Tuesday, December 23, 2008

People who live in glass houses...

It's interesting to see the frequent commentaries in the media recently about China's vulnerability to political unrest due to the economic downturn. "If China's growth rate dips below 8%..." or "If unemployment continues to grow..." types of comments are followed by a discussion of the potentially dire popular reaction. To this one could say, what about us, here in the U.S.A. We have no growth, plummeting housing prices, rising unemployment, the beginnings of a commercial real estate debacle, and a credit crisis that will not stabilize until the credit card companies go through their inevitable catharsis. Is there the, should this be said, arrogant assumption that because we are a democracy we will not have popular unrest or a significant political reaction.

True, Americans do not need to storm the Capitol building to make an impact. Enough pressure on members of Congress could lead to a disasterous series of protectionist trade measures that would lock in a recession or depression for the world, exacerbating nationalist tendencies and setting the stage for something terrible. In the U.S., political unrest can manifest itself in many ways. The commentators and the media want to focus on China and the fact that its growth rate may slip from 11% to 7.8%. Looks like a good problem to have from here.

This also brings to mind the media's focus on China's refusal of American aid after the devastating earthquakes there early in the year. Not that it wasn't a nice offer, but they are a powerful country now with the resources to address their problems. They're not Burma. At this point, what media pundit would dare compare the recovery from the earthquakes in China to the recovery from Katrina here.


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