces sputtering growth and the dimmest prospects in decades. China's leaders are learning the hard truth of what Wen Jiabao meant all those years ago.

To bolster confidence in the private sector, Beijing unveiled a 31-point set of guidelines. This document, released after a period of government crackdown on private companies and innovation, is a near-concession by the Communist Party that its previous campaign had failed spectacularly.

While some entrepreneurs rushed to praise the guidelines in official media, others privately dismissed the party's efforts as empty words, far from instilling the desired confidence. Stocks in mainland China and Hong Kong, where many of China's major private enterprises are listed, responded with uncertainty, reflecting the desperation felt by the party and the seeming insignificance of the guidelines.

Beyond the surface, the issue of confidence is deeply rooted in the government's credibility. Over the past few years, Beijing has lost much of its standing and trust in the eyes of the people. Restoring confidence would require not just hollow promises but significant systemic changes that truly protect and support the entrepreneur class and private ownership.

Under the leadership of Xi Jinping, private companies and entrepreneurs have faced constant challenges from both the government and online commentators. Xi's economic focus centers on bigger and stronger state-owned enterprises, leaving little room for the capitalist class.

China's private sector, which once contributed over 50% of the country's tax revenues, 60% of economic output, and 80% of urban employment, has been grappling with an uncertain future. Economic problems in the country are deeply rooted in politics, and confidence will only be restored through genuine changes that offer real protection to the private sector.

The government's charm offensive, with promises of support and meetings with business leaders, may offer temporary respite. However, true confidence can only flourish in a normal social environment regulated by the rule of law.

For China to truly emerge from its slump, it needs to create an environment where the entrepreneurial spirit can thrive, where opportunities abound, and where confidence can bloom once more. It is not about mere support; it is about creating a trustworthy space where the private sector can flourish and drive the nation forward.

Song by Bob Dylan:

Come gather 'round people, wherever you roam

And admit that the waters around you have grown

And accept it that soon you'll be drenched to the bone

And if your breath to you is worth savin'

Then you better start swimmin' or you'll sink like a stone

For the times they are a-changin'