How many times can you lie about growth data and get away with it?

[EJ]

Re: Will China do a Japan?

Singapore would seem to be the model the Chinese want to emulate...on a grander scale (and with their ubiquitous "Chinese characteristics") if they can pull it off. I wouldn't bet against them overall, but I do think there's going to be some very serious "bumps in the road" as they try to make that journey...

China's leader's desire to emulate Singapore's economy is misguided. Singapore's economic model works because of the country's history, small geographic and ethnic scale, and finance industry concentration. China is a huge third world continent, like Africa, with a handful of Singapores along its trade routes. The UK is closer to a workable version of the Singapore model than China can ever be.

China cannot scale because it is a centrally planned economy. It grows via finance not via organic economic activity. It is constrained by central planning and dictatorship.

We in the U.S. have the luxury of thinking that our legislature is corrupt because it has allowed the finance industry to survive an egregious violation of the public trust. Here's what the average Chinese citizen has to deal with:

"The net worth of the 70 richest delegates in China’s National People’s Congress, which opens its annual session on March 5, rose to 565.8 billion yuan (US$89.8 billion) in 2011, a gain of $11.5 billion from 2010, according to figures from the Hurun Report, which tracks the country’s wealthy. That compares to the $7.5 billion net worth of all 660 top officials in the three branches of the U.S. government."

China’s Billionaire People’s Congress Makes Capitol Hill Look Like Pauper

As I've said, a gigantic 3rd world country with nukes.

China will eventually fail just like every technocratic dictatorship has; as Nazi Germany failed, as the Soviet Union failed, as Syria is failing, but with Chinese Characteristics.

[touchring]

Re: Will China do a Japan?

Singapore would seem to be the model the Chinese want to emulate...on a grander scale (and with their ubiquitous "Chinese characteristics") if they can pull it off. I wouldn't bet against them overall, but I do think there's going to be some very serious "bumps in the road" as they try to make that journey...

I can tell you that China is hardly the Singapore model even though they claim to emulate the Singapore model.

1. Unlike China, Singapore has very good social security and welfare system for the real destitute. Healthcare, food and housing is virtually free for the very old, handicap and sick.

2. Public housing is widely available in Singapore at x6 median income. In China, the majority have to settle for x20 to x30 income.

3. The other issue is corruption. There is corruption in Singapore, more than what the state media claims, but it is a great deal much lower than China even on a per capita basis.

4. The people in Singapore are very afraid of the law. In China, people break the law all the time.

There's a lot more differences.

[GRG55]

Re: Will China do a Japan?

I can tell you that China is hardly the Singapore model even though they claim to emulate the Singapore model.

1. Unlike China, Singapore has very good social security and welfare system for the real destitute. Healthcare, food and housing is virtually free for the very old, handicap and sick.

2. Public housing is widely available in Singapore at x6 median income. In China, the majority have to settle for x20 to x30 income.

3. The other issue is corruption. There is corruption in Singapore, more than what the state media claims, but it is a great deal much lower than China even on a per capita basis.

4. The people in Singapore are very afraid of the law. In China, people break the law all the time.

There's a lot more differences.

As I said: "Singapore would seem to be the model the Chinese want to emulate..." I didn't say that they had achieved that.

[santafe2]

Re: Will China do a Japan?

Luckily here in the US, we have a one-party democracy.

No problemo . . .

I seldom laugh out loud at iTulip comments but thankfully there is a place where we can laugh at ourselves and observe that sad as it is, there is one party.

[BadJuju]

Re: Will China do a Japan?

I seldom laugh out loud at iTulip comments but thankfully there is a place where we can laugh at ourselves and observe that sad as it is, there is one party.

No, the parties are quite different. They may both be beholden to big business, but tell a woman who wants control of her body or a homosexual that both parties are the same and they will point to a mountain of evidence that they are both very different. As screwed up as the Democrats are, at least they are socially progressive.

[santafe2]

Re: How many times can you lie about growth data and get away with it?

How many times can you lie about growth data and get away with it?

The largest solar company in the world is insolvent. Suntech Power, (STP), will likely return zero to it's stock and bond holders but the city in China where they employ workers will take the company over and will continue production. It's a type of Chapter 11 completed in a very different culture. To answer your question, you can lie as long as you're well connected and you're not a complete embarrassment. Dr. Shi is apparently embarrassing.

[santafe2]

Re: Will China do a Japan?

China's leader's desire to emulate Singapore's economy is misguided. Singapore's economic model works because of the country's history, small geographic and ethnic scale, and finance industry concentration. China is a huge third world continent, like Africa, with a handful of Singapores along its trade routes. The UK is closer to a workable version of the Singapore model than China can ever be.

China cannot scale because it is a centrally planned economy. It grows via finance not via organic economic activity. It is constrained by central planning and dictatorship.

We in the U.S. have the luxury of thinking that our legislature is corrupt because it has allowed the finance industry to survive an egregious violation of the public trust. Here's what the average Chinese citizen has to deal with:

"The net worth of the 70 richest delegates in China’s National People’s Congress, which opens its annual session on March 5, rose to 565.8 billion yuan (US$89.8 billion) in 2011, a gain of $11.5 billion from 2010, according to figures from the Hurun Report, which tracks the country’s wealthy. That compares to the $7.5 billion net worth of all 660 top officials in the three branches of the U.S. government."

China’s Billionaire People’s Congress Makes Capitol Hill Look Like Pauper

As I've said, a gigantic 3rd world country with nukes.

China will eventually fail just like every technocratic dictatorship has; as Nazi Germany failed, as the Soviet Union failed, as Syria is failing, but with Chinese Characteristics.

I have posted similar ideas in the past but I disagree with this idea that we in the US are somehow ipso facto better prepared for the future than China. I see China through my industry and from that view I see 600 dumb companies that can't compete and 2-3 companies emerging as world class competitors. The ratio in the US and Europe is not much better as the solar industry grows from cottage to mainstream. China not only has a comparative advantage to Nazi Germany and the Soviet Union, they have a competitive advantage. If we don't soon understand how smart our competitors are we may doom ourselves to being a 3rd world country with nukes.

[touchring]

Re: Will China do a Japan?

I have posted similar ideas in the past but I disagree with this idea that we in the US are somehow ipso facto better prepared for the future than China. I see China through my industry and from that view I see 600 dumb companies that can't compete and 2-3 companies emerging as world class competitors. The ratio in the US and Europe is not much better as the solar industry grows from cottage to mainstream. China not only has a comparative advantage to Nazi Germany and the Soviet Union, they have a competitive advantage. If we don't soon understand how smart our competitors are we may doom ourselves to being a 3rd world country with nukes.

China has a one child policy and is faced with a declining workforce, raging inflation, insufficient resources, severe corruption, and skyrocketing real estate prices.

I don't know much about solar panels, but I believe we shall see how well Chinese panels will perform a couple years down the road after they have been installed.

As I've said, a gigantic 3rd world country with nukes.

China will eventually fail just like every technocratic dictatorship has; as Nazi Germany failed, as the Soviet Union failed, as Syria is failing, but with Chinese Characteristics.

I don't see China's nukes as world threatening. China doesn't have a warrior culture, unlike the Japanese, the Brits, Germans and Arabs. There's a Chinese saying that every child learns from a very young age "Good man don't become soldiers". Soldiers are despised in the Chinese society. It's even worst with the single child policy. Which parent will want to send their only child to war?

[astonas]

Re: Will China do a Japan?

China will eventually fail just like every technocratic dictatorship has; as Nazi Germany failed, as the Soviet Union failed, as Syria is failing, but with Chinese Characteristics.

yes, but eventually is a long time. ;)

More seriously, though, if you had to guess, would you predict it would fall in a war with the U.S. (hot, like Germany, or cold, like the USSR?) or implode more or less on its own, like Syria? In other words, do we have any indication of what "Chinese Characteristics" might look like?

[Polish_Silver]

China's dead end.

China's leader's desire to emulate Singapore's economy is misguided. Singapore's economic model works because of the country's history, small geographic and ethnic scale, and finance industry concentration. China is a huge third world continent, like Africa, with a handful of Singapores along its trade routes. The UK is closer to a workable version of the Singapore model than China can ever be.

China cannot scale because it is a centrally planned economy. It grows via finance not via organic economic activity. It is constrained by central planning and dictatorship.

. . . .
China will eventually fail just like every technocratic dictatorship has; as Nazi Germany failed, as the Soviet Union failed, as Syria is failing, but with Chinese Characteristics.

That is the view taken in "why nations fail". EJ has articulated China's problem very well.

It's also true that some ruling classes have voluntarily ceded power and made fairly smooth transitions to popular rule. Taiwan and South Korea are good examples of this. However, it seems to be easier for right wing dictators to do this than for communist bureaucracies. That is because the right wing dictators only want to collect the money and keep hold of the military. They don't care so much about people's thinking---they are not trying to create an ideal society.

In some ways, China is acting like a right wing dictatorship. But I wonder if the party will be willing to surrender the power it has--some kind of Gorbachev moment.

[GRG55]

Re: China's dead end.

That is the view taken in "why nations fail". EJ has articulated China's problem very well.

It's also true that some ruling classes have voluntarily ceded power and made fairly smooth transitions to popular rule. Taiwan and South Korea are good examples of this. However, it seems to be easier for right wing dictators to do this than for communist bureaucracies. That is because the right wing dictators only want to collect the money and keep hold of the military. They don't care so much about people's thinking---they are not trying to create an ideal society.

In some ways, China is acting like a right wing dictatorship. But I wonder if the party will be willing to surrender the power it has--some kind of Gorbachev moment.

Was there really a surrender of power in Russia? Or merely the realization that everyone in power could get much wealthier, much faster if they devoted less effort rattling sabres against the USA and directed that energy to more effectively stripping public assets and stashing the proceeds into private bank accounts?

I see the same pattern repeating in Central Asia...as "communism" (the state owns all the assets and means of production) gives way to "capitalism" (hey, that's my oilfield), first the income from state assets gets diverted and then the most valuable assets themselves start to be seized by officials and their cronies. As I posted once before, there's a joke doing the rounds in the FSU Republic of Kazakhstan: "It's a good thing the President doesn't have any more daughters; the country can't afford any more son-in-laws".

This is what I gather is happening within China now...an acceleration of diverting income from public assets away from the "People's Government" and into the individual Hong Kong and Singapore bank accounts of officials (and their relatives) that make up that government. Lower down the food chain, local party officials have taken to simply seizing land from farmers, with impunity, to promote construction and development for the so-called "greater good" - the reality being that the bigger the ticket on the project the easier it is to skim large sums off the top.

My guess is that one of the next areas of the economy the best placed Chinese officials will use to enrich themselves will be the procurement of commercial airplanes. It will be similar to what has been going on in the Arabian Gulf states (Qatar, Dubai and Abu Dhabi in particular). Large aircraft orders are prestigious, caters to the impression that the government is promoting a shift to a consumer economy, opaque enough that few know the actual transaction prices, and allows the most influential officials in the procurement chain to slice off enormous sums for themselves. The Chinese can't play this game with defense procurement the way Middle East officials do, hence my guess that commercial aircraft may be the "next big thing" in China...

[c1ue]

Re: China's dead end.

We in the U.S. have the luxury of thinking that our legislature is corrupt because it has allowed the finance industry to survive an egregious violation of the public trust. Here's what the average Chinese citizen has to deal with:

"The net worth of the 70 richest delegates in China’s National People’s Congress, which opens its annual session on March 5, rose to 565.8 billion yuan (US$89.8 billion) in 2011, a gain of $11.5 billion from 2010, according to figures from the Hurun Report, which tracks the country’s wealthy. That compares to the $7.5 billion net worth of all 660 top officials in the three branches of the U.S. government."

China’s Billionaire People’s Congress Makes Capitol Hill Look Like Pauper

As I've said, a gigantic 3rd world country with nukes.

China will eventually fail just like every technocratic dictatorship has; as Nazi Germany failed, as the Soviet Union failed, as Syria is failing, but with Chinese Characteristics.

Certainly there is all sorts of corruption in China, misallocation of resources, etc etc.

But once again, the question going forward is: will it get better or worse?

Unlike an oil producer, China's wealth is directly correlated to its people. You can pump oil with minimal support from the population - especially if you buy off your population with massive subsidies, but you can't get tons of cheap labor working in similar fashion.

Equally the comparisons of Chinese officials with US officials is highly warped. For one thing, the increase in national wealth during the 'reign' of any particular group of officials is quite small in the US. Arguably this is why they aren't more wealthy - they simply don't have the time to steal as much nor as large a pot of GDP growth to steal from via peculation and what not.

I'd also note that calling China a 3rd world nation is a grave insult.

Whatever you want to say about the levels of corruption or what not - the reality is that China has greatly improved the standard of living for its population in the past 3 decades despite having nothing of strategic value other than human labor.

Contrast that with say, Nigeria or a real third world country like Bangladesh.

As someone who - I believe - has seen the changes in everyday lives in China in the past 3 decades, I am disappointed that EJ would employ this type of rhetoric.

This is what I gather is happening within China now...an acceleration of diverting income from public assets away from the "People's Government" and into the individual Hong Kong and Singapore bank accounts of officials (and their relatives) that make up that government. Lower down the food chain, local party officials have taken to simply seizing land from farmers, with impunity, to promote construction and development for the so-called "greater good" - the reality being that the bigger the ticket on the project the easier it is to skim large sums off the top.

Should the Chinese government switch from diverting parts of GDP growth into their pockets to outright theft, then revolution won't be far away.

The reason any populace stays meek is due to the balance of what is not being gained vs. what would be lost. If government gets to the point where there is no gain and real prospect of loss, there's no benefit to staying meek any more.

The same can be said for what is happening in the US - except that US officials and legislators aren't diverting GDP growth.

[GRG55]

Re: China's dead end.

...Should the Chinese government switch from diverting parts of GDP growth into their pockets to outright theft, then revolution won't be far away.

The reason any populace stays meek is due to the balance of what is not being gained vs. what would be lost. If government gets to the point where there is no gain and real prospect of loss, there's no benefit to staying meek any more.

The same can be said for what is happening in the US - except that US officials and legislators aren't diverting GDP growth.

Revolution is not happening in the neighbouring FSU Republics. And there the majority of the population is dirt poor...literally. Anybody with any education is emigrating...to Europe or the Gulf if they have foreign language skills, or Russia if they don't. The "brain drain" going on from Kyrgyzstan, Uzbekistan and to a lesser degree Kazakhastan is dramatic. China seems infinitely better managed than the first two of these examples, however.

[don]

Re: China's dead end.

Unlike an oil producer, China's wealth is directly correlated to its people. You can pump oil with minimal support from the population - especially if you buy off your population with massive subsidies, but you can't get tons of cheap labor working in similar fashion.

Equally the comparisons of Chinese officials with US officials is highly warped. For one thing, the increase in national wealth during the 'reign' of any particular group of officials is quite small in the US. Arguably this is why they aren't more wealthy - they simply don't have the time to steal as much nor as large a pot of GDP growth to steal from via peculation and what not.

I'd also note that calling China a 3rd world nation is a grave insult.

Whatever you want to say about the levels of corruption or what not - the reality is that China has greatly improved the standard of living for its population in the past 3 decades despite having nothing of strategic value other than human labor.

Contrast that with say, Nigeria or a real third world country like Bangladesh.

As someone who - I believe - has seen the changes in everyday lives in China in the past 3 decades

(3 decades? More like never before.) What we have seen from the revolutions in China and Vietnam is that they have broken free from Western Imperialism and now appear to be in a transition from a socialist state to a form of state capitalism. Without mobilizing the masses at the bottom of the pyramid this would have been impossible.

[touchring]

Re: China's dead end.

I'd also note that calling China a 3rd world nation is a grave insult.

Agreed, children in Africa study in shanty huts made of scrap wood, whereas in China, they got bricked schoolhouses!



School in rural China:
http://www.stickboydaily.com/life/vi...china-gallery/