China’s regulatory crackdown on technology – and the private sector more broadly – has its own jargon.
These phrases are littered with the state media these days, many of which were coined or put forward by the top ranks of the Communist Party.
These are some of the terms most widely used to explain the political ideas and economic concerns that are leading Beijing to trigger measures that have turned the lives of millions of people upside down, both within China and beyond its borders.
Common prosperity (共同 富裕 gong tong fu yu)
When he surfaced: The expression has been around for several years, already noticed in Xi Jinping’s remarks at the Communist Party’s national congress in 2017, which marked the start of his second term. But with public dissatisfaction with China’s growing inequality, last week Xi reaffirmed the need for China to achieve this goal in part by demanding the “excessive income” adjustment. In 2019, Cai Fang, former vice president of the Chinese Academy of Social Sciences Think Tank, summed up (link in Chinese) the concept as having three parts: making the cake bigger and sharing it well; expand social mobility; and the construction of a “welfare state with Chinese characteristics”. It is related to another term – the “tertiary delivery mechanism” – or philanthropic efforts.
How to understand it: Put simply, it’s a grim message to China’s wealthy elite: it’s time to redistribute their fortunes. The meeting urged high-income groups and entrepreneurs to “give back more to society,” indicating the potential for higher taxes or the expectation of more charitable contributions from the rich and corporate. Even before the last speech, some wealthy tech companies had answered the call. Tencent pledged 50 billion yuan ($ 7.7 billion) in April – more than its last quarterly net profit – to social causes. After Xi’s speech, he pledged the same amount to a “common prosperity” fund.
Close and clean relations between the party and the business (“亲” “” 的 新型 政 inconnu 关系 Qin, qing of xin xing zheng shang guan xi)
When he surfaced: Xi first brought up this vision of the ideal relationship between officials and businesses in 2016. The term has since been used frequently in local government summaries of their meetings with entrepreneurs. On Monday, August 23, the watchdog of the Hangzhou City Registry, Alibaba’s headquarters, said it had started to regulate conflicts of interest in matters involving Party officials or their relatives, after Beijing has opened an investigation into the city’s party leader. during the weekend.
How to understand it: The phrase demands that public servants be both close to entrepreneurs, understand their needs and help them solve problems. At the same time, they must remain “clean” and not derive any benefits, financial or otherwise, from their proximity to businesses. This is one of the Party’s essential requirements for the coexistence between the Party and private enterprises, in addition to its requirement that entrepreneurs be patriotic.
Disorderly expansion of capital (, zi ben wu xu kuo zhang)
When he surfaced: On December 11, 2020, the Communist Party Politburo held a meeting to set economic priorities for 2021. In addition to seven other tasks, it said the country must control the disorderly expansion of capital.
How to understand it: The phrase refers to the monopoly power of China’s largest companies, which increasingly tend to be technology platforms, and indicates the Party’s determination to restrict the power of these companies to achieve its own economic and social goals, even whether that means stopping companies from raising capital to grow their business through IPOs or scaring away foreign investors. The concept is tied to China’s ambition to become a more technologically advanced economy – although its tech giants may seem like proof that it already is, the government fears the monopoly power of big business does not stifle innovation from small. Since the phrase was mentioned at the December meeting, China’s overhaul of the tech and education sector has accelerated and, as a result, has rocked the ranks of the billionaires holding this capital.
Double reduction (双 减, shuang jian)
When he surfaced: The phrase began to be widely used after Beijing Party Secretary Cai Qi (who is also deputy director of the upcoming Winter Olympics) hosted an event on May 7 under the name with directors of the local school districts. most wanted in town and to talk about excessive loads on children. His remarks were seen as a sign of a growing crackdown on private education services, already signaled by a speech Xi gave earlier in the year. The most prominent appearance of the term so far has been in the astonishing July regulatory announcement that essentially destroyed the industry in its current form: it bans private educational institutions from teaching the curriculum, make a profit or take foreign investment.
How to understand it: The “double” refers to the effort to reduce both the work and the pressure on children coming from public schools, but also the time that children devote to extracurricular studies in private establishments. Some see it as part of a larger effort to “bring” students from private institutions back into the public school system, where the government also has more control over what young people learn. In theory, all of this is aimed at reducing inequalities. But Chinese families and education professionals say that this will reduce opportunities for children, especially those in rural areas where public schools are not as good. Many in China also see it as an effort to reduce the costs of raising children to encourage people to have more children, but it could backfire by reducing a major source of employment for people in the country. around twenty.
Wild growth (野蛮 生长, ye man sheng zhang)
When he surfaced: In 2015, China’s leading internet regulator republished an article from a state newspaper in which the authors claimed that the “wild growth” of the mobile internet had created cybersecurity loopholes. The following year, many media outlets began to use the term to describe financial chaos in industries such as peer-to-peer lending and, more recently, the once booming e-cigarette industry. All in all, describing a growing industry or company that is too “wild” could be seen as a sign of growing mistrust of Beijing and its coming regulations.
How to understand it: This term is the Party’s clear warning to its tech giants: The freewheeling period in which businesses thrived on relatively light government regulation is over. The last two decades of China’s internet economy can be seen as analogous to the ‘go fast and bust things’ ethic adopted by tech startups in the United States, where companies often try things out or develop products that regulators had to catch up. Fang Xingdong, a prominent Chinese expert on internet governance, said in an article last month that Beijing’s recent cybersecurity investigations of companies, including transit giant Didi Chuxing, marked the official end of the era of wild growth for tech companies, which means they must treat compliance as a much more important part of their business strategy going forward.
Spiritual Opium (精神 鸦片, jing shen ya pian)
When he surfaced: The term derives from the metaphor of the German philosopher Karl Marx who described religion as “the opium of the people”. The word “opium” has particularly intense nuances in China, which uses the memory of its 19th century opium wars with Britain and other Western countries to shape its diplomatic strategy today. Chinese state newspapers have used the term to describe things ranging from mobile phones to short video apps. The term has taken on new meaning after a state media article this month called the video game industry a “spiritual opium”, leading to a rampant sell-off of the shares of major industry players, including Tencent. .
How to understand it: As harsh as the metaphor may sound, this is probably not an indicator that Beijing intends to shut down the gaming industry, but rather a routine warning to remind companies who is boss. The Economic Information Daily, whose article caused panic about video games, quietly removed the article from its website after the chaos, then later reinstated it without the “opium” comparison. The tone of the original article could have been “more extreme” than the regulator’s position, according to the Financial Times.