CCP Re-examines Drip and Ambition to Build a Digital Economy Empire

On July 16, the State Internet Information Office, together with seven departments including the Ministry of Public Security, the Ministry of State Security, the Ministry of Natural Resources, the Ministry of Transport, the General Administration of Taxation, and the General Administration of Market Supervision, jointly stationed at Drip to conduct a cybersecurity review, the CCP’s Internet Information Office said.

The storm of censorship whipped up by the Chinese Communist Party against Drip has intensified in half a month, with the public banner being cybersecurity. Think about it rationally, this is a grand excuse, will dignitaries and senior officials really call Drip to work? How can we talk about the information of ordinary people, involving national security. Last year, the Chinese Communist Party cracked down on Ant Financial Services under the pretext of Internet anti-monopoly, and Jack Ma, no matter how manipulative he was, could not have completely ignored the laws of the market like the Chinese Communist Party.

What is the signal that the Chinese Communist Party is taking advantage of overseas listed technology companies? If we look at it in the context of the Chinese Communist Party’s century-old political and economic ecology and the recent internal and external crisis, we can make rough inferences and predictions.

On July 1 of this year, Baidu news labeled the CCP’s four major historical achievements: the Mao era made the Chinese people stand up; the socialist planned economy; Deng Xiaoping’s reform and opening up; and Xi Jinping’s thought.

If we carefully consider the four major achievements of the CCP in the past century, it is interesting to see that Mao’s achievements account for two of them: one is the theft of government and the other is the planned economy that appropriated private property; Deng’s achievements account for one: successfully allowing the West to fatten the CCP; the last one is Xi Jinping, which seems to be placed at the end, but is intended to be compared and surpassed, and he wants to create a red power that is internally the Cultural Revolution 2.0 version and externally the War Wolf GEM.

Since the Sino-US trade war, especially as the world enters the era of epidemic, the West’s dream of improving the CCP with direct investment and political appeasement is completely coming to an end, and the world’s consensus and siege on the CCP’s evil face makes it difficult for the CCP to stand alone in the world. Based on such a wretched political and economic ecology, the CCP once proposed the theory of “internal circulation” to return to the era of planned economy, probably because the CCP power elites, who were used to living in overseas paradise like wealth, could not stand the penniless Maoist dilemma. The double cycle.

The so-called double cycle means the export-oriented allocation of resources by industrialization and the domestic allocation of resources by urbanization. In 2019, the CCP claimed that the GDP per capita exceeded $10,000, but it concealed the truth that the government’s debt ratio accounted for 40% of GDP, financial bad debts accounted for 10% of GDP, and flexible employment exceeded 200 million people. A return to a planned economy seems even closer to maintaining regime stability.

When the Internet enterprises in 2019 accounted for 36% of GDP, private enterprises accounted for more than 60%, private entrepreneurs have become a high-risk group. Among Internet enterprises, many of them, such as Ant and Drip, operate financial businesses, and according to the 2019 China Internet Finance White Paper, the scale of Internet finance transactions reached 229.9 trillion in 2018 and is expected to reach 499.1 trillion in 2022. Among them, private Internet finance enterprises are developing strongly, with a revenue scale of 19.38 billion yuan in 2018, and the average annual compound growth rate of private enterprises from 2015 to 2018 is 91.7%, and the revenue scale is expected to reach 129.63 billion yuan in 2023. Finance has always been the blood bank of the CCP’s economic development as well as its political lifeline. The Chinese Communist Party cannot tolerate private entrepreneurs building financial empires, and the massive mass movement triggered by the money circle of various powerful elites behind the P2P mine explosion in recent years has directly impacted the foundation of the Chinese Communist Party regime.

Of course, in the CCP system, private enterprises that can grow big are almost always the white gloves of red capital, but when the Internet economy occupies a strategic position in national economic production and life, private Internet enterprises that grow big are obviously uncontrollable factors and will be regarded by the CCP as potential factors that endanger the regime, and their purge and nationalization is basically a probable event.

The Chinese Communist Party’s plan to eliminate private capitalists is basically a trilogy of arrests, confiscation of assets and stigmatization, and there will be no chance to turn around. The Chinese Communist Party’s purge of Internet companies foretells that the Internet industry will have a long and severe winter with both public opinion and economic blockade.

The Internet economy is, in the end, a digital economy or a paradigm underlying the digital economy. The digital economy is an economic form that achieves resource allocation through big data. For example, the use of emerging technologies such as big data, cloud computing, Internet of Things, blockchain, artificial intelligence, 5G6G communication, etc. will make economic growth dependent on a surge in the share of technological innovation and promotion.

At the second China Internet Infrastructure Resources Conference 2020 (CNIRC 2020), Yang Xiaowei, deputy director of the Office of Internet Information, said that the size of the digital economy grew from 11 trillion yuan at the beginning of the 13th Five-Year Plan to 35.8 trillion yuan in 2019, and the size of the Internet population increased from 6.88 million in 2016 to 9.8 million in 2020 over the five-year period. In five years, the number of Internet users will increase from 688 million in 2016 to 940 million in 2020, and the Internet penetration rate will increase from 50.3% to 67.0%, exceeding the global average.

Digital technology is undoubtedly a double-edged sword, the liberal state mastering data technology will undoubtedly produce a new economic form of active economic development, and correspondingly a totalitarian state mastering and promoting the digital economy will make the Keynesian state intervention in economic control freely.

On July 16, 2021, the Central Bank of the Communist Party of China released a white paper on “Progress in R&D of China’s Digital RMB,” saying that data showed that by the end of June, there were more than 1.32 million pilot scenarios of digital RMB, covering such areas as living payment, catering services, transportation, shopping and consumption, and government services. More than 20.87 million personal wallets and 3.51 million public wallets were opened, and the cumulative number of transactions was more than 70.75 million and the amount was about 34.5 billion yuan.

Some scholars have said that if the Chinese Communist Party implements digital RMB, the people’s wealth will be completely controlled in the hands of the Chinese Communist Party, and every penny spent will be in the hands of the Chinese Communist Party, and it will be easy for the Chinese Communist Party to control the people’s digital wallets similar to the credential economy era.

As a new production factor of economic operation, and a new way to allocate resources, the head of the Internet platform companies have a natural data advantage, for example, Ant Financial Services was established only four years ago, it has expanded Ali Finance, balance of money, chanting, Sesame Credit, Ant Wealth and other diversified Internet financial products, forming six segments of business, such as payments, investment and finance, microloans, insurance, credit and technology export, its good The good financial environment of the Chinese Communist Party is a major impact on the traditional real finance.

The Chinese Communist Party will never stand by and watch this. It has repeatedly emphasized data security governance, Internet anti-monopoly, and the creation of a digital economy empire, the fundamental purpose of which is to maintain stability of the dictatorial regime.