Breaking the China Plate, Mate By James Reed
If we belong to the West anymore, then we should be concerned, deeply concerned about the direction which modern China is taking, which is something quite alien to Western rational thought.
Right next to a full-page ad celebrating an AFL game in Shanghai (The Australian, October 25, 2017, p.8), we have the story of Xi joining Mao and Deng in the Communist Party pantheon, with the elevation of Xi Jinping, Thought on Socialism with Chinese Characteristics, a strategy of building a modern socialist China. People will be required to conscientiously study this profound document, probably even us, down the track. Here are its key points:
1. Ensuring Communist Party of China leadership over all forms of work in China.
2. The Communist Party of China should take a people-centric approach for the public interest.
3. The continuation of “comprehensive deepening of reforms”.
4. Adopting new development ideas based on science and for “innovative, coordinated, green, open and shared development”.
5. Following “socialism with Chinese characteristics” with “people as the masters of the country”.
6. Governing China with the rule of law.
7. “Practise socialist core values”, including Marxism, communism and “socialism with Chinese characteristics”.
8. “Improving people’s livelihood and well-being is the primary goal of development”.
9. Coexist well with nature with “energy conservation and environmental protection” policies and “contribute to global ecological safety.”
10. Strengthen national security.
11. The Communist Party of China should have “absolute leadership over” China’s People’s Liberation Army.
12. Promoting the ‘one country, two systems’ system for Hong Kong and Macau with a future of “complete national reunification”; and to follow the One-China policy and 1992 Consensus for Taiwan.
13. Establish a common destiny between Chinese people and other people around the world with a “peaceful international environment”.
14. Improve party discipline in the Communist Party of China:
While there are obviously no critics of this in China, at least living, outside of China the point is made that it is difficult to see how a basic motherhood document about communist ideology can deal with contemporary challenges, such as the occurrence right now of the biggest stock market slump in world history, all from PetroChina:
“It’s going to take more than the biggest stock slump in world history to convince analysts that PetroChina has finally hit bottom.
Ten years after PetroChina peaked on its first day of trading in Shanghai, the state-owned energy producer has lost about $US800 billion ($1.04 trillion) of market value -- a sum large enough to buy every listed company in Italy, or circle the Earth 31 times with $US100 bills.
In current dollar terms, it’s the world’s biggest-ever wipeout of shareholder wealth. And it may only get worse. If the average analyst estimate compiled by Bloomberg proves right, PetroChina’s Shanghai shares will sink 16 per cent to an all-time low in the next 12 months.
The stock has been pummeled by some of China’s biggest economic policy shifts of the past decade, including the government’s move away from a commodity-intensive development model and its attempts to clamp down on speculative manias of the sort that turned PetroChina into the world’s first trillion-dollar company in 2007.”
This slump is predicted to get worse, and when the giant falls, Australia will be squashed flat:
Gee, thanks, Asianisers! But, don’t you worry about that because there are bigger things to worry about:
“Blodget: And how big a crash could we be looking at?
Rogers: It’s going to be the worst in your lifetime.
Blodget: I’ve had some pretty big ones in my lifetime.
Rogers: It’s going to be the biggest in my lifetime and I’m older than you. No, it’s going to be serious stuff. We’ve had financial problems in America — let’s use America — every four to seven years, since the beginning of the republic. Well, it’s been over eight since the last one. This is the longest or second longest in recorded history, so it’s coming. And the next time it comes — you know, in 2008, we had a problem because of debt. Henry, the debt now — that debt is nothing compared to what’s happening now. In 2008, the Chinese had a lot of money saved for a rainy day. It started raining. They started spending the money. Now, even the Chinese have debt and the debt is much higher. The federal reserves, the central bank in America, the balance sheet is up over five times, since 2008. It’s going to be the worst in your lifetime, my lifetime too. Be worried.
Blodget: I am worried.
Rogers: Good. Good.
Blodget: Can anybody rescue us?
Rogers: They will try. What’s going to happen is they’re going to raise interest rates some more. Then when things start going really bad, people are going to call and say, ‘You must save me. It’s Western civilisation. It’s going to collapse.’ And the Fed, who is made up of bureaucrats and politicians, will say, ‘Well, we better do something.’ And they will try but it won’t work. It will cause some rallies but it won’t work this time.
Blodget: And we are in a situation where Western civilisation already seems to be possibly collapsing, even with the market going up all the time. Often when you do have a financial calamity, you get huge turmoil in the political system. What happens politically if that happens?
Rogers: Well, that’s why I moved to Asia. My children speak Mandarin because of what’s coming. You’re going to see governments fail. You’re going to see countries fail, this time around. Iceland failed last time. Other countries fail. You’re going to see more of that. You’re going to see parties disappear. You’re going to see institutions that have been around for a long time — Lehman Brothers had been around over 150 years. Gone. Not even a memory for most people. You’re going to see a lot more of that next around, whether it’s museums or hospitals or universities or financial firms.”