By the mid-2010s, Chinese companies figured out how to make all the German tools, as well as the entirety of the solar value chain. The plunge on solar power costs over the last decade has been driven less by breakthroughs in science— which is the United State’s strong suit— than by efficient production, which is China’s strength. The beneficiaries are not only the climate but also China’s national power.

Science matters of course. China remains weak in chips and aviation in part because these are much more scientifically complex industries than solar. Not every technology improves through iterative adjustments to manufacturing processes, but a great deal can follow its logic. When lots of companies are doing similar things, in a brutally competitive environment where profit margins are small, they establish communities of engineering practice like Shenzhen. These factories will never be as glamorous as the desirable branding represented by Apple or Tesla. Every day, millions of workers go to factories to build up technological process knowledge.

Xi has forcefully reminded China’s tech companies that they cannot represent a power center that challenges the state’s sovereignty. It was, in other words, an attempt to change the cultural mindset of companies. The Communist Party reminded them that it retains the discretionary power to engineer all aspects of society, which means putting tech companies in their place.

There might be something to be said for this sort of approach. What if, say, the US government had responded to the 2008 financial crisis by reshaping Wall Street’s risk management culture rather than engaging in the endless negotiations that yielded a 2,300-page statute that nobody understands? But Xi’s attempt to achieve cultural change has left people disgruntled and whole industries disfigured.

The trouble with Xi Jinping is that he is perhaps 60 percent correct on everything. He’s driving toward a usually admirable long-term goal. But in the name of achieving change, the engineering state delivers such beatings on people or industries that they are unable to pick themselves back up again. Even if Xi’s judgments are right, his brute-force solutions reliably worsen things. Does big tech have too much power? Fine, but stomping out their businesses has traumatized entrepreneurs. Are housing developers taking on too much debt? Yes, but driving many of them toward default subsequently triggered a collapse in homebuyer confidence, prolonging a property slump. Does the government need to rein in corruption? Definitely, but Xi has terrorized the bureaucracy to the point of paralysis.

The control neurosis of the engineers is the fundamental limit to China’s power. But it will also push China to be an advanced manufacturer with dominant positions in many of the high-tech supply chains of the twenty-first century, with military capacity to match and a good chance to challenge US hegemony in Asia.

Even if the United States is able to outclass China in diplomacy, finance, and innovation, the contest between these two great powers is going to be close if the United States can't build anything in the physical world.

The strongest wind in China’s sails is the entrenched technological workforce that preserves process knowledge that I wrote about in Chapter 3 on tech power. Though 50 percent of China’s economy might be dysfunctional, 5 percent is doing superbly well (an approximation I borrow from Greg Ip at the Wall Street Journal).

Beijing has been taking the future dead seriously for the past four decades. That is why China will not outcompete the United States. The engineering state has delivered great things. But the Communist Party is made up of too many leaders who distrust their own people and have little idea how to appeal to the rest of the world. They will continue to bring literal-minded solutions for their problems, attempting to engineer away their challenges, leaving the situation worse than they found it. Beijing will never be able to draw on the best feature of the United States: Embracing pluralism and individual rights. The Communist Party is too afraid of the Chinese people to give them real agency. Beijing will not recognize that the creatives and entrepreneurs it is chasing into exile are not the enemy. It will not accept that their creative energy could bring as much prestige to China as great public works.