To stop starving its population, China embraced capitalist ideas: leveraging self-interest, creating jobs, and allowing for income inequality. This paradoxical move by a communist regime serves as powerful evidence that capitalism is the most effective tool for pulling masses out of poverty.

Observing the USSR's fall, the Chinese Communist Party drew key lessons to ensure its survival: use overwhelming force against dissent, prioritize the Party's power monopoly even at the cost of economic efficiency, and aggressively assimilate ethnic minorities to prevent separatism.

To counter the economic threat from China's state-directed capitalism, the U.S. is ironically being forced to adopt similar strategies. This involves greater government intervention in capital allocation and industrial policy, representing a convergence of economic models rather than a clear victory for free-market capitalism.

China's economic success stems from a unique hybrid model. It uses Soviet-style central planning for national infrastructure while simultaneously fostering rampant, Western-style competition among a vast number of private companies.

In 1978, Deng Xiaoping effectively staged a coup by keeping the Communist Party's branding while completely rewiring the country's economic system to a capitalist model. This pivotal but unacknowledged discontinuity from Maoism fueled China's modernization.

China's economic ascent began when Deng Xiaoping invited American experts to teach them about capitalism. This strategy, combined with becoming the world's manufacturing hub, allowed them to learn the system, grow strong quietly, and eventually become a dominant global power.

China's economic miracle was not a triumph of communism but a pragmatic adoption of capitalist incentives. The government realized that allowing individuals to selfishly get ahead—creating income inequality—was the only effective mechanism to spur economic activity and lift millions of people from starvation.

Deng Xiaoping’s reforms, which ignited China’s growth, were based on adopting American free-market principles like private enterprise and foreign capital. China’s success stemmed from decentralizing its economy, the very system the U.S. is now tempted to abandon for a more centralized model.

China's economic model blends the "best of socialism" with the "best of capitalism." The state provides long-term, profit-agnostic infrastructure like transport and power, reducing costs for businesses. Simultaneously, it fosters hyper-competitive markets in consumer goods, driving relentless innovation and efficiency.