Gas and China
Instapundit points to Gateway Pundit which features pictures of kilometer long gas lineups in Guangdong. The police are standing by.
One commentor ironically observes
I just don’t get it. China has a centrally-orchestrated energy policy, lots of bicycles and other efficient transportation, not too many SUV’s that I know of, no robber-baron oil companies to contend with, and isn’t the White Devil of the Muslim world. How could this be happening?
In fact, as many of the Gateway pundits observe, there are two major reasons. Gas is priced poltitically rather than by the market. Second, China uses energy 1/7th as efficiently as the US in its productive processes. A good deal of the Chinese economic miracle has been fueled by artificially low energy prices which, in turn, have meant there has been minimal incentive to use energy efficiently.
For a certain sort of declinist lefty China is the scary monster which will swallow the US whole. After all, the Chinese have so much US currency and are the largest buyers of US bonds. And the Chinese make things. Lots of things which the US no longer makes like televisions and dollar store merchandise.
In fact, China is a miracle of financial engineering hiding a hornet’s nest of unresolved problems. Making a lot of plasitic stuff with artificially low energy and feedstock input costs is possible; but it is not yet a full on market driven economy. Using politics rather than markets to set energy pricing is just one potentially disasterous Chinese policy.
Equally worrying is the fact China is almost out of water. Or that there is the potential for mass unemployment if the yuan rises more than the piddly .3 percent it was allowed to a month ago.
There are monsters under the bed no doubt - but China looks more and more like a paper tiger.
Written by jay on August 19th, 2005 with
1 comment.
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#1. August 19th, 2005, at 2:44 AM.
“And the Chinese make things. Lots of things which the US no longer makes like televisions and dollar store merchandise.”
Yeh. And it’s not exactly like our society will collapse if we have to go without our televisions or some piece of shit baubles we picked up at the local dime store.