Summers is most likely correct in his conclusions, but he is predictably wrong is his explanation of the cause. The end of crony system, he contends, will shift

Summers is most likely correct in his conclusions, but he is predictably wrong is his explanation of the cause. The end of crony system, he contends, will shift control to untested free market players, removing certainty of high performance that the corrupt system produced. Although we might object to central planning on cultural grounds, it has worked, and it's end will cause a fall. He's just as clueless the operation of boom-and-bust cycles in China as he is here in America. He thinks that GDP growth indicates performance instead simply activity, so no surprise he reads a downturn as caused by factors that damage performance. In China, as here, some GDP is good, and some destroys value and is thus unsustainable. The coming downturn in China will be the cure for malinvestment on an epic scale [1][2][3][4], not the disease. The crony system has generated massive amount of activity, most of it economically virtuous, but a great deal of it is economically evil, utter waste, and must be stopped and unwound. The longer the crony system persists, the bigger will be the reckoning. [1] http://www.businessinsider.com/chinas-ghost-cities-in-2014-2014-6 http://www.businessinsider.com/chinas-ghost-cities-in-2014-2... [2] http://www.thebubblebubble.com/china-bubble/ http://www.thebubblebubble.com/china-bubble/ [3] http://nextcity.org/daily/entry/surprise-china-built-the-worlds-biggest-building-and-its-a-boondoggle http://nextcity.org/daily/entry/surprise-china-built-the-wor... [4] http://www.washingtonpost.com/opinions/the-politics-of-chinas-high-speed-train-wreck/2011/07/27/gIQAGedXdI_story.html http://www.washingtonpost.com/opinions/the-politics-of-china...