March 5, 2008 | 1331 GMTAnalysis
Ten Australian tourists and their translator were taken hostage March 5 in the Chinese city of Xian, famous for its terra-cotta warriors.
A local Xian resident identified as Xia Tao boarded a tourist bus at around 9:52 a.m. local time, armed with explosives and threatening to blow up parts of downtown Xian. Local police negotiated with Xia, who released nine of the Australian hostages before transferring to another bus with one Australian and the translator and driving to the airport. Police shot and killed Xia as he approached a tollbooth near the airport. The remaining hostages were unhurt. Police have not released Xia’s motive.
I haven’t heard of a single incident like this before. But I suspect that generalized economic malaise, i.e. inflation, was what caused this. Inflation is the root cause of very serious latent social instability in China, about which Western investors are as clueless as ever. Inflation-driven unrest shook the Communist regime to its foundations in 1989, destroyed the Guomindang Nationalists in the 1940’s, and will shake China’s current regime to its core within the next five years.