China’s highly educated technocrats understand the challenges very well, and they have had four years in which to educate Xi as to their gravity. Until the 19th National Congress of the Communist Party in the autumn only minor measures to guard against systemic crisis will be taken. Thereafter, we can expect more serious action.  No nation has ever grown its way out of a debt mountain of the dimensions that China has built, so a recession, either sharp and deep or prolonged and gradual (such as Japan’s) is inevitable. Every attempt will be made to minimise the pain, but recession will cause large-scale unemployment, falls in property and share prices will destroy the life savings of many, and there will be a risk of loss of confidence in some financial institutions. This will happen in a society that does not have adequate unemployment benefits, where people are ill-prepared for such adversity: no one has ever experienced a nation-wide recession. It will happen in a context of moral crisis, environmental catastrophe, great social inequality, and political distrust; and the Party’s success or failure in coping with the economic challenges will be determined as much by these non-economic factors as by its skill in economic management.