Chinese Government and Its major Issues

Summary of Communist-Party-of-China's insurmountable Problems

"China has gone through an industrialization in the past twenty years that many developing countries needed one hundred years to complete," —Pan Yue

The poignant Question is, "How sustainable is China's growth model and at what cost did it gain this economic momentum"?

Excessive capital investment: Beijing rewards provincial and local government officials with promotions if they manage their regions well. For decades, the chief measure of progress was success in providing jobs for a rapidly growing urban workforce. That usually meant building factories or adding infrastructure, whether needed or not. Such overcapacity leads to waste of scarce resources, deflation and dumping of excess production abroad.

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Financial mismanagement: Local officials force state-owned banks to finance that construction at next-to-nothing rates, with no regard for borrowers’ suitability. Inevitably, non-performing loans pile up on the banks’ balance sheets. Beijing already recapitalized the four largest state banks once, forcing ordinary depositors to foot the bill, which hurt consumption. Now bad loans are once again on the rise, a result of the $586-billion stimulus China poured through banks last year. Though Beijing could manage another bailout, it certainly can’t go through this cycle endlessly.

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Educational Flaws: Chinese colleges graduate many times the number of engineers and scientists that American universities produce, but such statistics are misleading. To meet the quotas for graduates set by Beijing, academic programs dilute their standards. They further inflate their count by counting as engineering students those studying to become mechanics or industrial technicians. The result, according to a pioneering study led by Duke University professors Gary Gereffi and Vivek Wadhwa, is that many of these graduates fall far short of the standards imposed by U.S. colleges and universities. When they graduate, many are unable to find work in their professions.

Future of China's technological capabilities

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Stifled innovation: Those engineers and scientists who do measure up -- the cream of Chinese universities or those who study overseas and return home -- often have little freedom to explore. If they work for state-owned firms or universities, Beijing dictates the direction of research and development.

China Rips Off The iPad With The iPed. If this imitation continues,one day imitation will be China's only hope (many say it already is)

Many gravitate to the more open atmosphere at private firms, but these companies can’t get loans to grow because state enterprises gobble up the capital. Beijing aims to compensate by forcing multinationals to transfer advanced technology as the cost of doing business in China, but foreign firms are fighting back hard.

Report says equipment flaws caused Chinese Rail Accident on July, 2011.

Train Wreck in China

► China's illegal copying of movies, music, and software cost companies $2.2 billion in 2006 sales, according to an estimate by lobby groups representing Microsoft, Walt Disney (DIS), and Vivendi (VIV.PA).

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Environmental degradation:One of the Big questions about China is that although China's economy has grown tenfold since 1978, but what has China's economic boom done to the environment?

The future of China is fraught with a dreadful environmental crisis. Sixteen of the world's twenty most polluted cities are in China. To many, Beijing's pledge to host a "Green Olympics" in the summer of 2008 signaled the country's willingness to address its environmental problems. Experts say the Chinese government has made serious efforts to clean up and achieved many of the bid commitments. However, an environmentally sustainable growth rate remains a serious challenge for the country.

Behind this booming economy lies rampant environmental Pollution

Water pollution and water shortages pose the most serious problems. 

In the Yellow Sea coastline, countless sewage pipes buried in the beach and even extending into the deep sea. April 28, 2008

They cause health ailments, damage agriculture, jam up hydroelectric dams, interfere with manufacturing and limit urbanization. As aquifers dry up, soil erodes, turning an area the size of Connecticut to desert every year. The resulting dust storms add to the country’s already horrendous air pollution. Beijing’s preferred solution to the problem is a massive south-to-north river diversion project. Odds are, that will make matters worse, draining water from already overtaxed southern supplies.

Xuanwei (宣威) in Yunnan province is a cancer village. Every year there are more than 20 people die of cancer. 11-year-old student Xu Li (徐丽) is suffering from bone cancer. May 8, 2007

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Corruption: Consider this fact: A recent survey found that of the 20,000 richest men in China, more than 95% were directly related to Communist party officials. One of the major reasons Beijing has such a hard time dealing with all the problems mentioned above is that so many individuals have a vested interest in keeping things exactly as they are. Communist Party officials pay for their advancement, then aim to earn back their investment. Local governments seize houses and land, sell it to developers with little compensation for those displaced, then take kickbacks from the construction companies. Academics provide kickbacks to the party in exchange for research funding. U.S. companies operating in China suffer as well.

"When U.S companies hire for research and development there, there’s a lot of pressure to put Communist Party members in key positions," says Wadhwa.

Officials stand trial in Fujian province in China's biggest corruption scandal

Beijing does make examples of particularly corrupt officials and business leaders, sometimes even executing the offenders. But the problem of corruption is endemic, says Liao Ran, a China specialist with Transparency International. “Generally speaking, the cost of corruption amounts to about 10% to 13% of annual GDP,” he says. In absolute terms, that’s a loss of $500 billion to $700 billion per year.

NO REAL FREEDOM of expression thanks to Vicious Authoritarianism and Draconian form of Administration:

Post-1949 China attracted the world attention in 1989 by the massacre of dissenters in Tiananmen Square.

Citizens of the democratic World are free to declare things that go directly against their Government's credibility (such as, government in their country is not democratically elected or their president is "Hitler-reincarnate"). But in the People’s Republic of China, such an opinion is not within the freedom of speech.

Recently it was announced in the United States that the last still alive eleven participants in the Tiananmen Square protests were shot.

In the democratic West, freedom of speech is a citizen’s legal right.

In the People’s Republic of China, freedom of speech is a bureaucratic permission given by the ruling bureaucracy. Such a bureaucracy ruled thousands of years ago (in China, for example).


China has no rural property rights. China's 750 million rural residents who lease land are at the mercy of the local and regional government as to what compensation they will receive, if any, when they are forced from the land as a result of development, infrastructure improvements, etc. Additionally they have no right to borrow against their lease, and as such they have no assets.

Migrant workers Live like slaves and are bereft of all basic Human-Rights

Wu Chunxia, who was wrongfully imprisoned in a China Henan Provincial Psychiatric Hospital for 132 days as punishment for protesting about local injustice to authorities, says the electric acupuncture needles stung her scalp and the drugs bloated her weight, giving her heart palpitations and brought on premature menopause.

In fact, the Chinese government's official figures state that more than 200,000 hectares of rural land are taken from rural residents every year with little or no compensation. According to some estimates, between 1992 and 2005 20 million farmers were evicted from agriculture due to land acquisition, and between 1996 and 2005 more than 21% of arable land in China has been put to non-agriculture use. China Regime Sends Citizens to Psychiatric Hospitals to Silence Dissent.

China, Henan Province Petitioner ruthlessly Beaten for his dissidence

The result is not unexpected, with over 87,000 mass incidents (or riots) reported in 2005, a 50% increase from 2003. Many provincial governments in China have begun to use ununiformed policemen to beat, intimidate, or otherwise subdue any citizen that dares to oppose the Party.

(Read more about restrictions on freedom in PRC here)

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And demographics: 

People in China love to have more children.

The one-child policy is challenged in principle and in practice for violating a basic human right to determine the size of one's own family.
Although, between 2000 and 2005, as many as 1,968 officials in central China's Hunan province were found to be violating the one-child policy by their leverage of affluence, as the generation of the Cultural Revolution retires, the burden of their care falls heavily on the smaller generation of the one-child policy. Thus almost a colossally high 'Dependency Ratio' will affect the economy by reducing cheap labour-power that china boasts now!

“The Chinese population is simply growing older faster than it’s getting richer,”
—says Peter Navarro, a professor of economics and public policy at the University of California at Irvine.

As fewer workers support more retirees, competitiveness will suffer. For an illustration of what this could mean, China need look no farther than Japan.


Democracy, no doubt, is a messy thing, especially when you have an electorate that exceeds 600 million people who are motivated to vote. However, democracy also helps to ensure that individual liberties are respected and that the government is responsive and beholden to the will of the people, rich or poor. A democracy also ensures accountability through impartial courts that help enforce and protect such things as property rights, environmental rights, human rights, and good governance.

So, where would you place your bet?