From: Adam Back <aba@dcs.ex.ac.uk>
Date: Tue, 10 Feb 1998 06:51:22 +0800
To: tcmay@got.net
Subject: Re: time to learn chinese?
In-Reply-To: <v03102802b1050abbe851@[207.167.93.63]>
Message-ID: <199802092224.WAA00886@server.eternity.org>
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Tim May <tcmay@got.net> writes:
> Oh, and on the specific prediction...I have my doubts about even the per
> capita numbers rising as fast as some think. It's still a Communist system,
> with periodic crackdowns on anyone or any entity who is perceived to be
> doing "too well."

The interesting aspect of her speculation was on the possibility of an
economic and political process of change which would result in a
transition directly from communism to a free market based political
system, by-passing democracy and socialism.  She viewed democracy and
socialism as mistakes made by the west to be learned from and avoided.

Communist regimes typically include a significant element of central
planning which introduces economic inefficiencies, yes, and loss of
freedom of choice, etc.

Socialist democracies have much in common with communist regimes in
this respect: elements of centralised control, restrictions of choices
(the nanny state, huge welfare systems, 50%+ taxation) large
government restrictions on free market operation.

Both systems suck, but currently the lesser of two evils by a large
margin is living in a socialist democracy because of the wider
freedoms as compared to the lack of freedoms in Communist countries
such as China, and because of it being worth putting up with the nanny
state and 50%+ tax rates as compared to the economic instability and
organised crime problems in Russia, and previous Russian provinces now
split off back in to small countries.

The interesting question is the how these two evolving political and
economic systems will change over time.

Her speculation was that a previously communist system evolving
towards becoming a pure market system might move towards this goal
more rapidly than a rampantly socialist democracy would move towards
the same.  She also considered the different cultural work ethic
signficant: Chinese people on the whole work harder, and re-invest
more of per capita income.

> Anyway, China does not as yet have even a single reasonably state of
> the art chip making plant in its entire country. Given the
> timescales and learning curves involved, it seems unlikely they'll
> be a high tech leader in little over 10 years.

Singapore, Taiwan, and Japan produce sizeable quantities of electronic
devices, consumer electronics items, cars, etc.  In fact I understood
them to out compete western manufacturing in many instances.

They may not always be at the leading edge of R&D, but they do produce
a lot, much of it quality equipment, and we (westerners) buy more
consumer electronics, and cars produced by such countries now.
Personally I would buy a Toyota over a Ford anyday :-)

China might be viewed as larger version of Singapore a few decades ago
perhaps.  Enterprise zones (or same rules for the whole country) with
0% taxation, unrestrictive planning rules etc should help attract
outside investment from high tech companies, if political stability
was viewed as good enough.

Probably you are right on the optimism of the time scales of the
interviewed analyst.

Adam