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Soviet Collapse Echoes in China’s Belt and Road

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Re: Soviet Collapse Echoes in China’s Belt and Road

#91

Post by gspetr »

yostrovs wrote: post #49
duxup wrote: post #38

>In the 1950s, the Soviet economy grew faster than that of any other major country barring Japan. I'd like to read more about what was happening then, was it largely military investment?

So much destruction post 1940s coupled with slave labor (local political prisoners and German prisoners of war) leads to roads and steel plants being built quickly. The population though lived on near nothing till the 60s.

A not well-researched viewpoint. In USSR since late 20s, a significant portion of workforce was compensated on a "per unit of goods produced" basis, not "per hour worked", which was the standard in contemporary capitalist countries.

Slave labor in the post-renaissance era cannot compete with other types of labor.

If it could then the South would have fared much better in the US Civil War and everyone and their grandmother would have industrialized economies in Africa by now. Or at the very least Ethiopia should have, which was never a colony of anyone for any meaningful period of time.

Not to mention, the North Korean Famine of 1994-1998, in which 3% of population died, would not have been a thing.

Re: Soviet Collapse Echoes in China’s Belt and Road

#92

Post by factsaresacred »

Barrin92 wrote: post #28

I don't see any justification for the Soviet analogy other than wanting to conjure up the image of the impending collapse of China. This sounds like the infrastructure version of the 'financial bubble' prediction that crops up every other year. If one wanted to pick a positive story there would be the example of the American progressive era, the creation of the interstate system, the railway system during the 19th ce…

> it obviously makes sense to invest into continental infrastructure because it does not control the sea.

Easier and cheaper to pursue a Blue Water Navy than pump money into questionable projects in corrupt States -- projects who's success is anything but assured (See Malaysia PM planning to cancel all Chinese projects and the mess in Pakistan as recorded by WSJ recently).

> someone needs to build infrastructure, after all, I don't think we've somehow transcended the need for transportation.

It's more about the opportunity cost and ROI than the need, right?

Re: Soviet Collapse Echoes in China’s Belt and Road

#93

Post by sonnyblarney »

User23 wrote: post #78
dnomad wrote: post #72

Earlier quoted context omitted.

This is what really irks the West. China did not allow themselves to be controlled by external debt like the Soviet Union. The Chinese have not only avoided debt slavery they have actually begun to weaponize their own debt power and such that they are now the world's largest sovereign lender.

The US doesn't borrow money from China. The US swaps treasuries for reserves with the Federal Reserve, which then sells those treasuries to primary dealers, who in turn sell them on the open market where anyone including foreign sovereigns like China, can buy them. In the unlikely event that the Federal Reserve failed to sell those instruments, they'd be left on their balance sheet and the interest would be remitted…

It's the same thing as borrowing.

US gov sells TBills, those TBills are bought by China.

The transaction you described also translates government debt into currency, which China also sits on, so it's a kind of an exchange debt.

So the US 'owes' China a gazillion dollars in services and stuff. One way or another.

Re: Soviet Collapse Echoes in China’s Belt and Road

#94

Post by taobility »

seanmcdirmid wrote: post #89
taobility wrote: post #84

Earlier quoted context omitted.

HSR don't need to be profit individually, that's why it's funded by the government. HSR will stimulate the economy which it connected. So in a big picture, it brings a huge positive impact for the economy, just like the highway.

HSR wasn't funded by the government however, at least not completely. Well, this is where it gets complicated: China Railway is a SOE, so it is technically the government. It took out a lot of debt to do HSR, and technically that isn't considered public debt and is rather listed as corporate debt (if SOE debt was considered public debt, China's public debt would obviously be much higher than the USA). Anyways, see ht…

I am very aware that, as I am native Chinese. CRS is SOE, but when they constructed each individual HSR project, they got the investment from local governments, as each local governments knew that HSR would greatly benefit the economy. Just like HSR project between Beijing and Shanghai, which got the investment from seven local governments, if you can read Chinese: https://zh.wikipedia.org/wiki/京沪高速铁路 The whole project has 12 major shareholders, including 7 local governments.

Re: Soviet Collapse Echoes in China’s Belt and Road

#95

Post by sievebrain »

bogomipz wrote: post #41
logicx24 wrote: post #20

Earlier quoted context omitted.

India had the world's largest GDP under the Mughals and had continued positive growth, but by the end of the British Raj, was facing stagnant population growth and actually reduced agricultural productivity. So contrary to everything you're saying, India was not only productive before the British, it was actually worsened by Britain's exploitation.

>"India had the world's largest GDP under the Mughals and had continued positive growth." Do you have a citation for this? For the entire 300 years of the Mughal Empire? How accurate would that information even have been in say the early part of 16th century?

How exactly do you even measure the GDP of such an ancient empire? Economists can't accurately measure GDP of western economies today despite huge armies of statisticians, even China's true GDP is a mystery, so I'd have to assume any such claims about the GDP of the Mughal empire are nonsense.

Re: Soviet Collapse Echoes in China’s Belt and Road

#96

Post by Latteland »

seanmcdirmid wrote: post #62
AnimalMuppet wrote: post #57

Earlier quoted context omitted.

> China ... has never occupied a foreign country. I'm not sure that Tibet would agree with you.

It is China's position that they never invaded Tibet. The Yuan dynasty invaded and conquered Tibet, but they don't count since they were Mongolians. It is weird logic to be sure, but there it is. Otherwise Tibet was supposed to be Chinese territory afterwards even if the Chinese dynasties following the Yuan didn't actively govern it and mostly left them to their own devices.

Well then based on what actually happened (invading a county where there were other countries people & troops there since before the founding of modern china) it's not true to say that they haven't invaded anyone. Will they 'not invade' taiwan next? Invading and then declaring it was ours historically is still invading.

Re: Soviet Collapse Echoes in China’s Belt and Road

#97

Post by sievebrain »

adrianratnapala wrote: post #69
bogomipz wrote: post #41

Earlier quoted context omitted.

>"India had the world's largest GDP under the Mughals and had continued positive growth." Do you have a citation for this? For the entire 300 years of the Mughal Empire? How accurate would that information even have been in say the early part of 16th century?

Something like this is a pretty standard and unsurprising result. Here is one quick google hit: http://www.visualcapitalist.com/2000-years-economic-history-... No one should be surprised that that India and China were the big dogs for most of history. Perhaps more surprising are that: a) This continued well into the 19th century, and b) India was bigger than China in medieval times. I'd say that (b) is not a fair com…

How can you possibly describe a chart that your link admits is the opinion of one academic "pretty standard and unsurprising"?

The idea that you can even estimate percentage of world GDP 2000 years ago is laughable.

Re: Soviet Collapse Echoes in China’s Belt and Road

#98

Post by User23 »

sonnyblarney wrote: post #93
User23 wrote: post #78

Earlier quoted context omitted.

The US doesn't borrow money from China. The US swaps treasuries for reserves with the Federal Reserve, which then sells those treasuries to primary dealers, who in turn sell them on the open market where anyone including foreign sovereigns like China, can buy them. In the unlikely event that the Federal Reserve failed to sell those instruments, they'd be left on their balance sheet and the interest would be remitted…

It's the same thing as borrowing. US gov sells TBills, those TBills are bought by China. The transaction you described also translates government debt into currency, which China also sits on, so it's a kind of an exchange debt. So the US 'owes' China a gazillion dollars in services and stuff. One way or another.

This is hard to wrap one's head around, so let me try again with some more detail. The US doesn't sell TBills. It creates those interest bearing IOUs ex nihilo, and then swaps them for reserves (also created ex nihilo) with the Federal Reserve. Primary Dealers buy treasuries from the Fed, not from the treasury.[1] The process is absolutely nothing like going to a bank or anyone else to borrow money.

[1]https://en.wikipedia.org/wiki/Primary_dealer#Primary_dealers...

Re: Soviet Collapse Echoes in China’s Belt and Road

#100

Post by sonnyblarney »

User23 wrote: post #98
sonnyblarney wrote: post #93

Earlier quoted context omitted.

It's the same thing as borrowing. US gov sells TBills, those TBills are bought by China. The transaction you described also translates government debt into currency, which China also sits on, so it's a kind of an exchange debt. So the US 'owes' China a gazillion dollars in services and stuff. One way or another.

This is hard to wrap one's head around, so let me try again with some more detail. The US doesn't sell TBills. It creates those interest bearing IOUs ex nihilo, and then swaps them for reserves (also created ex nihilo) with the Federal Reserve. Primary Dealers buy treasuries from the Fed, not from the treasury.[1] The process is absolutely nothing like going to a bank or anyone else to borrow money. [1] https://en.wi…

Yes, I get it - but the mechanism does not matter: TBills and TBonds US government debt.

US dollars are a form of debt to the US economy.

So If you hold TBills/TBonds, the US government owes you money.

If you hold USD, then the US economy owes you 'stuff' that you can exchange those dollars for.

Anyone who holds TBills/TBonds is lending to the US Government.

China holds a lot of both, ergo the US is indebted to them ... essentially, the US does borrow money from China. Though the sale may not be directly to China, ultimately, that's who's sitting on those bonds/cash.

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