Photos: Bloomberg, Getty; photo illustration: Tom Hall/Bloomberg

Balance of Power: Xi’s War on Risk

Chinese President Xi Jinping is taking no chances this year -- financially or politically.

This month alone his government reined in the conglomerate run by China’s second-richest man and took steps to curb excessive speculation in the wealth-management business. Communist Party authorities also partially blocked Facebook Inc.’s WhatsApp messaging service -- part of a wider censorship push -- and abruptly ousted a potential successor to Xi in 2022.

Already the most powerful Chinese leader since the 1990s, Xi is moving to eliminate risks ahead of a once-in-five-year leadership shuffle -- the equivalent of an election year in the one-party nation. It comes at a perilous time: Debts are rising and the economy is growing at the slowest pace in a quarter-century.

While tightening his grip on power at home, Xi has employed “strategic composure” abroad -- particularly with U.S. President Donald Trump. While economic talks in Washington collapsed in acrimony yesterday, China’s response was muted. The foreign ministry said the country will work with the U.S. to improve trade imbalances, without making any concrete commitments.

The message to officials in Beijing is clear: For the next few months at least, keep your head down.

A child holding Chinese flags walks through Tiananmen Square in Beijing.
Photographer: Qilai Shen/Bloomberg

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Global Headlines

Russia hits keep coming | Congressional probes into Trumpworld’s ties to Russia are getting closer to the president. Donald Trump Jr. and former campaign chairman Paul Manafort have been invited to testify in the Senate next week, and Jared Kushner has agreed to meet with senators Monday -- but only in private. Look for Manafort to be asked about reports he was in debt to pro-Russia interests by as much as $17 million. Trump separately told the New York Times he wouldn’t have tapped Jeff Sessions for attorney general had he known Sessions would recuse himself from the Justice Department’s Russia investigation.

McCain battling brain tumor | U.S. politicians on both sides of the aisle are sending well wishes to John McCain after the senator and 2008 Republican presidential nominee announced he’d been diagnosed with an aggressive form of brain cancer. A Vietnam War hero who was held as a POW for more than five years, McCain has led efforts to rein in campaign spending and overhaul U.S. immigration law during his 34 years in Congress.  

Macron’s political honeymoon ends | Top military commander General Pierre de Villiers resigned yesterday as chief of the general staff over cuts to the French defense budget. It was an early sign of the resistance President Emmanuel Macron will confront in trying to drive through an ambitious economic reform program. To some, the clash has also exposed a worrying lack of political experience on the part of the 39-year-old leader.

Big data heads to Mexico | Voters will be on the receiving end of Cambridge Analytica’s mix of data science and psychology as the company sets up shop in Mexico City ahead of next year’s presidential election. Several political parties have expressed an interest in the big-data firm used by Trump’s campaign team, adding to the country’s election mix of corruption scandals, vote-buying accusations and reports of spying.

German-Turkish feud escalates | Relations between Germany and Turkey are in a downward spiral. Things were already bad between the two NATO members before Turkey detained a German human-rights activist this week. But now they are both threatening economic retaliation. Germany today warned companies against doing business in Turkey and issued revised guidelines for travelers as Foreign Minister Sigmar Gabriel announced a “new orientation” in relations.

And finally... The movement to boycott Israel over the conflict with the Palestinians has convinced a number of bands to cancel concerts there. Not Radiohead. Facing down public pressure from former Pink Floyd frontman Roger Waters and British film director Ken Loach, among others, the U.K. rock band played in Tel Aviv last night to nearly 50,000 people. The band’s laconic singer, Thom Yorke, addressed the boycott controversy only once. “A lot of stuff was said about this,” Yorke said. “In the end” -- and here there was a long, pregnant pause -- “we played some music.” The crowd burst into cheers.

Photographer: JACK GUEZ/AFP

— With assistance by Michael Arnold

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