China's economic ties both enable and constrain it's actions, just ours do.
Hu Jintau and Xi Jinping have had their hands full preparing for a successful Communist Party Congress this year, with the Bo Xi Lai saga the most visible part of the challenges to a smooth succession. Copper prices, euro vehicle import statics, and the Chinese shadow banking system are just a few places that investors and traders watch to continually gauge the stability of the system. Business clusters such as Chongqing may be seen as barometers of the larger whole.
Meanwhile back at the ranch we have our hands full with assessing the costs/benefits and sustainability of military keynesianism, not to mention system wide economic sustainability. The Budget Control Act of 2011 and the 2010 National Commission on Fiscal Responsibility and Reform will help DoD (among others), willingly or not, to prioritize incentives, behavior, strategy, and desired outcomes.
I think that neither the Chinese nor the US elite are willing to risk creative destruction at this inflection point in history, as the masses which they are responsible for are already under significant amounts of stress and strain.
- Hu Jintao, bio by Wikipedia, http://en.wikipedia.org/wiki/Hu_Jintao
- Xi Jinping, bio by Wikipedia, http://en.wikipedia.org/wiki/Xi_Jinping
- Was die Falle Bo Xi Lai und Chen Guangcheng eint, Kolumne von Klaus Methfessel, 05.05.2012, WirtschaftsWoche, http://www.wiwo.de/politik/ausland/a...-/6594190.html
- The economy of Chongqing, by Wikipedia, http://en.wikipedia.org/wiki/Chongqing#Economy
- Military Keynesianism, by Wikipedia, http://en.wikipedia.org/wiki/Military_Keynesianism
- Budget Control Act of 2011, http://www.gpo.gov/fdsys/pkg/BILLS-1...112s365enr.pdf
- UPDATE: Everything You Ever Wanted to Know About the Sequester, April 26, 2012, Bipartisan Policy Center, http://www.bipartisanpolicy.org/blog...ommittee-fails
- 2010 National Commission on Fiscal Responsibility and Reform, http://www.fiscalcommission.gov/site...h12_1_2010.pdf
- Creative Destruction by Wikipedia, http://en.wikipedia.org/wiki/Creative_destruction
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