Brief Notes from China
We are getting ready to leave Shanghai. The timing of the trip was fascinating because China seems to be ready to move to a new stage of development.
For example, just today I read that the government is instituting a 5% energy tax in the remote Xinjiang province. The response to the Honda strike and the string of suicides at the Foxconn factory were critical of management. Of course, the ownership of these plants was not Chinese; even so, the China Daily has pushing the line that it’s time to leave the low-wage economy behind. China is also beginning to take more control over the strategic minerals, of which it has large share of the world’s production.
The taxes levied on real estate knocked the Shanghai stock market down quite a bit. The papers have also been taking a critical attitude towards the wanton demolition of neighborhoods to make way for expensive commercial projects.
All of these moves are consistent with intelligent social democratic principles, but I have difficulty in seeing socialism here. At the same time, virtually everybody we encountered treated the Chinese economy and socialist.
I tried to get a feel for the real estate bubble. Real estate construction in Shanghai seems to have calmed down a bit since I was here a few months ago, but the rate of construction Suzhou and Hangzhou was phenomenal.