Trump Defeats Xi

T he initial read of the summit between President Donald Trump and Chairman Xi Jinping is that it was mostly a snooze. Trump didn’t get Xi to cry uncle on trade. Xi didn’t get geopolitical running room. But when you look at the sweep of the last decade, I don’t think there is anything but one conclusion: Trump defeated Xi Jinping.

Go back to January 17, 2017. Just three days before Trump’s inauguration, Xi Jinping stepped onto the stage at Davos and delivered a full-throated defense of globalization and free trade. It drew almost universal admiration of the Davoisie elite. The symbolism was as explicit as it got: The Chinese Communist Party was pitching itself as the new custodian of the liberal economic order that America had built and that Trump was threatening to abandon. “No one will emerge as the winner in a trade war,” Xi said. But this wasn’t just a matter of one pilot taking charge for another. The whole ship was meant to be rebuilt along Chinese lines. The governance structures overseeing this order were “no longer appropriate” Xi declared.

The replacement was to be the Belt and Road Initiative, which was enshrined in the CCP constitution that year. The idea was to connect 147 countries, two-thirds of the world population, into a new trading order in which all roads and sea lanes ran back to Beijing. It involved tens of billions of dollars from the Silk Road Fund alone, with Xi pledging 100 billion yuan more. This was the “project of the century,” according to Xi.

No one worried that China would conquer America by force, but that its model of a social credit system and surveillance authoritarianism joined to controlled and high economic growth would be persuasive on its own — offering elites a bureaucracy in which to exercise power and play politics, and the people the happy distractions of upward mobility. In March of 2018, Xi eliminated presidential term limits, making himself ruler for life. The reaction of the world was a shrug; what was treated as a scandal was Trump’s joking response, “Maybe we’ll give it a shot.”

Xi’s domination and purging of the CCP was not a straightforward revelation of his strength; it was a testament to elite looting and corruption. According to some estimates, 52 percent of People’s Liberation Army leadership roles have been affected by disciplinary measures in Xi’s third term alone. The Central Military Commission has been stripped down to just two members, from seven: Xi, and one loyalist. Three defense ministers investigated or fired. The commander responsible for Taiwan, gone. Even CMC Vice Chairman Zhang Youxia, one of Xi’s oldest allies, was placed under investigation in January this year. The closest analogy we have is to Stalin’s purges. Xi has sacrificed everything to maintain power and has guaranteed that China will have a succession crisis.

Meanwhile, the U.S. is getting some critical things right. China gets credit for quickly dropping ships into the ocean, expanding its navy. It should receive more scrutiny for one that immediately sank in its own dock during construction. The U.S. fields eleven nuclear-powered aircraft carriers to project power. China has three conventional carriers. France, the only other country with a nuclear-powered carrier, has one. China won’t have one until the middle of the 2030s.

The embargo on the most advanced chips being sent into China has put China behind in the AI race in a definitive way, even if Trump has lately made some exceptions. Nvidia’s best chips are five times more powerful that Huawei’s best. In another 18 months, that gap may be 17 times. Huawei is producing 2 percent of Nvidia’s computing power. And while China is geographically neighbor to the best chip manufacturers, in Taiwan, the U.S. has a near monopoly on the best silicon, which is necessary for making advanced chips. The world relies on the silicon that comes exclusively from Spruce Pines in North Carolina, an economic chokepoint that makes the Strait of Hormuz look like a merely crowded Chick-fil-A on Saturday night.

The real turning point was in December 2019. Dr. Li Wenliang, the Wuhan ophthalmologist who first warned colleagues about a SARS-like illness in late December 2019, was summoned by police and forced to sign a statement saying his warning was an “illegal” and “disturbing” rumor. He died of Covid on February 7, 2020, at 33. The command-and-control apparatus that was supposed to be China’s great advantage — centralized, decisive, capable of mobilizing the state without political friction — was the instrument of suppression. Chernobyl-style: The system that was meant to manage the catastrophe was the reason the catastrophe wasn’t managed. China’s economic might and sensitive ego kept the WHO and even the United States from condemning its handling of the crisis too early and allowed it to escape global fury about what was likely a leak from its own Wuhan lab.

China pioneered a “Zero Covid” strategy, memorably sealing people into their own apartment buildings, shutting down production across the busiest industrial zone in the world. Initially, much of the global elite envied and tried to imitate China’s pandemic strategy. But it turned into a humanitarian and economic disaster and inspired the largest anti-government demonstrations since the Tiananmen era.

The fiscal damage to China is astonishing. China saw a 3.9 percent GDP contraction in 2022. Combined with its now-shrinking population (a legacy of the one-child policy) China’s fiscal revenue fell by 5.5 percent in 2025. Land sales were down by 24.4 percent in the first quarter of 2026 compared with a year earlier. Central government transfer payments to local governments now exceed 10.42 trillion yuan annually. Youth unemployment is at 16.9 percent.

All of this is why China had to swallow Trump’s tariffs in his second administration and resort to workarounds through Vietnam and Mexico that partially enrich those countries at China’s expense. China’s November 2025 deal — halt fentanyl precursors, lift rare earth restrictions, and buy U.S. soybeans — was more capitulation than negotiation.

The U.S. took a big initial hit in Covid as it partially imitated China’s lockdown strategy. But Americans were so doggedly opposed to shutdowns and being shut in that the government eventually decided that the way out of the crisis was American ingenuity. Operation Warp Speed put out the most effective Covid vaccines. An estimated 20 million hospitalizations were avoided. The U.S. economic model had bounce in it. By Q2 2021, the U.S. had real GDP exceeding pre-pandemic levels.

In January of this year, the U.S. grabbed Venezuelan President Nicolás Maduro in Caracas and flew him to New York to face drug-trafficking charges. The removal of the hemisphere’s most noisome autocrat was another small blow to China, as Venezuela was a significant supplier of discounted oil to China through shadow tanker fleets.

The truth is, looking back on that 2017 speech by Xi Jinping, that the era of globalization was largely an era of Sinicization — of China inserting itself into a global system that the United States had built with its Allies after World War II. America first, but now increasingly Europe, began to feel the influence of the CCP itself through the commercial firms the Chinese state controlled — and they are taking policy measures to protect themselves. Xi’s promise in Belt and Road was to expand and centralize this American-built global market, but under Beijing’s control. And now, nearly a decade later, nobody talks about the Belt and Road Initiative as a model for the future. Nobody wants a Chinese future.

What they are marveling at is the resilience of the American economy in an era of disruption and revision. Europe is now waking up to Chinese dumping and understanding that some of the institutions of globalization were patterns of dependence that are unfit for their national interest. Trump-style sovereigntist politics is still growing across the European continent. And it has seen victories in Japan, too.

Trump deserves real credit. The global economy did not implode, despite the U.S. tariff schedule settling at its highest level since the 1930s. His gamble on chips has put a strategic rival behind us. His instinct to get out of Covid allowed a handful of renegades to initiate Warp Speed above the objections of the health bureaucracy. From there, the system’s own resilience, something deeper than one man or one administration, shined through. The universities, the biotech clusters, the chip designers — none of that was planned by Washington. The chaos and political disruption in the West from 2016 to today is not civilizational decline. It’s a series of free societies — the United States chief among them — sorting through disagreement in real time.

The Chinese model now has fallen into fatal disrepute. It has been exposed as racially supremacist in its persecution of the Uyghurs, noxiously authoritarian in its social credit system, Orwellian in its promotion of Xi Jinping Thought. It rests on systematic institutional looting, a military whose senior leadership isn’t trusted by the autocrat, a population turning elderly, and an economy that is set to slow and decline with it.