Tuesday, November 18, 2008
Via RealClear Politics comes an interesting New Republic article on the effects of the current financial crisis on China. Among them, the discontent I have noted before is spreading to the more affluent, urban areas.
Things could get very ugly there.
Beijing can afford a $580 billion stimulus package because it has nearly $2 trillion in reserves. But for all its cash, China's actions may not be enough. Aredux of Beijing's 1989 Tiananmen crackdown is not a good option: Two decades ago, the number of educated protestors was far smaller, and China had less interest in protecting its global reputation. At the same time, China has granted enough freedoms that average Chinese now demand wages, fair housing, and other rights. So, unless Beijing can get its economy going again, they are likely to face the first sustained wave of protests in decades. Thus far, China has kept the labor protests separate from one another, preventing them from developing a common theme or a common leader. But if China's downturn turns into an outright recession, the country could face its first serious threat to the regime. [link dropped, bold added]It's too bad for many reasons that, "this nominally communist country now [only] seems more capitalist than Wall Street"[bold added].
The people here have come to expect the fruits of capitalism (e.g., high wages and a good standard of living) while remaining ignorant of the nature of capitalism. True, they may blame the government when things turn sour, but this will likely be for the wrong reasons. Anyone who expects a government to be able to turn things around by any means other than simply protecting individual rights will be repeatedly disappointed.
A blind rebellion is unlikely to result in China ending up free. Worse, capitalism will get the blame for the uneven and unsustainable growth pattern that has resulted from foolhardy attempts at central planning on both sides of the Pacific.