China's Politics And Stuff

[ScotsAlan]

There was a funny story in China Daily last week about the various Tibeten Lamas.

 

The Party basically announced that it approves of reincarnation, but the Party has the last say in who has been reincarnated as who.

 

I am still struggling to get my head around that one.

 

I will post a link when I get to my laptop.

 

When I say it was funny, I mean it was a serious article, but it was seriously funny

[doc.fixit]

do you mean comical or peculiar?

[ScotsAlan]

do you mean comical or peculiar?

I mean it was a serious story in an official party newspaper, outlining a new policy of the party. To me it was comical. An atheist Government declares that it is in charge of a God it says does not exist.

 

I will post a link. It is funny.

 

But not as funny as the Chinese constitution.

 

Chinahand should post a link here to that on here.

 

There is no need to be anti party really. The party have a loaded gun pointed at their own feet. They pull the trigger themselves on a regular basis.

[Chinahand]

Great video on China's economy:

 

[ScotsAlan]

^{Here is the latest from China.}

 

^{http://usa.chinadaily.com.cn/china/2015-10/22/content_22250580.htm}

 

^{From what I can work out, it means the Party has extended it's jurisdiction from the leading cadres to the entire membership of 88 million people.}

 

^{So, if you are a member of the party, you are responsible to the party, above the law.}

 

^{Previously, if a leader done anything naughty, the Police and the courts were not allowed to do anything unless the Party allowed them. This has now been extended to all members.}

 

^{There is a little bit from the BBC on it, but they have sort of missed the main point of the change and went for the more titilating bits.}

 

^{http://www.bbc.co.uk/news/world-asia-china-34600544}

 

^{The reasoning behind this law change is that the moral and criminal standards the Party expects of it's members is higher than that expected by the Police and Courts for the general populace.}

 

^{I have been talking to some ordinary Party members about this today. It was news to them. But that is normal here. Laws change but the details are rarely made public.}

[ScotsAlan]

Right Chinahand.

 

Question for you, or indeed, for anyone that can explain economics to me :-)

 

When I lived in the UK, and was paying UK taxes, the Tory mantra was that none of my tax should be spent on nationalised industries. All money had to come from the private sector they would say. Every project had to pay for itself and make money for someone. The trickle down effect of the capatalist economy would benefit everyone.

 

Ha ha. Well, as most people on here know, I tend to lean towards the left in politics, so for me nationalisation of key industries are a good thing. Railways and power generation for example. I have always felt that infrastructure in general should be run for the people, on a non profit basis for the benefit of all. Not for the benefits of investors who want a return on their money.

 

You know what's coming...

 

So, I live in China these days, and pay Chinese tax.

 

And as a Chinese tax payer, I now find myself an investor in future UK infrastructure projects.

 

How does that work then?

 

When I was paying UK tax, the UK was selling off all it's infrastructure to make money.

 

Now I pay Chinese tax to the Chinese Government, my money goes to Chinese state owned companies that will be building power stations and railways in the UK !!!!

 

I can't for the life of me figure out what the Tories ( and Blair's mob) are thinking.

 

If Investment has to come from the private sector, how do they come to define other countries Nationalised industries as private investment?

 

I cant figure it out :-)

 

And what did they do with the tax I paid them? I know where my tax goes in China. I can see it being spent on infrastructure. And this week I saw it being spent in the UK..... on infrastructure.

 

( Note, I refer to paying UK tax as in when I was living in the UK, not from my 10 years living on the IOM)

 

It's a topsy turvy world.

[ScotsAlan]

Does nobody care that the UK Government has turned its back on human rights and democracy?

 

I was disgusted by what I saw this week.

 

Cameron with his begging bowl.

 

I think the state visit was great. Trade deals are fantastic. But all I saw this week was a British PM holding out a begging bowl. My Chinese friends are lapping it up.

 

But yet, whenever I post in support of China, I am dismissed as a nutter left winger. An apologist. A commie.

 

Everyone says I am wrong.

 

But not a single comment on MF about the Tories selling out to China.

 

They have nothing left to sell, so they sell the future. They are selling consumers and tax payers to China. They are selling the core needs (energy) to the highest bidder, irrespective of where that money comes from.

 

See my point...?

 

But keep going with your china bashing. China deserves to be bashed. It really does.

 

But Cameron and Osborne sold that right this week.

 

China outbid Saudi Arabia.

 

China can offer nuclear, Saudi Arabia can only offer oil.

 

Human rights of course are swept under the carpet.

 

Edit to add..

 

Just realized what Cameron sold this week.. The ultimate thing to buy in capitalism.

 

He sold the taxpayer.

 

He sold it to China.

Edited October 23, 2015 by ScotsAlan

[gerrydandridge]

I found the state banquet coverage quite gut wrenching this week, lets get out the priceless gold cutlery and ornaments for the president of China, not much talk of suicide nets on the side of factory's, execution vans for quick organ removal of the condemned, just a bunch of criminals having dinner that probably costs per head the average household monthly food bill.. All of these people at this banquet gives no care for the "average" person here or in China, it is nothing more than self service elitism and from a British viewpoint the trendy catchphrase "we are all in it together" didn't seem to fit in well when seeing this ridiculous pomp..I simply cant comprehend how they get away with this on one hand and then talk austerity on the other hand..

[ScotsAlan]

I thought the actual state visit was great. The Royals pulling out all the stops. Fantastic.

 

Cameron and Osborne in lapdog mode was sickening.

 

Then this...

[Chinahand]

Alan, I think you live in a development district deliberately set up by the CPC with tax concessions, investment incentives and table groaning banquets to persuade Foreigners to come and invest in China. China selling it's taxpayers to buy investments ;-)

 

China has been a huge beneficiary of Foreign Direct Investment over the last 30 years and has been very much slower in investing overseas itself.

 

The press and politicians love trumpeting about China, but in the grand scheme of things it is very much late to the party and currently a reasonably minor player:

 

Source

 

China's investments in the UK are all included in the Asia area in the chart above which will also includes all the investments by Japanese, Korean, Taiwanese companies etc. It will be a small percentage of the Asian total - my guess less than 25% of Asian investments in the UK will come from China. And Asia as a whole is less than 10% of the total. So we are talking about something like 97.5% of the UK's inward investment coming from places other than China.

 

Of course China has huge potential as an investment partner - with flows going both ways - UK investments in China (I think you know a bit about those don't you, Alan ;-)) and Chinese investments in the UK.

 

Those are all good things, but China is only just learning how to be a "normal" nation with overseas investments (something it has only been interested in over the last 15 years or so), and an open Capital Account. The Xi Jinping government keep claiming to want to do this, but then spook markets with currency devaluations etc. which show it just isn't ready for them.

 

The current brouhaha is mainly politics - and the reality of how China does its business. Rather than thousands of individual companies making investment decisions for themselves based on their own calculation of the costs and benefits, China is still dominated by command economy dictates coming from the CPC into state owned enterprises.

 

Hence the courting of CPC politicians worldwide.

 

That actually isn't particularly good for China's economy - it's private companies, freer of CPC control are a lot better at making investment decisions than the state controlled ones:

 

 

As ever the Economist explains it pretty well. Audio interview here. [Alan do any of these links get through the Great Firewall?]

 

The UK is trying to carve out a niche for itself as the place for companies' international headquarters and finance divisions and as a place for high tech investments requiring highly skilled labour.

 

That requires politicians being on message and providing the right regulatory and administrative framework.

 

Nuclear power stations inherently involve Politicians, banquets and ribbon cutting ceremonies, but the reality of FDI is far more mundane with more numerous, smaller investments totalling multiple times these flag ship projects.

 

I think the Uk should be open for business. We need a productive, well educated workforce capable of impressing people willing to put real cash into their efforts and an open and stable investment environment to ensure long term returns.

 

I think that is in the UK's interests.

 

 

[Vulgarian]

I think the Uk should be open for business. We need a productive, well educated workforce capable of impressing people willing to put real cash into their efforts and an open and stable investment environment to ensure long term returns.

 

I think that is in the UK's interests.

 

Sounds great but citizens need to be protected from exploitation from capitalists seeking good return on their investment. Where do you think the return on an investment comes from? It doesn't come out of thin air. It comes from the work and money of citizens who are too often taken advantage of.

[Chinahand]

Vulgarian, I think you are well aware that my view of capitalism is based on the idea of Non-Zero Sum cooperation.

 

Fred wants a tractor to increase the productivity of his farm, he's worked out that if the tractor costs less than £25K then it is worthwhile.

 

Harry wants to sell a tractor and use the proceeds to invest in a combine harvester, he's worked out that his tractor is worth £22K.

 

These two people have the opportunity to both mutually gain from transacting.

 

There is a conflict between them - whether the price paid will be closer to £22K or £25K, but other than that haggle it is in their interests to cooperate. Both these people are making investment decisions and can come to a mutually advantageous agreement.

 

The returns from these investments come from the different objectives of the two parties - it isn't an exploitative relationship.

 

Amartya Sen has championed the Capability Approach to freedoms. The idea is that individuals are empowered by giving them the capability to do multiple things and hence be able to choose options for themselves.

 

The UK fails on this in multiple ways - but frankly is better than most places in the world at providing its citizens the capabilities to create wealth for themselves - especially compared to China, let alone the Islamic world or Sub-Saharan Africa.

 

Left wing politicians have basically appointed themselves as the gate-keepers of benevolence, claiming they are uniquely able to decide what policies best help the disadvantaged empower themselves.

 

The state does have a hugely important role in helping its citizens have the capabilities to empower themselves, but whether it is in China or the more loony ideas of the left in the UK, the state is prone to hubris and policies which though they look great when at a state banquet or ribbon cutting ceremony would be better done by groups of capable individuals making their own investment decisions via the nexus of mutually agreed contracts which is a company.

 

This is not exploitative, but simply due to the fact the people have a multiplicity of interests.

 

I am all for increasing the capabilities of Chinese factory workers - I've done it - teaching them Quality Assurance techniques, engineering skills and English at night! This will give them more choices and allow them to escape from the production line.

 

The UK also has to invest in skills and ensure a flexible, capable workforce.

 

That isn't exploitative, quite the opposite it is empowering. And with that empowerment people can then choose how they spend their leisure time - whether it is reading poetry, doing politics or demonstrating about the Chinese nuclear plant down the road.

[Vulgarian]

You credit me with too great an understanding of economics, which is really not my field of interest. But I understand some basic principles.

 

You described a situation in which both parties have equal or nearly equal bargaining power, which is not the reality of many capitalist transactions.

 

In many parts of the world people are exploited in relationships which are unequal, and in which they have little power to negotiate the terms.

 

The state has a role in protecting its citizens from this kind of exploitation, and states take different approaches to this. There are of course those who think that the state is unnecessary and that we would all be just fine and free if money decided everything. Anarcho Capitalists seem to be loons who are fixated on an unworkable pet theory.

 

How far states go in this seems to be a delicate balancing act. To suppress profiteering and protect their citizens from the effects of greed, but risk losing investment and stifling growth; or on the other hand to allow capitalism free reign to abuse and exploit people who are not in a position to negotiate, and hope that this promotes economic growth which will eventually benefit everyone.

 

Take the power station as an example. So a government accepts investment to build it, and these investors want to maximise their return. What is to stop energy companies conspiring to fix prices? Consumers are not in a position to bargain against such collusion. The government has laws that prevent this. What if the power company is the only provider in an area? Can they charge what they like? Again the state may step in and cap profits. What if the provider puts out misleading or dishonest information to the public? There are laws that prevent this.

 

Tell me if I am mistaken in any of this. But what I'm saying is that people's primary protection from exploitation should come from the state and not be left in the hands of those capitalists who seek to maximise the profits that can be extracted from them. Education and other means of empowerment are great but they are 'soft' and do not provide protection from the real threats of greed.

[Chinahand]

China ends its one child policy.

 

It is now a Two Child Policy instead!

 

Link

[Chinahand]

 

Though Alan, I'm not really getting your point.

 

Both the UK and China seek investments from abroad. That isn't odd or unusual in my mind.

 

As state owned companies have huge advantages in China, it isn't surprising State owned companies are investing in UK projects. They have the cheap loans and the connections.

 

I would rather the commanding heights of China's state owned enterprises were freed from political and especially CPC domination, that would probably result in fewer investments in the UK, but overall better investments for increased productivity worldwide.

 

If you are finding what I'm saying controversial please say where.