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Social instability - not the U.S. - is greatest threat to Chinese ruling party, researcher says

Wednesday, September 23, 2015

LAWRENCE — As Chinese president Xi Jinping visits the United States, a University of Kansas researcher who studies the wealth gap in China and U.S.-China relations says the public back home is Xi's most important audience this week.

John Kennedy, associate professor of political science and director of KU's Center for Global and International Studies, is available to comment on issues surrounding Xi's state visit. He served as president of the Association of Chinese Political Studies from 2012-2014 and consistently returns to China to conduct research on rural politics since 1995. He has published research on several topics, including local finance and rural governance in China.

Q: What is Xi looking to establish on his state visit?

Kennedy: President Xi will play down the wealth gap in China, and he will do his best to present a strong, stable China to the United States. The most important audience for Xi is the Chinese public back home and the need to be viewed as strong and standing up to American demands for greater cybersecurity, reduced China presence in the South China Sea and increase currency value for the yuan against the dollar.

Q: Are there key issues to watch for regarding the wealth gap back home in China?

Kennedy: One thing to watch for regarding the connection between the China wealth gap and U.S.-China relations is the fluctuation of the yuan and China's exports to the United States. In short, the more yuan to the dollar, the cheaper Chinese exports are to the United States and Europe. 

The change in August decreased the value of the yuan against the dollar-making China exports cheaper and more competitive in the United States. This is critical for the Chinese economy because exports are an important part of growth for China, and a slowdown in exports will increase the unemployment and the wealth gap.

For Americans leaders in Congress, China is manipulating their currency to extract greater trade benefits — i.e., cheaper Chinese imports — from the United States. However, for the Chinese leadership, currency values and trade are closely tied to economic development, employment and, more importantly, social stability in China. Any significant slowdown in exports can sharply increase unemployment and social disparities. The greatest threat to the Chinese Communist Party and President Xi is social instability — not the United States. 

To arrange an interview with Kennedy, contact George Diepenbrock at 785-864-8853 or gdiepenbrock@ku.edu.