Chinese Economics Thread

[counterprime]

That it gamed the system, behold itself with ill gotten wealth, and too big to fail.

How are they the same?

The western banks, under the protection, of their governments were bailed out. The gains were privatized. The public paid the price.

Although there is plenty of corruption, China reinvests the earnings from Chinese SOE (State owned enterprises) into public assets like schools, roads, etc. The public benefits (not 100% but you get the idea).


Let's compare the legal system.


Song Wendai, death sentence
Crime: Grafting and embezzling public properties and funds
Job title: Former CEO of Qiankun Gold and Silver Refinery Co Ltd

Song Wendai was sentenced to death for illegally obtaining shares of the company and embezzling 87 million yuan ($13.87 million) in public funds and assets
(source:

Please, Log in or Register to view URLs content!

)


vs


Financial crooks brought down the world's economy — but the feds are doing more to protect them than to prosecute them

Why Isn't Wall Street in Jail?

Please, Log in or Register to view URLs content!

I can see superficial similarities eg both suffer corruption, but the magnitude is so vastly different, it's incomparable.

 

[Blitzo]

True. What was the source that created this conversation? Some posters drawing rather strong views from a survey. As I said, there are more than one way to tell a story.

And I myself also commented on Equation's views regarding that article as well.
https://www.sinodefenceforum.com/chinese-economics-thread.t3715/page-475#post-369069

Bringing up wealth distribution is fine, as the Gini coefficient as well as the difficulty in measuring it is a well accepted phenomenon, and saying that China's growth has not delivered equal growth for all parts of society would also be true as it is quite well established and accepted.
But your previous comments which suggested (in subtext) that many or all of China's middle and upper class are CCP members due to the unspoken suggestion of corruption and abuse of power, as well as the comments that China only underwent "wealth transfer" as opposed to "wealth growth" were rather unwarranted and unsupported.

Then trying to rope in the lack of protests and trying to draw in comparisons with wall street just made the tenuous position even harder to defend and more complicated as it ignores all manner of other confounding factors which influences why there may be a lack of protests compared to the occupy wall street movement... not to mention it ignores how wealth inequality is actually a well documented concern among the Chinese public.

 

[Brumby]

And I myself also commented on Equation's views regarding that article as well.
https://www.sinodefenceforum.com/chinese-economics-thread.t3715/page-475#post-369069

Bringing up wealth distribution is fine, as the Gini coefficient as well as the difficulty in measuring it is a well accepted phenomenon, and saying that China's growth has not delivered equal growth for all parts of society would also be true as it is quite well established and accepted.
But your previous comments which suggested (in subtext) that many or all of China's middle and upper class are CCP members due to the unspoken suggestion of corruption and abuse of power, as well as the comments that China only underwent "wealth transfer" as opposed to "wealth growth" were rather unwarranted and unsupported.

Your statement suggesting I ignore wealth growth is not factually true. I did acknowledge wealth growth when referring to a rising tide. My underlying point is that a lot of the wealth growth is benefiting members of the CCP and that is probably inherent in that middle bracket. Wealth transfer implicit in it is that the rest of the population did not enjoy a proportional benefit and that is reflected in the Gini. Who is in control benefits. Do you seriously think that I would possess statistics that conclusively link wealth to CCP? That might be in CCP's possession and a state secret. If you don't agree with my hypothesis, that is your prerogative.

 

[Blitzo]

Your statement suggesting I ignore wealth growth is not factually true. I did acknowledge wealth growth when referring to a rising tide. My underlying point is that a lot of the wealth growth is benefiting members of the CCP and that is probably inherent in that middle bracket.

That particular underlying point of yours is also a point of contention I listed in my last post alongside the "wealth transfer" point of contention.

Wealth transfer implicit in it is that the rest of the population did not enjoy a proportional benefit and that is reflected in the Gini.

Differential wealth growth leading to wealth inequality I think is a much more accurate term than "wealth transfer," let's put it that way.

Who is in control benefits. Do you seriously think that I would possess statistics that conclusively link wealth to CCP? That might be in CCP's possession and a state secret. If you don't agree with my hypothesis, that is your prerogative.

Obviously I don't believe that you are in possession of those statistics (though I think independent researchers could potentially have the assets to look for it if they wished).

And just for the record, I also do believe that there must be a statistically significant proportion of the middle and upper class who are CCP members and have achieved wealth through abuse of power via their positions.

The difference is that I'm willing to accept that I can't make anything near even a half-hearted guess as to what proportion of the current middle and upper class achieved their status via those means, because I lack even the beginning of the inkling of information to go about doing so... while you seemed to have been far more confident in your assertions and if it weren't called out by others you would've almost seem to have tried to pass off those claims as accepted and documented fact.

 

[counterprime]

from Bltizo
wealth inequality I think is a much more accurate term than "wealth transfer...

if it weren't called out by others you would've almost seem to have tried to pass off those claims as accepted and documented fact

This really sums up why I replied.

 

[solarz]

Some people, despite not even having the most basic clue about Chinese society, still insists on airing their prejudices by constructing fantasies about what China is like.

There are two classes of elites in Chinese society today: the "Businessmen", and the "Officials".

By Businessmen, I mean any entrepreneur or investor who became wealthy as a result of their investments or business ventures.

By Officials, I mean any member of the Chinese public service that wields a respectable amount of influence.

The Officials get rich by accepting bribes from the Businessmen. The Businessmen bribe the Officials because this lets them make more money. Only the Officials can be categorized as members of the CPC.

Therefore, it is utter nonsense to claim that China's wealth is being "transferred into the hands of the Communist Party". Officials can't get money without wealthy Businessmen offering them that money, and wealthy Businessmen don't get wealthy by making losing deals. The Businessmen are still far more wealthy than the Officials. Lai Changxing, for example, was not a member of the CPC.

 

[Blitzo]

Therefore, it is utter nonsense to claim that China's wealth is being "transferred into the hands of the Communist Party". Officials can't get money without wealthy Businessmen offering them that money, and wealthy Businessmen don't get wealthy by making losing deals. The Businessmen are still far more wealthy than the Officials. Lai Changxing, for example, was not a member of the CPC.

It's also important to consider wealthy businessmen who may also happen to be part of the CPC but whose success is independent of their political alignment -- that is to say, their success was not due to an abuse of power due to their political administrative position.

Of course, in China one can't do business without connections to the government (which goes for all companies), so no doubt people with closer ties to the government may be able to succeed easier but that isn't too different to backroom lobbying common in other nations.


For instance, Wang Jianlin is also technically part of the CPC but there's never been any suggestion that his wealth was a result of the kind of corruption or abuse of power that corrupt officials or businessmen are often shot down for, nor do I think he's really been in a position of administrative power that could allow any meaningful abuse to occur in the first place.

 

[Equation]

In the end how many Trillions of tax payers dollars did the Chinese people have to bail out all of those failed bankers and companies like the US did back in 2007-2009? Enough said, the CPC are doing a far better job than those in Washington, and that's the fact. It is due to good leadership and tough decision making for the long term benefits instead of one particular ideal political system.

 

[Equation]

It's also important to consider wealthy businessmen who may also happen to be part of the CPC but whose success is independent of their political alignment -- that is to say, their success was not due to an abuse of power due to their political administrative position.

Of course, in China one can't do business without connections to the government (which goes for all companies), so no doubt people with closer ties to the government may be able to succeed easier but that isn't too different to backroom lobbying common in other nations.

What about the many failed Silicon Valley start ups that end up as flops due to their connection to wealthy elites and venture capitalists?

Please, Log in or Register to view URLs content!

 

[Equation]

Before you pop the champagne it might be worthwhile considering a different read into the numbers. We are witnessing the biggest transfer of wealth in world history and that is from the general population of China to an elite sector of the economy and they are called members of the CCP. Yes Communism is paying big time (literally) with Chinese capitalism. It makes Wall Street pale in comparison. Who do you think are controlling all the state owned enterprises which is the driver of the Chinese economy? Conversely, how is it that in one generation the Gini coefficient for China has gone backwards from being the most equal to the least in Asia? In a rising tide, the elites took the major share (that is being generous in description) and the numbers is a testimony of that fact. Where are the 99 percenters? I guess protest carries risk in China.

You mean to tell me that the CPC uplifting of 800 million of it's own people out of poverty is a bad thing when their own 1%ers are doing a far better job than the 1%ers in America?