Crisis: Those that see the glass half full

Written by Uln on March 9th, 2009

Xinhua has come up with the most brilliant in-depth analysis of the economic crisis that we’ve read to date.

BEIJING, March 8 (Xinhua) — China’s relatively fast economic growth has caught the eye of the world at a time when most of the countries are experiencing the full wrath of a raging economic slowdown.

As some Western media questions why China works, the world’s economic experts and scholars are also wondering the same thing: What tools China has to keep its economy resilient and why it is well-positioned to weather the financial crisis?

The answer lies in the nation’s unique growth mode featuring a “scientific outlook on development.”

Economists and bloggers of doom, read and learn.  For the sceptics, this editorial is based on the work of recognized specialists, such as:

  • “Analysts”
  • The vice president of Stellenbosch University
  • The Colombian ambassador to China
  • “The international community”
  • Velia Hernandez, professor from the A.N. University of Mexico

And many other “economic experts and scholars”.

Finally,  science at the service of the community.  And the question is, what do I do now with my two months worth of canned tuna?

9 Comments so far ↓

  1. Mar

    My massage therapist studied at Stellenbosch University. He is a very good massage therapist. Chinese-style massage techniques are also very advanced. Maybe that’s the hidden clue to China’s superior economic performance, and Stellenbosch University’s vice president has found it…

    [Reply to comment]

  2. Mar

    LOL, Actually I feel a bit sorry for the guys I list above. It is not like they chose to take part in the Xinhua article, The editorial just picks some lines they said in different situations, I guess.

    Which is even more dumb from xinhua’s side, because if they wanted to do this, I am sure they could have used the statements of some more famous economists. There has been quite a lot of optimist statements out there lately.

    The point being: Xinhua is not only a State propaganda agency, it is also a very very dumb agency.

    [Reply to comment]

  3. Mar

    Maybe they are afraid that if they officially quote some high-profile experts out of context, those might well choose to make a high-profile response in the international press.

    [Reply to comment]

  4. Mar

    Having read the Xinhua piece, I’m hard pressed to understand what was in there that caused uln to react so negatively. The contents of the report by Xinhua are not that far off the mark, so I’m not sure I understand uln’s sarcasm.

    There are many high profile economists from “respected” universities and institutions who have written and said similar things as the people quoted in the Xinhua article. Joseph Stiglitz (Nobel Prize winning economist), and Jeffrey Sachs, head of Columbia University’s Earth Institute and President of the UN Millenium Development Goals program immediately come to mind — so I don’t see why quoting the people they have quoted in the article is so bad.

    See for example:

    Joseph Stiglitz: “China’s success since it began its transition to a market economy has been based on adaptable strategies and policies: as each set of problems are solved, new problems arise, for which new policies and strategies must be devised. This process includes social innovation . China recognized that it could not simply transfer economic institutions that had worked in other countries; at the least, what succeeded elsewhere had to be adapted to the unique problems confronting China. Today, China is discussing a “new economic model.” Of course, the old economic model has been a resounding success, producing almost 10% annual growth for 30 years and lifting hundreds of millions of Chinese out of poverty. The changes are apparent not only in the statistics, but even more so in the faces of the people that one sees around the country.”

    “China — not particularly democratic or open politically — has had the most rapid and sustained growth of any country over the past quarter century. Conventional wisdom holds that democracies, since they are more accountable to the “masses,” pay more attention to the poor. But China has done more to reduce poverty than most other countries. In recent periods, the United States has seen median real household income fall, and the rich have received huge tax cuts even as poverty has grown.”

    I don’t know what country uln is from, but isn’t it “First World Chauvinism” to think that just because the quoted people don’t come from “major countries”, they don’t know what they are talking about? Why do we think “economic experts” only come from famous universities? Why are the opinions of a South African, Mexican and Columbian not worth reporting? We hear these voices so infrequently in the international press - don’t you think they might have something to say?

    Notice that these are all developing countries. They have unique needs that are different from developed countries.

    Something like RGEMonitor takes a heavily finance view (meaning they focus on what matters to investors (holders of surplus capital, aka capitalists) and fund managers (some of which are no better than gamblers with other people’s money)) of the world. They are less interested in poverty reduction or livelihood issues as a goal in itself.

    The United Nations Millenium Development Project is focused on poverty reduction among other goals. China is playing a huge role in achieving those goals.

    China is still a very poor developing country - after 30 years of phenomenal growth, its per capita GDP (nominal) is still only about one-third of Mexico’s. It’s useful to keep that in mind to give some perspective on how far behind China was, and how far it has come, and how far it has to go - just to give its people the standard of living that mexico has.

    To continue that growth, China also needs the technology and management skill transfers from developed countries. So it’s interesting how China’s economic/political leaders have managed to get that all right, when you look at the dozens of failed development schemes in Latin America, Africa and Asia.

    Don’t forget too that, strangely enough, the US economy is now relying on China’s economy to continue producing so that it earns the hard cash to fund purchases of U.S. debt, which is needed to fund the stimulus and recovery packages. China’s productivity does not come so much from natural endowments (China is not OPEC) as it does from the hard work and ingenuity of its people.

    So when you look around you in Shanghai, all those busy hands are not only supporting the weight of 1.3 billion people, it’s helping to fund the hopes and dreams (or at least cushion the economic downfall) of 300 million Americans. Hard work it is.

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  5. Mar

    Hi, ph, sorry I just realized you were blocked by Akismet because you had more than 3 links in your comment. Basically, my blog thought you were spam. For info: all comments with more than 3 links are blocked automatically.

    My answer to your comment: this post is not against China or against those who think that the Chinese economy will survive the Crisis. I see some merits in their arguments and, although I am a bit sceptical, I would never position myself so radically against them. Only an idiot would be 100% sure of the outcome in such a complex system as Chinese/World economy.

    So this post is not against any kind of economic theory. It is only against Xinhua, the largest Worldwide Agency of Misinformation, who publishes an article trying to make us think that it is a serious analysis when it is no more than a vehicle to transmit a message from the CPC leaders.

    And the worst of all is: they do such a bad job of it! See the next post with the rosy slides to understand what I mean.

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  6. Mar

    Hello Julen,

    This is the first time I read your English blog.

    As for the report from Xinhua (Is it a newspaper?) I am astonished.

    My outlook of the Chinesse economy was of a wild economy without any social control. Now I have discovered -with the support of international signatures- this economy faces to the development considering at any time the stright against poverty and considering enviromental sustainability.

    Good news! Very good news to me!

    Congratulationes for your blogg.


    [Reply to comment]

  7. Mar

    LOL, Jarrillero, nice to see you come over to my English blog for once, thanks for the effort. Not being familiar to China you are missing some elements to understand this post:

    1- Xinhua is the Chinese official press agency, controlled by the party.

    2- The concept of “scientific development” is the political theory of HuJintao, now part of the official doctrine of the party. Regardless of it being right or wrong, the mere notion of an imposed, non commentable, solid block theory is in itself repulsive to any free-thinking mind.

    3- Finally, my post was intended to be ironic, and yes, you were (more or less) right to think China is a wild economy, with little care of the social and environmental issues.

    Thanks for coming by!

    [Reply to comment]

  8. May
    Overseas Born Chinese


    I think your views regarding the reporting by Xinhua is interesting. If Xinhua is under the influence of the CPC, then it clearly shows that the CPC and the writers of Xinhua do not have any real clue as to why China did not financially and economically collapse.

    Moreover, it also shows their own lack of understanding regarding the current economic situation in China, since they greatly need these so-called foreign experts to explain what is happening in their own country.

    If this is the case, I hope the CPC and Xinhua wise-up, ASAP. Although China’s government has done relatively well to contain the negative global effects to its own economy, it should pay closer attention to the counter economic and military actions of those affected (i.e., US, UK, & etc.), as those actions (i.e., trade sanctions, limited warfare, & etc.) do have China in their target sights.

    Good Article.

    [Reply to comment]

  9. May
    Carey Rowland

    The argument from “perspectivehere” is well-stated, and quite convincing, especially the last points: 1.) the “US economy is now relying on China’s economy to continue producing so that it earns the hard cash to fund purchases of U.S. debt, which is needed to fund the stimulus and recovery packages. ” and 2.)”all those busy hands” are supporting the of weight of 1.3 billion Chinese along with the “hopes and dreams” of 300 million Americans.

    Your response, uln, is educative as well. The point about Xinhua illuminates a large disconnect between economic efficiency and political freedom (as in freedom of speech and freedom of information,etc.) The traditional western view (a la Smith, Mill…Greenspan,etc) has been that economic prosperity flourishes only in the fertile greenhouse of political freedom.

    China’s present economic surge and emerging dominance seems to indicate otherwise. Or, perhaps, Xinhua and CPC are clueless about some pretty serious freedoms that are being flaunted beneath the scope of their authority.

    As “Overseas born in China” says, they don’t have any clue. One wonders how long the Emperor can issue decrees before his nakedness is taken advantage of, or, at least, noticed.

    Carey Rowland, author of Glass half-Full

    [Reply to comment]

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