China Law Blog

Let's put it this way: China's communism can be pretty amazing.

As for handling the crisis, I think the Chinese government did a decent job so far. I am a believer of "Free market," but I also believe that government should intervene if necessary, this is a good example. This can only be done in China though, because the state owns all major industries (power and energy, transportations, communications, insurance and banking etc.), Wen Jiabao can simply order them to do what he wants.

However, the system has it's drawbacks too. All these companies are monopolies, consumers sometimes don't get the usual benefits that a true free market economy brings. For example, the mobile phone service in China is too expensive even by American standards. The banking system is a joke as well. Last time I was in Beijing, I went to Bank of China to deposit some money. I wrote them a personal check (American bank), I was told that it'll take more than a month for the money to get there. And if I want to convert them into RMB, I have to come back IN PERSON after the money arrives. WTF?

Until they can get these problems fixed, I wouldn't call the “Capitalism with Chinese characteristics” a success yet.

Having read the article I must say that Chris has a point in the fact that the government tries its best to solve the problems. However it has been far from victorious as I have watched a lot of footage on the internet through Chinese websites and blogs.

This whole excercise has little to do with communism at all. Governments are supposed to do whatever possible to solve such a crisis and especially a non-elected government will have to do a bit more to mitigate the peoples anger.

This excercise went so far as apologizing, as if that makes a difference, for the bad weather to the people waiting in Guangzhou train station and shows how the government is above and all nervous about riots in the provinces.

Yes there are plenty of civil servants who genuinly want to help the people and try to put their best leg forward in times of trouble. That is not a unique China characteristic.

China is a capitalist country run by a single party, there is no such thing as socialism with Chinese characteristics looking at how the country has developed itself and at what speed. Sweden in the 70's and 80's would be a model state for that but unfortunately also the Swedes had to concede defeat upholding a model that is simply financially not sustainable. Remember Zhu Rongji telling the workers in the Northeast they could go and pack their bags a couple of years ago? Not all that socialist wasn't it?

Any government can take the actions China has taken in case of a serious crisis, any government can opt for spending packages or subsidized food and energy to help in case of calamities, be it in freezing prices or handouts, any government can order companies to drive their trucks to the place of a disaster and will reimburse the companies for the expenses (or not, it depends) or mobilize the army and army reserve to help out.

I just do not see how this should be a victory to communism or socialism. It is just a matter of a government, not an political doctrine, that has the means, capability and will to take on a calamity.

In that China's government has proven to put in its best effort, have its leaders go out there and try to get its workers home in time for the holidays or alternatively urge them to stay put in e.g. Guangdong.

I wouldn't say the central planning is the source of all wrongs. Rember, the difference of Russia and China in comparing economic development after 1989, is largely depended on the fact that there is more central direction in China which leads to efficiency and corespondence, whereas in Russia the so called democracy doesn't give rise to much efficiency but less coordination, cooperation and more dispersed development.

@Li - Do you mean that at least the communists make the trains run on time? Seems we're seeing some evidence that they can't even manage that.

I thought the whole point of 'reform and opening' was that it was making China into a more decentralised state, at least in economic terms. I fail to see how the government can claim positive responsibility for China's rapid growth, it seems that the best way in which the government has contributed to economic growth is by NOT intervening in economic affairs - or am I mistaken?

Pfeffer,

It has its pluses and minuses.

Will,

I generally agree.

George,

Nice points.

Li,

I am not a fan of central planning, yet I have to agree that Russia switched too quickly and so I am always mindful of that when analyzing China. I am not calling for full scale rapid privatization.

As many of your know, the comment thread to this post turned into a match between a group of people supporting the writer of this post and a group of people against the writer of the post, with me trying to mediate between the two. A few minutes ago, I spoke with someone I greatly respect, who told me the whole discussion was not befitting this blog and I agree.

For that reason, I have gone back and deleted all of those comments, pro and con, and I plan to do likewise in the future should I be confronted with a similar situation.