CHINA IS WEAKER THAN YOU THINK

Professor Walter Russell Mead on his blog Via Meadia on August 31, 2012, commented on the recent downturn of the Chinese economy. Excerpts below:

Over the past few months, the conventional picture of China’s meteoric rise to economic dominance has been cast into serious doubt. Numerous economic indicators are pointing toward a significant slowdown. In the past month alone, manufacturing has hit a nine-month low, steel prices have fallen dramatically, and investors have begun pulling their money out of the country.

In a new piece at Foreign Policy, Professor Minxin Pei argues that the recent troubles are signs of much more serious underlying problems that threaten the nation to its very core. Like the Soviet Union and Japan before it, China may be in for a long and painful fall:

The current economic slowdown in Beijing is neither cyclical nor the result of weak external demand for Chinese goods. China’s economic ills are far more deeply rooted: an overbearing state squandering capital and squeezing out the private sector, systemic inefficiency and lack of innovation, a rapacious ruling elite interested solely in self-enrichment and the perpetuation of its privileges, a woefully underdeveloped financial sector, and mounting ecological and demographic pressures.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s


%d bloggers like this: