Last Tuesday, Tencent’s share prices dropped more than 10% at one time, sparked by an article from a Xinhua-affiliated newspaper that called online gaming “spiritual opium”.
The article by Economic Information Daily(EID), has an eyeball-grabbing title: 《网游对未成年人影响触目惊心“精神鸦片”竟长成数千亿产业》or “Online games have shocking effects on the youth, ‘spiritual opium’ surprisingly became 100 billion yuan industry”.
After causing much havoc on the already very sensitive capital market, the article was taken off across the internet in China around lunch time.
Around dinner time, it was republished but with all the sensitive words such as “spiritual opium’ removed.
EID can be regarded as a mouthpiece of the authorities, therefore the reaction of the stock market. However, what really happened behind the scenes? We think the following scenarios are possible:
- (probably the most understandable from outside). The Government wanted to bash the online gaming industry by authorising such an article. However, the market over-reacted, causing the government to take remedial actions (by removing the sensitive words in the article);
- (the more plausible scenario in our opinion). Sensing the government trend of bashing big tech, an over-zealous editor of EID wanted to ride the wave and earn him some credits. However, he went a bit over the board, causing havoc and probably taking an earful from his bosses too.
After the EID article was published, a few notable commentators, including those who are closely aligned with the government lines, went on to criticise the article’s views.
If the article was really sanctioned by the top, those commentators would have received the notifications to play along with the same line.
Ultimately it does not make sense for the government to curb the gaming industry as a whole, because the industry’s vibrancy creates huge cultural influence and economic benefits abroad.
What the top really cares about is protecting the youth from over-indulgence, a social agenda that is consistently with the aims of recent clampdowns.
A more worrying trend
So quite likely what we see here is that when the top sets an agenda, middle level officials and other parts of the establishment would try to show off their loyalty and commitment. The editor of EID wrote this article probably, as mentioned above, thinking that it would earn him a promotion or praises from the top.
When many people in the establishment start doing the same, it will become quite worrying. Throughout history we have seen it multiple times – when the leader has absolutely power, he does great things but gradually dissenting voices would diminish. This will in turn reinforce the leader’s belief that everything is going well, pushing the country further towards a certain direction.
President Xi, who is also CCP’s Secretary General, mentioned numerous times that the Soviet Union failed because senior party members were detached from the people and realities on the ground.
He will have a difficult task to make sure China does not fall into the same trap, even when every part of establishment is clapping.