China’s Incapabilities

China’s Incapabilities, by David Archibald.

In running a country you can have either productivity or control — one or the other, but not both at once.

The Chicoms under Dictator Xi have reverted to type and have opted for control. They are favouring state-owned enterprises at the expense of privately-owned companies. Productivity in the former is one third that of the latter. China’s standard of living will fall as a consequence. Capitalism is a far more efficient allocator of capital than any other system. …

China’s growth over the last 30 years during its partially capitalist phase appears to be a miracle, but it is also a parasitic growth on the West. Now the mutant has grown outsize and the body must reject it to have any chance of survival. Tariffs and economic and legal instruments alone will not be enough. …

The Peoples Liberation Army writings in 2015 started referring to the ‘Five Incapables’ — the inability of officers to ‘(1) judge the situation, (2) understand the intention of the higher up authorities, (3) make operational decisions, (4) deploy troops, and (5) deal with unexpected situations’. Just as the workers of state-owned companies have only one third of the productivity of the workers at private companies, Peoples Liberation Army forces are likely to be far less effective than troops that are able to think for themselves, a situation only enhanced by the technological advances of the last 30 years.

David lets loose with some radical policy suggestions at the link.