One of the ways this corruption is evident is in systemic malinvestment. It works like this: China doesn't really have a free market system; it has a state run economy like any other socialist state. There is some freedom around the edges, but the monsters are the so called "state owned enterprises", typically run by local or provincial "big wigs", almost the equivalent of war lords. Think of these SOEs as engines of corruption, shoveling money from the government to cronies who do whatever they want with it (did I say it was like our system, only worse?) China has "ghost cities" that have never been occupied, bridges to nowhere, bridges and other projects that are abandoned after an aborted start and more.
Case in point is the city of Caofeidian, the "world's first fully realized eco-city", in a Guardian article from July of '14. Roughly 120 miles southeast of Beijing, Caofeidian was built on land reclaimed from the sea by dredging sea bottom and piling it up (the term "dredge and fill" is an obscenity in South Florida, BTW).
‘As precious as gold ...’ That was how then-president Hu Jintao described Caofeidian during his visit in 2006. It was pledged to be ‘the world’s first fully realised eco-city’ – yet 10 years and almost $100bn later, only a few thousand inhabitants have moved to this land reclaimed from the sea ...One million residents were once supposed to live there. It is a ghost town today, sporting only a few thousand inhabitants. Practically no-one has ever stayed in the city, and the buildings are already deteriorating. In fact, many of the buildings have been left half-finished, as credit eventually ran out.
The first city to get a lot of press as a ghost was Ordos, in Inner Mongolia. Ordos was built as a copy of... well, Ordos, a Mongolian city that became wealthy as a center for coal production. A BBC article from 2012 begins:
A huge statue of the mighty warrior Genghis Khan presides over Genghis Khan Plaza in Ordos New Town. The square is vast, fading into the snowy mist on a recent Sunday morning.But it's not just cities, it's all sorts of infrastructure. Consider the Qingdao Haiwan Bridge, shown here in white in the middle of the water.
Genghis Khan Plaza is flanked by huge and imposing buildings.
Two giant horses from the steppes rise on their hind legs in the centre of the Plaza, statues which dwarf the great Khan himself.
Only one element is missing from this vast ensemble - people.
There are only two or three of us in this immense townscape. Because this is Ordos, a place that has been called the largest ghost town in China.
This recently completed bridge (the white line across the middle of the bay in the image above) holds the world record for the longest bridge over water.The bridge saves approximately 20 minutes drive time to go from one industrial side to other. Is 20 minutes times the number of commuters really worth $8.7 billion? How much traffic does this represent? Consider, instead, building a bridge where the red line is at the mouth of that bay. It wouldn't be able to claim the title of "longest bridge over water in the world", but it would have cut drive time between the population centers as well.
Spanning 42 kilometers, it’s long enough to cross the English Channel.
Built at a cost of 56 billion yuan ($8.7 billion), the bridge crosses Jiaozhou Bay and connects the main urban area of Qingdao city with the Huangdao District.
There's bad investment all over China: bridges, cities and more. Estimates run into the trillions of dollars.
You've heard for some time that the China's yuan is being manipulated to make it look better than it really is. They made a mistake, though, in pegging it to the dollar. Since the dollar has been doing well for the last year or so (due to my "least disgusting girl at the dance" theory) causing the dollar to rise against other currencies. This makes Chinese exports more expensive compared to those from places like Vietnam, Myanmar, Taiwan or Thailand. Financial writer Tom Dyson of the Palm Beach Letter observes:
That’s why we’ve seen China’s gross domestic product (GDP) decrease every consecutive year since 2007. And it’s now growing at its slowest pace in 25 years. China’s GDP is expected to contract even further next year.He also cautions that we're not going to see China default or go bankrupt, but it is going to take years to go through this bad debt. The days of the (so-called) 7% per year growth in China are over. In my opinion, they're going to look at years of zero to negative growth. That will ripple around the world, and will affect the US economy, too. He presents a list of Exchange Traded Funds that center on China that should be avoided. If you accept his analysis (RTWT).
The billions of dollars in lost export revenue are now no longer available to service bad debts.
The lost revenue was the cash flow that kept the show going. Without it, those who have partaken in this grand scheme will have their legs swept out from under them.
Caofeidian. A six-lane road span bridge was abandoned after 10 support pylons had been erected.
I finally got around to reading Rickards' book.ReplyDelete
It's very good, and downright scary. Made me reevaluate my retirement savings allocations....
All true....China is rife with corruption, tell me DC and Wall St. aren't and do it with a straight face. China has centralized control of business, the US does the same thing by regulations and bureaucratic edicts. China wastes BILLIONS on questionable and even useless building projects. The US Gov has shelled out $3 million to study video games like World of Warcraft.....and that is just one of THOUSANDS of things that money is flushed down the shitter for.ReplyDelete
NOPE.....don't tell me how horrible China is. The US is NO BETTER.
No better? Seriously? The US certainly isn't a bed of roses bathed in sunshine and scented with unicorn farts, but it's a bit of a stretch to call it "no better" than the totalitarian, pseudocomnunist, Orwellian hell-pit that is China, in my opinion. Are we doing our damndest to change that, to make America into a totalitarian hellhole? You bet. *spits* But even with all the freedoms the constitution enshrines (doesn't give. It enumerates rights that already exist, it does not *grant* them.) that have been stripped away by unconstitutional processes and abuse of the (deeply flawed) concept of "judicial review", America is still a helluva lot freer than just about any other country on the face of this earth that you could name. In my opinion, of course. God bless, hope I didn't offend. :-)Delete
Precisely....in your opinion. Ask someone who has been jailed because a DA withheld exculpatory evidence or the po po lied under oath if this is a 'free country'. Ask someone who was pulled over and robbed by an armed badgemonkey of thousands of dollars simply because the thug COULD if this is a 'free country'. I could go on and on and on ad infinitum. NO.... our government is no better than that in China and we are no more free than the people of China.....it's just that our system and methodology of corruption and state sanctioned criminality is DIFFERENT from theirs.Delete
To begin with, I think when I said that China was worse than the US, that means a difference in degree, not fundamentally different.Delete
Is the US just as bad? I don't think so. We're still better at not having factories full of slave workers, and still better at not harvesting organs from live prisoners. We're still better at not bulldozing churches. They still haven't fundamentally transformed us to that level. Yet. All those other things you write about? Yeah, I've written about them in the pages of this blog, too. Many times.
@Dan: What Mr. Graybeard said. I couldn't say it any better. We have (huge, terrifying, awful) problems...but we at least have the illusion of being free. The NSA et al might monitor the content of our conversations, but at least we only *wonder* (can't believe I'm writing this...in America! God help us.) whether we'll be picked up and imprisoned secretly because we say something naughty. In China, they don't wonder. They *know* if their words are overhead they'll be shot or imprisoned. Is the comparison too close for comfort? Hell yeah. But even in China there are people who hope, and have faith, and look towards a brighter future, even if they die for the crime of believing that the present isn't bright and shiny. If China and the US are the same, just as evil, just as dark as each other...why do Chinese people flee here when they get the chance? Hell, the existence of this very blog is evidence that, though things are unacceptably bad, they still haven't gotten to China level. An even better example is the fact that "he who must not be named" (the "supreme dark lord" of the ELOE) continues to run his blog. The feds almost certainly monitor it, but it, and places even more...unsavory and unPC?...than it *exist*. And they exist as more than just a means for the state to identify noncompliant "badthink"ers to arrest. If you'll pardon the sentiment, the flame of Liberty may have been hooded in many places in this country...but it has not gone out. It will continue to burn, obstinate, indomitable, and unfaltering, as long as people like you, and me, and Mr. Graybeard, and the madgeniusclub, According to Hoyt, monsterhunternation, etc. crew refuse to give in to the temptation to despair. I don't know what struggles you've had, sir, but (if I may be so bold) I can tell they haven't extinguished your fervor and devotion to the concept of Liberty, however awful they were. That's a part of what makes this flawed, wounded, ravaged nation great, in my opinion: we are a bunch of seriously stubborn, intractable, unyielding nutters. (Love that word...) We refuse to surrender. And we "have not yet begun to fight!" :-DDelete
(Sorry if this makes little sense/seems off topic...I'm feeling under the weather today. I'll stop rambling now.) God bless!
Dan, 99.9% of Americans aren't robbed by the police or indicted by lying prosecutors and police. Don't conflate the horror stories the Internet spreads around with the normal life most of us live. I'm 72, don't drink or do drugs and have had zero bad interactions with the police. Most of my friends and family can sat the same.ReplyDelete