Dwarkesh Podcast Xi Jinping’s paranoid approach to AGI, debt crisis, & Politburo politics — Victor Shih
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May 29, 2025 
Victor Shih, an expert on China's political and banking systems from UC San Diego, dives into the intricacies of Chinese governance and the implications of Xi Jinping's leadership. He discusses the CCP's unique approach to AI and the central role of a key Politburo figure in its regulation. The conversation also addresses China's staggering local debt crisis, highlighting how corruption has fueled overbuilding. Shih provides insights into Xi's strategies and the potential ramifications for Taiwan, painting a complex picture of China's future.
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China's Fiscal Decentralization Paradox
- China's local governments control about 85% of government spending, making it more decentralized than expected.
- However, fiscal autonomy has decreased since 1994 when tax collection centralized at the national level.
Education vs Political Acumen
- Many top CCP officials have STEM or economics degrees but political acumen is critical for leadership.
- Princelings have an advantage due to upbringing, but elite education does not guarantee governing skill.
Power Over Policy Outcomes
- CCP prioritizes preserving its power above public health or economic outcomes.
- This approach led to suboptimal policies like prolonged zero COVID measures.