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Today, rather than being an organic outgrowth, it has been harnessed by the 
Communist Party as a tool of statecraft, a straw man on an international 
scale. If the people's rage can be kept simmering at Japan, the United 
States or Taiwan, it is less likely to be directed at the Communist Party—
and its excesses. 
However, nationalism is at best a double-edged sword and at worst puts the 
party in a straightjacket. China-Japan trade is an extensive $345 billion 
enterprise and recently the two nations marked (quietly) the fortieth 
anniversary of normalized relations. In short, heeding the angry calls of 
nationalists for economic boycott [10] and worse [11] would be 
catastrophic for China, especially as mounting evidence of economic 
slowdown has begun to emerge. 
By creating nationalism and then ignoring it, leaders in Beijing open 
themselves up to charges of weakness. Mao and Deng, secure in their own 
command, could brush it off, but Beijing's new technocrats are far less 
secure within China's immature civil-military institutions. They are more 
vulnerable to the anger of the mob if they seek compromise. The end result 
is a Faustian choice where the only thing worse than ignoring the mob 
would be obeisance to it. Xi Jinping will have to navigate through this 
dilemma if he hopes to name his successor in 2022. 
The End of the Miracle 
Doomsayers have been predicting the end of China almost since the 
beginning of China as we know it in the late 1970s. They have been wrong 
for over thirty years, and those still predicting the elusive "hard landing" 
and subsequent collapse probably are still mistaken. However, that does 
not mean China's growth will not slow down, perhaps considerably in the 
coming years. The last thirty years in China have been described as an 
economic miracle, and anyone on the ground can attest that this is no 
exaggeration. Yet it is very likely that we are at the end of the miracle, and 
that future Chinese growth, like that in all developing countries, will slow 
to lower and more sustainable levels. 
The most salient factor in this slowing growth is China's size. Unlike other 
nations that have experienced breakneck growth and then slowed—like 
Japan or Germany—China's uniquely large population presents obvious 
difficulties. Germany's population of around eighty million is roughly 
equivalent to the population of Sichuan Province, China's fourth largest. 
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All normal indicators must be adjusted for China's vastness. As a result, 
even if China's growth slows to 6 percent a year—still an enviable figure 
in any absolute sense—it would have the effect of creating a functional 
recession for a population long engorged on 10 percent growth and a 
skyrocketing standard of living. 
The Chinese challenge is best summed up in a telling anecdote from 
Decision Points, the memoir of President George W. Bush, who recounted 
asking Chinese president Hu Jintao "what keeps him awake at night." The 
Communist Party chairman did not need to think very hard. "Creating 25 
million jobs a year," he replied. 
If Chinese economic growth cannot produce those jobs for the next 
generation, it will undermine the central argument for the Communist 
Party's continued existence. The shotgun social contract—economic 
growth in exchange for one-party rule—could become untenable. Slowing 
global demand, slowing direct investment, a deflating housing bubble,
immature financial instruments and bloated public spending are only the 
most apparent drags that the new Chinese leadership will have to 
ameliorate or accommodate going forward. 
The Devil in Demography 
U.S. policy makers look to the soon-to-be-retiring baby-boomer generation 
with nothing short of terror. Now on the cusp of an entitlement windfall, 
they are well on track to overwhelm the entire federal budget unless those 
programs are reformed. Yet as bleak as our situation is, the Chinese soon 
will confront the same problem on a scale of biblical proportions. 
China's one-child policy by some estimates may have prevented up to four 
hundred million births, but it has also brought the long-term fertility rate to 
historic lows. Today it is roughly 1.56, well below the rate of replacement 
of about 2.1, the size required to keep the population relatively constant. 
This has generated a vicious phenomenon known as 4:2:1—one child, two 
parents, four grandparents. Even with thirty years of supersonic growth, 
China is not wealthy enough to offset the effect of the avalanche of 
pensions and insurance claims that are on the horizon. As The Economist 
succinctly put it, China will become old before it becomes rich. For the 
youth, who are culturally enjoined to tend to their elders, it will be an 
enormous and lasting burden. 
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Much was made recently when China surpassed [20] Japan to become the 
world's second-largest economy as measured by overall GDP. Given 
China's size, this milestone was inevitable, just as it is equally inevitable 
that China will one day surpass the United States by this metric. Lost in the 
weeds, however, was the real number that matters, GDP per capita. Here 
China is losing big. According to the CIA World Factbook, the United 
States and Japan, both of whom face rapidly aging societies, have GDPs 
per capita of $49,000 and $35,200. China, by contrast, languishes at 
$8,500. This translates to an individual living standard comparable to 
Bosnia or East Timor. In other words, Japan, despite its perennial hangover 
from the lost decade and its being on track to become the oldest society the 
world has ever known, will be more than capable of managing its aged, as 
will the United States. For China, this is far from certain. 
Since Deng Xiaoping's opening up and reform, the Chinese government 
and people have been consumed with two missions, undoing the damage 
wrought by Mao Zedong and making money. But as new generations 
emerge that have no firsthand recollection of Mao's deprivations, this will 
not be enough. As Abraham Maslow famously posited in his "Hierarchy of 
Needs," after food, water, shelter and basic physiological necessities are 
met, humans will demand more. Things such as safety, clean water and 
property rights begin to come to the fore. On top of mitigating all of the 
above challenges, Xi Jinping and his cadres will have to raise quality of 
life for their people as well, and in ways that are increasingly complicated 
and intangible. 
China's Communists face another long march—and this time it may be one 
they do not finish. 
Jonathan Levine is a lecturer of American Studies and English at Tsinghua 
University in Beijing and a contributing analyst at Wikistrat, a geostrategic 
consulting group. 
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