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The NYT Says Chinese Govt Stifles Capitalism!

From the New York Times, of all places:

Entrepreneur’s Rival in China: The State

December 7, 2011

SHANGHAI — … Some economists and academics [see] a disturbing pattern [in China].

After more than a decade in which private companies have been the prime engine of China’s economic miracle, the Chinese government is eager to control more of that wealth — even if that means running roughshod over private companies.

Chen Zhiwu, a professor of finance at Yale University and a harsh critic of the state’s dominant role in the economy, says the Chinese government is smothering the private sector. “When the government is involved in business, it’s hard for private companies to compete,” Professor Chen said.

The usurping of private enterprise has become so evident that the Chinese have given it a nickname: guojin mintui. That roughly translates as “while the state advances, the privates retreat.”

Some prominent Chinese economists are warning that the potentially corrosive effects of an approach that favors government companies at the expense of the private sector could eventually stifle innovation, saying it could stunt China’s long-term growth and quash the rising aspirations of the nation’s 1.3 billion people.

Wait a minute. Look at how great General Motors is doing. Look at its innovation. Look at the Volt!

“If China doesn’t deal with this problem and strengthen the private sector, this country’s growth is not sustainable,” said Xu Chenggang, a professor of economics at the University of Hong Kong

This professor must also be a lunatic. This kind of thinking is diametrically opposed to what we hear every day from the best and brightest in our country, like the New York Time’s own Nobel Laureate, Paul Krugman.

There are a variety of reasons the Chinese government is seeking an enlarged role in the economy — including fears that wealthy entrepreneurs could begin to challenge the Communist Party.

There is also an ingrained belief among leaders that the state is better at driving growth and redistributing wealth.

And so state companies have been given the green light to expand their interests and move into anything that promises high returns — whether real estate, finance, technology or other fields.

Which is exactly what we are seeing with Obama’s own brand of ‘crony capitalism.’

Private entrepreneurs have long complained about the way state banks discriminate against them, forcing them to turn to loan sharks and pay a higher cost for capital. They also say they are squeezed by state corporations that have the power to overcharge for basic services like power, transportation and telecommunications.

Thanks goodness none of this could never happen in a capitalist country like the United States.

“If the government doesn’t interfere, these entrepreneurs would be productive,” said Zhang Weiying, a professor of economics at Peking University, one of the country’s most prestigious schools

Where can we get some of these Chinese economics professors?

This article was posted by Steve on Thursday, December 8th, 2011. Comments are currently closed.

3 Responses to “The NYT Says Chinese Govt Stifles Capitalism!”

  1. untrainable says:

    This shows how wonderfully insightful the news staff is at the NYT. “Newsflash … China is Communist… film at 11.” In other news, that burning bright thing in the sky has been tentatively identified by scientists as the “sun”, though further more intense investigation is necessary before this identification can be verified.

    But I do love the fact that they have more Chinese professors than American professors with this view of state interference into the private sector. Didn’t they hear the Messiah give his Osawatomie speech? Don’t they understand that capitalism has NEVER worked. Obama said so, so it must be true… right? I mean he was a professor too. At least they tell us he was a professor.

    After this article, how long before those professors in China are jailed as enemies of the state? Actually, we should probably keep an eye on Chen Zhiwu at Yale. It probably won’t be long before the sharp edge of the IRS, or the (in)justice department bring this guy down for wrong thinking.

  2. BannedbytheTaliban says:

    “Private entrepreneurs have long complained about the way state banks discriminate against them”

    And yet all the OWS people want state control of banks. This is also exactly why the democrats keep fomenting class warfare against those greedy bankers. State controlled banks are also an excellent way to launder money to the ruling class. Just ask Barney Frank and Newt Gingrich how well in works with Fanny and Freddie.

  3. Mithrandir says:

    Time for another installment from CAPTAIN OBVIOUS

    Couple things:

    1. Tyrannies ALWAYS find out where revolution by the people is, and just dial it back a bit to get the most out of them, without risking a collapse of their precious system. (….smart tyrannies anyway)

    2. Communists and Socialists ALL LOVE MONEY! They use it as an engine to further their own goals, certainly not for the benefit of Capitalism. They play the game of abusing the Capitalist system, but not enough to stop the benefits of it coming in.

    3. HUBRIS. Eventually communist China, or Socialist Europe will get arrogant, and kill the goose that lays the golden eggs. IT ALWAYS happens, it’s happening right now, and will happen in the future. Too many people in China have tasted the sweet nectar of Capitalism, and it’s too late to put the genie back in the bottle (my strategy with CUBA, open trade, get them addicted to Apple products etc, then slam the embargo back in their face! Fidel and Co. will be gone in 6 weeks)…..there is no way 1.3 billion people are going to tolerate communism without serious problems, and we all know how communists solve problems with unrest. (stay tuned)

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