Arts & Culture 
 Business 
 Environment 
 Government 
 Health 
 Human Rights 
 Military 
 Philosophy 
 Science 
 U.S. Asian Policy 


Home > East Asia > 

What could trigger China’s economic internal shock?
Heide B. Malhotra, The Epoch Times
9/27/2004

The Taipei Times suggested that China’s economic crisis might be triggered by internal rather than external shocks. The Times left it up to the reader to come to a conclusion as to what could cause such internal shocks.

Given the many secrets China has veiled behind the façade of “state secrets,” it is hard to find the probable trigger. Since the Cultural Revolution, China’s populace has been instilled with the constant fear of revealing something that could set off reprisal against the entire family clan. The Chinese psyche has not overcome such fears. We even perceive it in those Chinese that immigrate to other countries. Divulging what Westerners expect to be openly discussed could have detrimental effect to those left behind.

Still, it’s not that hard to identify factors that will affect the economy. What comes to mind? How about China's one billion plus populace which continues to increase daily? As children grow into adults they need employment. The Chinese news agency Xinhua suggests that about 15 million people enter the job market annually. Others suggest numbers as high as 25 million. What about employment opportunities? Can China’s ruling party create enough jobs to hold down unrest? Or has the battle already been lost?

Official statistics report a 4.5 percent unemployment rate. It is purported that these numbers are vastly inaccurate, as they only account for urban unemployment and include only those laid-off from government employment. They do not include those that were laid-off from state-owned companies (SOEs). A more realistic number, counting all of those looking for work but can't find it, is probably far above 20 percent. It is scary to read that The Observer stated in early 2004 that 80 percent of those living in rural areas are unemployed.

Jobs are scarce! The Communist leadership is moving from government ownership to private ownership without creating new jobs. Private owners look at the bottom line, radically trimming off excess labor, and increasing unemployment. And, lots of jobs that could be held by the average uneducated worker are taken over by the growing number of slave labor camps, places actually illegal, under international agreements signed by China. No one can compete with such labor camps, as they do not compensate the enslaved detainees.

Chinese authorities have steered the economy away from socialism towards capitalism, while holding onto the reigns of power. This has created problems for China. Industrialists in China have all the freedom to pursue profit, but none of the democratic constraints found in a country where government and business is accountable to the free press. Corruption and economic crimes are rampant and difficult to control, given that those that govern are often those with the most corrupt behavior. It has cheap, unregulated labor with no labor-run unions and foreign investments flooding into China, expecting wages that would not be maintained in any democratic country.

Social justice, given ineffective and unenforced laws, is non-existent. A national infrastructure for the unemployed and a social welfare system are non-existent. The government so far, shows no interest in addressing or implementing a social system, similar to those in democratic countries, though one can find “Band-Aid” fixes. Most of these fixes are found only in foreign-invested enterprises, such as minimum wages. As long as official corruption is rampant, relief for unemployed labor will not be had.

Social protestors are brutally suppressed by China’s police force and are quickly whisked away to jail and accused of exposing “state-secrets.” Large protests have sprung up throughout China. In February 2004, 2,000 workers from the Tieshu Textile Factory in Suizhou, Hubei Province protested; in March 2004, 1,000 Anhui winery workers protested; and also this year, in inner Mongolia, 7,000 retrenched workers in the Military Factory in Baotou protested.

© Copyright 2002-2007 AFAR