The two real problems in China
China is a large country with a large population. If you are given the opportunity to govern China, you will probably grasping for breath thinking of a solution. Mind you, China is made up of many seperate states with as many cultures and beliefs. Although it has a single written language, people in different states talk with diferent slangs and it is not uncommon for a northern chinese to not understand what a southern chinese is talking about. To govern it, you would need great resources and to be ready to use untried methods. Now, China has progressed to the second largest economy in the world, and is moving towards dethroning US as the largest economy, probably within four years time. But beneath all those money making schemes that a revived China has, two things stand out in importance. One is how to control the communicating links among the citizenry and the other is the great concern about run away inflation. It is therefore not surprising that the present Chinese government spent most of their time debating as to what appropriate actions to be taken to keep the kettle from boiling over.
Communication is a serious matter. In China, with a population of one over billion and with most of them able to call each other over the handphone, keeping a close eye on what is being chattered is top prioirity. Having emegered from Chaiman Moa's red revolution from the seventies, the China of today will have a whole new set of problems to tackle. It used to be that the citizenry had to be very careful what they talk and who they talk to. Communism does'nt allow freedom of speech, or for that matter, talking bad about the government. Not only that, they have to sing in praise of their leaders, something that is no more in vogue and fully embraced in North Korea. Like people anywhere in the world, praising for government actions is no more popular. People learns about hypocarcies and talking good about the government is one of the worst kind of hypocracy! The latest sign of government intolerance of freedom of speech is the banning of Skype in China. Why is it banned? First, like Blackberries systems, it is a foreign thing. With both systems, the government can't get its hand on tapping what is being conversed. That means they can't effectively put their control on how many people pass of chatting their hatred for the govenment. Without adequate control, the populace could topple the government, perhaps with a little bit of help from the west!
The second big problem in China is running inflation. But why inflation? As China progressed into a world economy, there is a dicotmy between the rich and the poor. A rising middle class is emerging fast, due to the large trade surplus the China has achieved for the past ten years. Unfortnately, this rich sector is unevenly distributed. Large industrial towns , mostly in the western coastal regions is causing a lot of dissent from the poorer states in the interia and western regions. As China grew from an agricultural base, and is still helped by a large rural sector with meagre incomes, it is finding great difficulty in distributing of wealth among the populace. Imbued with endemic corruption in its governing structures, channeling of wealth to the poor is proving to be difficult. Agricultural lands are illegally taken away for sale to private entities for conversion to industrial entities. The poor gets poorer and the rich gets to stake away money in overseas accounts. There is a great fear that another revolution might come along, manned by the destitute poor and rural have nots. The leaders are of the oppinion that they can't use the army, two million strong to control any rebellion. The first sign of an agrieved government is of course the new law in controlling asset bubbles by way of getting the banks from upping their cash asset value. Still, the property market, populaced by the rich is running at a dangerous pace. A burst, no matter how small will affect the economy of China, bringing with it more problems for the poor and also affecting the world. Like China, the other progressing economies also have property bubble on their hands.
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