Geopolitical Consequence of Chinese Collapse

[bcassill]

Okay, I thought I'd start a discussion on something that has been in the back of my mind for some time now. We've all been hearing more and more about the issues coming out of China these days.

From the cooking of its books to post better than actual economic growth::rolleyes:
http://www.foreignpolicy.com/article...ooks_its_books

To the Chinese property and equities bubbles:
http://www.foreignpolicy.com/article..._one_you_think

Anyhow, my gut tells me that this will not end well politically.:eek: Is anyone here willing to speculate on what will happen next? Somehow, I don't think that runaway deficits and borrowing will be the kicker for the next crisis. The time line for it's consequences are just too long. Some external shock will likely lead to the next economic/political crisis which will have reverberations throughout the U.S. and world financial system. How likely is it for the next shoe to drop to be out of Asia?

Thoughts?

[hayekvindicated]

Re: Geopolitical Consequence of Chinese Collapse

Okay, I thought I'd start a discussion on something that has been in the back of my mind for some time now. We've all been hearing more and more about the issues coming out of China these days.

From the cooking of its books to post better than actual economic growth::rolleyes:
http://www.foreignpolicy.com/article...ooks_its_books

To the Chinese property and equities bubbles:
http://www.foreignpolicy.com/article..._one_you_think

Anyhow, my gut tells me that this will not end well politically.:eek: Is anyone here willing to speculate on what will happen next? Somehow, I don't think that runaway deficits and borrowing will be the kicker for the next crisis. The time line for it's consequences are just too long. Some external shock will likely lead to the next economic/political crisis which will have reverberations throughout the U.S. and world financial system. How likely is it for the next shoe to drop to be out of Asia?

Thoughts?

The Chinese regime survived even when 65 million died of starvation under Mao. If people are now trying to conivnce me that the regime will collapse because some Chinese workers have lost their jobs, then I am not convinced.

[BlackVoid]

Re: Geopolitical Consequence of Chinese Collapse

Somehow, I don't think that runaway deficits and borrowing will be the kicker for the next crisis.

That is the US, not China. And that is where the real crisis is.

[touchring]

Re: Geopolitical Consequence of Chinese Collapse

The Chinese regime survived even when 65 million died of starvation under Mao. If people are now trying to conivnce me that the regime will collapse because some Chinese workers have lost their jobs, then I am not convinced.

they already had that rehearsal in urumqi. if it happens in other cities like say beijing or shanghai, send out the troops in machine gun, fire a few warning shots and if they don't retreat, shoot a dead few dozen people. who wants to die? no one wants to die when he can surf the net. so the protesters retreat.

[hayekvindicated]

Re: Geopolitical Consequence of Chinese Collapse

they already had that rehearsal in urumqi. if it happens in other cities like say beijing or shanghai, send out the troops in machine gun, fire a few warning shots and if they don't retreat, shoot a dead few dozen people. who wants to die? no one wants to die when he can surf the net. so the protesters retreat.

Ergo, revolution is highly unlikely though not impossible (nothing is impossible).

[touchring]

Re: Geopolitical Consequence of Chinese Collapse

Ergo, revolution is highly unlikely though not impossible (nothing is impossible).

If they want to, they haven't yet, they can adopt the Singapore approach which guarantees that a revolution will be impossible.
http://www.reuters.com/article/lifes...52N25920090324

[bcassill]

Re: Geopolitical Consequence of Chinese Collapse

Just understand that political change doesn't have to mean a popular uprising. If you go back to the beginning of the communist party in China, Mao was the original revolutionary. He was able to get away with a lot given his cult of personality and the occasional purge (e.g. the Cultural Revolution). This enabled him to stay firmly on top of the party apparatchik. Now, times are very different. There is no populist leader like Mao in power. Instead, we see a system that has resorted to the uniquely Chinese historical norm: a largely corrupt civil service dominated by regional party heads/decision makers whose main motive seems to be stuffing their own pockets with ill gotten gains. The populace has largely been satisfied with full employment, but with exports down, what are these folks going to do? You can only build so many empty skyscrappers and bridges to nowhere to keep everyone busy. With an economy that may likely go bust in the end, a change of leadership, even within the communist party, is not out of the question. That and the use of the jack boots (i.e. the guys with guns) to keep the population at bay/under control, then suddenly we may see an even more oppressive and authoritarian regime than is in place today with anyone's guess as to what it would mean in regards to policy changes coming out of China.

[jpatter666]

Re: Geopolitical Consequence of Chinese Collapse

The Chinese regime survived even when 65 million died of starvation under Mao. If people are now trying to conivnce me that the regime will collapse because some Chinese workers have lost their jobs, then I am not convinced.

I'm not convinced, but I wouldn't discount it either. You could possibly see an inter-party purge or a revolution under the covers. When I was in China there seemed to be an implicit understanding that so long as (nearly) everyone was making money, the Party would remain in power.

Now that this is changing, we'll see whether the Party still has the will to remain in power (to use force). This was definitely the case for Tienanmen -- not sure now in the internet age.

But Iran has managed it so far.....

But comparing China during the Great Leap Forward and now is apples and oranges. Two very, very different societies.

[touchring]

Re: Geopolitical Consequence of Chinese Collapse

I'm not convinced, but I wouldn't discount it either. You could possibly see an inter-party purge or a revolution under the covers. When I was in China there seemed to be an implicit understanding that so long as (nearly) everyone was making money, the Party would remain in power.

Now that this is changing, we'll see whether the Party still has the will to remain in power (to use force). This was definitely the case for Tienanmen -- not sure now in the internet age.

But Iran has managed it so far.....

But comparing China during the Great Leap Forward and now is apples and oranges. Two very, very different societies.

I think the higher the income, the lower the propensity for risky endeavors. There are many examples of high income authoritarian governments and monarchies that are more autocratic than China.

This is the Internet age, but the old men from the pre-Internet age are still alive and in power. Until these people kick the bucket, I don't see much changes.

[globaleconomicollaps]

Re: Geopolitical Consequence of Chinese Collapse

The Chinese regime survived even when 65 million died of starvation under Mao. If people are now trying to convince me that the regime will collapse because some Chinese workers have lost their jobs, then I am not convinced.

People are willing to put up with a huge amount of pure unadulterated evil if they think they are part of a movement to liberate humanity. The corruption of the communist party is creating a powder-keg in china.

[cobben]

Re: Geopolitical Consequence of Chinese Collapse

"we see a system that has resorted to the uniquely Chinese historical norm: a largely corrupt civil service dominated by regional party heads/decision makers whose main motive seems to be stuffing their own pockets with ill gotten gains. "

Chinese Girl Becomes Media Darling After Expressing Desire to Become “Corrupt Official”
http://www.prisonplanet.com/chinese-...-official.html

"Friday, September 4, 2009
Beijing – A six-year-old girl has become a media darling in China on her first day of school by expressing her aspiration to become a “corrupt official” when she grows up, state media said on Friday.
The young student stated her aspirations in a televised interview that was posted on a southern China website, leading bloggers to describe her comments as “a reflection of social reality,” the Southern Metropolis Daily reported.
“When I grow up I want to be an official,” said the girl, whose face was blurred to protect her identity.

“What kind of official?” the interviewer asked.
“A corrupt official because corrupt officials have a lot of things,” she replied.
Many chatroom users praised the child for her “realistic” outlook on life, while others expressed cynicism over rampant corruption in China.
Full story here."

[bcassill]

Re: Geopolitical Consequence of Chinese Collapse

"we see a system that has resorted to the uniquely Chinese historical norm: a largely corrupt civil service dominated by regional party heads/decision makers whose main motive seems to be stuffing their own pockets with ill gotten gains. "

Chinese Girl Becomes Media Darling After Expressing Desire to Become “Corrupt Official”
http://www.prisonplanet.com/chinese-...-official.html

"Friday, September 4, 2009
Beijing – A six-year-old girl has become a media darling in China on her first day of school by expressing her aspiration to become a “corrupt official” when she grows up, state media said on Friday.
The young student stated her aspirations in a televised interview that was posted on a southern China website, leading bloggers to describe her comments as “a reflection of social reality,” the Southern Metropolis Daily reported.
“When I grow up I want to be an official,” said the girl, whose face was blurred to protect her identity.

“What kind of official?” the interviewer asked.
“A corrupt official because corrupt officials have a lot of things,” she replied.
Many chatroom users praised the child for her “realistic” outlook on life, while others expressed cynicism over rampant corruption in China.
Full story here."

Well, that just about sums it up. I had a friend once who related a story to me about a friend of hers who was a school teacher in one of the more run down sections of town. Seems the little girls were coming to school with their grown up aspirations already in full blossom. Apparently many of them wanted to become "Hoochie Mamas" when they came of age. I'm just glad to see that our neighbors across the Pacific pond are just as successful in instilling good examples of how to become productive members of society when they grow up.

[medved]

Re: Geopolitical Consequence of Chinese Collapse

Just understand that political change doesn't have to mean a popular uprising. If you go back to the beginning of the communist party in China, Mao was the original revolutionary. He was able to get away with a lot given his cult of personality and the occasional purge (e.g. the Cultural Revolution). This enabled him to stay firmly on top of the party apparatchik. Now, times are very different. There is no populist leader like Mao in power. Instead, we see a system that has resorted to the uniquely Chinese historical norm: a largely corrupt civil service dominated by regional party heads/decision makers whose main motive seems to be stuffing their own pockets with ill gotten gains. The populace has largely been satisfied with full employment, but with exports down, what are these folks going to do? You can only build so many empty skyscrappers and bridges to nowhere to keep everyone busy. With an economy that may likely go bust in the end, a change of leadership, even within the communist party, is not out of the question. That and the use of the jack boots (i.e. the guys with guns) to keep the population at bay/under control, then suddenly we may see an even more oppressive and authoritarian regime than is in place today with anyone's guess as to what it would mean in regards to policy changes coming out of China.

IMHO, this is a very reasonable prediction.

China is still a communist (not the "totalitarian capitalist") state. Maybe, it is less totalitarian, than before, but as any communist state it is controlled by the party apparatchicks. "Less totalitarian" means they have two big fractions in the Party, not just one dictator. This fractions are at odds regarding the future path of the party and the country.

The Chinese Collapse (whatever that may be) will help the hardliners. There will be more party control, some reforms will be reversed, there will be more pressure on the US, China will be less willing to cooperate with the US to resolve the global crisis. China will try to become less dependent on US/European markets and develop markets in Asia/East Europe.

All this means more pressure on $US and less authority for the US and whatever international bodies it supports. I doubt it will lead to war, but the "globalization" bubble will be seriously deflated.

[hayekvindicated]

Re: Geopolitical Consequence of Chinese Collapse

People are willing to put up with a huge amount of pure unadulterated evil if they think they are part of a movement to liberate humanity. The corruption of the communist party is creating a powder-keg in china.

China has always been a despotism. None of this is new.

[touchring]

Re: Geopolitical Consequence of Chinese Collapse

IMHO, this is a very reasonable prediction.

China is still a communist (not the "totalitarian capitalist") state. Maybe, it is less totalitarian, than before, but as any communist state it is controlled by the party apparatchicks. "Less totalitarian" means they have two big fractions in the Party, not just one dictator. This fractions are at odds regarding the future path of the party and the country.

Interesting concept, would you consider D and R one party?