I think sometimes the importance of propaganda is overstated. Those guys are around 70 years in power now, and have shut down every attempt ate rebellion so far, so they must be doing something right.
Yeah, their international image is not the most stellar one. But what will people do about it, besides bitching online?
None of the big power players or even medium power players have exactly stellar image. So does image even matter if you can get away with things anyway... Terrorism by state actor is default policy and nothing is being done about it... So why should China act any different?
