Global Xi Wakeup Call: TIE interviewed Derek Scissors of the American Enterprise Institute, asking about some of China's recent provocative moves.

TIE: How do you explain Chinese leader Xi Jinping's latest moves to turn China more inward, to curb its capitalist impulses, and to further its restrictions on individual freedom? Why now? Was there a trigger? Is this a one-man show with even Xi's closest advisors cut out of decision-making? Is it even possible to predict China's moves from now on?

Scissors: Recent actions are primarily about Xi's political future, with the once-in-flve-years Communist Party Congress looming in October 2022. All important decisions concerning economic and political repression are cleared through him.

A crackdown before the Party Congress was almost inevitable but it came somewhat early, probably triggered by Alibaba founder Jack Ma openly criticizing Chinese regulators. That kind of public criticism is intolerable to Xi--see Hong Kong.

For the next year, economics will be dominated by politics. In my view, Xi is attacking opposition in the Party, opposition he sees as linked to cadres themselves being extremely wealthy or being too close to the extremely wealthy.

TIE: It seems that America and its allies need to answer a fundamental question: Are Xi's moves driven by feelings that China's economy is still fundamentally strong and its capitalist impulses need to be curbed like putting a bridle on a wild stallion? Or is Xi acting out of fear of economic weakness stemming from China's huge demographic problem, massive debt, and potential widespread real estate crisis? An example: For years, upper-middle-class families purchased one, sometimes two condo units as an investment hedge against inflation. These units remained unoccupied to protect their value. But now values are collapsing. The potential for widespread anger among the uppermiddle class if a full-blown real estate crisis unfolds is very real. How do you come down on this question?

Scissors: I don't think recent actions are primarily motivated by a shift in Xi's economic views. From the start, he considered intrusive state direction of the economy to be superior to pro-market decentralization. Through 2020, Chinese debt accumulation continued, its response to pending demographic contraction remained weak, and property dependence was largely ignored. The demographic challenge is only one year worse and debt accumulation has been wisely slowed. Such changes are unlikely to cause Xi to become fearful. More specifically, there has been tighter control on credit and the property sector this year, but it may be...