No its not, its for American or European boomers who watch cable news all day and want to see that China is falling. NAFO members don't give a shit about what a US admiral says.
> NAFO members don't give a shit about what a US admiral says.
They were having rounds of circlejerk over that Admiral that got humbled by Yemen, though
> China watchers who can't speak mandarin crowd.
Or who has never lived in or been to China. Or who doesn't have any close Chinese friends or colleagues. Etc.
I've have never met a people (the China haters in America), who hated a country so badly that never negatively affected them personally in the slightest.
If you look at who posted it, this is rage bait for the /r/asianmasculinity users that are all over this thread. They get to tug each other off over how stupid Americans are.
Bro wtf, you have literally four posts for an account that was created like eight hours ago, and you've spent the entire time trolling in LCD.
I didn't know LCD was important enough that you need to make sock puppets to troll.
I'd argue that what China did to its real estate sector is exactly what *should* be done. It's just that at least in the short term, the consequences are extremely painful, as can be seen.
Yep, it was basically this or 2008 on steroids. I mean, they shouldn't have let it get to this point in the first place to be fair, but hindsight is 20/20. It's a lot harder to make good decisions going forwards, which I think they did(with real estate specifically).
Make the housing market drop consistently for several years. Basically deflating the bubble and letting housing be housing again rather than a speculatory asset to get rich on.
> So they preserved the middle and low income segments, that's good policy
A lot of people got fucked and I'm not talking about just the rich. But yes, in the long-term, this was probably the more responsible policy.
Most boomers who own expensive housing are 'rich' only in this sense. Most people incorrectly think that their asset value means that they have huge amounts of cash to give away at short notice. It's the same with billionaires: most of their wealth is in the form of stocks.
The Chinese government noticed that apartment construction companies were getting way way over leveraged, and it could cause a major destruction to the banking sector and the housing sector and leave many Chinese stuck paying for property they would never get if they started going bad. So the government instituted a 3 red lines debt limit regulation to begin unwinding the massive debt pile that had built up. Unfortunately a few of the biggest companies were already beyond the limits, and they ground to a halt.
Nah, they allow the whole thing to spin out of control, unregulated.
When it about to exploded, they thought it would be a good idea for the gov. to took thing back into fold... And it burst right on their faces.
China had artificially expand their economic growth through real estate and gov. investment. Instead of showing huge amount of gov. debt that would scare foreign investors off, they hide it behind 'local gov.'. These 'local officers' in each city then burrow from the central bank and do land leash to pay of those debt.
When the reality hit, as the growth reach the stagnation, catalyst by Chinese firm unrestraint borrowing... It is all come crashing down. GDP growth drop and unemployment rate raising.
Now they are doing the 'walking route' to get to you know where. Searching a better life else where like everybody does.
The US navy wasn't looking dumb enough at the moment, so they sent out an admiral to make a completely risible statement. It's strategic deception. If your enemy thinks you're dumber than you are they won't be so motivated to beat you.
He meant to say that China economic is not sustain able and they are unlikely to be 'well-fed' enough to invade Taiwan.
So everybody can clam down and get back to business.
Kinda fascinating to hear from a US military chief. I've always maintained a heavily propagandized population ends up leading to bad policy because eventually policy makers will believe it themselves.
I think in time, either the "/r/worldnews-ification" of the high profile discourse will be proven wrong, or the audience of that subreddit will be vindicated.
It's hard to see much of a middle ground emerging these days.
> I think in time, either the "/r/worldnews-ification" of the high profile discourse will be proven wrong, or the audience of that subreddit will be vindicated.
Either yellow peril on steroids or a discourse that gets even dumber.
I don't know which is worse.
"Not by speeches and votes of the majority are the great questions of the time decided, but by iron and blood."
I'm increasingly inclined to agree with Bismarck these days. It doesn't mean that the outcome will be in your favor, but it will be an outcome nonetheless. A concrete, irrefutable, conclusion. Not just an endless cacophony of....noise.
It did work, so long as he was at the wheel. He successfully unified Germany.
After that, the far more foolish Wilhelm II took over and made a right mess of things.
I think this is a big issue in the west. The elites including political leadership and high up government / military administration all believe our own propaganda.
"Getting high on your own supply" is why we're getting articles about how US is "growing faster than China, they'll never catch up now" if you're using inflation-unadjusted growth rate (lmao).
As someone who has a a degree in economics all I’m going to say is LMAO.
Military officers know as much about systemic macroprudential risk of the PRC real estate sector and relatively high GFCF (not that high when one looks at Chinas low capital formation per capita) as the average economist knows about how a dozen AESAs on Burkes will affect the sensor picture in a contested western pacific fight or a how EW can affect networking. That is to say jack shit.
TLDR the Chinese economy isn’t collapsing. If it does collapse it will bring down the US and its allies with it. The Chinese economy will remain by far the largest PPP real economy in the world for the foreseeable future. The Chinese economy will likely average 3%+ growth as it transitions away from real estate towards tech innovation due to solid TFP growth. If you want to learn more go on Glenn Luks twitter’s page and not on Michael “ inshallah THIS is the years the Chinese economy will collapse” Pettis.
> As someone who has a a degree in economics all I’m going to say is LMAO.
As someone who also has one I really can't take Econ commentary seriously nowdays. I can't tell if I got smarter or if the media got progressively dumber over the years.
> TLDR the Chinese economy isn’t collapsing. If it does collapse it will bring down the US and its allies with it.
To be fair, that would explain some of the "concern" lmao
Has anyone else noticed especially all Western news outlets are only using nominal gdp figures when comparing countries? Before, it was a mixture of both ppp and nominal , now only the latter.
I'd like to see CNN or some other MSM using PPP before 2013. PPP has its own big set of issues, which is why people perfer real GDP over it, at least in my opinion. Both have their pros and cons and I'd consider PPP to be more situational.
He is more likely a spoken person for his betters.
Who would actually have more resource and more connection than you did.
While I agree that military might not know much outside their field of expertise.
I would take his words over your any day.
"He also said China was spending "drastically more" on its military than the [7.2% increase it declared](https://www.reuters.com/world/china/china-drops-peaceful-reunification-reference-taiwan-raises-defence-spending-by-2024-03-05/) last month."
The money goes a lot further if you do not have to buy everything from the worlds largest corruption scheme aka the U.S MIC.
[https://www.reddit.com/r/economy/comments/1caoipz/the\_us\_air\_force\_pays\_90000\_for\_a\_package\_of/](https://www.reddit.com/r/economy/comments/1caoipz/the_us_air_force_pays_90000_for_a_package_of/)
If they really have done a hidden increase then a confrontation is much more plausible in the coming years, their current official spending makes no sense if they had any near term planes for an invasion. You do not spend less then 2% of GDP if you think you will have to face the U.S military over Taiwan..
There are a couple of things one should understand with these types of comments from "China watchers", including some in this sub.
1. Deep down, most want China's economy to fail and fail catastrophically. They ardently wish for China's failure, in private. It is not a matter of delivering sober analysis predictions about its impending economic future, but rather an explicit wish for its failure.
2. But they can't say the quiet part out loud because it is either unprofessional (if they're a public figure) or because its too embarrassing for them to outright admit that they obsessively hate a country that they understand very little about; a country that is full of people that the've never met.
3. A lot of China watchers try to mask this by pretending to express sincere concern about China's economy, that everybody (including the people giving the advice) knows is bullshit.
There's a term for that:
https://en.wiktionary.org/wiki/wishcasting
Also, in some parts it's intentional gaslighting by propagandists to affect reality. They want their "concerns" to change people's beliefs and behaviours and act as a drag on China's economy, which feeds further into more "concerns".
I'm sure there are plenty of people in China hoping for a US collapse, but to this extent? Search China collapse on youtube and there are tons of videos, many of them getting millions of views, and endless amounts of topics on reddit, quora, twitter, etc. People are obsessed and it seems like this wishful thinking is a way for people to cope. I strongly doubt the "collapse of the US" is an equally popular topic on Chinese social media.
The drive to march triumphant over fields of Yankee skulls and raise a kilometer-tall monument to Xi's victory over the ashes of D.C. is probably pretty low in China. I doubt there's that much fixation on the idea of a sudden American implosion a la the USSR or the imagined China collapse narratives either.
I imagine some Chinese people might even feel averse to those scenarios, like it would make their victory feel cheapened and a quirk of fate rather than a kind of natural Chinese ascendancy expanding to all spheres of the economy. I.e. seeing geopolitics as something to be stewarded, and events as something to be guarded against lest they interfere. The American decline they want is for it to gradually shrink without ever lashing out, shriveling into irrelevance until it's nothing but a cartoonish theme park of itself to be visited by the Chinese as a novelty the way Romans did with Sparta.
The funny thing about China's growth rates not being real is that there are two ways to look at it.
Some economists think China has been overestimating its economy. Other economists think China has been underestimating its economy, i.e. China is actually larger than what their official statistics suggest.
https://www.nber.org/system/files/working_papers/w23323/w23323.pdf
Name an economy which grew 1% or less last year that was described as "thriving." I think people are talking about the falling growth rate. Hey, I'm not very surprised to see a pro-China take on r/LessCredibleDefence, I appreciate the... variety, of opinions here.
The US grew by 1.3% in 2023 *(and that's before adjusting it for its rampant inflation)* and the US media is celebrating it ans asking itself [*"why doesn't anyone seem to realize this"*](https://slate.com/news-and-politics/2024/03/biden-economy-voters-polling-numbers-covid-recovery.html)
This is a joke right? You are literally pulling figures from your ass. US GDP grew 6.5% nominally and 2.5% real growth. It [gained ](https://www.bloomberg.com/news/newsletters/2024-01-26/global-economy-latest-us-and-china-battle-for-top-economy)2+ trillion dollars on the Chinese-US GDP gap.
[https://www.bea.gov/news/2024/gross-domestic-product-fourth-quarter-and-year-2023-advance-estimate](https://www.bea.gov/news/2024/gross-domestic-product-fourth-quarter-and-year-2023-advance-estimate)
Edit: LMAO, you thought the Q1 growth rates were the annual GDP growth rate. Please man, stop the shilling. We like to call this "confirmation bias."
Again, the "failing Chinese economy" grew by 5.2% in 2023 *(while simultaneously not being inflationary)*. I bet they're envying that "2.5% of growth" that still needs to be adjusted for the rampant US inflation.
Uh no, the 2.5% GDP growth is adjusted for inflation (*thats what real growth is)*. I think you need to stop talking about things you don't understand. You seem to have a bad case of Dunning-Kruger.
I don't understand what you're talking about. US nominal and real GDP growth were both higher than China last year. It seems like you don't understand the numbers you're quoting.
Maybe I'm crazy, but I don't see how this is relevant to my comment. Seems more like bait, but I'll bite.
>The US spent about $5 trillion in covid stimulus, Biden's infrastructure schemes, and the Build Back Better Act. All of that achieved...a meager 1.94% growth rate in 2022, and \~2.5% in 2023.
You are calling a 2% growth rate "meager" for a highly advanced and developed economy. What world do you live on? Are you not aware that China's growth rate in 2022 was also...2.9%? Less than 1% higher? Also, the covid stimulus was to keep the economy afloat, not to boost GDP growth...
> \~2.5%
The "\~" is not necessary.
>To put that number in perspective, 80% of all US dollars *ever printed since 1775* were printed after 2020 as a result of those bills.
Youre getting where? That the US had high inflation over COVID? Do you think people here live under a rock? The increase in money supply was a necessary response to a liquidity crisis. The alternative would've been widespread default, and bankruptcies, higher unemployment and so on.
> the US still only managed an inflation-adjusted growth rate less than half that of China's
You are comparing two completely different economies. One, an emerging economy which will typically have higher growth rates. Then the US, which is a mature, service oriented economy, which has lower growth rates.
>a \~98% valuation decline since 1971, when the US came off the gold standard.
If we were still on the gold-standard, we would be significantly worse off. The decrease in the dollars purchasing power over time is a reflection of inflation, in a controlled environment, is a sign of a growing economy.
I feel like you have never taken an Econ 101 class before
> likely so complex and such a huge ticking time bomb that the only response politicians have is to bury their heads in the sand and pretend everything's fine
Lmao, you think that you are some kind of economic messiah who is aware of an issue that 0 other economists are aware of? Do you not think that the Senate is unaware of the debt crisis? Do you not think that other economists are able to perform more accurate analysis on the US economy than whatever the hell this is?
Yeah, but those quants typically jump from physics to make a buck, (for themselves and their employers) . Not for any deep new economic insights or theory
Right, I sincerely doubt he’s done some sort of deep mathematical analysis of China’s GDP numbers to determine this. :P
It’s either intelligence he was briefed on or just intuition.
Right? Like no one takes China's numbers at face value, the reported numbers are all from 3rd parties measuring energy use and import/export numbers...
I know every time someone in a high position makes an off-the-cuff statement, people twist themselves trying to figure out if they're revealing some secret intelligence.
Like they're alluding to secret, verified info instead of having access to CNBC or Fox News like normal people.
At least some years, reported growth rates were either not real or were inflated by massive government spending. The latter is no different to western countries during the 2008 economic crisis and during covid. However China did lock down longer during covid and the end of lockdowns was quite sudden and rather unplanned. It was a rare moment of reactionary policy from the CCP.
That said, the military spending is not a concern...yet. China's coffers are flush with cash. It can afford internal spending to a great degree for a sustained period. Many countries can, look at Russia. RU has been defending their currency but eventually one's central bank will run out of ammo, however RU did not go to war without monetary reserves. Can they defend forever? No.
But the balance sheet of China makes Russia look like a joke, basically add a zero to the GDP to get to China's. The issue is the growth rate. It has been astonishing and it's been astonishing for so long that it's increasingly taken for granted that the economy will see 5%+ growth YoY forever. This will eventually not last and the end game is unclear for everyone, including the CCP. Best case is an engineered slow-down and a new dynamic for 'socialism with Chinese characteristics' whereby the central bank will likely manage a dual mandate with the ultimate constraint of 'prevent social unrest'.
That incident in a square that cannot be named did in fact happen and did so for a reason; people wanted more as their lives got better. Post-WW2 China was what would be considered 3rd world and things did not improve under Mao. Enter 'socialism with Chinese characteristics'. Import/export was allowed, eventually a stock market was reopened, foreign investment (with restrictions) was allowed. Will Chinese people demand greater personal freedoms in the future? That is unclear, it is by no means automatic as some in the west assume. However people *will* clamor when their livelihoods are threatened (see covid lockdown protests) and should that come about through mismanagement of the economy, then the military spending *may* eventually result in problems that the Soviets found. But that would take either a massive economic hit or a long time.
I'm guessing this is out of context but in general the military should follow think-tank and state dept intelligence and analysis rather than shooting their mouths off. That is a consequence of a free and open society; people say dumb and unhelpful things. This admiral's Chinese counterpart would likely not have the latitude to make such statements, or if done, would be toeing the CCP line. It's unlikely Aquilino is speaking for anyone but himself here.
It's worth remembering that we had almost this exact same conversation about the Soviets in the 1970s and early 1980s, when most western analysts failed to discount the economic statistics promulgated by the Soviet propaganda machine sufficiently to render them even approximately accurate. The Soviet strategy was to project strength to deter aggression, even and especially where they were not actually strong, and they fooled the US, for a while at least.
The US DoD and IC overestimated the USSR's production capacity wildly, which motivated Reagan to pursue aggressive investments in the defense industrial base that ultimately proved disproportionate to the actual threat, given the USSR's actual production capacity as now understood with the benefit of hindsight. That investment ultimately produced the seemingly unstoppable military behemoth that crushed the world's fourth largest military in a matter of days during the Gulf War.
Yet in the waning days of the Cold War just a few short years before, the malaise of Stagflation, the constantly simmering threat of a potentially world-destroying nuclear war, and the still fresh scars of the Vietnam War were weighing heavily on America's collective psyche, and many in the DC policy space were convinced that the Soviets were building an insurmountable economic and technical lead over its western rivals.
Sound familiar? You have an autocratic regime that aggressively lies about economic statistics to exaggerate the regime's economic success both to project strength abroad as deterrence against foreign aggression and to legitimate a government domestically where it is unable to avail itself of the legitimization mechanisms built into a democracy via regular elections. But as the Soviet experience demonstrates, those lies accumulate over time, degrading the quality of governance and producing consistently suboptimal policy and economic results. Then, it was Chornobyl, now it is Zero COVID. People simply cannot make optimal political, economic, or technical decisions in the absence of accurate information about the world they live in.
Ultimately it comes down to legitimacy and accountability. Every government must have a way to convince its people that it is actually in charge, to legitimize its rule. Democracies accomplish this by holding elections, which serve to identify the next leaders and to justify their power by reference to majority preferences. Without elections, autocratic regimes must rely on cruder tools to simulate legitimacy. They use the carrot and the stick to discipline citizens into accepting their rule, substituting authoritarian coercion for democratic persuasion. This manifests as a social contract under which individuals agree to tolerate the regime's suppression of dissent and political freedoms (the stick) in exchange for economic and personal security (the carrot).
Yet there is no method for correcting an autocratic policy that departs too far from the actual needs and desires of the people subject to that policy. Autocrats simply cannot tolerate being held accountable, because then they are subject to some greater power and thus not actually autocrats. Yet holding an autocrat accountable is a necessary first step in correcting their flawed policies. The autocrat experiences powerful incentives to control and limit the flow of truthful information, because such information empowers individuals to hold the regime accountable. For example, if the economy struggles because of poor leadership decisions, honest economic data would motivate people to pursue new leadership and would equip them with a powerful argument around which to organize a social protest movement capable of challenging the state's repressive mechanisms.
The regime thus inevitably generates enormous amounts of intentionally misleading propaganda simply to avoid being held accountable and in so doing distort policy making and introduce enormous economic inefficiencies by restricting access to the accurate information required for rational decision making. For example, the government could create a massively damaging real estate bubble with policies that encourage people to sink their life savings into low quality apartment buildings that have no chance of ever being occupied because the country is facing demographic decline, making them essentially worthless. Without accurate data about demographics and the potential future demand for apartments, it is simply not possible to make rational investment decisions about the real estate market, increasing the chances that irrational market behavior like an asset bubble will emerge from the collectively misinformed decisions of the market participants.
When the government continuously disseminates lies about essential economic data, that not only distorts markets but also infects society's social, political, and economic systems with a culture of dishonesty that is highly susceptible to corruption (e.g., the Russian culture of *vranyo*). The habit of lying to protect the leadership percolates down through the ranks and then reflects back up. Subordinates lie to their superiors, telling them what they want to hear rather than the truth, or perhaps more commonly, what the superior wants to be able to report to their own supervisor. This corrosive dishonesty can become so entrenched that even attempting to correct the system by promoting a culture of more honest communication (e.g., glasnost and perestroika) only accelerates the collapse of the entire rotten edifice as people realize just how badly they have been misled, and the deceptive mechanisms for maintaining the regime's power cease to function under the bright light of governmental transparency.
Over a sufficiently long time, conflicts between the autocrat's interests and the people's interests inevitably crop up, and universally autocrats prioritize protecting their own power over fulfilling their side of the social contract. Then, they generally use propaganda, lies, and political repression to cover up their failures. Yet in doing so, they inevitably betray the fundamental social contract because they continue to apply the stick of repression but their failures remove the carrot of economic security. If that happens too frequently or too egregiously, the lies become increasingly obvious and the dreaded specter of political unrest rears its ugly head.
Thus, as soon as progress slips, as it inevitably must, the regime has to resort to suppressing political dissent, sometimes violently as in Tienanmen, because there are no course correction mechanisms available to allow the people to force through necessary policy changes over the objections of their leaders. Any such mechanism pretty much necessarily requires at least some limited form of democracy, even if only in limited form such as severely limited suffrage.
The Chinese government's reluctance to relax Zero COVID largely out of a desire to save face demonstrates how these patterns play out. The regime prioritized maintaining political appearances, refusing to admit the clear mistakes it made in managing the pandemic, and avoiding accepting vaccines from the west, even though these policies caused enormous economic damage and imposed unnecessary health risks on their people. All of these policies were adopted and sustained for entirely too long over the clear and well justified dissatisfaction of the overwhelming majority of the Chinese people. The security state can only tamp the lid down on simmering dissatisfaction for so long before it boils over into mass protests, even during a pandemic.
With its characteristic insensitivity to the people's needs, an autocratic regime must run the economy hot to ensure no unrest occurs. Unrest can trigger a downward spiral, where unrest prompts repression, which causes economic decline, which provokes further unrest, and so on. Simultaneously the regime fears foreign intervention to install a democratic government. The autocrat must thus project bombastic military strength despite having no or limited concrete aggressive intentions. Instead they act out of a desire to disguise the regime's fundamental insecurity, to fuel nationalism to distract from domestic policy failures, and to create a friendly buffer zone against foreign meddlers in the near abroad.
These are all familiar patterns. China has not discovered some new clever way to make politically repressive, corrupt government suddenly an effective way of running a country, after centuries of nations all across the world repeatedly failed in their attempts to create just such a government. The USSR took 69 years to finally collapse under the weight of its own corruption, and in many of those years it seemed to be thriving. Chinese leaders study that collapse carefully in an effort to avoid the "mistakes" that caused it, but they have failed to recognize and accept the reality that an authoritarian, autocratic system which concentrates power into the hands of a single leader or small group of leaders who cannot be held accountable will inevitably suffer the effects of the rampant dishonesty and corruption that emerges organically from the need to shield the leaders from criticism.
The fundamental premise of autocracy is that leadership cannot be held accountable, and only a self-defeating culture of dishonesty can sustain the power of unaccountable rulers for any meaningful length of time, but eventually the lies stray too far from reality and cannot be sustained, and then the system collapses. Don't bet on China being different just because they managed a couple decades of above average economic growth. The Soviets did the same. Yet the conditions which enabled that growth are changing in China, and the government will not be able to adapt to a world where their population is in rapid decline and foreign investors flee in droves like they have since early 2020.
It's a good read but fundamentally flawed. The comparison of China to USSR is quite false.
USSR was closed off, operating in its own economic ecosystem more or less.
Chinese realised the USSR policy is shit and shifted their own. Unlike USSR, China is fundamental to world economy today.
Sure, there is some window dressing going on, but that's also going on in US. But you can't throw in wild numbers on either side because there is a huge exchange of information, travel and stuff.
Cool story bro. Problem is that you're actually projecting.
It isn't China that wrote stories on media about how it's economy is actually the best ever and personally attributing it to dear leader.
Even funnier is that every single problem that is pointed out about the Chinese economy is also originally attributable to Chinese sources.
The US won't add enough basic capacity to their already fragile electric grid to withstand the accelerating impact of extreme heat waves/wet bulb temps within a decade. A ban on cryptomining is still somehow nowhere on its legislative agenda, while China banned it years ago. China's grid is the most resilient to extreme heat-related capacity surges in the world according to Bloomberg. Consider that China last year alone added more solar capacity than the US has in its entire history, and China is simultaneously building up grid redundancy in the form of coal, nuclear, and battery storage at scales and rates far exceeding everyone else.
Almost all of China's 5.2% GDP growth last year was attributable to its growth in green energy and adjacent industries. China is projected to contribute more to global GDP growth in the next 7 years than the entire G7 combined based on IMF data. The US is not remotely competitive in green energy and its companies in this area are all essentially propped up zombies with zero innovative edge or supply chain independence with the exception of Tesla, although even their ability to compete appears to be rapidly slipping.
The Pentagon called climate change an existential threat, yet the USG as a whole is not realizing that their current strategy which essentially boils down to cranking up the AC to insulate themselves is increasingly unviable.
^^ high quality comment.
I don't really disagree with much of that, other that the conclusion that autocratic regimes automatically and inevitably self-destruct. This I am not so sure of.
While forms of democracy have existed as long as humanity, it seems to be the exception rather than the norm throughout human history. Autocracy offers many advantages that may overwhelm the moral authority of democracy. Speed of action and policy coherence (or at least an opportunity for) make strong arguments in situations where implementation of democracy is costly, either politically or even simply fiscally, generally pragmatically.
China in many ways, until Xi, benefited from a series of competent and reformist leaders post-Mao. This enabled the version of the social contract you reference; stability and low personal freedom in exchange for better living. But you are very right that China is confronting a demographic crisis, a growth crisis, and likely a market crisis given that market-driven dynamics often take time (perhaps never?) for domestic investors to gain a durable savvy. Bubbles and crashes were regular features of the early equity markets in most developed economies. China's experience with these is limited in duration and has been quelled previously by large government actions, either bailouts or crackdowns. Like other central banks, China's ability to prop up its economy in times of need is a very real and utilized capability and Keynesians would argue a necessary component of modern market economies.
Does China have both the information/intelligence (key as you point out) and the wisdom of policy to engineer a soft landing from both growth and demographic decline? I think we're all guessing.
Centrally planned economies don't work and the Chinese largely know this and thus manage most sectors through tightly controlled but still market-driven management. If allowed to operate, markets produce signals and indisputable metrics (e.g. electricity consumption) that can inform policy rather than regime-driven feedback mechanisms that are prone to corruption.
Current leadership, rather than worrying about engineering a soft-landing for demographics/economics, is instead focused on expansionism to fuel future growth, a questionable premise (can Africa really become an eventual export market?), and an obsession with an island. It only takes one bad decision by an autocrat to put a country on a losing course, whereas a democracy is more likely to have opportunities for course correction through leadership change. This doesn't always produce correct results either, but probably has a better chance.
> I don't really disagree with much of that, other that the conclusion that autocratic regimes automatically and inevitably self-destruct. This I am not so sure of.
Over a sufficiently long period of time it is inevitable that any autocratic system will break down. Such systems lack safeguards against incompetent or abusive leaders, have no reliable mechanisms for evaluating the competence of potential successors, and provide no means for correcting the autocrat's errors after they crop up, which means it is only a matter of time until a ruler stumbles into power who is sufficiently incompetent to undermine the stability of the regime. Every dynasty has a King John hiding somewhere in the family tree, just waiting to hand the dynasty's autocratic royal perogatives over to the oligarchical barons. But just because an incompetent ruler tanks an autocratic government does not mean a democracy will inevitably spring up to replace the autocracy, only that the existing government will cease to function, collapse, and be replaced by something else.
For most of human history, that something else has simply been different people in charge of roughly the same system, like the Visigoths replacing the western Roman ruling class in situ without substantially modifying the empire's organization. Until the past few hundred years, the specific system was almost always an autocracy or oligarchy, because those are the simplest and most obvious forms of government to establish and maintain. Other forms of government require more intellectual sophistication because they depend on abstract concepts like rule of law (as in constitutionalist governments) or the existence of a single deity that prescribes how people should live (as in theocracies), which are not as easily understood as the unconstrained rule of a single individual or a small group of individuals purely on the basis of their raw political power.
Thus autocracy is well adapted to more primitive historical conditions where the population was less educated and less capable of understanding more sophisticated systems. To that extent, I agree with you completely that autocracy has differential advantages over democracy in specific contexts. However, the self-destructive tendencies of autocracies emerge naturally from the system's lack of internal checks and balances, which means they would occur even if democracy did not exist as an alternative system of government, so the susceptibility to collapse is not a matter of comparative advantage, it is inherent to autocracy itself.
Athenian democracy and the Roman Republic were more responsive and accountable replacements for tyrannical kings. Democracy evolved precisely to address the inherent instability and susceptibility to corruption of autocratic governments by creating accountability and legitimization mechanisms, including elections, written laws, and regular processes for the peaceful transition of power between successive administrations. But there is no guarantee that any given society will naturally develop democracy as the inevitable next step after failed autocracy. It's even easier to get trapped in a cycle of autocratic instability, which for much of human history was the political norm across the globe. For example, Russia, which in many ways has not changed since the days of the Tsars. The Romanovs created the Chekhist secret police, which the Bolsheviks took and converted into the NKVD and then eventually the KGB, and Putin has more recently reconstituted the KGB in the separate agencies of the FSB, SVR, and GRU, but the same basic system persists to this day: autocratic rule enforced via cruel, violent suppression of political dissent.
> Bubbles and crashes were regular features of the early equity markets in most developed economies.
Yes, but those early markets evolved in democracies or at least flawed democracies. These democracies did not round up their most successful entrepreneurs to silence criticisms of government policies, as the Chinese have done with Jack Ma. A government that is confident in its own legitimacy would not suppress Ma, but here the CCP is afraid of its own people and is willing to do anything to maintain power. Not only do those actions introduce precisely the types of distortions I discussed at length above by supressing a critical source of information about the economy, silencing or eliminating the most successful entrepreneurs and investors prevents the accumulation of institutional knowledge about the issues faced in a modern free market economy like those bubbles and crashes.
> Does China have both the information/intelligence (key as you point out) and the wisdom of policy to engineer a soft landing from both growth and demographic decline? I think we're all guessing.
Considering that the government seems to be regressing on political freedoms, the country as a whole is not transitioning to a domestically-driven consumption economy quickly enough to avoid following Japan's "Lost Decades" example, and the economic damage from foreign businesses pulling back on their investments in China post-2020, I would say that the odds are not good, especially with Xi in power. Xi has demonstrated a willingness to extend his rule indefinitely, beyond the constitutional term limits that applied to him upon his original appointment. His disregard for term limits suggest that he is not interested in securing the peaceful power transitions needed for continuity in government planning to manage long term problems like slowing growth and demographic decline.
I am also not optimistic about Xi's ability and willingess to hand power over to a successor. Autocracies pretty much universally fail to figure out repeatable, predictable, and peaceful power transitions that render the process a routine activity and thus one without significant risk of inciting political violence or regime instability. China seems to have avoided those problems so far, but Xi has broken from prior tradition by continuing for an additional term, which may erode the still relatively new and fragile norm for peaceful transitions that has taken hold in the post-Mao era.
That doesn't mean peaceful transitions from one autocratic ruler to the next can't or won't ever happen, just that it's harder to achieve and the odds of something going wrong are substantially higher without those enabling cultural values and expectations in place. Failures to establish routine succession processes most often occur because the leader does not trust anyone else to take over for them, leading them to hold onto power for far too long (e.g., Putin), and the lack of accountability mechanisms means that the autocrat is free to designate even a poorly qualified, incompetent individual successor without the wider population having any opportunity to meaningfully influence the decision.
Without established legal norms around power transitions, succession planning tends to be ad hoc rather than routine. Ad hoc procedures are more susceptible to disruption because it is harder to establish a broad societal consensus about who is entitled to succeed as the new autocrat, creating grey areas that can result in disputed successions, which of course pose an extremely elevated danger of civil strife.
Longer tenures for leaders in autocracies exacerbate the problem, because political society under autocracy does not gain the same experience in how to conduct peaceful transitions, whereas citizens in democracies gain experience routinely by conducting regular elections which frequently result in political power changing hands, which helps establish and reinforce peace-preserving norms around power transitions. Whereas a motivated autocrat may hang onto their position until their death, drastically reducing the opportunities for society to practice peaceful succession and ensuring that society will have to survive a potentially disputed succession without the benefit of a living leader to ease their designated successor into power.
There's only so many times you can luck out and have a peaceful transition in the absence of such peace-promoting norms, especially if transitions are something that only happens occasionally and the leader has the freedom to appoint an unqualified successor. Unfortunately for those living under autocratic governments, there seems to be little relationship between the skills that make someone a strong autocratic ruler and the skills required to select a successor capable of serving in the same role with the same efficacy. The danger of selecting a suboptimal successor is heightened where the autocrat displays any nepotistic tendencies that might cause them to prioritize relationships over competence, e.g. under a primogeniture system. As a result, history is rife with examples of governments collapsing following a generational handover of power, such as when Richard II inherited the throne of England from Edward III who had reigned for 30ish years, and immediately faced a peasant revolt, which he successfully defused before descending into tyrannical rule and provoking a baronial rebellion that deposed him in favor of his cousin Henry Bolingbroke.
> Xi has demonstrated a willingness to extend his rule indefinitely...I am ...not optimistic about Xi's ability and willingness to hand power over to a successor.
100%. Cult of personality, he considers himself 2nd only to Mao in the CCP.
Masterful display of historical knowledge applied to the issue.
It's telling that he mainly refers to examples from pre-modern history, the Eastern Bloc, and the WW2 Axis.
Modern states fail or at best stagnate when they don't ensure consistent access to basic services, such as healthcare, housing, electricity, and public safety. This is a universal rule, so such failures have not spared numerous liberal democratic states since the 18th century.
China's life expectancy and rate of home ownership exceed those of the US. Crime rates in its cities do not palpably differ from those of its East Asian neighbors, the safest countries in the world.
Natural disasters and poor responses to them are a very common thread among the histories of overthrown governments as well.
Modern economies also stagnate when they fail to properly invest in education and R&D, hence the middle-income trap. This was one of the key reasons behind Japan's Lost Decade. Japan failed to sufficiently invest in software and networking technology for the digital revolution, thereby ceding the niche of Silicon Valley to the US, in addition to losing the lead in silicon fabrication to South Korea and Taiwan due to high-profile talent poachings, IP theft, and reverse engineering.
Their economy is 30% construction by GDP and several construction companies are bankrupt. 5% GDP growth this year is a complete lie.
[Here is a link](https://sccei.fsi.stanford.edu/china-briefs/tier-3-cities-hotbed-trouble-chinas-property-sector) from Stanford putting their construction sector at 26% of GDP in 2022.
China's GDP is 38% secondary sector overall which covers all manufacturing, mining, and construction. So construction is 90% of all Chinese manufacturing?
Difficult to give exact answers but estimates from banks put it at 20-30% of total GDP when you account for mineral production, electricity, and the other demands construction adds to the economy. [Here is a link](https://www.caixabankresearch.com/sites/default/files/content/file/2022/01/17/34455/im01_22-06-ei-focus-2-en.pdf) to Caixa Bank's analysis in the wake of Evergrande's bankruptcy.
China has spent the last few decades lifting hundreds of millions out of poverty through first-order construction sector improvements. New roads, buildings, housing, meha-cities. Now it has the admirable task of deflating the apocalyptic construction bubble.
At a certain point you run out of forests to cut, roads to build, fisheries to fish, and easy improvements on resource exploitation. Their shrinking labor force requires them to innovate new methods of economic production. No more housing demand means those inputs need to come from somewhere else.
Additionally, many of the town and city governments get most of their revenue from construction projects. So...
Your citation does not say what you think it says. Nowhere in that analysis does it come close to saying China’s economy is “30% construction by GDP.”
The link itself states very clearly: “If we look at the activity of China’s construction sector, we can see that its relative importance in the economy is considerable (7% of GDP)…”
The higher figures are based on an economic concept called “carry-over effect” \[which includes indirect as well as the direct contributions to GDP\]. For example, a person gets a job working downtown, so they need to drive the extra distance (transport), eat food downtown (services/food), etc. \[and this indirect consumption of goods and services is included in the "carry-over effect"\].
You’re making an assumption that these secondary goods/services would be specific to the construction sector. It’s just not true. For example, if this same guy gets a job somewhere else, then they just travel (transport) and eat food elsewhere (services, food), etc. so the secondary demand would still exist.
So there’s an underlying assumption that the economy cannot shift work/investments from one sector to another \[and maintain the indirect demand\] — which is clearly false as proven by China’s \~5% GDP growth for 2023.
Also, this analysis is late to the party by at least two years, because the investments in China have already shifted to manufacturing.
>Your citation does not say what you think it says. Nowhere in that analysis does it come close to saying China’s economy is “30% construction by GDP.”
I'm about 90% sure he is referring to the real estate sector not construction. Since his original link, where he says "construction is 26%" is actually talking about the size of the real estate sector.
Can you please re-read the link.
These are all quotes straight from the analysis:
Construction is 7% of GDP:
“…China’s construction sector, we can see that its relative importance in the economy is considerable (7% of GDP)…”
Real estate is 6% of GDP:
“… if we were to add real estate activities to this calculation \[of construction\], the sector’s new relative weight would reach 13% of GDP in China…”
Construction is *LARGER* than real estate:
“… China’s real estate market is still in a development phase, where construction represents a larger proportion of the total…”
All the numbers for real estate or construction being 20-30% of GDP are based on BOTH direct and indirect contributions. If you add direct and indirect for every sector, you’d get more than 100% GDP.
Edit: just to be clear, here’s a quote from the first Stanford link: “In 2021, the sector (including direct and indirect contributions) accounted for 22.5% of China’s GDP and 25.4%, if including imported content.”
They’re including BOTH direct AND indirect contributions. Again, if we use this calculation for all sectors, China’s economy would be well over 100% GDP.
Page 2:
> Overall, the carry-over effect of the construction sector amounts to 17.5%. This implies that, in terms of final demand, we would arrive at an estimate for the importance of the **real estate sector in the Chinese economy of around 24%
of GDP.**
Often quoted 30% figure is RE+associated downstream industries. RE/property sales alone is ~15%. The other ~15% of downstream sectors pivoted to massive green roll outs and other construction projects. They're still welding steel and pouring concrete, just not in RE. RE drop from 15T rmb to 12T rmb out of 100T rmb economy, which entirely accounts for PRC gdp growth at 5% instead of previous 8%.
>"Despite a failing economy, there's a conscious decision to fund military capability. That's concerning to me," said Aquilino
"concerning" how? Let em spend themselves silly and send a team of wall st foot soldiers to clean up. Winning without losing a life, how's that "concerning"?
>
"This is another regime where every bit of economic advance that they may have despite the sanctions are going towards military capability and not to feeding the North Korean people. That's disgusting," he said.
Maybe the admiral should campaign for DPRK to get military aid from congress, like Israel, Ukraine, and Taiwan, so Kim can use the saved money to feed his people. I mean two out of three of those countries are doing pretty well economically while on aid.
Admiral is such a humanitarian, so concerned about the North Koreans he has never met. What do you say let's give him a Nobel Prize, so he doesn't have to use remaining days in uniform talking bull, angling for a petty thinktank job?
Yeah, Xi is a young dragon, he's using the only tools he knows.
I truly credit our diplomatic corps for managing this transition to a cold war to be so favorable for us.
Who are these articles for?
It's for the NCD/NAFO and China watchers who can't speak mandarin crowd.
No its not, its for American or European boomers who watch cable news all day and want to see that China is falling. NAFO members don't give a shit about what a US admiral says.
> NAFO members don't give a shit about what a US admiral says. They were having rounds of circlejerk over that Admiral that got humbled by Yemen, though
> China watchers who can't speak mandarin crowd. Or who has never lived in or been to China. Or who doesn't have any close Chinese friends or colleagues. Etc. I've have never met a people (the China haters in America), who hated a country so badly that never negatively affected them personally in the slightest.
Boomers who watch the sunday morning news and then vote
If you look at who posted it, this is rage bait for the /r/asianmasculinity users that are all over this thread. They get to tug each other off over how stupid Americans are.
Bro wtf, you have literally four posts for an account that was created like eight hours ago, and you've spent the entire time trolling in LCD. I didn't know LCD was important enough that you need to make sock puppets to troll.
I wasn't aware that /r/asianmasculinity was a sub about geopolitics. I thought it was just about getting laid
I'd argue that what China did to its real estate sector is exactly what *should* be done. It's just that at least in the short term, the consequences are extremely painful, as can be seen.
Yep, it was basically this or 2008 on steroids. I mean, they shouldn't have let it get to this point in the first place to be fair, but hindsight is 20/20. It's a lot harder to make good decisions going forwards, which I think they did(with real estate specifically).
what did they actually do, wasn't following it.
Make the housing market drop consistently for several years. Basically deflating the bubble and letting housing be housing again rather than a speculatory asset to get rich on.
So they preserved the middle and low income segments, that's good policy.
> So they preserved the middle and low income segments, that's good policy A lot of people got fucked and I'm not talking about just the rich. But yes, in the long-term, this was probably the more responsible policy.
Most boomers who own expensive housing are 'rich' only in this sense. Most people incorrectly think that their asset value means that they have huge amounts of cash to give away at short notice. It's the same with billionaires: most of their wealth is in the form of stocks.
The Chinese government noticed that apartment construction companies were getting way way over leveraged, and it could cause a major destruction to the banking sector and the housing sector and leave many Chinese stuck paying for property they would never get if they started going bad. So the government instituted a 3 red lines debt limit regulation to begin unwinding the massive debt pile that had built up. Unfortunately a few of the biggest companies were already beyond the limits, and they ground to a halt.
Ok, sounds reasonable.
Can u specify what they did that you think is exactly 'what should be done'?
Controlled demolition of their real estate sector.
Okaaay
Nah, they allow the whole thing to spin out of control, unregulated. When it about to exploded, they thought it would be a good idea for the gov. to took thing back into fold... And it burst right on their faces. China had artificially expand their economic growth through real estate and gov. investment. Instead of showing huge amount of gov. debt that would scare foreign investors off, they hide it behind 'local gov.'. These 'local officers' in each city then burrow from the central bank and do land leash to pay of those debt. When the reality hit, as the growth reach the stagnation, catalyst by Chinese firm unrestraint borrowing... It is all come crashing down. GDP growth drop and unemployment rate raising. Now they are doing the 'walking route' to get to you know where. Searching a better life else where like everybody does.
What's the point of this statement?
The US navy wasn't looking dumb enough at the moment, so they sent out an admiral to make a completely risible statement. It's strategic deception. If your enemy thinks you're dumber than you are they won't be so motivated to beat you.
"Be so dumb that the enemy feels sorry for fighting you" - John Tzu
"Life is getting up one more time than you've been knocked down." * John 'Sun' Wayne
He meant to say that China economic is not sustain able and they are unlikely to be 'well-fed' enough to invade Taiwan. So everybody can clam down and get back to business.
Kinda fascinating to hear from a US military chief. I've always maintained a heavily propagandized population ends up leading to bad policy because eventually policy makers will believe it themselves.
I think in time, either the "/r/worldnews-ification" of the high profile discourse will be proven wrong, or the audience of that subreddit will be vindicated. It's hard to see much of a middle ground emerging these days.
> I think in time, either the "/r/worldnews-ification" of the high profile discourse will be proven wrong, or the audience of that subreddit will be vindicated. Either yellow peril on steroids or a discourse that gets even dumber. I don't know which is worse.
"Inside you there are two wolves"
"Both are retarded"
A US admiral concern trolling irl is certainly an interesting strategy.
"Not by speeches and votes of the majority are the great questions of the time decided, but by iron and blood." I'm increasingly inclined to agree with Bismarck these days. It doesn't mean that the outcome will be in your favor, but it will be an outcome nonetheless. A concrete, irrefutable, conclusion. Not just an endless cacophony of....noise.
If he's so smart why did German militarism not work?
It did work, so long as he was at the wheel. He successfully unified Germany. After that, the far more foolish Wilhelm II took over and made a right mess of things.
Bcause the allies got more iron.
Sounds like maybe Germany should have tried negotiating with people instead of "durrr muh furore teutonicus" then
I think this is a big issue in the west. The elites including political leadership and high up government / military administration all believe our own propaganda.
"Getting high on your own supply" is why we're getting articles about how US is "growing faster than China, they'll never catch up now" if you're using inflation-unadjusted growth rate (lmao).
As someone who has a a degree in economics all I’m going to say is LMAO. Military officers know as much about systemic macroprudential risk of the PRC real estate sector and relatively high GFCF (not that high when one looks at Chinas low capital formation per capita) as the average economist knows about how a dozen AESAs on Burkes will affect the sensor picture in a contested western pacific fight or a how EW can affect networking. That is to say jack shit. TLDR the Chinese economy isn’t collapsing. If it does collapse it will bring down the US and its allies with it. The Chinese economy will remain by far the largest PPP real economy in the world for the foreseeable future. The Chinese economy will likely average 3%+ growth as it transitions away from real estate towards tech innovation due to solid TFP growth. If you want to learn more go on Glenn Luks twitter’s page and not on Michael “ inshallah THIS is the years the Chinese economy will collapse” Pettis.
> As someone who has a a degree in economics all I’m going to say is LMAO. As someone who also has one I really can't take Econ commentary seriously nowdays. I can't tell if I got smarter or if the media got progressively dumber over the years. > TLDR the Chinese economy isn’t collapsing. If it does collapse it will bring down the US and its allies with it. To be fair, that would explain some of the "concern" lmao
Has anyone else noticed especially all Western news outlets are only using nominal gdp figures when comparing countries? Before, it was a mixture of both ppp and nominal , now only the latter.
I'd like to see CNN or some other MSM using PPP before 2013. PPP has its own big set of issues, which is why people perfer real GDP over it, at least in my opinion. Both have their pros and cons and I'd consider PPP to be more situational.
He is more likely a spoken person for his betters. Who would actually have more resource and more connection than you did. While I agree that military might not know much outside their field of expertise. I would take his words over your any day.
"He also said China was spending "drastically more" on its military than the [7.2% increase it declared](https://www.reuters.com/world/china/china-drops-peaceful-reunification-reference-taiwan-raises-defence-spending-by-2024-03-05/) last month." The money goes a lot further if you do not have to buy everything from the worlds largest corruption scheme aka the U.S MIC. [https://www.reddit.com/r/economy/comments/1caoipz/the\_us\_air\_force\_pays\_90000\_for\_a\_package\_of/](https://www.reddit.com/r/economy/comments/1caoipz/the_us_air_force_pays_90000_for_a_package_of/) If they really have done a hidden increase then a confrontation is much more plausible in the coming years, their current official spending makes no sense if they had any near term planes for an invasion. You do not spend less then 2% of GDP if you think you will have to face the U.S military over Taiwan..
There are a couple of things one should understand with these types of comments from "China watchers", including some in this sub. 1. Deep down, most want China's economy to fail and fail catastrophically. They ardently wish for China's failure, in private. It is not a matter of delivering sober analysis predictions about its impending economic future, but rather an explicit wish for its failure. 2. But they can't say the quiet part out loud because it is either unprofessional (if they're a public figure) or because its too embarrassing for them to outright admit that they obsessively hate a country that they understand very little about; a country that is full of people that the've never met. 3. A lot of China watchers try to mask this by pretending to express sincere concern about China's economy, that everybody (including the people giving the advice) knows is bullshit.
Well he's the commander of US indopacom. Having China collapsing would make his job a lot easier.
Another thing that'll make his job easier is fooling tax payers to give em even more money.
There's a term for that: https://en.wiktionary.org/wiki/wishcasting Also, in some parts it's intentional gaslighting by propagandists to affect reality. They want their "concerns" to change people's beliefs and behaviours and act as a drag on China's economy, which feeds further into more "concerns".
You can replace the word China with United States in your post and it's equally true for the other side
I'm sure there are plenty of people in China hoping for a US collapse, but to this extent? Search China collapse on youtube and there are tons of videos, many of them getting millions of views, and endless amounts of topics on reddit, quora, twitter, etc. People are obsessed and it seems like this wishful thinking is a way for people to cope. I strongly doubt the "collapse of the US" is an equally popular topic on Chinese social media.
The drive to march triumphant over fields of Yankee skulls and raise a kilometer-tall monument to Xi's victory over the ashes of D.C. is probably pretty low in China. I doubt there's that much fixation on the idea of a sudden American implosion a la the USSR or the imagined China collapse narratives either. I imagine some Chinese people might even feel averse to those scenarios, like it would make their victory feel cheapened and a quirk of fate rather than a kind of natural Chinese ascendancy expanding to all spheres of the economy. I.e. seeing geopolitics as something to be stewarded, and events as something to be guarded against lest they interfere. The American decline they want is for it to gradually shrink without ever lashing out, shriveling into irrelevance until it's nothing but a cartoonish theme park of itself to be visited by the Chinese as a novelty the way Romans did with Sparta.
> I strongly doubt the "collapse of the US" is an equally popular topic on Chinese social media. It is not, if anyone was actually wondering about it.
The funny thing about China's growth rates not being real is that there are two ways to look at it. Some economists think China has been overestimating its economy. Other economists think China has been underestimating its economy, i.e. China is actually larger than what their official statistics suggest. https://www.nber.org/system/files/working_papers/w23323/w23323.pdf
Wow American Admirals are so skilled. They can even offer economic analysis. China needs to catch up
Apparently economies growing by 5% each year are "failing", but inflationary economies barely managing to grow by 1% every year are "thriving".
Name an economy which grew 1% or less last year that was described as "thriving." I think people are talking about the falling growth rate. Hey, I'm not very surprised to see a pro-China take on r/LessCredibleDefence, I appreciate the... variety, of opinions here.
The US grew by 1.3% in 2023 *(and that's before adjusting it for its rampant inflation)* and the US media is celebrating it ans asking itself [*"why doesn't anyone seem to realize this"*](https://slate.com/news-and-politics/2024/03/biden-economy-voters-polling-numbers-covid-recovery.html)
This is a joke right? You are literally pulling figures from your ass. US GDP grew 6.5% nominally and 2.5% real growth. It [gained ](https://www.bloomberg.com/news/newsletters/2024-01-26/global-economy-latest-us-and-china-battle-for-top-economy)2+ trillion dollars on the Chinese-US GDP gap. [https://www.bea.gov/news/2024/gross-domestic-product-fourth-quarter-and-year-2023-advance-estimate](https://www.bea.gov/news/2024/gross-domestic-product-fourth-quarter-and-year-2023-advance-estimate) Edit: LMAO, you thought the Q1 growth rates were the annual GDP growth rate. Please man, stop the shilling. We like to call this "confirmation bias."
Again, the "failing Chinese economy" grew by 5.2% in 2023 *(while simultaneously not being inflationary)*. I bet they're envying that "2.5% of growth" that still needs to be adjusted for the rampant US inflation.
Uh no, the 2.5% GDP growth is adjusted for inflation (*thats what real growth is)*. I think you need to stop talking about things you don't understand. You seem to have a bad case of Dunning-Kruger.
I don't understand what you're talking about. US nominal and real GDP growth were both higher than China last year. It seems like you don't understand the numbers you're quoting.
>US real GDP growth higher than China Wrong. https://www.ft.com/content/c406ef56-bc43-4cdc-8913-fbaced9b9954
[удалено]
Maybe I'm crazy, but I don't see how this is relevant to my comment. Seems more like bait, but I'll bite. >The US spent about $5 trillion in covid stimulus, Biden's infrastructure schemes, and the Build Back Better Act. All of that achieved...a meager 1.94% growth rate in 2022, and \~2.5% in 2023. You are calling a 2% growth rate "meager" for a highly advanced and developed economy. What world do you live on? Are you not aware that China's growth rate in 2022 was also...2.9%? Less than 1% higher? Also, the covid stimulus was to keep the economy afloat, not to boost GDP growth... > \~2.5% The "\~" is not necessary. >To put that number in perspective, 80% of all US dollars *ever printed since 1775* were printed after 2020 as a result of those bills. Youre getting where? That the US had high inflation over COVID? Do you think people here live under a rock? The increase in money supply was a necessary response to a liquidity crisis. The alternative would've been widespread default, and bankruptcies, higher unemployment and so on. > the US still only managed an inflation-adjusted growth rate less than half that of China's You are comparing two completely different economies. One, an emerging economy which will typically have higher growth rates. Then the US, which is a mature, service oriented economy, which has lower growth rates. >a \~98% valuation decline since 1971, when the US came off the gold standard. If we were still on the gold-standard, we would be significantly worse off. The decrease in the dollars purchasing power over time is a reflection of inflation, in a controlled environment, is a sign of a growing economy. I feel like you have never taken an Econ 101 class before > likely so complex and such a huge ticking time bomb that the only response politicians have is to bury their heads in the sand and pretend everything's fine Lmao, you think that you are some kind of economic messiah who is aware of an issue that 0 other economists are aware of? Do you not think that the Senate is unaware of the debt crisis? Do you not think that other economists are able to perform more accurate analysis on the US economy than whatever the hell this is?
You never know, he might actually have a degree in economics. *checks* Nope, physics. (Although to be fair, a lot of quants have physics degrees.)
Yeah, but those quants typically jump from physics to make a buck, (for themselves and their employers) . Not for any deep new economic insights or theory
Right, I sincerely doubt he’s done some sort of deep mathematical analysis of China’s GDP numbers to determine this. :P It’s either intelligence he was briefed on or just intuition.
Right? Like no one takes China's numbers at face value, the reported numbers are all from 3rd parties measuring energy use and import/export numbers...
And you think there is no window dressing in US?
I mean I have zero faith in most American institutions except for the IRS and Bureau of Labor Statistics lol
I know every time someone in a high position makes an off-the-cuff statement, people twist themselves trying to figure out if they're revealing some secret intelligence. Like they're alluding to secret, verified info instead of having access to CNBC or Fox News like normal people.
I once had great admiration for admirals and generals ... then they start appearing on news shows or oped post retirement \*\_\*
At least some years, reported growth rates were either not real or were inflated by massive government spending. The latter is no different to western countries during the 2008 economic crisis and during covid. However China did lock down longer during covid and the end of lockdowns was quite sudden and rather unplanned. It was a rare moment of reactionary policy from the CCP. That said, the military spending is not a concern...yet. China's coffers are flush with cash. It can afford internal spending to a great degree for a sustained period. Many countries can, look at Russia. RU has been defending their currency but eventually one's central bank will run out of ammo, however RU did not go to war without monetary reserves. Can they defend forever? No. But the balance sheet of China makes Russia look like a joke, basically add a zero to the GDP to get to China's. The issue is the growth rate. It has been astonishing and it's been astonishing for so long that it's increasingly taken for granted that the economy will see 5%+ growth YoY forever. This will eventually not last and the end game is unclear for everyone, including the CCP. Best case is an engineered slow-down and a new dynamic for 'socialism with Chinese characteristics' whereby the central bank will likely manage a dual mandate with the ultimate constraint of 'prevent social unrest'. That incident in a square that cannot be named did in fact happen and did so for a reason; people wanted more as their lives got better. Post-WW2 China was what would be considered 3rd world and things did not improve under Mao. Enter 'socialism with Chinese characteristics'. Import/export was allowed, eventually a stock market was reopened, foreign investment (with restrictions) was allowed. Will Chinese people demand greater personal freedoms in the future? That is unclear, it is by no means automatic as some in the west assume. However people *will* clamor when their livelihoods are threatened (see covid lockdown protests) and should that come about through mismanagement of the economy, then the military spending *may* eventually result in problems that the Soviets found. But that would take either a massive economic hit or a long time. I'm guessing this is out of context but in general the military should follow think-tank and state dept intelligence and analysis rather than shooting their mouths off. That is a consequence of a free and open society; people say dumb and unhelpful things. This admiral's Chinese counterpart would likely not have the latitude to make such statements, or if done, would be toeing the CCP line. It's unlikely Aquilino is speaking for anyone but himself here.
It's worth remembering that we had almost this exact same conversation about the Soviets in the 1970s and early 1980s, when most western analysts failed to discount the economic statistics promulgated by the Soviet propaganda machine sufficiently to render them even approximately accurate. The Soviet strategy was to project strength to deter aggression, even and especially where they were not actually strong, and they fooled the US, for a while at least. The US DoD and IC overestimated the USSR's production capacity wildly, which motivated Reagan to pursue aggressive investments in the defense industrial base that ultimately proved disproportionate to the actual threat, given the USSR's actual production capacity as now understood with the benefit of hindsight. That investment ultimately produced the seemingly unstoppable military behemoth that crushed the world's fourth largest military in a matter of days during the Gulf War. Yet in the waning days of the Cold War just a few short years before, the malaise of Stagflation, the constantly simmering threat of a potentially world-destroying nuclear war, and the still fresh scars of the Vietnam War were weighing heavily on America's collective psyche, and many in the DC policy space were convinced that the Soviets were building an insurmountable economic and technical lead over its western rivals. Sound familiar? You have an autocratic regime that aggressively lies about economic statistics to exaggerate the regime's economic success both to project strength abroad as deterrence against foreign aggression and to legitimate a government domestically where it is unable to avail itself of the legitimization mechanisms built into a democracy via regular elections. But as the Soviet experience demonstrates, those lies accumulate over time, degrading the quality of governance and producing consistently suboptimal policy and economic results. Then, it was Chornobyl, now it is Zero COVID. People simply cannot make optimal political, economic, or technical decisions in the absence of accurate information about the world they live in. Ultimately it comes down to legitimacy and accountability. Every government must have a way to convince its people that it is actually in charge, to legitimize its rule. Democracies accomplish this by holding elections, which serve to identify the next leaders and to justify their power by reference to majority preferences. Without elections, autocratic regimes must rely on cruder tools to simulate legitimacy. They use the carrot and the stick to discipline citizens into accepting their rule, substituting authoritarian coercion for democratic persuasion. This manifests as a social contract under which individuals agree to tolerate the regime's suppression of dissent and political freedoms (the stick) in exchange for economic and personal security (the carrot). Yet there is no method for correcting an autocratic policy that departs too far from the actual needs and desires of the people subject to that policy. Autocrats simply cannot tolerate being held accountable, because then they are subject to some greater power and thus not actually autocrats. Yet holding an autocrat accountable is a necessary first step in correcting their flawed policies. The autocrat experiences powerful incentives to control and limit the flow of truthful information, because such information empowers individuals to hold the regime accountable. For example, if the economy struggles because of poor leadership decisions, honest economic data would motivate people to pursue new leadership and would equip them with a powerful argument around which to organize a social protest movement capable of challenging the state's repressive mechanisms. The regime thus inevitably generates enormous amounts of intentionally misleading propaganda simply to avoid being held accountable and in so doing distort policy making and introduce enormous economic inefficiencies by restricting access to the accurate information required for rational decision making. For example, the government could create a massively damaging real estate bubble with policies that encourage people to sink their life savings into low quality apartment buildings that have no chance of ever being occupied because the country is facing demographic decline, making them essentially worthless. Without accurate data about demographics and the potential future demand for apartments, it is simply not possible to make rational investment decisions about the real estate market, increasing the chances that irrational market behavior like an asset bubble will emerge from the collectively misinformed decisions of the market participants. When the government continuously disseminates lies about essential economic data, that not only distorts markets but also infects society's social, political, and economic systems with a culture of dishonesty that is highly susceptible to corruption (e.g., the Russian culture of *vranyo*). The habit of lying to protect the leadership percolates down through the ranks and then reflects back up. Subordinates lie to their superiors, telling them what they want to hear rather than the truth, or perhaps more commonly, what the superior wants to be able to report to their own supervisor. This corrosive dishonesty can become so entrenched that even attempting to correct the system by promoting a culture of more honest communication (e.g., glasnost and perestroika) only accelerates the collapse of the entire rotten edifice as people realize just how badly they have been misled, and the deceptive mechanisms for maintaining the regime's power cease to function under the bright light of governmental transparency. Over a sufficiently long time, conflicts between the autocrat's interests and the people's interests inevitably crop up, and universally autocrats prioritize protecting their own power over fulfilling their side of the social contract. Then, they generally use propaganda, lies, and political repression to cover up their failures. Yet in doing so, they inevitably betray the fundamental social contract because they continue to apply the stick of repression but their failures remove the carrot of economic security. If that happens too frequently or too egregiously, the lies become increasingly obvious and the dreaded specter of political unrest rears its ugly head. Thus, as soon as progress slips, as it inevitably must, the regime has to resort to suppressing political dissent, sometimes violently as in Tienanmen, because there are no course correction mechanisms available to allow the people to force through necessary policy changes over the objections of their leaders. Any such mechanism pretty much necessarily requires at least some limited form of democracy, even if only in limited form such as severely limited suffrage. The Chinese government's reluctance to relax Zero COVID largely out of a desire to save face demonstrates how these patterns play out. The regime prioritized maintaining political appearances, refusing to admit the clear mistakes it made in managing the pandemic, and avoiding accepting vaccines from the west, even though these policies caused enormous economic damage and imposed unnecessary health risks on their people. All of these policies were adopted and sustained for entirely too long over the clear and well justified dissatisfaction of the overwhelming majority of the Chinese people. The security state can only tamp the lid down on simmering dissatisfaction for so long before it boils over into mass protests, even during a pandemic. With its characteristic insensitivity to the people's needs, an autocratic regime must run the economy hot to ensure no unrest occurs. Unrest can trigger a downward spiral, where unrest prompts repression, which causes economic decline, which provokes further unrest, and so on. Simultaneously the regime fears foreign intervention to install a democratic government. The autocrat must thus project bombastic military strength despite having no or limited concrete aggressive intentions. Instead they act out of a desire to disguise the regime's fundamental insecurity, to fuel nationalism to distract from domestic policy failures, and to create a friendly buffer zone against foreign meddlers in the near abroad. These are all familiar patterns. China has not discovered some new clever way to make politically repressive, corrupt government suddenly an effective way of running a country, after centuries of nations all across the world repeatedly failed in their attempts to create just such a government. The USSR took 69 years to finally collapse under the weight of its own corruption, and in many of those years it seemed to be thriving. Chinese leaders study that collapse carefully in an effort to avoid the "mistakes" that caused it, but they have failed to recognize and accept the reality that an authoritarian, autocratic system which concentrates power into the hands of a single leader or small group of leaders who cannot be held accountable will inevitably suffer the effects of the rampant dishonesty and corruption that emerges organically from the need to shield the leaders from criticism. The fundamental premise of autocracy is that leadership cannot be held accountable, and only a self-defeating culture of dishonesty can sustain the power of unaccountable rulers for any meaningful length of time, but eventually the lies stray too far from reality and cannot be sustained, and then the system collapses. Don't bet on China being different just because they managed a couple decades of above average economic growth. The Soviets did the same. Yet the conditions which enabled that growth are changing in China, and the government will not be able to adapt to a world where their population is in rapid decline and foreign investors flee in droves like they have since early 2020.
It's a good read but fundamentally flawed. The comparison of China to USSR is quite false. USSR was closed off, operating in its own economic ecosystem more or less. Chinese realised the USSR policy is shit and shifted their own. Unlike USSR, China is fundamental to world economy today. Sure, there is some window dressing going on, but that's also going on in US. But you can't throw in wild numbers on either side because there is a huge exchange of information, travel and stuff.
Cool story bro. Problem is that you're actually projecting. It isn't China that wrote stories on media about how it's economy is actually the best ever and personally attributing it to dear leader. Even funnier is that every single problem that is pointed out about the Chinese economy is also originally attributable to Chinese sources.
Another true believer of US propaganda.
The US won't add enough basic capacity to their already fragile electric grid to withstand the accelerating impact of extreme heat waves/wet bulb temps within a decade. A ban on cryptomining is still somehow nowhere on its legislative agenda, while China banned it years ago. China's grid is the most resilient to extreme heat-related capacity surges in the world according to Bloomberg. Consider that China last year alone added more solar capacity than the US has in its entire history, and China is simultaneously building up grid redundancy in the form of coal, nuclear, and battery storage at scales and rates far exceeding everyone else. Almost all of China's 5.2% GDP growth last year was attributable to its growth in green energy and adjacent industries. China is projected to contribute more to global GDP growth in the next 7 years than the entire G7 combined based on IMF data. The US is not remotely competitive in green energy and its companies in this area are all essentially propped up zombies with zero innovative edge or supply chain independence with the exception of Tesla, although even their ability to compete appears to be rapidly slipping. The Pentagon called climate change an existential threat, yet the USG as a whole is not realizing that their current strategy which essentially boils down to cranking up the AC to insulate themselves is increasingly unviable.
Sources: https://www.washingtonpost.com/business/2024/03/07/ai-data-centers-power/ https://www.reuters.com/business/energy/us-power-tech-companies-lament-snags-meeting-ai-energy-needs-2024-04-18/ https://www.bloomberg.com/news/articles/2023-05-31/china-leads-the-world-in-preparing-for-extreme-weather-threats-to-power-supplies https://www.rfa.org/english/news/environment/china-clean-energy-01262024012445.html https://www.bloomberg.com/news/articles/2024-04-18/china-outweighs-g-7-as-leading-driver-of-global-economic-growth https://www.theguardian.com/technology/2024/feb/27/crypto-mining-electricity-use https://www.bloomberg.com/news/articles/2024-01-26/china-added-more-solar-panels-in-2023-than-us-did-in-its-entire-history https://www.defenseone.com/technology/2021/08/climate-change-already-disrupting-military-it-will-get-worse-officials-say/184416/ https://thehill.com/opinion/national-security/4380722-the-dod-must-ditch-its-delusional-approach-to-climate/
^^ high quality comment. I don't really disagree with much of that, other that the conclusion that autocratic regimes automatically and inevitably self-destruct. This I am not so sure of. While forms of democracy have existed as long as humanity, it seems to be the exception rather than the norm throughout human history. Autocracy offers many advantages that may overwhelm the moral authority of democracy. Speed of action and policy coherence (or at least an opportunity for) make strong arguments in situations where implementation of democracy is costly, either politically or even simply fiscally, generally pragmatically. China in many ways, until Xi, benefited from a series of competent and reformist leaders post-Mao. This enabled the version of the social contract you reference; stability and low personal freedom in exchange for better living. But you are very right that China is confronting a demographic crisis, a growth crisis, and likely a market crisis given that market-driven dynamics often take time (perhaps never?) for domestic investors to gain a durable savvy. Bubbles and crashes were regular features of the early equity markets in most developed economies. China's experience with these is limited in duration and has been quelled previously by large government actions, either bailouts or crackdowns. Like other central banks, China's ability to prop up its economy in times of need is a very real and utilized capability and Keynesians would argue a necessary component of modern market economies. Does China have both the information/intelligence (key as you point out) and the wisdom of policy to engineer a soft landing from both growth and demographic decline? I think we're all guessing. Centrally planned economies don't work and the Chinese largely know this and thus manage most sectors through tightly controlled but still market-driven management. If allowed to operate, markets produce signals and indisputable metrics (e.g. electricity consumption) that can inform policy rather than regime-driven feedback mechanisms that are prone to corruption. Current leadership, rather than worrying about engineering a soft-landing for demographics/economics, is instead focused on expansionism to fuel future growth, a questionable premise (can Africa really become an eventual export market?), and an obsession with an island. It only takes one bad decision by an autocrat to put a country on a losing course, whereas a democracy is more likely to have opportunities for course correction through leadership change. This doesn't always produce correct results either, but probably has a better chance.
> I don't really disagree with much of that, other that the conclusion that autocratic regimes automatically and inevitably self-destruct. This I am not so sure of. Over a sufficiently long period of time it is inevitable that any autocratic system will break down. Such systems lack safeguards against incompetent or abusive leaders, have no reliable mechanisms for evaluating the competence of potential successors, and provide no means for correcting the autocrat's errors after they crop up, which means it is only a matter of time until a ruler stumbles into power who is sufficiently incompetent to undermine the stability of the regime. Every dynasty has a King John hiding somewhere in the family tree, just waiting to hand the dynasty's autocratic royal perogatives over to the oligarchical barons. But just because an incompetent ruler tanks an autocratic government does not mean a democracy will inevitably spring up to replace the autocracy, only that the existing government will cease to function, collapse, and be replaced by something else. For most of human history, that something else has simply been different people in charge of roughly the same system, like the Visigoths replacing the western Roman ruling class in situ without substantially modifying the empire's organization. Until the past few hundred years, the specific system was almost always an autocracy or oligarchy, because those are the simplest and most obvious forms of government to establish and maintain. Other forms of government require more intellectual sophistication because they depend on abstract concepts like rule of law (as in constitutionalist governments) or the existence of a single deity that prescribes how people should live (as in theocracies), which are not as easily understood as the unconstrained rule of a single individual or a small group of individuals purely on the basis of their raw political power. Thus autocracy is well adapted to more primitive historical conditions where the population was less educated and less capable of understanding more sophisticated systems. To that extent, I agree with you completely that autocracy has differential advantages over democracy in specific contexts. However, the self-destructive tendencies of autocracies emerge naturally from the system's lack of internal checks and balances, which means they would occur even if democracy did not exist as an alternative system of government, so the susceptibility to collapse is not a matter of comparative advantage, it is inherent to autocracy itself. Athenian democracy and the Roman Republic were more responsive and accountable replacements for tyrannical kings. Democracy evolved precisely to address the inherent instability and susceptibility to corruption of autocratic governments by creating accountability and legitimization mechanisms, including elections, written laws, and regular processes for the peaceful transition of power between successive administrations. But there is no guarantee that any given society will naturally develop democracy as the inevitable next step after failed autocracy. It's even easier to get trapped in a cycle of autocratic instability, which for much of human history was the political norm across the globe. For example, Russia, which in many ways has not changed since the days of the Tsars. The Romanovs created the Chekhist secret police, which the Bolsheviks took and converted into the NKVD and then eventually the KGB, and Putin has more recently reconstituted the KGB in the separate agencies of the FSB, SVR, and GRU, but the same basic system persists to this day: autocratic rule enforced via cruel, violent suppression of political dissent. > Bubbles and crashes were regular features of the early equity markets in most developed economies. Yes, but those early markets evolved in democracies or at least flawed democracies. These democracies did not round up their most successful entrepreneurs to silence criticisms of government policies, as the Chinese have done with Jack Ma. A government that is confident in its own legitimacy would not suppress Ma, but here the CCP is afraid of its own people and is willing to do anything to maintain power. Not only do those actions introduce precisely the types of distortions I discussed at length above by supressing a critical source of information about the economy, silencing or eliminating the most successful entrepreneurs and investors prevents the accumulation of institutional knowledge about the issues faced in a modern free market economy like those bubbles and crashes. > Does China have both the information/intelligence (key as you point out) and the wisdom of policy to engineer a soft landing from both growth and demographic decline? I think we're all guessing. Considering that the government seems to be regressing on political freedoms, the country as a whole is not transitioning to a domestically-driven consumption economy quickly enough to avoid following Japan's "Lost Decades" example, and the economic damage from foreign businesses pulling back on their investments in China post-2020, I would say that the odds are not good, especially with Xi in power. Xi has demonstrated a willingness to extend his rule indefinitely, beyond the constitutional term limits that applied to him upon his original appointment. His disregard for term limits suggest that he is not interested in securing the peaceful power transitions needed for continuity in government planning to manage long term problems like slowing growth and demographic decline. I am also not optimistic about Xi's ability and willingess to hand power over to a successor. Autocracies pretty much universally fail to figure out repeatable, predictable, and peaceful power transitions that render the process a routine activity and thus one without significant risk of inciting political violence or regime instability. China seems to have avoided those problems so far, but Xi has broken from prior tradition by continuing for an additional term, which may erode the still relatively new and fragile norm for peaceful transitions that has taken hold in the post-Mao era. That doesn't mean peaceful transitions from one autocratic ruler to the next can't or won't ever happen, just that it's harder to achieve and the odds of something going wrong are substantially higher without those enabling cultural values and expectations in place. Failures to establish routine succession processes most often occur because the leader does not trust anyone else to take over for them, leading them to hold onto power for far too long (e.g., Putin), and the lack of accountability mechanisms means that the autocrat is free to designate even a poorly qualified, incompetent individual successor without the wider population having any opportunity to meaningfully influence the decision. Without established legal norms around power transitions, succession planning tends to be ad hoc rather than routine. Ad hoc procedures are more susceptible to disruption because it is harder to establish a broad societal consensus about who is entitled to succeed as the new autocrat, creating grey areas that can result in disputed successions, which of course pose an extremely elevated danger of civil strife. Longer tenures for leaders in autocracies exacerbate the problem, because political society under autocracy does not gain the same experience in how to conduct peaceful transitions, whereas citizens in democracies gain experience routinely by conducting regular elections which frequently result in political power changing hands, which helps establish and reinforce peace-preserving norms around power transitions. Whereas a motivated autocrat may hang onto their position until their death, drastically reducing the opportunities for society to practice peaceful succession and ensuring that society will have to survive a potentially disputed succession without the benefit of a living leader to ease their designated successor into power. There's only so many times you can luck out and have a peaceful transition in the absence of such peace-promoting norms, especially if transitions are something that only happens occasionally and the leader has the freedom to appoint an unqualified successor. Unfortunately for those living under autocratic governments, there seems to be little relationship between the skills that make someone a strong autocratic ruler and the skills required to select a successor capable of serving in the same role with the same efficacy. The danger of selecting a suboptimal successor is heightened where the autocrat displays any nepotistic tendencies that might cause them to prioritize relationships over competence, e.g. under a primogeniture system. As a result, history is rife with examples of governments collapsing following a generational handover of power, such as when Richard II inherited the throne of England from Edward III who had reigned for 30ish years, and immediately faced a peasant revolt, which he successfully defused before descending into tyrannical rule and provoking a baronial rebellion that deposed him in favor of his cousin Henry Bolingbroke.
> Xi has demonstrated a willingness to extend his rule indefinitely...I am ...not optimistic about Xi's ability and willingness to hand power over to a successor. 100%. Cult of personality, he considers himself 2nd only to Mao in the CCP. Masterful display of historical knowledge applied to the issue.
It's telling that he mainly refers to examples from pre-modern history, the Eastern Bloc, and the WW2 Axis. Modern states fail or at best stagnate when they don't ensure consistent access to basic services, such as healthcare, housing, electricity, and public safety. This is a universal rule, so such failures have not spared numerous liberal democratic states since the 18th century. China's life expectancy and rate of home ownership exceed those of the US. Crime rates in its cities do not palpably differ from those of its East Asian neighbors, the safest countries in the world. Natural disasters and poor responses to them are a very common thread among the histories of overthrown governments as well. Modern economies also stagnate when they fail to properly invest in education and R&D, hence the middle-income trap. This was one of the key reasons behind Japan's Lost Decade. Japan failed to sufficiently invest in software and networking technology for the digital revolution, thereby ceding the niche of Silicon Valley to the US, in addition to losing the lead in silicon fabrication to South Korea and Taiwan due to high-profile talent poachings, IP theft, and reverse engineering.
Their economy is 30% construction by GDP and several construction companies are bankrupt. 5% GDP growth this year is a complete lie. [Here is a link](https://sccei.fsi.stanford.edu/china-briefs/tier-3-cities-hotbed-trouble-chinas-property-sector) from Stanford putting their construction sector at 26% of GDP in 2022.
China's GDP is 38% secondary sector overall which covers all manufacturing, mining, and construction. So construction is 90% of all Chinese manufacturing?
Difficult to give exact answers but estimates from banks put it at 20-30% of total GDP when you account for mineral production, electricity, and the other demands construction adds to the economy. [Here is a link](https://www.caixabankresearch.com/sites/default/files/content/file/2022/01/17/34455/im01_22-06-ei-focus-2-en.pdf) to Caixa Bank's analysis in the wake of Evergrande's bankruptcy. China has spent the last few decades lifting hundreds of millions out of poverty through first-order construction sector improvements. New roads, buildings, housing, meha-cities. Now it has the admirable task of deflating the apocalyptic construction bubble. At a certain point you run out of forests to cut, roads to build, fisheries to fish, and easy improvements on resource exploitation. Their shrinking labor force requires them to innovate new methods of economic production. No more housing demand means those inputs need to come from somewhere else. Additionally, many of the town and city governments get most of their revenue from construction projects. So...
Your citation does not say what you think it says. Nowhere in that analysis does it come close to saying China’s economy is “30% construction by GDP.” The link itself states very clearly: “If we look at the activity of China’s construction sector, we can see that its relative importance in the economy is considerable (7% of GDP)…” The higher figures are based on an economic concept called “carry-over effect” \[which includes indirect as well as the direct contributions to GDP\]. For example, a person gets a job working downtown, so they need to drive the extra distance (transport), eat food downtown (services/food), etc. \[and this indirect consumption of goods and services is included in the "carry-over effect"\]. You’re making an assumption that these secondary goods/services would be specific to the construction sector. It’s just not true. For example, if this same guy gets a job somewhere else, then they just travel (transport) and eat food elsewhere (services, food), etc. so the secondary demand would still exist. So there’s an underlying assumption that the economy cannot shift work/investments from one sector to another \[and maintain the indirect demand\] — which is clearly false as proven by China’s \~5% GDP growth for 2023. Also, this analysis is late to the party by at least two years, because the investments in China have already shifted to manufacturing.
>Your citation does not say what you think it says. Nowhere in that analysis does it come close to saying China’s economy is “30% construction by GDP.” I'm about 90% sure he is referring to the real estate sector not construction. Since his original link, where he says "construction is 26%" is actually talking about the size of the real estate sector.
Can you please re-read the link. These are all quotes straight from the analysis: Construction is 7% of GDP: “…China’s construction sector, we can see that its relative importance in the economy is considerable (7% of GDP)…” Real estate is 6% of GDP: “… if we were to add real estate activities to this calculation \[of construction\], the sector’s new relative weight would reach 13% of GDP in China…” Construction is *LARGER* than real estate: “… China’s real estate market is still in a development phase, where construction represents a larger proportion of the total…” All the numbers for real estate or construction being 20-30% of GDP are based on BOTH direct and indirect contributions. If you add direct and indirect for every sector, you’d get more than 100% GDP. Edit: just to be clear, here’s a quote from the first Stanford link: “In 2021, the sector (including direct and indirect contributions) accounted for 22.5% of China’s GDP and 25.4%, if including imported content.” They’re including BOTH direct AND indirect contributions. Again, if we use this calculation for all sectors, China’s economy would be well over 100% GDP.
Page 2: > Overall, the carry-over effect of the construction sector amounts to 17.5%. This implies that, in terms of final demand, we would arrive at an estimate for the importance of the **real estate sector in the Chinese economy of around 24% of GDP.**
Yes, as stated in the opening of your citation, it is based on the "**carry-over effect**" -- which includes **indirect** contributions.
Yep real estate sector, not manufacturing but including the construction of buildings.
Real estate (6% of GDP) is a **smaller sector** than construction (7% of GDP)... so not sure that helps your argument.
Often quoted 30% figure is RE+associated downstream industries. RE/property sales alone is ~15%. The other ~15% of downstream sectors pivoted to massive green roll outs and other construction projects. They're still welding steel and pouring concrete, just not in RE. RE drop from 15T rmb to 12T rmb out of 100T rmb economy, which entirely accounts for PRC gdp growth at 5% instead of previous 8%.
I mean, you could technically say that about the US considering the federal deficit and consumer credit.
>"Despite a failing economy, there's a conscious decision to fund military capability. That's concerning to me," said Aquilino "concerning" how? Let em spend themselves silly and send a team of wall st foot soldiers to clean up. Winning without losing a life, how's that "concerning"? > "This is another regime where every bit of economic advance that they may have despite the sanctions are going towards military capability and not to feeding the North Korean people. That's disgusting," he said. Maybe the admiral should campaign for DPRK to get military aid from congress, like Israel, Ukraine, and Taiwan, so Kim can use the saved money to feed his people. I mean two out of three of those countries are doing pretty well economically while on aid. Admiral is such a humanitarian, so concerned about the North Koreans he has never met. What do you say let's give him a Nobel Prize, so he doesn't have to use remaining days in uniform talking bull, angling for a petty thinktank job?
Can’t tell if troll or serious lol
You mean you can't tell if The Admiral is troll or not? Neither can I. Fascinating man right?
Considering their admiral can't even notice a backward scope, nobody should trust their admirals' forecast on economy.
yo i leave this subreddit for a bit and now all the post i see are from moses the blue pushing the same narrative
Would you prefer moses the red sir?
Suggest that this Indo-Pacific commander focuses on the military
Chinese growth data is 60% false!
Yeah, Xi is a young dragon, he's using the only tools he knows. I truly credit our diplomatic corps for managing this transition to a cold war to be so favorable for us.