Background Info Part 1 - Covid-19 Regime

What's the reality on the ground in China during the Covid-era?

View from China with an Austrian School of Economics Perspective

True Story: Recently a man on a train car traveling from Shanghai to nearby Hangzhou on business was discovered to have shared a train car with an alleged "close contact" of a positive tested case. Upon arrival in Hangzhou he was sent to a quarantine hotel for 21 days: 14 days paid by the government and 7 more days on his own. The final 7 days count as “home quarantine”. Since the unlikely victim lacked a “home” to go back to in Hangzhou, he was stuck with the hotel.

In China this is often described as “中标了” – i.e. he hit the jackpot.

But not just him.

Immediately after this, his office in SHANGHAI was sealed and the Shanghai Covid control team demanded everyone in his office do a PCR test. (Remember, he never made it back to Shanghai.) But this is the best part: his wife and child – who never had contact with him after his alleged ‘contact’ – were told to quarantine at home for 2 weeks.

The implicit justification for all of these extreme measures is that we are dealing with one of the most dangerous diseases humanity has ever encountered. Yet according to the government’s own statistics, China has had hardly any deaths at all from Covid-19 since April 2020. There seems to be a disconnect here.

Nonetheless, if for the sake of argument, we accept that this is indeed a terrible crisis requiring extreme measures, and we accept the idea that the government has the right to abrogate basic human rights in such situations, then perhaps it is somehow logically justifiable to lock up everyone who happens to share the same train car with a contact of a case. But how can we possibly justify locking up the guy’s wife and kid?

The answer is of course that there IS no justification. It’s just a nonsensical rule and everyone knows it. In everyday life normally Chinese bureaucracy is highly resistant to enforcing nonsensical rules. So why not here? It’s because the Chinese government, like so many others around the world, has used the Covid-19 “crisis” to implement a top-down set of draconian rules. Officials who fail to implement policies – no matter how obviously absurd they are – risk the loss of their cushy positions.

So where does the line get drawn? How many people must be affected before someone with authority finally steps in and says ‘no’? Evidence on the ground suggests that this tends to vary significantly from province to province, with cities like Ruili in less affluent and influential provinces such as Yunnan sometimes experiencing extremely callous treatment on the part of government, while affluent provinces such as Shanghai have been far more careful to avoid measures with indiscriminate impact on society and economy.

To cite one recent example, recently a GSK salesman held a luncheon for doctors from many of the leading hospitals in the Western part of Shanghai. After the luncheon, at least one of the participants tested positive for Covid-19. When the Shanghai Covid-19 control team learned of this, in proper knee-jerk fashion, they immediately notified 20 hospitals that they were to be closed down for two weeks. Everyone who did not leave the premises with 1-2 hours would be interned for the entire period. In some cases patients ran out of the hospital with IVs attached, carrying their saline solutions along with them.

Besides being an extremely hasty decision, this also implied that much of Shanghai would essentially have to live without hospitals for 2 weeks. As it turned out, at least in this case, someone with authority finally decided to stand up and say no. The quarantine was reversed and all hospitals were reopened with 72 hours.

The basis for these measures is the government’s official ‘Zero-Covid’ policy. The goal is to completely eliminate it and stop the spread. To accomplish this, the government’s initial move was to shut down the entire province of Hubei for 2 months. This approach seems to reflect the “pandemic planning” done prior to 2020 in the West, for example as elaborated in the Rockefeller Foundation’s 2010 “Lock Step” scenario. That report specifically referenced China, and said that China would:

- Quickly impose and enforce mandatory quarantine for all citizens.
- Seal off borders.
- Stop the spread of the virus far earlier than other countries.
- Recover much more quickly than other countries.

The resemblance between the scenario elaborated in that report and what actually happened in early 2020 is so uncanny that it’s hard not to conclude that high-level Chinese health department officials not only had a corresponding action plan in their drawers, but attempted to actually execute it to the letter¹.

Adherence to the Rockefeller Foundation script did not seem to continue beyond the initial 2 months, however, and restrictions imposed on everyday life were not maintained beyond April 2020. While we do not know what types of discussions went on at a high level, it seems likely that the government realized an approach such as the one adopted in Wuhan was not sustainable for any extended period of time, and certainly not on a national scale. So instead, the approach adopted was three pronged:

- No treatment outside hospitals in order to capture as many cases as possible.
- Use of PCR test for initial screening, but requirement of actual symptoms before qualifying a person as a case.
- Strict but highly targeted quarantining of all contacts plus contacts of contacts. (This can mean either home, housing subdivision or hotel quarantine.)

Because the restrictions imposed by the Chinese government related to Covid-19 are very specifically targeted, they tend to affect a very small percentage of the population – for the moment. This is a very different approach from the one adopted in the West, where most countries have imposed rules affecting the everyday life of basically everyone. And yet, while it’s true that broad-stroke policies such as those implemented in much of the West are arguably the most destructive kind of central planning, if you are one of the persons or businesses impacted in China, the results can be equally devastating.

Here are some of the other major differences between policies adopted in China and those adopted in most of the West.  

1) Vaccination promotion, but no general vaccination mandate².

It is true that, deserved or not, China’s central government enjoys a high degree of trust within the population at large. When the government called on people to get vaccinated using one of its hastily approved ‘traditional’ Covid-19 vaccines, most people went along with this. The basic line of thought seems to be: “If the government says it’s in our best interest and is devoting so many resources to it, surely it must be, right?”

Though it remains unclear how many will take up the offer, a similar logic seems to hold for the ‘booster’ shots as well, despite the fact that many people have realized that the vaccines don’t seem to prevent infection or transmission. To cite one example, Ms. Wu, an entrepreneur in her 40s, said that while the initial shots were perhaps not so effective, surely given all the time since the rollout of the first round of shots, the newer ones would turn out to be better. Though there are plenty of less charitable takes, this kind of logic is quite common.

China’s two Covid-19 vaccines, one made by Sinovac (国药) and the other by Sinopharma (科兴) can have nasty short term side effects including occasional deaths. No statistics on vaccine injuries are published by the government, but estimates can be made based on numbers from other countries and regions using the Chinese vaccines. However, they are not mRNA-based and the general impression seems to be that if one survives the first month post-vaccination, they don't seem to cause noticeable long-term damage. The government has zero tolerance for any online content critical of vaccines.

However, there is no general vaccination mandate and there is no discrimination against unvaccinated people. Vaccination status is not a topic which arises in everyday life, or anything that provokes an emotional response. It’s illegal to demand proof of vaccination to attend school³, travel, enter a shop or participate in an event. There have of course been incidents (see Chongqing example in the upcoming Background Info Part 5), but there is no official tolerance for such policies.

The key is a willingness to say ‘no’. While no official statistics are available, this may be precisely what is happening with vaccinations for young children. The vaccines are now licensed for children as young as three, but anecdotal evidence hints that the take-up rate may be fairly low. We are aware of at least two cases where 70% of parents said no to a school vaccination offer, leaving the vaccinated children in a minority.

The contradiction between the government’s promotion of vaccination and its unequivocal insistence that all vaccination be voluntary does generate some conflict. Background Info Part 5 (stay tuned!) will include a discussion of this.

2) No suppression of effective treatments.

Unlike most Western countries, the Chinese government took no measures to suppress effective treatments and maximize deaths. Whereas in the West the sale of generic drugs usable to treat Covid-19 (like hydroxychloroquine/HCQ and ivermectin) was restricted as early as January 2020, in China these drugs remain dirt cheap, readily available und unrestricted, though for the most part unknown among the general public. Nor was early treatment suppressed as in the West. While China has never permitted outpatient treatment, government hospital treatment of actual cases seems to be effective. In the early days it is known that use was made of chloroquine as one treatment, but what is in use now is not a matter of public record⁴.

It’s notable that Chinese government policy of not revealing treatment methods even extends to reports from outside China. For example, Chinese media have on occasion poked fun at India for using ‘anti-parasitical’ drugs against Covid-19. They did not mention the fact that thanks to ivermectin, Covid-19 seems to be almost wiped out in India, with new daily cases falling from 400,000 to less than 10,000 now.

3) No mRNA or DNA-based vaccines. Both of the Chinese vaccines use inactivated virus technology.

4) No general requirement to show proof of a recent negative Covid test to gain entrance to buildings or travel.

For readers unfamiliar with the situation in Europe, in many European countries proof of a recent negative covid test or proof of vaccination is required by government mandate in order to travel and enter many buildings: restaurants, shops etc. There is nothing comparable in China.

There are certain hospital wards which are exceptions to this rule. In an extreme case in Beijing, one hospital (北医三院) requires that anyone entering the inpatient ward show not only a negative PCR test result, but also a recent CT scan. This includes visitors and accompanying family members. Visitors who leave and return have to repeat the same procedure every time they re-enter, including the CT scan.

5) No national government mandated smartphone app supplying a QR code.

Each province and some cities have their own “health code” smartphone mini-app using either WeChat or Alipay. These mini-apps are supposed to generate a color-coded QR code upon request. Green is good; yellow or red mean that your phone probably spent a certain amount of time in a “hot” zone. However, the mini-app doesn’t always work and not everyone has a smartphone. These apps are neither compatible nor interchangeable between provinces - no province accepts codes from other provinces. For those whose daily routines do not involve entry into government buildings or high-end malls, they are rarely used in everyday life. Discrimination against people without smartphones is illegal, so manually adding your name to a list is always an alternative.

There is also a mini-app created by the national government which allows users to scan in a QR code for tracking purposes. Some high-end malls, clinics and government offices use these, but due to the extra time required, these are used even more rarely than the provincial health codes.

6) No general masking mandate.

It’s up to the individual business. Many government buildings and banks do require them, but compliance varies widely. If enforced at all, most businesses only perform a token check at the entrance.

7) No social distancing rules.

No regulations on human interaction or anything even remotely comparable to the kind of interference in behavior which is now considered to the be new normal in countries like Singapore, Australia and much of Europe.

1. To the extent that other countries implemented policies such as mass lockdowns and border closures, these have often characterized in Western media as following the “Chinese model”. Yet is this attribution apt, given that these policies were designed in the West rather than in China? Moreover, unlike most countries in the West, the Chinese health authorities (a) stopped the use of generalized lockdowns after April 2020, and (b) do not seem to have been in the loop with regard to all aspects of the pandemic rollout plan. A prominent example of this is the fact that unlike in the West, China never banned the use of HCQ. Contrast this with France, where according to RFK Jr's book HCQ was taken off the OTC list in mid-January 2020. Someone with decision making power in France knew that it constituted a danger to the game plan and had to be restricted.

2. See https://m.gmw.cn/baijia/2021-04/11/1302224569.html. A video of the National Health Commission press conference can be found here:

http://video.sina.com.cn/p/finance/2021-04-12/detail-ikmyaawa9188422.d.html

3. See Education Ministry statement on August 27th: https://baijiahao.baidu.com/s?id=1709411795443840239.

4. One possible explanation of this is the government’s position of not permitting outpatient treatment.