Western Minds may have it Wrong about China Building Empty Cities

March 13, 2011

World Net Daily quoted Patrick Chovanec, an expatriate and business teacher at Tsinghua University in Beijing, saying, “Who wants to be the mayor who reports that he didn’t get 8 percent GDP growth this year? Nobody wants to come forward with that. Therefore, the incentives in the system are to build. And if that’s the easiest way to achieve growth, then you build.”

What Mr. Chovanec is referring to is China building empty cities by the dozens then connecting them with expressways.

Although Mr. Chovanec has an impressive resume, I’m sure China’s leaders did not confide in him, which explains why he may be wrong.

In fact, what World Net Daily doesn’t mention is in the last thirty years China had the largest migration in recorded history of almost 300 million people moving from rural to urban China as it became an export nation resulting in the expansion of China’s urban industries.

The People’s Daily wrote in 2003, China was encouraging the migration of between 300 to 500 million people from rural areas to towns and cities by 2020, a transformation that Beijing hopes will help drive growth but which will also fundamentally alter the economy of the world’s most populous nation.

“A country where most of the population is in poor or remote villages will not be a modern and developed nation,” said Wang Mengkui, minister at the State Council’s Development Research Centre. “Our urbanization rate [of 39 per cent now is equivalent only to that of the UK in the 1850s, that of the US in 1911 and that of Japan in 1950.”

Wang Mengkui says, “I think our urbanization rate should reach 55-60 per cent of the population by 2020.”

Where do Mr. Chovanec and World Net Daily think China is going to house all those people as they move from rural to urban China?

Unlike democracies, where chaos, lobbyists and political agendas lead to mostly short-term decisions without planning for the future as in America’s case regarding the HUGE federal deficit and what I wrote about in India Falling Short, China’s leaders tend to plan long-term goals that benefit the most people.

China’s leaders have demonstrated for millennia (not just China’s Communist Party) that China’s collective culture often plans decades and centuries into the future, which explains the success of projects such as the Great Wall and the Grand Canal, which took centuries to complete.

This same long-term thinking led to modern, empty towns being built in Tibet years ago that are now filling with Tibetan nomads  (I wrote of this in an earlier post) that suddenly found the grass they depended on to feed their herds gone due to global warming ending a lifestyle that had survived for centuries.

China’s leaders — being scientists and engineers instead of economists such as Mr. Chovanec — studied the potential future and planned for it, which is a benefit of being an autocratic one-party republic instead of a chaotic democracy that depends on short-term goals and quarterly profits to guide the decisions of accountants and lawyers.

What China is doing by building these empty cities, roads and railways is getting ready for the future.

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Lloyd Lofthouse is the award-winning author of My Splendid Concubine [3rd edition]. When you love a Chinese woman, you marry her family and culture too. This is the love story Sir Robert Hart did not want the world to discover.

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5 Comments | business, China, cultural differences, economy, environment, government | Tagged: , , , , , | Permalink
Posted by Lloyd Lofthouse

The Cause of China’s Pollution

February 26, 2011

Before criticizing and blaming China for polluting the environment, learn about the history that caused the pollution first.

The first Industrial Revolution took place in England after James Watt developed the coal/wood burning steam engine in the late 18th century. This was beginning of air and water pollution.

The second Industrial Revolution (1820-1870) helped the economic development of the United States. Then industrialization increased between 1870 and 1914.

Pollution from industries grew to epidemic proportions after 1945. In fact, the type of pollution changed significantly when industries in America and Europe began manufacturing and using synthetic materials such as plastics and DDT.

These materials are not only toxic; they accumulated in the environment and were not biodegradable. This increased rates of cancers, physical birth defects, and mental retardation.

Due to an increase in world trade after World War II and moving a significant percentage of the world’s manufacturing to Japan, then China after Mao died, the pollution created using these synthetic materials increased and pollution reached a global scale.

Most of the products manufactured in China were sold around the globe by multinational corporations such as Wal-Mart. If you buy products made in China, you are partly responsible for the pollution there. The odds are that the computer I’m using was made or assembled in China. Darn!


June 2007 – the US still has more cars on the road and buys much of what China manufactures for US companies.

Another factor was pressure from the people of China on their government to improve the standard of living for 1.3 billion people. India faced the same challenges.

The lifestyle changes taking place in China and India parallel the changes that already took place in America, Britain and Europe more than a century earlier.

In the 1960s, about 60% of Chinese labor worked in agriculture. That figure remained about the same throughout the 1960s into early 1990s. Then by the late 1990s, the farm force in rural China fell to about thirty percent.

In comparison, in 1870, 53% of US labor worked in agriculture. Today, farm labor in the US makes up 3% of workforce. The rest live in towns and cities with a middle-class demanding more synthetic products to feed the consumer lifestyle.

Discover The One Party Advantage

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Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too.

If you want to subscribe to iLook China, here is a “Subscribe” button at the top of the screen in the menu bar.

 

Note: This post first appeared on iLook China February 7, 2010 as post # 31. This revised version reappears as post # 1086.

2 Comments | America, business, China, Chinese middle class, economy, environment | Tagged: , , , , , , , , | Permalink
Posted by Lloyd Lofthouse

Three Heads Talking of China

February 25, 2011

On April 24, 2010, I attended a panel at the 2010 Los Angeles Times Festival of Books.

The topic was “China: The Next Superpower?” The experts were Richard Baum, author of China Watcher: Confessions of a Peking Tom; Zachary Karabell, Superfusion, and Jeffrey Wasserstrom, China in the 21st Century.


Jeffrey Wasserstrom

Baum is an expert on politics; Karabell on money/economics, and Wasserstrom on history.

Wasserstrom said that China is not the older country. The PRC was sixty-years old while the United States was more than two hundred.

Both the Communist Civil War and the American Revolution rejected colonialism then both expanded into other countries and territories to become world powers.


Richard Baum

Baum added that the cultural differences are significant starting with Confucianism, which expresses Collective Rights instead of individual rights as in America.

Karabell mentioned that there was a lot of misunderstanding and ignorance between the United States and China.


Zachary Karabell

Many in the US believe China is unfair in world trade and that Americans lose jobs because of that.

However, China’s trade with the world is about even between exports and imports and what China buys from the United States keeps many Americans working.

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Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too.

If you want to subscribe to iLook China, there is a “Subscribe” button at the top of the screen in the menu bar.

 

Note: This post first appeared on iLook China April 30, 2010 as post # 278. This revised version reappears as post # 1084.

3 Comments | China, cultural differences, economy | Tagged: , , , , , | Permalink
Posted by Lloyd Lofthouse

China’s schoolchildren learn how to buy and sell stock

February 16, 2011

On December 9, 2010, a CNN Go Asia headline said, “Shanghai has the world’s smartest teens”.

If you heard the news of Shanghai students beating out 65 countries in student scholastic performance tests in three key categories of ability, the Al Jazeera English video embedded with this post may provide part of the answer of how that happened.

While many American students are applying makeup, drinking sodas, eating candy and french fries in class while texting friends and ignoring teachers let alone reading or doing homework, Al Jazeera reports of twelve year olds in Shenyang, China learning how to be stock brokers.

These students buy and sell and learn how to get the latest information on global stocks.

One Student, Ding Chuan, was asked how his investment portfolio (a class assignment where the students don’t actually buy stocks) was doing, and he replied that last year his investments hit 10,000. Now, his portfolio is at 20,000. He wants to be a millionaire when he grows up.


This Al Jazeera English news segment aired June 23, 2007.

Xiu Shu Jun, the headmistress for the school, says, “We decided to do it because we wanted to give the children a more realistic and practical financial education.”

Tony Cheng, the Al Jazeera reporter, says, “It is ironic that the largest Communist nation in the world has become obsessed with this capitalist pastime.”

Cheng says, “Stock trading goes against about every principal Chairman Mao stood for, and he would be pretty horrified to learn that there are now more registered (stock) traders in China than there are members of the Communist Party.”

Mao’s statue in Shenyang is surrounded by banks. After all, Tony Cheng says, today to be rich in China is glorious.

I say, What Tony Cheng doesn’t tell us is when Deng Xiaoping came to power by arresting those that would have continued the Cultural Revolution, China’s central government repudiated revolutionary Maoism and launched a Chinese style of socialist-capitalism.

Meanwhile, outside school, China’s citizens are buying stocks hoping to get rich quick.

However, some Chinese are learning the hard way that what goes up also goes down.  Investing in a capitalist stock market is like riding a roller coaster and life savings may vanish in a day if the investor isn’t cautious.

Discover China’s PISA Pride

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Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too.

If you want to subscribe to iLook China, there is a “Subscribe” button at the top of the screen in the menu bar.

Leave a Comment » | capitalism, China, economy, education, mathematics | Tagged: , , , , , , | Permalink
Posted by Lloyd Lofthouse

Mostly Free to be Poor

February 15, 2011

Riz Khan hosts a program for Al Jazeera English and in this twenty-two minute segment, he leads a discussion about the possibility that democracy hinders economic growth.

Khan asks, “Is a centralized system, such as China’s one party, better than democracy for growth?”

Both India and China became countries about the same time.  In 2008, India’s GDP was $1.16 trillion and China’s was about three times larger at $4.33 trillion.

There is a debate in India that China’s one party political system has allowed China to modernize and improve lifestyles easier and faster than India’s democracy.

His first guest speaker is Tarun Khanna, a professor of the Harvard School of Business, who does not agree with the argument that India’s democracy is the cause of slow growth.

His opinion is that democracy may be a faulty option but it is the best of the faulty options we have. However, he says it is true that India’s democracy has underperformed.

Then MIT Professor Yasheng Huang says in the last thirty years, the leadership in China has improved its decision-making and made many correct decisions regarding productivity.

A listener to the program sends a message from Facebook.  “All a country needs is purposeful leadership, security, vision, and justice for all. China has demonstrated all this, unlike India.”

Professor Huang disagrees with the Facebook comment.

Kahanna says that China’s strong leadership has been an asset and that even in the Communist Party there is a meritocracy of sorts, which is a system of advancement based on individual ability or achievement—something that India’s political system lacks at this time.

Regarding a dictatorship, Huang says a dictatorship wouldn’t work in India. The culture is too complex.

Kahanna agrees that a dictatorship wouldn’t work in India and says India has to improve its democracy.

Huang feels if China doesn’t change its economic structure and put more emphasis on private companies, India will be the better place to do business in regards to long-term growth.

Kahanna says India’s biggest challenge is to include as many people as possible to share in the economic growth and more than half of its population has been left in poverty.  He says the biggest challenge will be basic health care and education and there has to be more opportunities in India for more people. The caste system in India is also a problem. India’s politicians must stop politicizing the cast system.

Professor Huang then says that democracy is not a solution to solve all of society’s problems. There has to be more than free elections. However, an authoritarian system is also not the answer. He says, take the strengths of both India and China and figure a way to take advantage of them—to make them work.

Learn more at India Falling Short

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Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too.

If you want to subscribe to iLook China, there is a “Subscribe” button at the top of the screen in the menu bar.

Leave a Comment » | business, China, economy, education, government, politics | Tagged: , , , , , , , , , , , , , , | Permalink
Posted by Lloyd Lofthouse

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