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As a non-expert, it seems likely that of the 3 options, wealth transfer will be the main solution to China's debt problems. (It's worth noting, China's high cor

As a non-expert, it seems likely that of the 3 options, wealth transfer will be the main solution to China's debt problems. (It's worth noting, China's high corporate debt levels are, like Japan's, owed to mainly to domestic creditors, and I believe also denominated in the local currency.) In a totalitarian dictatorship, "political opposition from so-called vested interests" is not that strong a barrier when political and economic stability is at stake. I think while some unsustainable debt will continue to be allowed to default, a lot of debt will eventually be painfully bailed out by taxpayers (both households and corporations) over time. This mean lower health, education, and social welfare spending affecting people who didn't cause the debt problem in the first place. That's just the unfortunate price of accumulating large amounts of non-productive debt.

baybal2 8y ago
There is no Zhu Rongji in current generation of party leaders. From my personal observations, the leeching of public debt through borderline fraudulent projects barely ceased under Xi. This is an elephant in the room. Only the moment they will lift a knife on it, will we be assured that they began an actual move on that front. Do you know why Xi raised his hand on his closest supporters in the reactionary camp he leads - Bo and Co? He did so because he was too afraid that Bo as a much more charismatic person will take over the lead of reactionaries from him. Now, he needs to pay his supporters in the party lavishly in form of state sanctioned corruption - all kinds of unsupervised small local projects where money vanish using long lending chains, or simply stratospheric remunerations for offsprings of party officials employed somewhere in the chain.
- samspenc 8y ago
  Thanks for your analysis. Just to clarify some of your points to readers who may not be that familiar with Chinese politics. * Zhu Rongji is the more reformist leader in the late 1990s, and seen as one of the few leaders (maybe along with Zhao Ziyang in the 80s and Wen Jiabao in the 2000s) who may have been favorable for a move towards democracy in China. * Bo and Co = Bo Xilai and ... Zhou Yongkang? They were arrested in 2012-2013 for plotting a coup against Xi and human rights abuses such as organ harvesting of prisoners of conscience, after a high-ranking security official (Wang Lijun) defected and sought refuge in the US consulate, providing inside dirt on these two party chiefs. * Xi = Xi Jinping, current Chinese leader.
  - justicezyx 8y ago
    Not sure how zhu was viewed as more possible for democracy. Note that what he did was the most brutal form of autocratic policy making, by forcing unemployment of millions of workers who are not trained to live in a different system; was possible because of autocratic government; and his policy pretty much made the rich out of the ranks of former government officials just like what happened to the Russian oligarchs. I am guessing the rich do know how to court the expectations from inside and outside. And I often hear praises from Chinese people to zhu, while at the same time none of them suffer during zhu's policies...
- ksec 8y ago
  Wang Qishan

baybal2 8y ago

There is no Zhu Rongji in current generation of party leaders. From my personal observations, the leeching of public debt through borderline fraudulent projects barely ceased under Xi. This is an elephant in the room. Only the moment they will lift a knife on it, will we be assured that they began an actual move on that front. Do you know why Xi raised his hand on his closest supporters in the reactionary camp he leads - Bo and Co? He did so because he was too afraid that Bo as a much more charismatic person will take over the lead of reactionaries from him. Now, he needs to pay his supporters in the party lavishly in form of state sanctioned corruption - all kinds of unsupervised small local projects where money vanish using long lending chains, or simply stratospheric remunerations for offsprings of party officials employed somewhere in the chain.

samspenc 8y ago
Thanks for your analysis. Just to clarify some of your points to readers who may not be that familiar with Chinese politics. * Zhu Rongji is the more reformist leader in the late 1990s, and seen as one of the few leaders (maybe along with Zhao Ziyang in the 80s and Wen Jiabao in the 2000s) who may have been favorable for a move towards democracy in China. * Bo and Co = Bo Xilai and ... Zhou Yongkang? They were arrested in 2012-2013 for plotting a coup against Xi and human rights abuses such as organ harvesting of prisoners of conscience, after a high-ranking security official (Wang Lijun) defected and sought refuge in the US consulate, providing inside dirt on these two party chiefs. * Xi = Xi Jinping, current Chinese leader.
- justicezyx 8y ago
  Not sure how zhu was viewed as more possible for democracy. Note that what he did was the most brutal form of autocratic policy making, by forcing unemployment of millions of workers who are not trained to live in a different system; was possible because of autocratic government; and his policy pretty much made the rich out of the ranks of former government officials just like what happened to the Russian oligarchs. I am guessing the rich do know how to court the expectations from inside and outside. And I often hear praises from Chinese people to zhu, while at the same time none of them suffer during zhu's policies...
ksec 8y ago
Wang Qishan