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comment by b_b
b_b  ·  1252 days ago  ·  link  ·    ·  parent  ·  post: China's Stock Market Crash, Explained

If the government survives, then I agree with you. My view is there is a chance that the government will collapse. Whatever happens Walmart will continue to peddle shit made by poor people.




nota999  ·  1252 days ago  ·  link  ·  

I doubt we'd see any significant regime change with the path that China is on right now. Generally political systems are fairly stable when either on the more authoritarian or the more democratic side. It's in the middle where instability is most prevalent (called an anocracy). I'd expect that only if China starts to reform its political system to be more democratic that we'd see significant unrest calling for a regime change, and China is currently reluctant to do so.

However, as Youwei notes in "The End of Reform in China" (Foreign Affairs May/June 2015), China is starting to run out of areas it can reform without becoming less authoritarian.

    [M]ost easy reforms have already been launched. Revamping agriculture, encouraging entrepreneurship, promoting trade, tweaking social security—all these have created new benefits and beneficiaries while imposing few costs on established interests. What is left are the harder changes, such as removing state monopolies in critical sectors of the economy, privatizing land, giving the National People’s Congress power over fiscal issues, and establishing an independent court system. Moving forward with these could begin to threaten the hold of the Chinese Communist Party on power, something that the regime is unwilling to tolerate.
b_b  ·  1252 days ago  ·  link  ·  

    Generally political systems are fairly stable when either on the more authoritarian or the more democratic side.

I know of no other case of an authoritarian regime being successful when ruling over a large, dynamic economy. The USSR lasted 70 years. China is pushing that right now, although they might get extra life, because they have been able to liberalize a lot more than the USSR ever did.

Spindel  ·  1252 days ago  ·  link  ·  

Soviet was a "communist" dictatorship, modern China is a ultra capitalistic dictatorship. That's the difference. Also USSR poured insane amounts of GDP into the military, where China doesn't (or I should say, as far as we know they don't).

China will prevail, may cause a lot of suffering for 10-100 millions but the new empire will most probably not fall.

kleinbl00  ·  1252 days ago  ·  link  ·  

Elaborate on that. Because by my read, the likelihood of regime change in China has gone down every year since 1988. That is what Tienamen Square was ultimately about - whether the transition from command economy to market economy would occur on the command side's timeframe or the market side's... and the command side won that debate handily.

b_b  ·  1252 days ago  ·  link  ·  

    ...the command side won that debate handily.

Yes they did. But how have they accomplished all that they have in the interceding years? Some of it through real, sustained economic development, but a lot of it through graft, corruption, environmental destruction. They've thrown money at every problem, and greased every wheel that needed greasing along the way.

For example:

They've had a building spree that has left entire cities unoccupied (literally). People have invested a lot of money in these unoccupied buildings, and construction companies are now a dying breed in China. Lots of people are going to lose their ass a lot more than what the Shanghai market can do to them.

We've been seeing discontent with the environmental degradation in recent years. Reports abound that people won't let their children play outside in many ares due to the risk of illness. There's hell to pay in terms of human health for the way they've handled air quality issues.

The Internet occasionally leaks into mainstream China, and it often ends with someone going to jail for a long time for saying something pretty benign about the government. It doesn't take much to be labeled a subversive enemy of the state there.

I read one account of Xi trying to resurrect the personality cult of Mao among the peasants. That strikes me as desperation.

And these are all things that make the US media, so one can imagine how bad things are below the surface. So, with all these underlying fundamental problems, why have the people tolerated it? I believe it's because the only thing people really care about is the ability to feed their family. So long as their paycheck this year is bigger than last year, then all the other problems look small and manageable. However, when unemployment rises (and it will) for the first time since Tienanmen, people aren't going to stand for getting fucked six ways to Sunday any longer.

The people are richer and more educated than they ever have been, and this will express itself eventually. The rulers of China aren't dealing with all farmers anymore (although there are certainly still a lot of them). It is much harder to pull the wool over the middle class's eyes than the peasant class.

Add all this to the hyper media environment we now live in, and I think it's a real tinderbox over there. Just wait until there's a large protest to try to force the government to bend on some issue (like for example when their new policy of investing pensions in the market blows up), and it gets met with the government mowing down a bunch of people with tanks. They won't be able to spin it nearly so well this time. I hope for a peaceful transition, but I fear for a bloodbath.

kleinbl00  ·  1252 days ago  ·  link  ·  

    Yes they did. But how have they accomplished all that they have in the interceding years? Some of it through real, sustained economic development, but a lot of it through graft, corruption, environmental destruction. They've thrown money at every problem, and greased every wheel that needed greasing along the way.

My point exactly: The command economy has advanced the market economy through command reforms. With the market economy in turmoil, the market will expect the command economy to step in. Does Xi need to resurrect a cult of personality? No... because central control of China remains strong.

China remains a place where you can go from "accused" to "dead" in a week. They're a draconian place, and always have been. My argument is that China has a lot more leeway for austerity and aggressive controls and corrections than any market economy does... and that the entrenched democracy the Western world demands is a recent luxury in China.

b_b  ·  1252 days ago  ·  link  ·  

Either way, we're in uncharted waters, and it's going to be fascinating to watch.