The US China trade war with President Donald Trump and President Xi Jinping as the key players shows the world two men with a lot of self-confidence. Or is it overconfidence?
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Self-confidence is an important feature. It puts people into action. However, too much confidence can pass off as overconfidence, especially in people who have positions where they face little criticism as in the case of President Xi Jinping. Severe forms of overconfidence may lead to depression and narcissism.
One with overconfidence can also suffer, for instance President Donald Trump. People who suffer from overconfidence and want to do something will first have to acquire insight into the cause. Only then can they choose an appropriate approach.
Despite optimism that a deal could materialise soon to end the trade war, the sides remain unresolved on issues such as drawing up a mechanism to force China to honour its commitment to enable access to its markets, reduce subsidies to state entities and improve intellectual property protections for foreign firms operating in the country.
The present economic model served China well when it was trying to catch up with developed countries after opening up to the west 40 years ago but that monopoly model no longer works for a nation that needs to focus on “globalisation on equal terms”, so China should break up state monopolies that dominate nearly half its economy to create a level playing field for both foreign firms and private Chinese companies. The state-controlled economic style is very much “outside the parameters of the World Trade Organisation” and out of line with the expectation that China would integrate its economy with the global economy when it joined WTO in 2001.
President Xi Jinping is not only feeling the heat with the trade war but also at home in China where he declared his function as “president for as long as he lives” which either means a lot of self-confidence or overconfidence. The number one priority for President Xi after the trade deal is to restore confidence in his leadership. He needs to assure people that his plan and agenda remain on course.
The key is to restore confidence among entrepreneurs because it matters so much to the Chinese economy, and that economic growth is the only legitimacy of the ruling of the Communist Party.
So it wasn’t surprising at all that Xi’s speech on January 5, 2013 regarding China’s need for cooperation and competition with more advanced capitalist countries was republished (including new phrases which helped the president convince China that he is doing the right thing) by the Communist Party’s journal a few weeks ago. This might also be a hint of the Chinese president’s stance on the trade war with the US. Observers say the decision to run the transcript of the speech was likely a directive from the top to send a message across.
Alfred Wu, an associate professor at the Lee Kuan Yew School of Public Policy at the National University of Singapore, says: “It must be a decision that comes directly from [Xi] or his office. He clearly wants to convey an important message within the party by republishing the full version of an old speech”.
In the speech republished on Monday April 1 2019, Xi called Deng a “great Marxist leader with breadth of vision and width of mind”, saying that Deng saved the party by not completely negating Mao Zedong because it would have negated the importance of the greater part of Chinese revolutionary history. According to Deng, Mao was “70 percent right and 30 percent wrong”. By reaffirming Deng, Xi is also trying to demonstrate his own breadth of vision and width of mind.
Along the same vein, President Trump is feeling the heat as the request by the House Democrats for six years of Donald Trump’s tax returns opens a serious new political, legal, constitutional and personal front in the party’s battle to use its new majority to check a defiant president. The historic move, made official by House Committee on Ways and Means chairman Richard Neal on April 3, 2019, is all but certain to unleash a legal battle narrowing on Trump’s most guarded secrets that could drag for months or years while shaping the terrain for the 2020 election.
Neal’s intervention came less than two weeks after Mueller ended his investigation and a summary by Attorney General William Barr stated that the special counsel neither established a connection between Trump’s team and Russia’s election meddling scheme nor decided whether the President obstructed justice. And so, the heat is on again for Donald Trump, as well.
Benjamin is a business consultant based in China