There are a number of articles out there in internet land, putting the case that China with its state socialism, will destroy neo-liberalism. One need not embrace this full-blown communism to see the flaws of so-called free trade where there is no level playing field, and China does not play by the rules:
https://www.truthdig.com/articles/neoliberalism-has-met-its-match-in-china/
http://www.henryckliu.com/page105.html
What is interesting is that the case has been put that China is following a form of national socialism, socialism, but wrapped in nationalist rather than globalist values:
https://foreignpolicy.com/2012/11/15/national-socialism-with-chinese-characteristics/
This means that China is more resilient to shocks that neo-liberal economies. But is China immortal? Many have doubts about this, seeing China as a paper tiger. James Rickards has some thoughts on this, primarily negative:
https://www.zerohedge.com/news/2019-08-14/rickards-china-paper-tiger
“China’s per capita income is only $11,000 per person compared to per capita income of $65,000 in the United States. Put differently, the U.S. is only 38% richer than China on a gross basis, but it is 500% richer than China on a per capita basis. China’s military is growing stronger and more sophisticated, but it still bears no comparison to the U.S. military when it comes to aircraft carriers, nuclear warheads, submarines, fighter aircraft and strategic bombers. Most importantly, at $11,000 per capita GDP, China is stuck squarely in the “middle income trap” as defined by development economists. The path from low income (about $5,000 per capita) to middle-income (about $10,000 per capita) is fairly straightforward and mostly involves reduced corruption, direct foreign investment and migration from the countryside to cities to purse assembly-style jobs. The path from middle-income to high-income (about $20,000 per capita) is much more difficult and involves creation and deployment of high-technology and manufacture of high-value-added goods. Among developing economies (excluding oil producers), only Taiwan, Hong Kong, Singapore and South Korea have successfully made this transition since World War II. All other developing economies in Latin America, Africa, South Asia and the Middle East including giants such as Brazil and Turkey remain stuck in the middle-income ranks.
China remains reliant on assembly-style jobs and has shown no promise of breaking into the high-income ranks. In short, and despite enormous annual growth in the past twenty years, China remains fundamentally a poor country with limited ability to improve the well-being of its citizens much beyond what has already been achieved. With this background and a flood of daily reporting on new developments, what do we see for China in the months and years ahead? Right now, China is confronting social, economic and geopolitical pressures that are testing the legitimacy of the Communist Party leadership and may lead to an economic crisis of the first order in the not distant future. In contrast to the positives on China listed above, consider the following negative factors: Trade wars with the U.S. are escalating, not diminishing as I warned from the start in early 2018. Trump’s recent imposition of 10% tariffs on the remaining $300 billion of Chinese imports not currently tariffed (in addition to existing tariffs on $200 billion of Chinese imports) will slow the Chinese economy even further. China retaliated with a shock devaluation of the yuan below 7.00 to one dollar, a level that had previously been defended by the People’s Bank of China. Resorting to a currency war weapon to fight a trade war shows just how badly China is losing the trade war.
But, this currency war counterattack will not be successful because it will incite more capital outflows from China. The Chinese lost $1 trillion of hard currency reserves during the last round of capital flight (2014-2016) and will lose more now, despite tighter capital controls. The spike of bitcoin to $11,000 following the China devaluation is a symptom of Chinese people using bitcoin to avoid capital controls and get their money out of China.
The unrest in Hong Kong is another symptom of the weakening grip of the Chinese Communist Party on civil society. The unrest has spread from street demonstrations to a general strike and shutdown of the transportation system, including the cancellations of hundreds of flights. This social unrest will grow until China is forced to invade Hong Kong with 30,000 Peoples’ Liberation Army troops now massed on the border. This will be the last nail in the coffin of the academic view of China as a good global citizen. That view was always false, but now even the academics are starting to understand what’s really going on. International business is moving quickly to move supply chains from China to Vietnam and elsewhere in South Asia. Once those supply chains move, they will not come back to China for at least ten years if ever. These are permanent losses for the Chinese economy. Of course, lurking behind all of this is the coming debt crisis in China. About 25% of China’s reported growth the past ten years has come from wasted infrastructure investment (think “ghost cities”) funded with unpayable debt. China’s economy is a Ponzi scheme like the Madoff Plan and that debt pyramid is set to collapse. This cascade of negative news is taking its toll on Chinese stocks. This weakness began in late June 2019 when the summit meeting between U.S. President Trump and President Xi of China at the G20 Leaders meeting in Osaka, Japan failed to produce substantive progress on trade disputes. Since then, the trade wars have gone from bad to worse and China’s economy has suffered accordingly. My expectation is that a trade war resolution in nowhere in sight and the trade war issues have been subsumed into a larger list of issues involving military and national security policy.
None of these limitations have prevented China throwing its weight around, as imperialist powers do. The Chinese state media has made a nuclear warning to India over the Kashmir issue for example:
https://www.breitbart.com/national-security/2019/08/14/chinese-state-media-warns-india-kashmir-move-nuclear-war-provocation/
“India’s recent decision to declare Chinese Kashmir an area controlled by New Delhi brings the region to the brink of nuclear war, China’s state-run Global Times warned this week. In a series of articles, the Global Times blasted India’s move in Kashmir last week, accusing New Delhi of annexing the portion of the Muslim-majority region administered by Beijing.Last week, the Hindu nationalist-led Indian government revoked New Delhi-controlled Kashmir of its autonomy, angering China and its ally Pakistan. As part of its decision, India also declared part of the Beijing-controlled Kashmir lands to be a territory administered by the Indian federal government. Pakistan, its ally China, and their mutual rival India all have competing claims to Kashmir territories. Both China and Pakistan have engaged in military conflicts with India over the region. Pakistan has warned of war over India’s Kashmir decision last week. Islamabad downgraded its diplomatic relations with New Delhi, expelling the Indian ambassador. In an op-ed issued Monday and titled “India’s Unilateral Kashmir Move Unwise, Dangerous,” the Global Times declared: Although a chance of nuclear war remains remote, any steps taken by a nuclear-armed India to provoke a nuclear-armed Pakistan or a nuclear-armed China are clearly matters which should concern the wider world. In this sense, the threat of such a war is sadly closer than it was just weeks ago. The Global Times went on to note that India’s recent decision over its Kashmir territory “amounts to an annexation of a disputed territory.”
As Pakistan has vowed not to let the move go unanswered, another India-Pakistan war is now all the more real a possibility,” it added. In a separate op-ed issued Mon day, the Global Times proclaimed, “New Delhi is too reckless on border issues,” further noting: The Kashmir issue is highly complicated and India’s move also hurts China’s interests. … Its actions challenge surrounding countries’ interests, but it wants these countries to swallow the provocation and accept the new facts made by India. … It is unimaginable if Pakistan does not take strong countermeasures. The Global Times went on to caution, “New Delhi is much too confident.” It stressed that New Delhi’s unilateral decision over Kashmir would incur risks for India, adding: Pakistan is a nuclear power and its state apparatus has loose control over local forces [in all of Kashmir]. It would be a wiser choice for India not to squeeze its neighbor. … If New Delhi uses nationalism to support its reckless diplomatic moves, a vicious spiral will be launched. India will have to be increasingly radical. A nationalist India has no future. A third Global Times article published Monday and billed as an objective news report covered India’s foreign minister’s recent visit to Beijing. Citing comments from Chinese Foreign Minister Wang Yi to his Indian counterpart Subrahmanyam Jaishankar, the Global Times reported:
Wang said China is concerned about the current Kashmir situation and the escalating India-Pakistan conflict. … India’s move is neither valid to China nor will change the status quo that China exercises sovereignty and administrative jurisdiction over the territories involved, Wang stressed. Jaishankar expressed India’s stance, noting that India’s constitutional amendment won’t create new sovereignty claims, won’t change the LoC [Line of Control] in the Kashmir region and won’t change the control line on the China-India border. Pakistan and India claim ownership of the area in its entirety. However, a border — the LOC— separates the portions of Kashmir administered by India and Pakistan. Islamabad has ceded some of its Kashmir lands to Beijing. India disputes China’s control of some of the territories on its side of the LOC.”
There is probably no region in the world more dangerous than the Kashmir region, yet we are starved of news about the conflicts in the West. For all we know, nuclear war could erupt, and we will never know who exactly killed us, either by direct hits or by side effects, such as global poisoning via fall out. Oh, and Australia wants to have closer defence ties with India; will that mean that we therefore become a nuclear target? Isn’t is about time that Australia grew up and became independent, or just gave up? Oh, we have given up, or at least our leaders have, happy to have sold us out, for thirty pieces of silver, and a pat on their pointy heads.
https://economictimes.indiatimes.com/news/defence/australia-vows-to-deepen-defence-ties-with-india-increase-engagement-in-indian-ocean/articleshow/70676432.cms
The point to be made is that China’s goal to rule the world as once the US did, is most unlikely, where countries like India have nuclear weapons, and do not accept them as rulers. And, as a tangent, isn’t strange that India has nuclear weapons, but Australia has none? Instead of getting such weapons at the time of the British nuclear tests, we went down the Arthur Caldwell way, of beefing up migrant populations, because, well, population is superior to nuclear bombs and technology!