For many countries, annual GDP growth of 4.5 to 5 percent would be a very good year. For China, which announced the target this year, it’s setting expectations deliberately low. After more than three decades of sky-high growth—regularly topping 10 percent a year—Beijing’s economic ambitions have been brought back to earth. And that has changed far more than just the country’s economy.

Until the late 2010s, the entirety of Chinese life was shaped around the reality of high growth. People took on painfully high debt, confident that their salaries would rise to match it. They skipped out on jobs after two months because there was bound to be something better out there. In a world of opportunity, chance meetings could turn into life-changing careers—or you might fall victim to one of the con artists who also flourished in an era where easy payoffs weren’t always a scam. That risk-taking culture itself helped once small businesses grow into international giants.

Golden decades were relatively common in the 20th century: France’s “glorious years,” Germany’s Miracle on the Rhine, even the “Mexican miracle.” But China’s growth after 1980 topped them all, both in scale and length. China went from a country poorer than India to one challenging the United States, surpassing rival after rival: France, Britain, Japan.

Part of this was an elastic band effect; the disasters of Maoist policy had held the country back for decades even as Japan, South Korea, and Taiwan boomed. There was a lot of catching up to do: Just 18 percent of Chinese lived in cities in 1978, compared with more than 50 percent in South Korea. Chinese farmers had started to break away from collectivization in the 1970s, a move finally approved by the Chinese Communist Party (CCP) in 1979.

But Maoism’s legacy was paradoxical; even as the CCP had stomped on the ambitions of ordinary Chinese, it had successfully introduced nationwide middle school education that produced the hundreds of millions of literate, numerate workers the global economy needed. Deng Xiaoping and his successors, too, were unusually canny leaders, steering the country successfully through the financial shocks that rocked Asia in the 1990s. The Chinese diaspora steered money back into the homeland, reuniting divided families as Taiwanese or Hong Kong capital sought investment opportunities back in China.

A new prosperity washed through Chinese society at every level. Money reached the strangest places. You could arrive in a southern tea village to find houses sprouting satellite dishes or spot a lone, dusty skyscraper in a desert town. The “Four Big Things” of the 1970s—symbols of a household doing well—were a watch, a bicycle, a radio, and a sewing machine. By the 1980s, those were a tape recorder, a color TV, a washing machine, and a fridge, and by the 1990s, microwaves, VCRs, cars, computers, and freezers were the big-ticket items.

---

In other countries, economic booms brought carefully developed welfare systems, generous pensions, and universal healthcare. Communist China was far more cutthroat. If you dropped out of school, there were no nets other than family to catch you; parents reminded children at every chance that it was them against the world. Social benefits remained linked to restrictive residence permits: You could move from the country to the city, but good luck getting your kids into schools there or collecting your pension.

One of the biggest boons was the privatization of housing in the 1990s. If you were lucky enough to be assigned Beijing real estate in the 1980s, you got to own it in the 1990s and watch it grow in value by 15 to 20 times in the next two decades. If you were a farmer, like most of the country, no such luck.

Yet growth meant hope—and risk. “Factory girls” flocked into the cities looking for something better than the fields their families had toiled in for centuries. College graduates skipped from job to job, sometimes four or five a year, confident that something better would come along. Fortunes were made through chance meetings on trains. Opportunity was cheap and failures easy to abandon; if you opened one successful restaurant, why not open another six the next year and then 60 and then 600?

Some advances came slowly and then all at once. Ration books lasted until 1993; by 1997, Chinese were eating more pork per capita than Americans. In 1976, when an earthquake hit the city of Tangshan in the middle of the night, it was easier for local officials to drive three hours to Beijing to tell party leaders in person than to find a landline to call them. In 1986, access to a landline, usually through an office, was still a treasured good, traded for favors.

In 1996, there were just over four landlines for every 100 people, and the fee for installation was several months’ salary. By 2006, mobile SIM cards were being sold on every corner, and students spent hours in internet cafes playing World of Warcraft. By 2016, half the country brandished a smartphone.

The end of the golden years arrived the same way as technological changes had: gradually and then suddenly. Throughout the 2010s, growth was slowing every year, from 9.3 percent in 2011—the last surge of a huge wave of government stimulus post-global financial crisis—down to just over 6 percent in 2019.

Then came the COVID-19 pandemic. Fearful of repeating what he saw as the mistakes of the 2009 stimulus, Chinese President Xi Jinping kept the purse strings closed. China’s household support was miniscule compared with U.S. generosity; nearly a quarter of those rural households lifted out of absolute poverty in the 2010s slipped back. Growth in 2020 was just 2.2 percent, and a dedication to the “zero-COVID” policy kept the economy in the doldrums throughout 2022, despite a brief recovery bump in 2021. The numbers started to look dodgy even by Chinese government standards: In 2023, youth unemployment reached such highs that the statistics bureau stopped issuing the figures altogether.

Most painfully, the pandemic burst the real estate bubble. In 2019, Beijing’s central real estate prices were rivaling Manhattan’s (while salaries stayed at around a tenth of New York’s). The implications of the collapse of giant firms such as Evergrande and Country Garden have not yet fully played out; the government continues to prop up nominal prices even as sales slump. Some 70 percent of Chinese household wealth is tied up in housing; to let prices fall to actual market levels would be a shock to the middle class that the CCP couldn’t tolerate.

---

For China’s leadership, the slowdown is a political problem as much as an economic one. The legitimacy of CCP rule has rested on three pillars since the end of the Maoist era: the ideological claims of the superiority of socialism, the historical-nationalist claims of revenging past humiliations and restoring China’s global status, and the practical claims of economic growth and greater prosperity.

Economic success has been by far the strongest source of legitimacy since the 1990s. In the post-Tiananmen era, an implicit bargain emerged between the CCP and public: Don’t rock the boat, and the good times will keep rolling. Shakier economic times mean a less secure party in turn and more hope placed in the other two pillars—not always successfully.

As growth started slowing, Xi pushed an even more aggressive form of nationalism, pressing China’s maritime claims and encouraging diplomats to posture as “wolf warriors” online. That has diminished in the post-COVID era, although the drumbeat of “patriotic education”—and the destruction of minority culture—continues.

Efforts to revive Communist ideology have won little public support; Xi Jinping Thought is a tedious obligation and the attempts to make young people take Communist heroism seriously a continuous flop. Xi is protective of the pious fables of martyrs his generation was raised on, imprisoning critics as “historical nihilists,” but he can’t persuade anyone to go see movies about Maoist boy hero Lei Feng.

---

Xi’s main response to the end of the golden years has been his campaign for “common prosperity,” a failed attempt, replete with Communist clichés, to stop the growth of economic inequality. His chief ideological foe, meanwhile, is “welfarism,” which he associates with Western decadence and laziness; he loves the language of hardness, sacrifice, and austerity.

The problem is that for China’s economic model to shift, consumption needs to rise—the reverse of the golden years, when domestic consumption was deliberately repressed. While the CCP has made this an official priority, it sits uneasily with Xi’s own rhetoric—and with frequent government campaigns against the things people want to spend money on, whether that be private education or video games. The COVID years reinforced a belief in the necessity to save for bad times, and the fresh sense of economic insecurity has only encouraged that.

With each passing year, too, China comes closer to falling off the demographic cliff. The great fear since the 2000s has been that the country will get old before it gets rich. If it were just the workforce of the 1980s entering retirement, China might be able to cope, but the birth rate has also crashed; for the first time since the devastating famines of 1959-61, the Chinese population shrunk in 2022 and has continued to fall every year since. However much the government tries to convince women to abandon their careers in favor of the patriotic duty of childbirth, women aren’t listening.

None of this stops China being a world-shaking power. Even 3 or 4 percent growth in a technologically advanced middle-income country of 1.4 billion people transforms lives, from rural migrants still flocking to China’s metropolises to Kenyan townsfolk running their new Haier TVs and microwaves off Chinese solar panels. But if you’re used to the golden years, ordinary ones feel a lot grayer—and the future a lot darker.