In July of 2001, Gordon Chang predicted an inevitable meltdown of the Chinese Communist Party in his best-selling book The Coming Collapse of China. Since then, China’s economy has increased by more than eightfold, to surpass even the United States on a purchasing parity power basis. Oops?This entire article is a MUST READ! I'm getting e-mails from my financial guy that is warning of bad things happening in China.
In Chang’s defense, he could not have anticipated the colossal blunder of President Bill Clinton and a Republican Congress in paving China’s ruthlessly mercantilist way into the World Trade Organization just five months after his book was published. That mother of all unfair trade deals—a well-deserved target of both the Sanders and Trump presidential campaigns—kept China’s Great Walls of Protectionism largely intact. However, it also opened U.S. markets to a flood of illegally subsidized Chinese imports, and catalyzed the offshoring of millions of American manufacturing jobs.
Since China’s entry into the WTO in 2001, the center of the world’s manufacturing base has seismically shifted as the People’s Republic of Unfair Trade Practices has used a dizzying array of illegal export subsidies, currency manipulation, intellectual-property theft, sweatshop labor and pollution havens to seize market share from both Europe and North America. To date, more than seventy thousand American factories have closed, over twenty million Americans have been put out of work and Chinese Communist Party leaders have laughed at Gordon Chang—all the way to their Swiss, Panamanian and Caymanian bank accounts.
China’s mercantilist WTO windfall notwithstanding, there are nonetheless growing signs that the collapse of China as Gordon Chang once predicted, andDavid Shambaugh is now intimating, may soon be at hand. As Exhibit A of the signs of China’s troubles I offer, in the remainder of this missive, an email correspondence directly from the Chinese mainland. It’s from an American citizen living and working with his Chinese wife and son in the PRC.
I will let you decide whether the views of this observer (name withheld to keep him out of a Chinese prison or shallow grave) is an accurate one or overly pessimistic. If it’s the former, it could well be the harbinger of Gordon’s Chang’s crystal-ball revenge.
“From what I can see, and my Chinese wife can see, China will probably soon implode. Just what the catalyst will be is uncertain. Just before that time, or as a result of that implosion, the [Communist Party] will probably try to get the population to focus outside the country, probably through conflicts in the South China Sea or Taiwan.For more than two decades, I have been telling people that the first thing China would do before trying to take Taiwan would be to take the Spratly Islands. If the world simply ignored that, then Taiwan would be next.Hong Kong is a bitter, poison pill left by Britain for China. There will be no peaceful resolution of that problem.
Things are weird there and Wall Street is whispering about it with increasing frequency behind closed doors.
Did Clinton and numerous Republican Congresses unleash our greatest weapon against China? Did we unknowingly set them up for a fall by giving them the most destructive gift known to man...unfettered Capitalism and all the destructive greed and corruption that comes with it?
Maybe. One thing is certain. China is in for a rough ride this year.
UPDATE! I've watched in amazement as this post garners few if any comments. This is HUGE boys and girls. Depending on Chinese actions, our own presidential election be effected or the next president will have to deal with a crisis that rivals 2009 in its ferocity. Add to it the troubles in the Middle East and massive immigration into Europe and we're looking at a perfect storm that is beyond the control of our policy makers. We would be stuck behind the reaction curve and will not be able to shape events. More troubling? If China goes south then all bets are off. You want to know what will affect your lives? More than likely it won't be terrorism, an illegal immigrant or even crime. An imploding China though....Do yourself a favor. Read Williams comment below and chew on the implications!