When people have more income, more society welfare, they will naturally look for more political rights. That's the situation CCP are unwilling to face.
China runs a trade surplus economy and has become huge. Not many places can be the receiving end of the investment induced by its balance of payment. Inevitably, many countries will get into conflict, many will need to get on China's side. One can say China is already a great empire.
I can see that a lesser trade surplus and more consumption will better enable a win-win outcome for the World. (Similarly for the US, lesser trade deficit, and lesser borrowing). However, I fail to identify the agent that can lead to this outcome. We can talk but authorities are unlikely to listen. I hope Europe can be such a force, e.g. by executing Mario Draghi's plan and becoming more intraregional sufficient.
Unshackle the behavioral animal spirits? Only a free and democratic China can create long term value for its citizens. Recently a Chinese economist spoke the truth about China's bleak economic prospects which ran counter to the party line. He was immediately ostracized. The yuan will never supplant the US dollar as the world's reserve currency because of China's lack of transparency.
Mr. Market always knows best. I have to laugh when Putin says the world is multi-polar. That's not his decision to make especially with Russia's economy the same size as Italy's.
Transparency is crucial, as seen during the Covid pandemic. Also, improving public understanding of things by providing facts has never been a key focus in their politburo meetings (I guess it's just the same for most autocratic govt). From what I understand, China's ambitious leaders are more likely to welcome a relatively weak RMB as far as consumers can normally live i.e. without compromising social stability. This further enables them to use top-down directives to engineer "shock economic" via different apparatus (e.g. like what we see from the post-Covid shocking emergence of EV challengers and the case of Apple Self-Driving Industrial Espionage). Such a play has been so far successful in terms of empire-building. And it may also cause more economies to critically depend on China.
Something needs to demonstrate that this is not okay.
Why isn’t China using its stimulus to bring more people out of poverty and low income status. Wouldn’t stimulus to people who really need the money, and who will spend it, reduce income inequality and fulfill the CCP’s social contract. Or along the same lines create a social safety net for the growing elderly population who might also then to spend more. Finally, shouldn’t China accelerate a shift to a services economy rather than a goods economy?
When people have more income, more society welfare, they will naturally look for more political rights. That's the situation CCP are unwilling to face.
China runs a trade surplus economy and has become huge. Not many places can be the receiving end of the investment induced by its balance of payment. Inevitably, many countries will get into conflict, many will need to get on China's side. One can say China is already a great empire.
I can see that a lesser trade surplus and more consumption will better enable a win-win outcome for the World. (Similarly for the US, lesser trade deficit, and lesser borrowing). However, I fail to identify the agent that can lead to this outcome. We can talk but authorities are unlikely to listen. I hope Europe can be such a force, e.g. by executing Mario Draghi's plan and becoming more intraregional sufficient.
As Japan and Germany demonstrated there is far more to empire building than running current account surpluses.
Agree, there are paths that can make people happier instead of getting a bigger empire
Unshackle the behavioral animal spirits? Only a free and democratic China can create long term value for its citizens. Recently a Chinese economist spoke the truth about China's bleak economic prospects which ran counter to the party line. He was immediately ostracized. The yuan will never supplant the US dollar as the world's reserve currency because of China's lack of transparency.
Fair point. Raises big question— value CCP places on Chinese people vs CCP grip on power.
no doubt that CCP grip on power wins
Mr. Market always wins in the long run!
Mr. Market with Chinese characteristics?
Mr. Market always knows best. I have to laugh when Putin says the world is multi-polar. That's not his decision to make especially with Russia's economy the same size as Italy's.
Transparency is crucial, as seen during the Covid pandemic. Also, improving public understanding of things by providing facts has never been a key focus in their politburo meetings (I guess it's just the same for most autocratic govt). From what I understand, China's ambitious leaders are more likely to welcome a relatively weak RMB as far as consumers can normally live i.e. without compromising social stability. This further enables them to use top-down directives to engineer "shock economic" via different apparatus (e.g. like what we see from the post-Covid shocking emergence of EV challengers and the case of Apple Self-Driving Industrial Espionage). Such a play has been so far successful in terms of empire-building. And it may also cause more economies to critically depend on China.
Something needs to demonstrate that this is not okay.
Why isn’t China using its stimulus to bring more people out of poverty and low income status. Wouldn’t stimulus to people who really need the money, and who will spend it, reduce income inequality and fulfill the CCP’s social contract. Or along the same lines create a social safety net for the growing elderly population who might also then to spend more. Finally, shouldn’t China accelerate a shift to a services economy rather than a goods economy?
All addressed in this and the previous piece. Necessary but not sufficient. Political constraints the big elephant.