Comments by "" (@craigkdillon) on "China Observer"
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The Belt & Road Initiative of China is doomed to fail.
1. China's construction processes are incompetent. Construction is done by habit. Designers, managers and workers will work the same way from project to project.
It is impossible for them to do one project poorly to save money, and then do the next one at high quality. The workers will do the same work.
So, tofu dreg projects are to be expected.
2. Debt slavery or debt colonialism won't work. No matter what the contracts say, nations can simply not pay.
Payment of contracts between countries can only be guaranteed under the threat of military force. That is how the French, English, Dutch, and others maintained and enforced their colonial rule.
Colonial rule has ended. China has no ability to threaten military enforcement of its B&RI contracts. First, China has no expeditionary forces. Secondly, the western powers would oppose any Chinese effort to military enforcement of its contracts.
Lastly, any country that was a colony knows exactly what they need to do to oppose any such action.
China has really screwed up.
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Take time to define "migrant" worker in China. It is very different from how it is used in US.
In US, a migrant worker is a foreign worker, often Mexican, that comes in annually to work, like pick crops.
In China, a migrant worker is a Chinese citizen from another part of the country. So, if one moves from Hunan to Beijing to find work, that person becomes an internal migrant.
They don't have access to the education, health, and other benefits if they stayed home.
This structure of internal migrants in China is a major factor holding the country back, IMO.
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That is how China's industry developed. Western companies would develop things, and then go to China for cheap production. So, China focused on manufacturing costs and efficiencies.
And, that is OK.
If China had not gone rogue, then we could have continued with that.
US companies would do chip research and design, then China would produce them in quantity and cheap. Now, that link is broken.
US companies will develop, but now production will be domestic or to trusted countries -- like Mexico, Philippines, Columbia (maybe), India, or Vietnam. Oops, I forgot, Taiwan, too.
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China's natural customers that are rich or nearby.
Rich countries like the US, UK, Japan, Canada, and Sweden.
And nearby countries like Japan, Taiwan, India, Philippines, Vietnam, and Malaysia.
CCP has threatened each one of those countries with war,
or at least used vaguely worded threatening rhetoric which could mean war.
Every one of those countries is trying to reduce trade and economic dependence with China.
China's factories are closing, and workers will suffer.
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Now, besides regulatory uncertainty, businesses have to cope with operational uncertainty.
I am referring to power blackouts caused by the CCP punishing(?) Australia, and boycotting their coal,
which in turn, is causing power blackouts in parts of China.
Companies want their factories to hum production.
No drama. No interruptions.
Most thought these were one time events, and things will be normal right away.
That is not happening.
Now production interruptions have become normal.
That is intolerable. Businesses will do everything to escape that situation.
I PREDICT ---- there will be MANY more businesses leaving China,
and going to ANYWHERE else.
They want normalcy. India, Vietnam, Philippines, Columbia, Chile, South Africa, Ethiopia, etc. etc.
ANYPLACE but China.
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To me, the most logical way for China to secure its borders would be to act friendly and peaceful towards its neighbors.
China's bellicose threatening acts and words has resulted in its neighbors spending a lot more on their militaries.
Japan, Taiwan, Philippines, Australia, Indonesia, Malaysia, Vietnam, and India have ALL increased purchases of planes, ships, missiles, and tanks.
China's RELATIVE military power has decreased as a result.
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Technically, China is experiencing "collapse", not decline.
"Decline" implies part of a cyclical economici cycle, like a recession or even worse depression.
Both "recession" and "depression" suggest that they will end as an economic cycle works its way through, and comes to an end.
All recessions and depressions are followed by booms and expansion.
China is NOT experiencing that, IMO.
China is going through profound structural change.
Whole industries are being affected, with some disappearing.
Today's China is a shadow of what it was just a few years ago.
In 10 years, China will be unrecognizable from the booming China we knew for 30 years.
40 years ago, poverty was universal in China. It was everywhere. Poverty was normal, and the Chinee people accepted it. It was part of life. It was their life.
B U T --- the Chinese of today don't remember that poverty. All they knew was boom and prosperity. Abject poverty will hit them hard.
They will be angry.
I wonder who they will blame??
Hmm, anyone have an idea/??
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@offiz Every now and then, some American banks go bust, that is true.
In fact, in 2008-09, more than a few went under.
BUT -- not one person lost their savings, or even a portion of their savings. Can the same be said of Chinese bank failures??
The American system is flexible, and can take big hits. It bends, but does not break.
That is its biggest virtue, IMO.
Some who hate the US, are now predicting disaster, just because there are some issues. There will always be issues.
Debt, or inflation, or deflation, or recession, etc. etc.
But, if you look at history, the American economy and system just sailed on through.
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@youxkio I presume they would try their hardest, and would get a percentage, but much less than the 100% they get in peace time.
Oil would be a bad problem. However, if a pipeline can be built from Iran, that might solve that problem.
Biggest problem would be food.
Fishing would be almost totally stopped.
Other imported food would be stopped as well. China is now a net importer of food, so that would be its greatest problem, I think.
If is a big rice producer. Is that enough??
War is horrible, and seems to never work out as leaders think at the start.
Civil War, WW1, and WW2 were supposed to be short wars, as thought by the ones who started them. The wars were long, and they lost.
Wars do tend to favor the ones with greater resources. So, US would likely win.
But, that doesn't always work out -- look at our Revolutionary War. The weaker side won that one.
War?? Best to avoid one.
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When China was agrarian, its people were farmers. Farmers could grow their own food, and survive. Food and shelter were basic, but accessible.
Now, China is urbanized.
Living requires money, actual money.
Money for an apartment, and money for food, at the very least.
As China sinks into deep poverty, young people will suffer the most.
They don't know how to live in poverty.
They cannot grow food.
They cannot sew and make their own clothes.
The youth were told - get a degree, and jobs will be there for you.
Jobs are not there.
Chinese youth are lost, and sinking into despair.
The weak will kill themselves.
The strong will get angry.
What will the CCP do with with that anger?
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Philippines, India, Indonesia, Mexico, Vietnam, Columbia, Thailand, and many others
do their best to make foreign companies feel wanted and appreciated.
Unlike China, who puts their executives in jail, threaten companies, and steal from them.
What sane business owner would want to do business in China??
(Note: Elon Musk does not qualify, since I did say "sane")
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@offiz Good question. We don't really care about what happens in places like Brazil, or India, or Egypt, or many other countries -- so, it is a good question - "What is it about China that makes America react like it has??"
I think there are several reasons.
1. China is threatening war to take Taiwan.
2. China claims sovereignty (not competing EEZ rights) over the South China Sea.
3. China has threatened war against many countries unless they do precisely what China tells them to do -- Sweden, Canada, US, Japan, Australia, India, Vietnam, UK, and Philippines.
4. China has publicly and repeatedly said that the US is their enemy. It is hard to be apathetic when a country as big and powerful as China declares you its enemy.
5. There is the human rights issues -
---- persecution and genocide of the Uighyrs.
---- Persecution and organ harvesting from Falun Gong members.
---- Illegal arrests and detainment of citizens of other countries to use as bargaining chips.
----- the persecution and inhumanity of the CCP towards Chinese citizens. (not that we really care, though).
Is that enough to explain it?
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One more thing about China is that since it has threatened, insulted, and alienated almost every nation,
I don't think anyone will offer China any help.
After all, if the Germans and French did not offer the Greece or Italy much help,
what can China expect from the world?
In contrast, remember when a tsunami hit India??
Do you remember all the help that poured out from nations to India?
People like India, so help was quickly and freely given.
If the same thing happened in China,
would you expect a similar outpouring of aid and sympathy for China??
I don't.
Oddly, to save face, I think the CCP would rather Chinese people die,
than to accept foreign help.
To the world, that is sick, but to the CCP, that is normal.
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Russia's invasion of Ukraine is having an unexpected, but welcome, effect.
The unity of the west and the power of its sanctions, I believe, have impressed and scared the CCP.
They see what can happen if they attack Taiwan.
The west can freeze, and even take, all their money.
The money corrupt officials have put in western banks and assets could be lost.
Secondly, China uses Russian equipment and doctrine.
The poor performance in Ukraine should make them have a rethink.
Would an invasion of Taiwan fare better than the invasion of Ukraine???
Probably not.
BUT, a failed sea invasion results in many more deaths, as troop ships are sunk.
I think these are good developments, reducing China's hunger for invading Taiwan.
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The idea that China's economic slump was due solely to COVID was stupid.
Anyone watching China knew that other serious factors were at play.
I. the real estate collapse and bankruptcies of developers like Evergrande is wreaking tragedy on homeowners. They are losing their life savings in many cases.
2. The CCP has made it very clear that western companies are not welcome. Apple, Samsung, Foxconn, Toyota, and many others have left, or are preparing to leave. The Port of Shanghai's traffic is way down. Containers are piling up on the dock.
3. CCP has increased war tensions. The risk of war increases the risk of all companies doing business in China. Companies are risk averse, so some are leaving for this reason.
Altogether, multiple factors are hitting China's economy at the same time.
If only one was happening, China could probably cope and recover in a short time.
Taken together, it means that China's economy is re-structuring and will not be the same for generations.
If China wants to start the process of healing and recovery, it should start being peaceful.
It should treat its neighbors, and most natural trade partners, with affection.
Too bad, the CCP does not even know how to do that. Its belligerence and combativeness is too deeply engrained in its psyche.
The only mystery now is how far will China decline?
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China started war with the world.
It has threatened war with --- Taiwan, Japan, US, Australia, Philippines, Vietnam, India, Sweden, Canada, UK, and others.
China forgot that all those countries were their customers.
Not too bright, IMO.
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What the CCP does not understand is the lack of foreign, especially American buyers, come from decisions made by those companies,
not the US government.
The reasons foreign buyers are not coming are these ==
1. The CCP constant talk of war with Taiwan creates risk for buyers,
You see, if a war broke out, maritime trade in the South and East China Sea's will be stopped.
Maritime insurance is not available in a war zone. So, buyers may not get their goods.
That is a serious risk.
2. Foreign businessmen no longer feel safe in China. Abusive arrests and harassment makes them feel unsafe and unwanted.
Even if a company wanted to do business with China, how can they, if their executives won't go??
3. On top of that, the Chinese executives may not be able to leave China to do business. If foreign businessmen cannot get in,
and Chinese businessmen cannot get out --- how can they get together to do anything???
4. Lastly, and this might be the most important, is that western companies may not trust Chinese contracts, or their enforcement in China.
Western companies need to trust contracts and the legal mechanisms for enforcing them.
Who can trust the CCP and China??
They have proved themselves to be fickle friends.
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