- 18 Aug 2019 16:45
#15027319
Chinies economy is dependant on the access to the most prosperous markets in the world. (Everyone is actually) Currently there are 3-4 major consumer markets in the world:
1) The EU market.
2) The US market.
3) Asia pacific/Japan market.
There is where the most richest consumers live nowadays who buy a lot compared to anybody else. If for some reason China looses access to EU or US markets then its economy WILL spiral out of control and collapse. It is not just a question of them selling to us but a question of our companies operating from China to produce goods and services. So if the links are severed then the companies will significantly downsize and leave China.
As mentioned before, China understands that perfectly well and 2008 crysis was a real eye opener. They have tried to move away from this dependency by growing their own domestic market to the size of the EU or the US to no avail. Their program had some limited success but now China is sitting on the largest toxic debt in history which they own to themselves and the funny part is that China is not that relatively rich per capita. So how are they going to return that debt?
The problem with growing a consumer market is that you have to pay your workers and people more by either higher salaries, subsidies, programs etc. The consumer market works when the people actually have money to buy things basically. That in itself is a problem when your current model is dependant on producing things cheaply or staying competitive globally by devaluing your currency and prices of your goods/services.
The better question people should be asking is how can China make this move without shooting itself in the foot. I don't have a straightforward answer for this but American and European examples are appropriate i think. How the US and EU achieved their current consumer market statuses? Well, the answer i think is that we actually forced this down the throats of our politicians and businessman. Our liberal systems allowed the people to actually carry power and weight which in turn forced the politicians and businessman to act. The problem is that it is not linked to 1 measure of any sort but a hundred thousand of them. As both EU and US examples show, it is possible to build this market in different ways. The US system has less government involvement and achieves it by creating a legal framework that compensates everyone to a degree depending on your contribution. (For example oil rights where local economy gets benefits, the people get benefits and obviously the companies get benefits. This is the main reason shale oil revolution happened in the US and not somewhere else) Europe achieved much of the same but with much larger government involvement through redistribution for example and regulations.
I would say this is the two important examples. So when people talk about ineffective government programs in the US compared to the EU(Healthcare?) or EU businesses not appearing so often compared to the US then you should consider why it is so? Basically our system are similar, yet different. Both have downsides and upsides.
I guess my point being that democracy and liberalism are a must to improve the well-being of people in China. At least this is my opinion.
I do not think that any nation is hopeless to change; however, I think that some nations do require a lot more effort than others to become changed. - Verv
anasawad wrote:^
Yea, honey, listen.
As much as I am against Chinese domestic policy, we've got to be realistic here; The only reason Hong Kong still has all its freedoms is that mainland China trades with the US and Europe and they pressure the Chinese government, through trade, to allow Hong Kong to have these freedoms.
Now, with the US trade war, the massive expansion of Chinese political influence in Europe, and the rapid growth of African consumer markets, that leverage is dwindling as the Chinese government is no longer in need of appeasing its consumers in the west and at a certain point clamping down on Hong Kong and even the annexation of Taiwan will become to have no effect on its economic interests; When it reaches that point, Hong Kong will become just another province of China under the CCP's control.
It's an unfortunate truth, but that's just the way it is for the time.
Chinies economy is dependant on the access to the most prosperous markets in the world. (Everyone is actually) Currently there are 3-4 major consumer markets in the world:
1) The EU market.
2) The US market.
3) Asia pacific/Japan market.
There is where the most richest consumers live nowadays who buy a lot compared to anybody else. If for some reason China looses access to EU or US markets then its economy WILL spiral out of control and collapse. It is not just a question of them selling to us but a question of our companies operating from China to produce goods and services. So if the links are severed then the companies will significantly downsize and leave China.
As mentioned before, China understands that perfectly well and 2008 crysis was a real eye opener. They have tried to move away from this dependency by growing their own domestic market to the size of the EU or the US to no avail. Their program had some limited success but now China is sitting on the largest toxic debt in history which they own to themselves and the funny part is that China is not that relatively rich per capita. So how are they going to return that debt?
The problem with growing a consumer market is that you have to pay your workers and people more by either higher salaries, subsidies, programs etc. The consumer market works when the people actually have money to buy things basically. That in itself is a problem when your current model is dependant on producing things cheaply or staying competitive globally by devaluing your currency and prices of your goods/services.
The better question people should be asking is how can China make this move without shooting itself in the foot. I don't have a straightforward answer for this but American and European examples are appropriate i think. How the US and EU achieved their current consumer market statuses? Well, the answer i think is that we actually forced this down the throats of our politicians and businessman. Our liberal systems allowed the people to actually carry power and weight which in turn forced the politicians and businessman to act. The problem is that it is not linked to 1 measure of any sort but a hundred thousand of them. As both EU and US examples show, it is possible to build this market in different ways. The US system has less government involvement and achieves it by creating a legal framework that compensates everyone to a degree depending on your contribution. (For example oil rights where local economy gets benefits, the people get benefits and obviously the companies get benefits. This is the main reason shale oil revolution happened in the US and not somewhere else) Europe achieved much of the same but with much larger government involvement through redistribution for example and regulations.
I would say this is the two important examples. So when people talk about ineffective government programs in the US compared to the EU(Healthcare?) or EU businesses not appearing so often compared to the US then you should consider why it is so? Basically our system are similar, yet different. Both have downsides and upsides.
I guess my point being that democracy and liberalism are a must to improve the well-being of people in China. At least this is my opinion.
Last edited by JohnRawls on 18 Aug 2019 16:50, edited 1 time in total.
I do not think that any nation is hopeless to change; however, I think that some nations do require a lot more effort than others to become changed. - Verv