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20 May 2022

The Collateral Damage in China’s COVID War

Yanzhong Huang

Two and a half years into the pandemic, China is rapidly losing its battle to maintain its “zero COVID” goal. The government’s total lockdown of Shanghai, its largest city and financial hub, has created economic chaos and engendered social backlash from tens of millions of residents who have been prevented from going outside, even to obtain food or to seek health care. Despite such protocols, the government was unable to prevent hundreds of thousands of new cases from emerging in the city during the lockdown, while causing much unnecessary hardship and suffering. Now a similar problem threatens the capital itself. Unwilling to acknowledge the changing nature of the virus, the Chinese government continues to claim that it can outrace the virus through extreme containment measures, even amid growing popular discontent.

For all countries, COVID-19 of course remains a public health problem. But for China, the chief risks of the virus have become less epidemiological than political and economic. As the experience of other countries has shown, with appropriate strategies in place the Omicron variant can be managed and contained. But the Chinese government insists on maintaining policies that are unsustainable and have little grounding in science. In doing so, it has shown an increasing willingness to put China’s economy, and even its social stability, at risk.

For Chinese President Xi Jinping, the stakes could not be higher. The all-important 20th Chinese Communist Party (CCP) Congress is scheduled for later this year, and the purported success of Beijing’s COVID-fighting strategy has been a central part of state propaganda almost since the pandemic began. If Beijing loses the trust and support of the public on this core issue—at a time when the Chinese economy itself is suffering from continual lockdown shocks—a regime once known for its technocratic efficiency could soon face a growing legitimacy crisis.

From the outset, Beijing’s approach to this spring’s outbreak in Shanghai has been governed by fidelity to party policies rather than best public health practice. Blaming Shanghai’s targeted approach for causing the surge of new cases, the central government not only imposed a harsh new version of its zero-COVID strategy but also parachuted in officials from Beijing to supervise the city’s response. As a result, Shanghai’s 26 million residents suddenly found themselves under the world’s most stringent lockdown, which has now been repeatedly extended, for more than six weeks.

Enforcement of zero COVID in the city has been accompanied by heavy-handed measures that have little basis in science or even common sense. In order to ferret out new COVID cases, for example, the government favored the invasive and costly PCR tests over rapid antigen tests. (Although rapid tests can provide good indicators of when an infection is contagious, the government prefers the PCR method, because it facilitates government control and better serves zero-COVID goals.) Whenever a single new positive case has been detected, the patient’s entire residential community—perhaps as many as 200,000 residents—has been sealed off for an additional 14 days; in some neighborhoods, residents of entire apartment buildings have been relocated to quarantine centers. Infected residents with mild or no symptoms have been required to go to makeshift hospitals for isolation; then, public health workers have come to their homes and sprayed large amounts of disinfectant on walls, floors, and personal possessions, even though numerous studies have shown that it is very rare for the infection to spread through contaminated surfaces, and that the virus is unlikely to survive outside the human body for longer than a very brief period.

During much of the Shanghai lockdown, residents in areas under full measures were prohibited from going outdoors except when they were corralled to receive PCR tests; the mass testing events only spread the virus further. Meanwhile, since most health-care workers had been mobilized to provide PCR tests and treat asymptotic or mild cases, very few were available to provide routine or emergency health care. And with wholesale markets and grocery stores closed, the city government scrambled to distribute food to residents in lockdown, many of whom faced shortages not just of food but also of medicine and other key supplies.

Worse, the vast lockdown has done nothing to remedy one of China’s greatest vulnerabilities: its failure to adequately vaccinate its elderly and at-risk population. For almost two years, the government did not prioritize vaccination of the elderly because of a dearth of clinical data about any possible side effects in that age group. And for a long time, the zero-COVID policy, by shielding the vulnerable from exposure to the virus, also created a false sense of safety among the elderly, reducing the incentives to get vaccinated. With the rise of Omicron and far larger numbers of cases in China, that calculus has changed. But the use of health-care workers to enforce lockdown testing measures has left very few people to administer COVID vaccines to the at-risk population, which should have been the main priority. As of mid-April, some 38 percent of Shanghai’s over-60 population had not received more than one dose of the vaccine.

By adopting a zero-tolerance policy in China’s largest city, the central government has sent a powerful message around the country. Watching the Chinese leadership ratchet up the pressure on Shanghai, local officials elsewhere have doubled down on their own similar strategies, fearful that they will be blamed if their measures are not severe enough. In my hometown in the eastern Jiangsu Province, the local government required mass PCR testing of the entire population in the absence of a single known COVID case. Other cities have imposed lockdowns after only two or three cases were detected. By April 18, about 45 cities across the country, representing nearly 30 percent of China’s population and 40 percent of its annual GDP, were under full or partial lockdown. In some rural areas, outsiders have been banned from entering villages; farmers have had to receive permission to go to their fields, and even then have been required to wear hazmat suits. To enforce a lockdown in Qian’an, in Hebei Province, local officials have asked residents to hand in their keys so that volunteers could lock the door from outside.

The effects of these measures on local populations are becoming clearer by the day. In Shanghai, horror stories about the lockdown—often tinged with black humor—have filled social media feeds. There have been accounts of residents who died by suicide for not being able to cope with the pressures of the lockdown; patients who died not because of COVID-19 but because they were denied access to emergency health care; citizens in their 90s who were dragged by faceless people in hazmat suits to quarantine centers at midnight; a nursing home who sent a 75-year-old COVID patient to a morgue even though she was still alive.

ACCELERATING IN REVERSE

Fueled by stories like these, Shanghai residents have become increasingly vocal in criticizing the government. In some areas, they have scuffled with police who allegedly ordered them to surrender their homes to COVID patients; staged protests from their balconies, banging on pots and pans to demand basic necessities; and even confronted Shanghai’s party chief, Li Qiang, when he was paying an inspection visit. Until now, few of these acts of defiance have been violent, and much of the outcry has focused on material needs. Moreover, not all dissenting voices have explicitly blamed central government leaders or the zero-COVID policy itself. But it is hard to deny that the public response in Shanghai has reached a turning point. Where the Chinese leadership’s COVID policies were generally supported during the first years of the pandemic, there is now growing distrust of the government among the middle class. Commenting on the lockdown measures in a conversation recorded on China Digital Times, an online news site, one Shanghai resident said, “We are not coming to a halt. We are driving in reverse while stepping on the gas.”

One of my friends in Shanghai, who has long held a pro-government stance, described her attitude during the lockdown as having gone “from helplessness to disappointment to desperation.” Zhang Qiang, a Shanghai doctor turned entrepreneur, said that until the lockdown he did not believe the stories about the 1959–61 famine caused by the Great Leap Forward, in which tens of millions of Chinese starved to death; now he understood that “there can be food shortages even in Shanghai.” Such sentiment is shared by some leading pro-government commentators, including Larry Hsien Ping Lang and Liu Liu. In the Financial Times, Shan Weijian, the chair and CEO of a leading Asia-focused private equity firm, observed that popular discontent in China is at its highest point since the 1989 Tiananmen Square crackdown.

Popular discontent, of course, can be fleeting. But the excessive lockdown in Shanghai—experienced by 26 million citizens, including many members of the urban middle class—could contain the seeds of future political transformation. For one thing, the growing distrust and discontent with the party’s COVID policies contributes to a government credibility crisis, and, as Xi has acknowledged, the inability to please or placate Chinese society is a prelude to losing “the ruling foundation” and “the ruling status” of the CCP. For another, the measures that have caused such frustration in Shanghai and in many other cities have also damaged one of the other pillars of the regime’s legitimacy: its reputation for sound economic management.

For years, Chinese leaders have managed to hold on to popular support by maintaining high economic growth rates. Indeed, Beijing’s initial success in controlling the spread of COVID-19 enabled China to become the only major economy that registered positive economic growth in 2020. But that growth engine is rapidly losing steam, as the total lockdowns in Shanghai and other major cities have upended supply chains, stifled domestic consumption, and weakened the country’s growth outlook. By analyzing trucking data, scholars from the Chinese University of Hong Kong found that even before Shanghai launched partial lockdown at the end of March, economic activity in the city was down 40 percent below normal levels. Now, because of the shutdowns of Shanghai and other industrial centers, businesses are holding back, fearful of the uncertain economic outlook, and there is a plummeting demand for business loans. Net new yuan loans in April dropped by 79 percent from the previous month, and were less than half what they had been a year earlier. The International Monetary Fund has reduced China’s growth forecast for the second time this year, to 4.4 percent, well below the CCP’s 5.5 percent target.

Citing the Shanghai lockdown, some China watchers portray an even bleaker picture. According to Shan, the Chinese economy is currently “in the worst shape in the past 30 years.” Daniel Rosen noted in an April Foreign Affairs article that “zero growth or even economic contraction” in China should not be ruled out this year. And in late April, Stephen S. Roach, the Yale economist and former chair of Morgan Stanley Asia, declared that “the China cushion has deflated” and that “the world can no longer rely on China as a source of resilience.” Yet rather than change course, the Chinese government has seemed all the more determined to stick to its existing policies, no matter the consequences.

TOO AUTOCRATIC TO FAIL

Despite the high social and economic costs, China's leaders have refused to make any fundamental changes to their original COVID strategy. For months, it has been clear to epidemiologists that the current situation has changed dramatically since COVID first spread in Wuhan in early 2020: the dominant Omicron variant is much more contagious than the original COVID strains, but its infection tends to be less severe, and the existence of effective vaccines and treatments have limited the risk of severe illness and offered new ways to manage it. Indeed, 0.09 percent of positive cases in Shanghai have led to death, which is below the approximate case fatality rate of seasonal influenza. A recent study jointly conducted by Chinese and American scientists found that administering effective vaccines on all eligible elderly people alone would lead to a 54.1 percent decrease in hospital admissions and a 60.8 percent decrease in mortality. Yet the Chinese government has been intransigent. Rather than recognizing the new reality, top government epidemiologists continue to highlight the danger of the Omicron variant. Ma Xiaowei, the head of China's National Health Commission, has asked public health officials to take a clear-cut stand against the “wrong thinking” of coexistence with the virus—treating it like a flu-like disease that people should learn to live with. On May 16, with many Chinese cities already locked down, Ma called instead for even more stringent “prevention and control measures,” including building more COVID isolation hospitals, as well as so-called “permanent makeshift hospitals” and “quarantine centers.”

Although many people in rural areas and smaller towns continue to support zero-COVID policies, the hardening approach has begun to shift popular perceptions of the government in China’s large cities. At the start of the pandemic, Beijing’s success in fighting COVID seemed to demonstrate the resilience and resourcefulness of the Chinese state. But the government’s obstinacy in the Shanghai lockdown has shown that its political system has become more rigid and resistant to change than ever. In part, this is a result of self-reinforcing mechanisms within the government administration itself. Two years into the zero-COVID strategy, many government agencies, as well as PCR testing companies, public health officials, and others involved in the zero-COVID effort have a deep stake in maintaining the current approach and have helped make the political system resistant to any significant shift in policy. But opposition from vested interests alone cannot explain the current approach, given both the social discontent and the serious damage to the Chinese economy.

Like Putin’s Russia, Xi’s China appears to be caught in what one journalist recently called an “authoritarian feedback loop,” in which a long-ruling, insulated leader is surrounded by advisers who have no interest in challenging his views. Indeed, even as the lockdowns are sapping China’s economy, Xi has told officials to ensure that China outperforms the United States in GDP growth this year. As an unnamed government policy adviser suggested in the Financial Times at the end of April, making China’s top decision-maker understand that the Shanghai lockdown is both counterproductive and unsustainable has become a “key challenge for the system.”

In turn, rigidity at the top has hampered decision-making further down the chain. In the absence of lively and informed policy debate within the central government, there is ever more pressure on local officials to fanatically pursue a zero-COVID policy, no matter the social and economic costs. A growing number of liberal-minded scholars in China are concerned that zero COVID has also provided a fresh blueprint for a state that, once when the pandemic is over, will seek to control every facet of people’s lives. “To tell the truth, I am scared,” a well-known financial commentator said on WeChat. “I venture to assert that even after the end of the pandemic, the management-and-control methods that treat people like pigs, dogs, and criminals will be retained.” A political science professor in Fudan University predicted that, rather than be relaxed, the extreme social measures “will be tightened” in a post-COVID future. For many Chinese, such a merciless and omnipresent state has not been seen since the days of the Cultural Revolution.

Fears of growing social controls have already caused many well-off people to consider leaving. Amid the Shanghai lockdown this spring, WeChat Index, which measures search popularity on the social media platform, recorded a sevenfold jump in searches with the word “immigration.” Many foreigners who have been in China during the pandemic have left or have plans to do so. A recent survey of 950 foreigners in Shanghai found that nearly half plan to leave China in the next 12 months. Taking notice of signs that multinationals are seriously considering pulling out of China, a Canadian researcher wrote that “Beijing’s zero-COVID policy does what Trump’s trade war could not.”

Of course, it is still possible that the social and economic shock of the Shanghai lockdown will cause the Chinese leadership to think twice before repeating the same mistakes, perhaps in Beijing itself. With some effort, China could choose a better course based on more effective vaccines and therapeutics, workable protocols for screening and triage of COVID patients, and targeted non-pharmaceutical interventions. But the government’s behavior so far indicates that it is unlikely to change course, which would involve acknowledging, at least implicitly, that its policies are doing more damage than good. Its recent decision to cancel hosting the summer 2023 Asia Cup indicates that the government has no plan to end zero COVID next year. Instead, it seems likely to stake everything on its current approach, even at the risk of cutting itself off from the world and eroding its support at home.

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