A rchive Date
[ 07-11-2005 ]
Category
[ International Relations ]
sub-Categoy
[ China ]
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[http://www.torontosun.com/News/Columnists/Downing_John/2005/11/07/1296212-sun.html
China's big, bad boom
COUNTRY'S EXPLOSIVE POPULATION GROWTH MAY HINDER ITS ECONOMIC PROSPERITY
By JOHN DOWNING
Mon, November 7, 2005
SHANGHAI - China's leading the world in production, poverty and pollution. Will the fact it also leads in brats slow its drive to dominate this century?
I may sound like a grumpy grandpa, but there's proof on every street that the one-child policy imposed since 1980 by the Communists causes the Chinese to "treasure" their kids. Even if the princes and princesses aren't theirs, they can scream and flop and pee in the gutter and do whatever they please while onlookers beam.
The Chinese candidly admit they spoil children. Not all like it. Our guide around the world's largest dam taming the fabled Yangtze River was a teacher and the son of college teachers. He said he quit, and his parents would like to, because their pupils are pampered and think the world owes them a living.
So what, you may think. Hasn't the older generation always thought that? A Canadian tells me his Belgian partner sent his son here to run a business. He hired a young staff who didn't see any need to work. So he replaced them with people over 40 who remember the hard times.
That anecdote overflows with irony because unemployment's high here and there's pervasive poverty. There are still hard times for most outside the prosperous giant cities, hundreds of millions left behind in China's charge to dominance.
The huge pool of workers has the world salivating. The question is whether the great expectations of the new middle class will slow the explosive growth of China, just as it has blunted the economic bite of Taiwan and South Korea.
The Communist bosses limit birth because they say China will prosper if its 1.3 billion population doesn't keep growing. Yet at 12 births per 1,000 people, it's still ahead of Russia at 11 and Canada at 10, despite brutal campaigns of forced abortions and sterilizations. Pregnant women have been grabbed off the street so local party bosses will get promoted.
The party acts Communist when it comes to freedoms but capitalist on everything else. If parents want another son for old age insurance, they let them buy the boy. The party voted unanimously (of course) in 2002 to let parents pay a fine of around $400 - which for peasants in poor areas can be four times annual net income - for each additional child (girls often are aborted.)
There are no free lunches. The days of being kept by the state vanished a decade ago. Now the people pay for schools, housing, even operations. (Just what they have to pay is listed on an electronic board in a hospital lobby: $16 for an abortion, $33 for a cardiogram, with major procedures costing a year's salary.) And they fear what happens in old age when less than half of the 240 million workers have a pension plan.
As the respected magazine The Economist reported in a hard look at the Chinese boom's underbelly, the people have reacted to their state forcing them to pay for everything by saving at world record rates - families save 25% of disposable income, the country saves nearly 50% of GDP. They also pay cash to avoid taxes in a thriving underground economy.
With all that saving, with little credit available, that huge market that North America drools over may not expand to expectations. Just one example The Economist cited: Golden Resources, the world's largest mall in suburban Beijing, has over 1,000 shops featuring more clerks than customers.
China floods the world with cheap goods. North America buys far more from China than it sells. Canada's trade deficit with China will be over $17 billion this year - the U.S. deficit is 13 times that.
Yet there are more important riddles than China's consumers. The bosses say they want closer ties with the U.S. but won't co-operate militarily and may spend $100 billion this year on an already formidable force. And on Oct. 19, the Communist Party issued a white paper with no initiatives for even the simplest changes wanted by neighbours and the U.S..
After centuries of isolation and a century of civil war, famine and revolt, we have a China that will change this century for us. Let us pray - still dangerous to do here - that it will be for the better.
You can e-mail John Downing at john.downing@tor.sunpub.com
Have a letter for the editor? E-mail it to editor@tor.sunpub.com
Copyright © 2005, Canoe Inc. All rights reserved
 World Fact Book (CIA)]
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