Economics: Is China A Paradise For Liberals?

 (Drivebycuriosity) - China`s economic policy gets a lot headline these days. The government announced a huge economic stimulus program to revitalize the sluggish economy. Beijing "will significantly increase government debt issuance to offer subsidies to people with low incomes, support the property market and replenish state banks’ capital as it pushes to revive sputtering economic growth" ( cnn). Finance Minister Lan Foan also promised that "there will be more “counter-cyclical measures” this year".

Obviously China´s rulers believe that they are responsible for the course of the economy and they try to control it. China´s economic policy resembles the politics of America´s Liberals who attend to steer the economy since Roosevelt`s New Deal. Both are taking recipes out of the playbooks by John Maynard Keynes and his followers. The so-called Keynesians recommend to rekindle a weak economy by more government spending. They advise that the government takes more loans and pumps the money into the economy, known as deficit spending. The announced Chinese "subsidies to people with low income" resembles also the program of America`s Liberals who want to support the "poor".

And America´s Liberals have more in common with China`s leader Xi Jinping. They want to expand the size and scope of the government massively and decide how large corporations do their business. Since Xi Jinping is the absolute ruler in China his administration intensified the grip on the economy. In 2021 began an ideological crusade against China´s Big Tech companies and their alleged "monopoly power". Beijing claimed that Alibaba, Tencent, Baidu and other big Tech companies behave "antisocial" and abuse their huge power at the expense of their competitors and the society. China’s market regulator released anti-monopoly guidelines that target internet platforms, tightening already existing restrictions faced by the country’s tech giants ( cnbc.). The authorities hit Alibaba, China`s Amazon, with a $2.8 billion fine, claiming the company behaves as a monopoly (what ever that means in Communist China). Beijing also forced Tencent, operator of the  hyper-popular messaging platform WeChat, to suspend all new user registrations temporary. Later the government restricted businesses of online food deliverer Meituan and ride-hailing firm Didi. They also turned Gotu and other booming online education firms into nonprofits and castrated their business models.

America`s Liberals are trying the same. They are using two powerful US administrations, the Federal Trade Commission(FTC) and the Department of Justice Antitrust Division (DOJ), to tighten the government´s grip on business. FTC & DOJ were originally established to practice antitrust, meaning to protect customers against monopolies & cartels. For a long time antitrust enforcement stood for the interests of the consumers   and tried to punish corporations for bad services, low quality & variety and too high prices (consumer welfare).   

Today FTC & DOJ are lead by two progressives: Lina Khan (FTC) and Jonathan Kanter (DOJ). Both belong to the Neo-Brandeisians (after Supreme Court Justice Louis Brandeis, 1916-1939), a left-wing group, which is supported by powerful Liberal politicians like Elizabeth Warren, Bernie Sanders, AOC, Wu and others. 

The Neo-Brandeisians are now in control of the FTC & the DOJ and are working on a fundamental change of America´s economic structure and try to expand the role of the government in the U.S. economy significantly ( pbwt.com dailyjournal promarket reason).  

Since Lina Khan leads the FTC the authority represents a Marxist ideology, explained former FTC-Commissioner & Khan colleague Christine S. Wilson (ftc.gov ). Kahn & Co.try to replace the market process of supply and demand by a continuously regulated environment. FTC chair Khan  argued - in an article for a Marxist paper - that antitrust must be reconfigured toward the redistribution of economic and political power and away from concerns regarding price (lpeproject  realclearpolicy). FTC commissioner Rebecca Slaughter, a Khan supporter, demands that “antitrust should be used to accomplish political and social goals including racial equity” ( thecentersquare  crowell).  

The FTC majority views large companies as evil and prefers "that the government, rather than the private sector, orchestrates the functioning of the economy" wrote former FTC-commissioner Christine S. Wilson  ( .ftc.gov). That is exactly what Xi does in China.

FTC & DOJ already started to sue Amazon, Apple, Meta & Google and other corporations. The mighty authorities claim that these companies are monopolies even though they are already struggling with rising competition (driveby1 driveby2). Kanter´s DOJ is already talking about dismantling Google, a reminder of Xi´s attack on Alibaba & Tencent. The purpose of these law suits is to gain control over America´s largest corporations and to be in charge of their business, like Xi does in China.

But there is one big difference between China and the US: America has courts. While Xi can curtail any corporation as he wishes, Americas regulators have to deal with courts & judges. So far the courts have curtailed the regulatory overreach. FTC & DoJ lost most of their cases and the law suits against Amazon & Google have a long way to go.

China must be a paradise for the Liberals.