Chinese Economics Thread

[AssassinsMace]

China's rise and Japan's decline are two different animals. Japan's problems have nothing to do with China because economically they are never really in competition.

 

[Violet Oboe]

@tphuang:
"Wow, what a revelation. Going to socialism reduces a country's competitiveness. Thanks for your lesson."

I have to admit being somewhat confused about your thesis since I am not capable to comprehend how large scale deregulation, ´opening up´ of domestic markets and massive privatization of state assets (railways, postal service, insurance etc.) are related to any concept of ´Socialism´. Especially Hashimoto Ryutaro (PM 1996-98, say nothing bad about the dead!) and Koizumi Junichiro (PM 2001-2006) would have been thoroughly surprised about being called a ´socialist´, though Ishihara Shintaro's comments about them were sometimes a close call .

Of course Hashimoto tried to create a new economic boom by deficit spending and crashed the budget during the late 90's but this has nothing to do with socialism. Japan had a comparably low level of state expenditure before the early 90's and this crazy ´ballooning debt´ strategy was certainly the wrong way, though calling this failure socialism is indeed disingenuous. (e.g. Singapore and Switzerland are very competitive, fairly liberal, absolutely non socialist economies alas with substantial levels of state expenditures (Singapore would show even higher figures if activities of GIC and Temasek had been accounted for!))

P.S.: Regarding your statement that China has yet many things to learn in management and technology from the West (and also Japan) you are certainly correct though this obvious fact to dispute was never my intention.

 

[tphuang]

Well I think you're both right. There's no contradiction here. Japan's "relative" decline was caused by China's rise and by financial market tactics of the US.

It is true that China still has a lot to learn. As a whole, Chinese industry and economy is relatively rudimentary and unsophisticated compared to the West. At the same time, the gap is very quickly narrowing, and I expect in 10 years the best businesses in China will no longer have anything to learn from the West. They will need to innovate on their own.

Japan's decline could've ended much earlier if it did not try to expand the size of the gov't, rescue all the banks, kept the interest rate next to nothing. All of which, the US gov't is doing right now.

Oh yeah, you can always learn from each other. There is nothing wrong with China learning from the West. I'm not talking about specific area of R&D, but general philosophy.

@tphuang:
"Wow, what a revelation. Going to socialism reduces a country's competitiveness. Thanks for your lesson."

I have to admit being somewhat confused about your thesis since I am not capable to comprehend how large scale deregulation, ´opening up´ of domestic markets and massive privatization of state assets (railways, postal service, insurance etc.) are related to any concept of ´Socialism´. Especially Hashimoto Ryutaro (PM 1996-98, say nothing bad about the dead!) and Koizumi Junichiro (PM 2001-2006) would have been thoroughly surprised about being called a ´socialist´, though Ishihara Shintaro's comments about them were sometimes a close call .

look at the Japanese society in the past 20 years, how they've created so many new social programs, expanded the size of the gov't, increasing tax burden and so on. That's what socialism is, spreading of wealth.

As for deregulation, deregulation on its own is moving toward capitalism, but deregulation + implied gov't protection is not moving toward capitalism.

Of course Hashimoto tried to create a new economic boom by deficit spending and crashed the budget during the late 90's but this has nothing to do with socialism. Japan had a comparably low level of state expenditure before the early 90's and this crazy ´ballooning debt´ strategy was certainly the wrong way, though calling this failure socialism is indeed disingenuous. (e.g. Singapore and Switzerland are very competitive, fairly liberal, absolutely non socialist economies alas with substantial levels of state expenditures (Singapore would show even higher figures if activities of GIC and Temasek had been accounted for!))

P.S.: Regarding your statement that China has yet many things to learn in management and technology from the West (and also Japan) you are certainly correct though this obvious fact to dispute was never my intention.

All the Asian countries that doing well including Singapore have comparatively speaking very capitalistic economies. Meaning, they have low corporate tax, low income tax, lower regulation standard, low capital gain tax.

Remember, there is a huge difference between social liberalism and fiscal liberalism.

Just for reference, the capital tax in different countries:
Hong Kong 16.5%
Singapore 17%
China 25%
South Korea 27.5%
Japan 42%

And then there is also income tax, the highest tax bracket in Singapore gets taxed 20%. Does that sound like a fiscally liberal system to you?

As for Switzerland, that's actually something people should watch out for. When the majority of their economy is based on the banking industry (UBS and Credit Suisse), they really have a lot to watch out for with how the market just collapsed. See what happened to Iceland, the same thing could happen to Switzerland.

 

[AssassinsMace]

Emissions in parts of China 'above rich nations'
Fri Sep 11, 10:49 am ET

BEIJING (AFP) – One of the world's top authorities on climate change warned on Friday that carbon emissions per person in parts of China were higher than in some developed countries.

Nicholas Stern, the British author of an acclaimed review on climate change, told students in Beijing's People's University that 13 Chinese provinces, regions and cities had higher per capita emissions than France. Six also overtook Britain.

"There are many parts of China where emissions intensity and emissions per capita are looking much like some of the richer countries in Europe," he said in a speech that laid out his predictions on global warming.

Stern warned that if the world continued to emit around the same levels of greenhouse gases every year, there was a 50 percent chance temperatures would rise more than five degrees Celsius (nine degrees Fahrenheit) within 100 years.

A rise of "five degrees Celsius has not been seen on this planet for 30 million years -- we as humans have been here for only 200,000 years," he said.

"This type of temperature change involves radical dislocation, it involves re-writing where people can live, it would involve the movement of hundreds of millions, probably billions, of people."

"This would result in extended, serious global conflict."

Stern's comments came ahead of a key summit in Copenhagen in December aimed at hammering out a new climate change pact to cut emissions.

China and other developing nations are opposed to any compulsory cuts in emissions, saying their per capita emissions are low and the responsibility for solving the problem rests with developed countries that have polluted longer.

Based on Stern's calculations, emissions per person worldwide would have to fall to two tonnes by 2050 to minimise the risk of a dangerous rise in temperature.

Currently, according to Stern, China emits six tonnes per person, the European Union emits an average of 12, and the United States 25.

Stern, a noted economist, said he was confident China would lead on climate change action.

"China will use its leadership... to explain to the developed world what their obligations are, and China will support developing countries as a whole," he said.


Copyright © 2009 Yahoo! Inc. All rights reserved.

Is this really new news? Oh, I get it... they're trying to cover-up the spin they've been hiding that China may pollute more in total but with the West's miniscule fraction of a population on this Earth, they still pollute many times more per person. And let's not forget the other spin where they also outsource their pollution to China to make their products. And also how when this financial crisis first began they were jumping for joy at the collapse of China's exports shutting down factories and reducing the amount of carbon coming from power plants which also means pollution figures are different and the US is most likely the number one polluter again.

 

[pla101prc]

yeah the article is utter bullshit, the west had their turn during induistrialization. China is called the world factory for a reason, its not only producing for itself.

 

[daveman]

People are still talking about global warming? Give it up already. There are other legitimate environmental concerns for China today, like water pollution and air pollution, but global warming is not one of them.

Let the West hang on to their evolutionary and environmental superstitions, they will be discredited soon, let China not inherit them as part of the transition.

 

[bladerunner]

There are other legitimate environmental concerns for China today, like water pollution and air pollution, but global warming is not one of them.

I would have to disagree, global warming could cause periods of severe flooding and water shortages as the higher snowline melts in Tibet. Much of China/Tibet is dependant on this water, and any drop off would be a major catastrophe.

 

[daveman]

Yawn.... except global warming is not real. Prove it if you're so inclined.

Global warming...will man's naivety never end?

 

[SampanViking]

With you on this one Daveman and that is without all the contradictory scare stories.

Even if AGW is eventually proven, the consequences for the watershed areas of Western China are increased Glacial Melt rates and (the bit the media ignores) significantly increased rainfall.

The Worst Case Scenario then for China would be the transformation of useless frozen water assets stuck half way up a mountain, into useful liquid water assets (easily Dammed) in the foothills and a higher precipitation throughput.

Not the kind of prospect to leave the Central planners with sleepless nights I think

 

[tphuang]

Yawn.... except global warming is not real. Prove it if you're so inclined.

Global warming...will man's naivety never end?

global warming could be caused by just natural change in temperature or human factors. The question is how much naturally and how much by human. It has certainly helped the "anti-global warming" group that there hasn't been any elevation in global temperature in the past 10 years, but that doesn't mean it's not going to happen in the long run.

there are obviously reasons why China's emission level is higher than France/UK in certain regions. Any time that you are the manufacturing center of the world, that would happen. Simply put, China contains more energy intensive industries than the rest of the world. But China obviously needs to find ways to impose higher emission standard for its industries so that they will produce less harmful substance. It's really for its good. If you ever lived in the more polluting areas in China, you'd see why it really needs it.