China’s leaders are “bizarrely unwilling” to use more government spending to support consumer demand instead of production, according to Nobel laureate in economics Paul Krugman.
“The fact that we seem to have a complete lack of realism on the part of the Chinese is a threat to all of us,”
Krugman echoed criticism by U.S. economic officials including Treasury Secretary Janet Yellen that China can’t simply export its way out of trouble. The comments come amid renewed concern in the U.S. and Europe over what is viewed as Chinese overproduction and the dumping of heavily subsidized products overseas
China’s whole economic model is not sustainable because of “vastly inadequate” domestic spending and a lack of investment opportunities, he added. Beijing should be supporting demand not more production, he said.
one of the rare
takes i disagree with is that china needs the us to buy all the stuff they make. while they might currently want closer us ties for safety and us capital, i really don't think they have a structural need for us domestic purchasing. with relatively modest consumption, there's no reason that a fully socialist and developed china would actually need constantly working armies of manufacturing labor.
Yeah, they can just start mandating more vacation days until domestic production equals domestic consumption.
But I think China's climate change plan is to dump cheap solar panels on the world until all the countries working on profit logic are forced to switch to solar power. Which does need people to buy their stuff.
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