I was challenged, and I rebutted as follows.
http://www.mpettis.com/2013/06/10/how-much-investment-is-optimal/#comment-23978I am writing from the perspective of social capital & trajectory, since I am projecting the future.
When the rule of law is itself corrupted by the demands of boomers to maintain what can't be maintained, thus handing control of the government to the bankers who will never write-down the capital stock, then the rule of law is an illusion that is already rotten inside and waiting for the Minsky moment.
Whereas, China's people are becoming increasingly vocal about corruption and their actions are increasingly capitalistic. I was told by a Chinese recently that it is perfectly okay to criticize the government, just don't organize into groups when doing so. The only practical limit is to not challenge the actual authority by organizing. Whereas in the West, it is becoming increasingly politically incorrect to criticize the government. In the USA, there are even laws and Homeland security policies that characterize a person as a terrorist if they belong to certain ideologies.
China is liberalizing their financial door slowly, while the West is closing it, now with capital controls increasing.
Absolutely not, the Chinese criticize socialism and praise capitalism. Whereas, Westerners criticize capitalism (Obama!, ZIRP, bailins, etc) and embrace socialism.
I can't imagine how you could be so blind. Oh wait, yes I can. You are Westerner, so you believe this propaganda you've been fed about your social capital being superior to China.
No you've gotten it backwards. Not having welfare in place, means the free market and private capital is more free to invest and innovate. Two more phenomenal decades of this private enterprise will provide the funding for the social programs China needs 20 years from now.
Chinese readily subvert the censorship on the internet, using varied techniques such as misusing words so their meaning is obscured. A few VPNs of input, can be spread out by forum posts and word-of-mouth.
I didn't say China has better respect for privacy NOW, I said that their control is not opaque and the citizens are not living in a fantasy world believing they have privacy. Thus they've been having a dialogue about it, and are well along the way towards being ready to dismantled it when the Minsky moment comes. Whereas the West is in denial thinking they are good, but actually rotten to the core of their social capital needs. And when the Minsky moment comes, the West is going devolve into what it really is behind the curtain.
How much you want to bet that the USA public eventually forgets the recent NSA infocalypse, and the behind-the-curtain abuses increase? Whereas, the Chinese are not going to forget until they obtain the freedom to capitalize freely.