A Note on the Middle Income Trap

In the last couple of years, a number of China political observers have commented on the dangers to China of the middle income trap.  The fear is that the Chinese economy will fall into the trap. Since economic growth is the remaining claim to legitimacy for CCP, a substantial slowdown from real growth rates of 6 to 15 per cent per year, which obtained in the last forty years, will be disturbing to the harmony that keeps CCP in power. 

In what follows I am not making direct claims for or against the middle income trap in China, only describing the concept. 

Huawei - Lie down with dogs, get up with fleas

You know the meme – when you work with bad guys, you should expect to be labeled a bad guy. I mean no disrespect to the thousands of Chinese companies doing business across the world that manage to be profitable without intimate Chinese government relations.  But in our globalized, internet era, it is impossible for a high tech company, particularly one as fundamentally important to internet networks, to not be tarnished with the specter of theft of intellectual property and CCP internet control and monitoring of Chinese businesspeople, students, even foreigners.

Probably no one outside a small group of analysts has the actual evidence of real dirt on Huawei.  But that is the risk of being a national champion in China.  If the government is promoting you, then there must be a government interest in promoting you, beyond just “go team.”  This is simply Chinese practical reasoning.

But it seems that lying down with dogs is more than just a saying here.  In his extraordinary Sinocism news blog, Bill Bishop continues the Huawei stories.  From the February 9 edition, with no repetition in the stories (all should be clickable) -

Another update at July 24, 2019 - Boris Johnson became Prime Minister today.  From the South China Morning Post -

Boris Johnson, Britain’s prime minister-designate, said his government would be very “pro-China”, in an interview with a Hong Kong-based Chinese-language broadcaster shortly before he was chosen to succeed Theresa May on Tuesday...

Speaking to Phoenix TV, Johnson backed Chinese President Xi Jinping’s infrastructure-based Belt and Road Initiative and said his government would maintain an open market for Chinese investors in Britain.

Crash out is now scheduled for October 31 - Halloween in the US, when goblins arrive. 

Idle Thought           last week in January, 2019

What if this past weekend were the beginning of the end for the orange haired baboon?  And, in the process, the GOP were so damaged that even a Pence presidency couldn’t do much harm, and we gained a president in 2020 who was smart, thoughtful, respected intelligence and loyalty to allies and was up for repairing the extraordinary damage, domestic and international?

Someone who might say something that would remind us of these lines -

“Let the word go forth from this time and place, to friend and foe alike, that the torch has been passed to a new generation of Americans, born in this century, tempered by war, disciplined by a hard and bitter peace, proud of our ancient heritage, and unwilling to witness or permit the slow undoing of those human rights to which this nation has always been committed, and to which we are committed today at home and around the world. Let every nation know, whether it wishes us well or ill, that we shall pay any price, bear any burden, meet any hardship, support any friend, oppose any foe to assure the survival and the success of liberty.”

Update on Peking U Ideological Battle    January, 2019

In a recent post, The Ideology of Occupation, I described an ideological struggle being played out last month at Peking University, the combined Harvard-Yale of China.   Now, a followup on what has happened to the "Old Marxist" students who questioned the manner in which CCP has been providing leadership of the proletariat.  Spoiler - they are in jail.