Instant China Expert

Shanghai by Night

Alice and I just returned from three weeks in China, and as you might expect, I am now an expert in matters Chinese (at least as how China will impact the future).

The first point is that China is not going to risk or provoke war with the United States, for the simple reason that China has nothing to gain, and everything to lose. To paraphrase Kris Kristofferson, “Freedom (to take risks) is just another word for nothing left to lose.”

Where is my proof?

One word. Shanghai.

Our incredibly competent, hard working, and industrious (entertaining, too) tour director, Comrade David (a Party member), informed us that the city bird of Shanghai was the crane – the construction crane. In twenty years Shanghai went from a city with its tallest building 26 stories high, to a city with over a thousand buildings over 26 stories. Most of the building boom, which continues, occurred between 1995 and 2000, causing a world-wide shortage of construction cranes.

More proof needed? Beijing, Chongqing, Xi’an, Guilin, Hong Kong, Macao, and hundreds of places in between and around. Places I’ve heard of, more that I hadn’t, and a huge number that I still know nothing about, and all of them putting a “Chinese face on socialism.”

As Alice gently chided David, the Chinese socialist face looks decidedly capitalist.

David, his modest salary augmented by generous tips (which he richly deserves), smiled inscrutably.

The old state-owned businesses, many owned and operated by the People’s Liberation Army, have failed or are failing. Many Communist Party bosses are known more for ineptness and corruption than enlightened management. So who or what is responsible for China’s spectacular growth?

Quite simply, the Chinese people.

They have a remarkable capacity to work hard at difficult jobs. China’s rapidly growing per capita GDP of about $2,000 is still very low (in the bottom half) among world economies, but the private sector already produces 70% of the total and its share is steadily increasing.

Of course, Chinese growth is not occurring in an economic vacuum. Those high rises on the Shanghai waterfront house banks and businesses with familiar international names. The Chinese economic miracle is built on foreign investment, and exports to fill the West’s demands to consume prodigiously, but inexpensively.

The Chinese themselves are reluctant consumers, just as the Japanese were during their brief period of seeming economic invincibility. Chinese reluctance to spend is understandable. David grudgingly agreed with Alice that the United States fits the model of socialist welfare state much better than China. Chinese government pensions are and will continue to be nasty jokes on China’s elders that thought Communism would reward their sacrifices and provide for them in their Golden Years.

(Most of the old State-Owned Enterprises are operating at a loss, and can barely meet their obligations to pay current retirees. When inflation is added to the picture, the payments to current retirees are rendered meaningless.)

“From each according to his abilities, to each according to his needs.”

Right?

Old people have diminishing abilities coupled with increasing needs. So how does Communist China take care of them in their Golden Years? By passing a law that children must support their parents (and parents can sue if they don’t). Of course, prior to passage of this law, Communist leaders also passed a law that basically limits each couple to one child (with some exceptions, so don’t nit pick me). So now you have two elderly parents depending on one child (who, with a spouse, is also supporting themselves, a child, and the spouse’s elderly parents).

The typical Chinese young working couple is also paying into a pension fund, which is being eaten by inflation while being squandered though corruption and mismanagement.

No wonder all but the wealthiest Chinese save all they can, and why Chinese consumption alone can’t power economic growth until the Chinese can see that their savings and investments will secure their futures.

The Chinese will have Privatized Social Security long before we do, and for the right reasons – principally, economic necessity. And while they’re doing the thing right, our bankrupt Medicare system will be joined in a decade by our already actuarially bankrupt Social Security system, and ruinous tax increases, benefit cuts, financial means testing, and rationing of medical care will be required in a vain attempt to avert total government-funded retirement system failure.

However, the tax increases and benefit cuts necessary to attempt to salvage Social Security and Medicare will only kill our economy and make matters worse.

To bring it all down then, in three short weeks I learned that China is not a military threat, but thanks to the West is an economic juggernaut. I learned that China will not sacrifice the economic progress of its predominantly impoverished citizens on the altar of environmentalism – every place we went in China had air pollution worse than Los Angeles at its smoggiest.

Things I knew before the trip – China has Pandas, the United States has pandering politicians.

The Chinese are doing all they can to save their endangered Pandas.

Our industrious citizenry are continuing to create and grow our incredibly strong economy, but our politicians are not doing anything to prevent it inevitably drowning under a sea of unsustainable social welfare expenditures.

Long before natural global warming floods our coastal cities, we’ll drown under a sea of red ink.

When Al Gore was VP, he didn’t do anything to forestall future disasters, and he still isn’t.

The fact that he was an inept leader uniquely qualifies him, in the eyes of the Nobel Prize committee, for its Peace Prize.

Just as the Nobel previously saw fit to award the corruption of Yasser Arafat, and the ineptitude of Jimmy Carter.

In China, Chairman Mao is turning over in his mausoleum.

Chairman Mao: “If inept leadership is all it takes, I deserve one for the Cultural Revolution. One decade of Cultural Revolution set back Chinese industrialization two decades. Not even Jimmy Carter could screw things up that bad.

Kim Jong-Il deserves one.

Fidel deserves one too.

Jimmy Carter has the credibility in the inept leadership realm to write the nominating letters.”

Note to the Nobel Prize Committee. You should award Chairman Mao posthumously. He would graciously share it with Fidel and Kim Jong-Il.

Dead totalitarians are very accommodating.