Yeah, I was wrong when I predicted that the world would end on May 21, 2011. It should end on October 21.

-Harold Camping

with all due respect mr. chang, you have argued that china has been on the brink for more than a decade now just what is your definition of being on the brink? close to collapse? decades from collapse? centuries from collapse? because you clearly assume that the chinese government has not changed its ways.

quote "Not long ago, everything was going well for the mandarins in Beijing. Now, nothing is. So, yes, my prediction was wrong. Instead of 2011, the mighty Communist Party of China will fall in 2012. Bet on it. " unquote

i would very much like to take you up on this bet, i am willing put-up everything i own, as i believe this is a far safer investment than any stocks or government bonds.

"So, yes, my prediction was wrong. Instead of 2011, the mighty Communist Party of China will fall in 2012. Bet on it. "

The thing is that China naysayers have been consistently wrong over the years. Yet most of them are still being paraded in the Western media as "China experts" as long as they say things which most people want to hear.

China definitely has its share of problems and Chang pointed out some of them correctly. However nowhere did Chang provide any evidence as to why would China collapse next year as opposed to 2016, or 2020. The fact of the matter is that there are very few world leaders who actually want China to collapse, because in addition to economic turmoil there would be political uncertainty. In such an environment China won't collapse.

The US currently has mass protests in the "Occupy" movements around the country. It started as a Occupy Wall Street and eventually morphed into a country wide response.

The US currently has a strongly divided government as can be seen in the gridlock that is occurring in Congress and pretty much everywhere else on the political seen with Republicans and Democrats at each others throats.

Also, the Soviet Union collapsed because of many factors. Demographically, at the height of the Soviet Union only 45% of the population were ethnically Russian, and this meant the keeping the power of the majority was a challenge. By 2045, it is predicted that the white population will be a minority in the US, with the other "minorities" becoming the "majority". The Soviet Union overspent on it military, with a massive portion of the economy dependent on the military-industrial complex to feed it. The US by comparison is militarily overstretched, with huge obligations in every portion of the world. Third, the Soviet Union collapsed mainly because of Mikhail Gorbachev. Gorbachev let the Soviet Union collapse without mobilizing any forces, he watched as the empire collapse on its own. Had another leader that had the character of say Stalin or today's Putin been at the helm, the Soviet Union would probably still be alive today. Now the US does not have this same problem.

Now Gordon also mentioned exports. Well the US has an export deficit with the whole world and an enormous budget deficit also. Gordon mentioned that China lived through a great era but the same is true of the US post-WWII as it lived through one of the greatest boom eras (i.e. 1950-1970 hence the term "Baby Boomers"), it also lived through one of the greatest eras in borrowing (post 1987 stock market crash) when Allen Greenspan kept the interest rates too low for way too long. We also have the current post 2008 subprime loan crash, with the Federal Reserve keeping real interests negative.

Now is the US going to collapse? I don't think so.

communist party China is evil country, where common people have been torn since 1949.every normal chinese hope Coummunist party China can collapse as soon as possible

I cannot believe that the prestigous Foreign Policy could manage to publish this article on its front page. It's ridiculous. I've been to some western European countries and believe that China is not so bad. With another two decades, China will be quite prosperous, but even today, I don't think China is an authoritarian country. Those who say so must be manipulated by some ill-intentioned Western capitalist foundations that cannot wait to take advantage of China's collapse. I like Western air quality (although it used to be worse than China's at some point in history), but I don't like its food and service. Maybe my impression on the West is superficial, but I hope that China can do the same to them as revenge: turn Europe and America into communist states!

I don't think China nor the CPC will collapse in 2012, but obviously China is not immune to what is happening in the rest of the world as some domestic developments (rising labor costs, real estate bubble, NPL's, etc.). However, the inward focus of China is something that may cause companies to more look for opportunities outside China as well.

I personally don't think China will collapse, but I do believe its extraordinary economic growth will peter out way before it becomes the superpower everybody expects it to be.
I remember back in the 80s when Japan was going to conquer the world. Never happened, they just ran out of steam.
And yes, the US has plenty of problems, but it's one helluva big steam engine.

There's nothing for us to do anyway but wait and see what happens.

As one who has voyaged to the heart of China's propaganda machine in a futile search for fundamental change in the PRC I could not agree less with Mr Chang's prediction.

If China was changing, so would be its media. It isn't. Two years at the state-run Xinhua news agency followed by a period with the Beijing Olympics News Service was enough to convince me that, if anything, the state's control over the media is becoming more, not less, stringent and repressive. And that without a relaxation of this control, the average Chinese will never really be aware of any 'revolt' anywhere within the country. Especially with the state clamping down on the internet.

So no, Mr Chang, you are wrong and I, for one, won't be putting my shirt on any significant change in 2012. Or, for that matter, anytime in the foreseeable future. The state will always ensure just enough crumbs fall from its table to keep the average Zhao on its side.

I base my assessment on my own experience of living cheek by jowl with the 'system' which I've summed up in my book 'Limp Pigs and the Five-Ring Circus'. Mr Chang could do worse than take a look at it (see summary and sample chapter on my website www.marknewham.com).

For most of the last two thousand years China was ruled by a, theoretically, impartial bureaucracy. Entry was by performance in an examination and promotion, in principle, was by merit. Wealth could buy you education and coaching but on the day of the test, you were on you're own. The legitimacy of the mandarins, quite apart from the "mandate of heaven" was based on the fact that they had demonstrated the level of intellect required to govern. For most of that period China was the social, economic and technological leader of the world. Looking at the system that gave us George W Bush, Lehman Brothers and the Iraq war, perhaps the Chinese might think twice about the merits of democracy in providing what the enlightenment called "good government".

If we compare CCP to one dynasty of many which rose and fell in China, we will be able to understand China better.

We cannot say CCP will fall in 2012 or 2013. We cannot say it will muddle through and hold on for a few more decades, either. The Chinese regime which would follow its collapse would not be a democratic system. China lacks in its history and society cultural and political factors which go into the making of democracy or at least a Western-style democracy. A democratic China could not be predicted to be bound to be pro-Western or pro-U.S.A. as a democratic Egypt or Iran could not be pro-Western or pro-U.S.A. Unnan City, Japan

I hope that Mesothelioma Lawsuits cases in China also collapse in 2012.

The condtions that the author pointed out are rather relevant to China's reality. But they are not causing a collaps, instead of a concern. The reason is simple, the conditions are moving rather slowly, not able to cause a sudden change; everybody in China is talking about it anyway. The model that the author used to predict the collapse of China is not workable. To predict somehting, you need a model; but a model should consists of a number of verifiable principles. The author does not have any verifiable principles. And he will not able to get it, because all collapses are different. China will collapse when nobody care about it.

I had a huge trollface on as I read this article.

I agree with all of the commenters who basically equated this to the Harold Camping debacle this year.

Mr. Chang, don't clog up my beautiful FP front page with your pitiful request to push the end of times one year ahead.

In my opinion it is very dangerous and unconfident paper. The author talks about China's collapse. So, he suggest that now this state is on the strong position. So, why author "predicts" bad future for prosperous and stable country? Does this collapse will improve International Relations or wil democratizise China? It is quite clearly that China's economic slowdown will lead to the crisis in the all South East Asia region and will stimulate humanitarian disaster. Is the author politically adequate then he speak (so calmly)about new crisis in Asia? Is the author for the unstable world? If not, he must be more carefull with the foreseen in the IR . Chine is very subtile country, with subtile history and its own tradition. Fundemental elements of democration in their pure forms (as in the USA, or Great Britain) are new and sometimes alien for it's community. However, the forms of feudal terrany as we just saw in North Korea are not in the case of China. So, there should be find the balance between just mentioned forms of state-ruking (democracy or terrny), but not cardinal and drasticall changes.

It seems far-fetched to say that a slow-down in the CPC PB is an indication of 'divided government.' The Gang of Four and the period during and after Tianamin Square were eras of divided government. And even these were easily absorbed by the CPC.

If anything propels reform in China, it seems the local protests like those in Wukan will. I last read that the Provincial Government is now involved, showing a good communist better be able to respond to popular demands or risk his career.

It seems the Chinese are very interested in the 'rule of law' and demanding it in hot spots across the nation. But the CPC is in a different position than the Soviets or the Middle East autocrats.

It's ruled over a dynamic, growing economy for almost 3 decades. Why would the Chinese want to dismantle the government now? Reform, yes. But the end of the CPC in 2012? Forget it.

BTW, your analysis is rather cavalier in not addressing what would happen, who would rule and how if the CPC fell. You lack credibility

Oh please don't say that Mr. Chang. I have spent oodles of dollars to learn how to kow tow and have registered in long distance learning courses of a well known Confucious Institute.

Will all be a waste?

Gordon Chang is pleading for another year to approve that he has been a prophet all along. He wants another year, in concert with others, to help push for a US-China war, be it a trade war or a cold or shooting one. A review of his relevant articles in 2011 would show his immense enthusiasm for the US Administration on issues concerning China to take actions that would result in such a war. Of course, such a war would raise sharply the probability of China’s collapse that is the fulfilment of his prophecy. Yes, the fulfilment of his prophecy is all that matters. Never mind, if it may cost a billion Chinese lives plus tens of millions of American lives plus hundreds of millions of others’.

He must be very excited about 2012, a year pregnant with possibilities, from the Middle-east turmoil and stand-offs, Eurozone disintegration, the election of an independent-minded party to power in Taiwan, the death of Kim Jong-il to the territorial disputes in the South China Sea that could lead to regional or global conflagrations, confrontations or economic meltdowns that could bring about China’s collapse.

The prospects for an autonomous “Chinese Spring” is indeed very slim as the prospective “peaceful protestors” in China would not be able to hire an air force to impose a “no-fly-zone” and to bomb out the PLA and PAP. Nor, in the 21st century, any of China’s neighbours will be willing to permit the use its territories for smuggling of arms to the “peaceful” protestors in China unlike in the 1960’s when arms could be smuggled across the borders with India and Nepal to the Tibetan separatists. So, as noted by some readers here, the talk about the collapse of the CCP as result of a “Chinese Spring” during 2012 in the article cannot be serious.

In 1989 many Western analysts predicted the collapse of CCP within months. How did that pan out?
Going back further, a mass famine in the 1950s didn't bring down the CCP. The cultural revolution in the 60s and 70s didn't.
My prediction: It takes a mass famine *today* to bring down the CCP.
In other words, it's not going to happen unless they screw up really big.

Just go to war with all countries in the world, and don't stop!

One can always dream of an open, politically liberalized, and free China. It would be the best thing for us, really. But, alas, if you are right, the tumult will be dramatic, with bad short term consequences for us all, particularly all the people that might die in the ensuing chaotic struggle.
I have this nagging feeling that collective nationalism - not party loyalty - will bring your prediction to naught. Chinese diasporas around the world (e.g. Malaysia, South Africa) have reliably shown they would rather dance with the devil they know than lay with the one they don't

Thanks for giving the worst predictor of the Chinese economy in last decade some more space to sprout more nonsense.

I look forward to the following articles from FP (after all, these four people were much bigger luminaries when Gordon wrote his first dumb book):

Natural Gas Boom by Jeff Skilling
Hedge Fund Review with Bernie Madoff
State of Telecommunications with Bernie Ebbers
Cable Television's Future by John RIgas

While growth streak enjoyed by China after joining WTO in 2001 may not continue, Gordon Chang’s theory of collapse of Communist Party’s rule is not going to happen either.

With the backing of its powerful army, robust economy, ever-increasing foreign exchange reserves that are world’s envy and the world hooked to its cheap products, Communist Party is in absolute control of China and nobody on this earth is capable to shake it up, least of all the Chinese people - most of whom are enjoying the fruits of the phenomenal progress under Communist Party rule.

None of the reasons enumerated by Gordon Chang - renationalization, 2008 financial meltdown or demography - will undo already-achieved growth.

If Gordon Chang is forecasting Japan-style stagflation for China, then China won’t be alone. China will join the world where most of the countries are already experiencing that stagflation and worse. Authoritarian China will be far more able to handle that decline than democracies have.

Political transition will not divide Chinese government as Mr. Chang predicts - that transition will be smooth.

China will have to spawn a Gorbachev for China to disintegrate like Soviet Union which is NOT going to happen. So anybody betting on that is on a losing side.

The conditions leading up to the collapse of PRC you described had been in existence for the last 5/6 years. Why will 2012 (or 2011) be the year ? I suspect the collapse will come, but why 2012 ? The collapse of the economy, or even major famine, didn't take CCP down. Why would it this time ? Millions died by prosecution during the Cultural Revolution, and nothing happened. Everyone just followed orders and return home, or go to assigned places peacefully, with empty stomach. But CCP was still in charge.

Foreignpolicy was once a respected source of information but now it has come to the point they are just tabloid journal quality no better than the NYT or Washington Post, Time, Newsweek or CNN. I'm very concerned with the quality the articles have degenerated.

Anyway, if this Gordon Chang had any sense of integrity and shame he would have tucked tail and crawled back under the rock he came from after his failed predictions in 2000, 2001, 2002, or 2003. But I guess you can always fool some of the people some of the time and that is how he makes a living.

I don't see China's economy collapsing anytime soon. More like they will take lead in a world economy. tampa nursing jobsThat's what I see happening. Aren't they now trading their dollar with other countries for the first time? I think that is a sign of things to come. nurse resume help You are going to see a lot of other countries aligning themselves with Chins. Russia, Iran. I think China has won this game of Monopoly.

I guess the author doesn't truly grasp the size and depth of Chinese society.

On the whole, America can blame itself for China’s rise. There are certainly various other factors, but the naivité and arrogance of US politicians like Nixon and Kissinger who were so intent on beating up the Russian communists that they thought they can “use and manipulate” China for that purpose, together with the short-sighted greediness of US businessmen on Wall Street (and Wal-Mart consumers) were the main causes of “China’s Rise”. I interpret Deng Xioaping’s famous quote about the colour of the cat as follows: In order for China to become a “superpower” it has to go through an economic and technological “Great Leap Forward”. Deng wanted technology transfer from the West. Russian communism wasn’t helping the Chinese economy too much in those days (except for introducing ballet!) Well, in the 90?s, many people in the West were so naive. All they were thinking was how to make a “quick buck” out of the huge Chinese market and labour force, but the Chinese think more strategically and in China, there is no division of State and Business. Look, who’s got the money now. That’s not even the main goal for China. What they really wanted was technology transfer and they got it big time (through offering cheap labour). Perhaps they would have gotten that by hook or by crook (industrial espionage) someday anyway, but the faulty economic and political decisions made in the West expedited those Chinese goals. We will have to wait and see what the economic, political and environmental effects of “China’s rise” will be for the rest of the world, especially for the smaller countries in Asia and Africa. After giving away valuable and fundamental know-how and technology for short term gains, it is hard for the capitalists in the West to complain that the Chinese are now capable of cloning (reverse engineering) any high-tech product (including stealth fighters and DF-21D’s). In fact, China has the cash now and can easily buy off technology from high-tech Western (especially German) companies and natural resources (energy and minerals) from the Third World (and Canada). In a strange twist, Chinese Communist Party is proving to be much more efficient at running a “Capitalist State” than the parochial politicians in the US. The impact of China’s rise is “worrisome” in the mind not just of the average American, but also for many other people in the rest of the world, but I have always have the naive view that creative and intelligent human beings are always attracted towards an open and flexible society and the question now is whether Americans will dig deeper into their souls to see what they really are made of and whether China will become a more open and democratic society. Only if both of these scenarios happen then it will be a win-win situation. Otherwise I predict some serious conflicts within and outside of China during the next decade.

I think people should look at first your country before talking about collapse in china.
China is fine and all you talk about won't happen only because of elements you did'nt notice.CULTURE and HISTORY.

Revolutions occur when "stagnation" goes on for too long a period. China is still on average a poor nation. Many nation in recent history have been able to grow from poor to middle income nations. A "simple" recipe of good governance, spending on infrastructure, and copying technology and techniques from developed nations can get a country into the middle tier. Notably this doesn't require Democracy.

But getting from the middle tier into the developed nations is much harder. This requires innovation and this is where authoritarian regimes often fail. Repression prevents the development of an open society where innovation can thrive. So nations that develop rapidly and then open up (South Korea, Chile) continue to thrive, those that developed stall until they open up (Brazil) and those that stayed authoritarian (Soviet Union) fail as eventually citizens get fed up with authoritarianism.

So my prediction is when China enters the middle income level, it will take 10-15 years from that point. Even if China overtakes the US as the largest economy in 2016 it's average income will still be that of a poor nation only the shear size of it's population will let it overtake the USA. Wait until GPD per a head hits $10,000 in today's dollars up from it's current $4500-$5000.

Mr Chang made the prediction, whether it is going to be happened or not, he is not clear with the 'government' and 'country'. The collapse of China, as a country? Never will happen.....collapse of the government? maybe, but until the year of 2010, the community party owns over 800 millions of population as its follower. .Collapse? year, with the losing of their jobs.

Is Chang's piece just another attempt to stage a media coup or to win some brownie points as we enter 2012? If its not a publicity stunt and is a genuine prediction, I'm afraid its as silly as Harold Camping's claim that the rapture will take place in 2011.

First, I congratulate Chang for providing an extremely interesting read. His piece gives a lot of food for thought. If the piece was titled "the decline of the CCP" I would have no problem with it. Chang is clearly a fact finder, that I concede. Well done sir, bravo, you have written a B+ political science essay on why China is weak.

The problem is the claim to "oh crap, they didn't collapse in 2011 as I predicted....ummm, err....2012 it is". Without little self critique to the original 2011 hypothesis, I'm afraid Chang's words are bordering arrogance, a tragedy for an FP analyst.

I am not asking Chang to admit defeat or proclaim he was wrong. I agree that the CCP is on a trajectory towards being crushed by one force of society or another or many. But what I am asking Chang to do is show the audience that he has done a bit more thinking as to why his prediction was wrong. To put it off by only one year is childish. It is no more realistic than those cultists who keep saying the world will end every year due to a "oh I misread the gods' calendar". Surely, the fact that the CCP has not collapse should present Chang with a fresh opportunity to ignite new literature and thinking rather than a "give them another year" response. It could be considered a development that challenges current theory (or at least challenges the theory put forward by Chang). That is not such a bad thing...given that the Arab Spring and India's democracy in the context of persistent extreme poverty are things that political scientists find challenging to their theoretical thinking.

I also have a problem with Chang's exact interpretation of "China collapse" and the exact meaning of "collapse". Firstly, the CCP may collapse but China and its people will continue to march on. Secondly, collapse in what way? A self-executing civil war, a political collapse, an economic collapse, what? In addition, if Chang is so brilliant predicting a collapse, then what is to come afterwards? Will all the ills of China be healed by a switch in government? Will it necessarily be better for China's people? Will we see the emergence of a true democracy or will another opportunistic party/individual take China down another imperial dynasty?

Chang also fails to consider how we can avoid "collapse". Collapse of China, in whatever physical or metaphorical or spiritual sense, will not be good for the rest of the world. As cheesy as it sounds, it is in the world's interest to see a stable prospering China. Are there ways to avoid collapse without necessarily assassinating the CCP?

The CCP is not a Borg-collective. There are many factions and different schools of thought within it, perhaps as wide-ranging as those within the GOP or Democrats. Not all Chinese leaders are belligerent to change. The question we should ask ourselves is how we can support and cultivate and strengthen those members of the CCP who want reform and open engagement. Social constructivism may give us an answer here rather than realism.

The saving grace in Chang's piece is his reference to the strength of China's people and social media. I don't think we will see an Arab Spring in China anytime soon (sad face). Rather, social media means that mass incidents today are more noticed (Wukan is a glowing example), and even after the CCP's censorship machinery is put to work, thousands would have already been made aware of the struggle of their compatriots on the other side of the country. The soul searching and rage after the Wenzhou train accident and even things like the video capturing the lack of good samaritans in China indeed have "revolutionary" effects. These things do not lead to "collapse". Rather has Chang ever considered them as an energy that could be harnessed towards positive change and growth rather than collapse and "omg the witch - aka China - is dead"?

Can Chang be forgiven? I guess so. He joins a disturbingly large school of political scientists who keep predicting the decline of many governments. But just as the US has defied predictions back in 2003-2005 that it will no longer be a hegemon, so has China defied Chang's prediction.

To follow up my critique and the critique of others, which has been mostly constructive (well done guys!) I would love Mr Chang to come back from his holiday and engage with us readers in these comments. It would be interesting to hear what he has to say following our "doubts". So I invite you, Gordon, to make a comment or two. I am keen to listen and learn :) but I hope you are too.

Sure, most of these comments may be brushed aside as "Chinese patriot talk" or "he/she is a member of the Chinese intelligence service". But I assure you Mr Chang, I am a political studies grad and someone who is very much in favour of evidence and facts and seeking the truth.

The author is correct about many of the issues that the Chinese ruling class faces, but I'd say that he is definitely drawing the wrong conclusions from them. In the Soviet Union, conservative generals attempted (and failed horribly) to stop the semi-liberal efforts of Soviet politicians and it coincided with a sharp rise in nationalist feeling across Eastern Europe and Central Asia. In contrast the CCP appears to have the military strongly loyal to the CCP's continued power, CCP leaders will probably try to cement their harder credentials before risking any liberal thoughts, and, with the exception of the Tibetans and possibly Uighurs*, nationalism seems more to be pro-Chinese nationalism than anti-Chinese nationalism.

With that in mind I think it's safe to say that the elites of Chinese society are firmly on the side of the CCP, the military is not going to try to become king, the CCP will not do anything to suggest a release on power and breakaway efforts will meet little success. Additionally claiming that it will happen in 2012 seems rather ridiculous. You might be able to argue that there is a chance of the CCP's collapse at some point over the next decade or so, but there is no political scientist on Earth who could safely predict it to the exact year.

*And neither group seems at all capable of breaking away from Chinese control.

Excellent work. This is what i want to read.
Really good news. :)

In my view, China has already collapsed politically, and it was in the year 1989, when the government ordered soldiers to kill all those students in Tiananmen Square. Since then, no one really trusts China's government. Most nations just deal with China because of its economy, and there is very little warm and fuzzy feelings about the people who run China. In fact, if there were a vote today to execute the leaders, I am quite sure the Politburo's heads would role. The question is, when will China's economy collapse, and I feel the time is nigh. However, it may drag on a few more years. I am guessing there are more bullets than people in China, and I don't put it past the Chinese dictatorship to mow down anyone organizing to do away with the party when the economy really turns sour. Everything does come to an end, but the CCP will be the last party standing even if it means everyone else is dead.

The problem that this article doesn't take into consideration is that China is in fact the new superpower in the information warfare game. They have been dominating cyberspace for years now and have a massive amount of information at their disposal across all economies. There is no way they will collapse because they can leverage all this information to their benefit as they have been for years. They have tons of insider information that no other superpower has, and they are great at using it to their advantage.

I agree with MIKEHUNT07 in that China will take the lead as the world economy. Their goal is to take their economy from a producer to a consumer, and I think we'll see more and more of that this decade.

Actually it is possible that China will collapse in 2012. But it is far more likely that both the European economy as well as the US economy will go into a deep recession if not a depression. China will just be joining them that is all.

An interesting article, but if things start to fall apart in China won't they start brining home every penny they've invested in the rest of the world to help deal with it? And if Obama loses his bankers while he's still piling up over $4 billion dollars in debt every day and has our nation headed to $16 TRILLION in debt by election day won't that crash the U.S. economy, and the rest of the world, certainly Europe? Obama has pushed the U.S. right up to the edge of a debt collapse and he's still pushing. If Europe and or China goes won't it be the final push? Can we save ourselves if its clear we're going to get rid of Obama in Nov 2012, or has Obama already done to much damage?

... first, 2006; then, 2011; now, 2012 (December 21st., no doubt.) A government who can still deliver ~10% annualized economic growth is in danger of collapsing in 2012!? While the flatliners, Europe and the US, have nothing to worry about!? Question: if Chang is wrong again, would FP spare us his "expertise," so he could more appropriately peddle his wishful thinking on Fox News?

As much as I hate the Chinese and their knock-offs, I dont think they will, uhm, "collapse" in a year or two. Where goes that $1T surplus of theirs? Money buys most everything, and if it doesnt, a LOT of money will.
However, isnt the country already on a course of that "Japanese-style multi-decade decline"? The facts are pointing more toward that one.

Even if China were to go down the drain hole, I believe they would get up quickly with the use of their massive manpower. coolsculpting

Actually it is possible that China will collapse in 2012. But it is far more likely that both the European economy as well as the US economy will go into a deep recession if not a depression. Good Work!
massagista
avioes venda

He must be very excited about 2012, a year pregnant with possibilities, from the Middle-east turmoil and stand-offs, Eurozone disintegration, the election of an independent-minded party to power in Taiwan,3 quart saucepan the death of Kim Jong-il to the territorial disputes in the South China Sea that could lead to regional or global conflagrations,

n my part, China has already collapsed politically But China China overtakes Other countries in R&D.ambitious plan to 'change the face' of science.Its continuous to grow up in future years
makers

a U.S. collapse to happen ten years after it pulls out of Iraq or was it Afghanistan?. Ask the Sovi errr Russians. The US almost collapsed in order to end slavery. Imagine if it ends the Empire.

Since then, no one really trusts China's government. Most nations just deal with China because of its economy, and there is very little warm and fuzzy feelings about the people who run China.In my view, China has already collapsed politically, and it was in the year 1989, when the government ordered soldiers to kill all those students in Tiananmen Square. In fact, if there were a vote today to execute the leaders, I am quite sure the Politburo's heads would role. pecas
seguro

Gordon Chang thinks the collapse of China is a blessing...but its something a lot more terrifying for the rest of the world.

A massive economic crisis on a scale unseen and disruption (no matter how temporary) to Western exports and investment to China...e.g. Australia's economy is where it is largely thanks to Chinese demand. If China were to collapse and even if the turmoil or conflict in which the CCP falls is only to last a couple of months, that is still sufficient to trigger an economic crisis of all sorts.

Ok, moving on, what about who will control China? Chang and other optimists probably expect a swift collapse of the CCP and the ushering of a multi-party democracy. But that is only one of many possibilities. What if the PLA, no longer bound to serve a non-existent CCP, refuses to professionalise and tries to take over? Of course it may not be successful given that many of its troops could be sympathetic. But nonetheless it is a worrying outcome in which the country could descend into civil war, infighting between PLA factions could result in mass collateral damage.

And a worst thought. Nuclear weapons. If CCP collapses, who will inherit the trigger? Is it realistic to expect a collapsing and desperate CCP willingly turning over control of WMDs to a new government? Unlikely.

It has been a long day for me.....thanks for making me laugh.....

I was pleased to read an article that sets out the facts in an unbiased fashion of the real problems China face, I too stated five years ago that there would be critical problems in 2011 but I too was wrong in the time, not substance. Please don't get me wrong I would love to be wrong altogether & China keeps powering through the 10%pa growth pattern but realism must be injected even if it only helps a few from losing everything by listening to self interested people promising the world.
It is paramount that people (even Chinese residents) focus on what is happening on the whole of their country & not just their small part which may still be striving ahead, remember that this striving could well still be the coming end to the incredible infrastructure spending the State implemented a couple of years ago, actual export orders have plummeted, many many areas of China are on the boil for civil unrest & like ALL Govs the "official" numbers quoted are a very adjusted set of numbers rarely reflecting what is truly going on. Even usually very optimistic entreuprenuers are (in private) becoming extremely worried about the turmoil which is approaching which will have to be dealt with one way or the other.
It's not all doom & gloom but please don't expect for a minute that China will continue on it's phenomenal growth & remember if it sounds too good to be true then it probably is, do your own indepth research & have an exit strategy that you can implement at a moments notice & be extremely suspicious of so called bargains, there's always a reason why.
My best to you all & best of luck.

Gordon Chang will be proved right. His reasons are very good. There is another reason that is probably even more important than the ones he identifies.

I have been saying for years that China - and India - will be part of an "Asian Crisis II", bigger than ever.

The reason: the level of "planning gain" - that is, the capital gain made when farmland (which is always very cheap) is "permitted" for urban development. This is nothing to do with the cost of development and infrastructure - it refers to the straight out inflation of nothing more than the "raw land".

Mainstream economists are clueless about the role of this in the future economic trajectory of a nation. This is really where ALL serious property price bubbles originate. Check out the correlations in the property-related crises that have happened in Japan, California, the UK's frequent cycles, Ireland, Spain, etc etc.

Some nations call a de facto racket in land for urban development, "urban growth containment", but in China and India it does not have this fig leaf of respectability, it is straight out corruption.

The result there is rows and rows of empty apartment buildings that some "greater sucker" is stuck with at prices far too high to fill with residents - millions of whom still live in nearby slums. If the same apartments had been built under genuine free market conditions like in cities in, say, Texas, the Chinese and Indian slum dwellers could actually afford to live in them.

http://www.thechinabeat.org/?p=3610

I was driving home one day when I heard Gordon Chang as a guest on a radio show.

One of the comments he made was that America didn't need Chinese money and he cited the demand for US Treasuries right after the Standard and Poor's ratings downgrade of US sovereign debt. US Treasury yields went down instead of up. This was evidence that Americadidn't and doesn't need China. I think he used it as a basis

This is a superficial assessment of what goes on in the sovereign debt markets based on a highly simplified, almost nonsensical, "model" of a bipolar (economic) world. What about the EU? Where are the BRI in the BRIC? More than anything, demand for US Treasuries is driven by fear of the European crisis or crises. Yet he did not think it was worth a mention in his "assessment". OH, and yes, the Euro would probably collapse before the China will.

In fact, for all the economic and political problems of the "Free World" and the contagion effect on the global financial markets, it is precisely China's authoritiarian government that could very well be the key deciding factor in keeping China humming along. If China is economically healthy, it could continue to at least keep East Asia from being dragged down into the economic morass in the US and Europe.

China was able to stimulate its economy in 2008 and 2009 while America was mired in "rescuing" America's financial system. China's stimulus was massive, swift, and most importantly it worked -- it probably worked too well, in fact. How did China do it so well? It was because the authoritarian government could dictate that banks lend.

In America, the opposite was happening. The banks were bullying the government into pumping taxpayer money into the rescue -- for what? An anemic "recovery" that continued to shed jobs and worst still, shed homeownership. US banks basically transferred their massive losses onto the taxpayers backs (the effects of which could very well be multi-decades long) while continuing to foreclose on ordinary citizens and we are here talking about Chinese citizens being sheeplike. US taxpayers are paying the banks to foreclose on our neighbours. It's surreal if you ask me. How is liberal democracy working for us now?

Many have said that China sits on a property bubble similar to the US property market pre-subprime crisis and that we are witnessing a slow-motion collapse of that bubble. That may be true. But China has three: key things going for them: their authoritarian government that understands economics, their massive foreign exchange reserves, and their strong Yuan.

China won't experience partisan bickering and the banks are beholden to the country not the other way round. China can act decisively and swiftly.

Foreign exchange reserves can be "repatriated". It will cause inflation but if China's situation is dire enough, inflation won't be a problem, in fact, they may need to inflate the economy back to life. Same "problem" with the strong Yuan. They can print more Yuans. They have the room to do this. A lot of room. Certainly more "room" to see it past 2012.

Finally I believe China's largely closed financial market insulated it from financial contagions. It limited exposure and made risk more manageable. Although it is getting harder to park their massive foreign exchange reserves in hard currency bonds. Perhaps this is one reason why Gold and other commodities have risen so much.

Counterintuitively, China's authoritarian government just may be the thing to see the country through. It is for the long term? Maybe not, but for now, it's probably a better thing than indecisvieness.

For most of the last two thousand years China was ruled by a, theoretically, impartial bureaucracy. Entry was by performance in an examination and promotion, in principle, was by merit. Wealth could buy you porno education and coaching but on the day of the test, you were on you're own. The legitimacy of the mandarins, quite apart from the "mandate of heaven" was based on the fact that they had demonstrated the level of intellect required to govern. For most of that period China was the social, economic and technological leader of the world. Looking at the system that gave us George W Bush, Lehman Brothers and the Iraq war, perhaps the Chinese might think twice about the merits of democracy in providing what the enlightenment called "good government".

When a one-party state hosts an Olympics, ten years later that state circles the drain if it isn't already down it. To wit:

1936: Berlin Olympics / Garmisch-Partenkirchen Winter Olympics
1946: Allied Occupation

1980: Moscow Olympics
1990: Collapse of Communism

1984: Sarajevo Winter Olympics
1994: Yugoslav Civil War

2008: Beijing Olympics
2018: ?

Remember, you read it here first. Let’s hope China manages a smooth regime change – for once in their history!

China May Ease Property Curbs Mid-Year to Prevent Price Collapse, UBS Says
By Bloomberg News - Jan 10, 2012 9:27 AM GMT+0700 .

Jan. 10 (Bloomberg) -- Chen Li, head of China equity strategy at UBS AG, talks about the nation's stock and real estate markets. He spoke yesterday in Shanghai with Bloomberg Television's Stephen Engle. (Source: Bloomberg).

China will probably ease property curbs as early as the middle of the year to prevent a collapse of the housing market as the measures may boost supply to the highest in a decade, according to UBS AG.

“The gap between supply and demand will reach the peak, and the supply will be 1.5 or even 1.6 times demand, and it will be a disaster for developers,” Chen Li, head of China equity strategy at UBS, said in a Bloomberg Television interview. “Their cash flow will be exhausted to zero by the end of this year if they cannot get any financing. No one can afford that.”

China’s home prices fell for a fourth month in December after the government reiterated plans to maintain curbs that include higher down-payment and mortgage requirements, according to SouFun Holdings Ltd. (SFUN) Housing values dropped in 60 out of 100 cities tracked by the nation’s biggest real-estate website owner, including the 10 largest cities such as Shanghai and Beijing.

The government said last month at an annual economic planning meeting that it won’t back away from real-estate industry curbs this year that are damping home sales and pulling down prices. The nation’s financial center of Shanghai and some other Chinese cities have also said they will continue to impose the home purchase restrictions this year.

“If you assume the property policy keeps stable in the coming year, that means by the end of the year the inventory of property will reach a new peak, around 10 years or even 20 years,” Chen said.

The government has said it will continue to increase the supply of social housing. It plans to start the construction of 7 million homes this year, compared with 10 million in 2011. The completion will at least keep pace with last year’s 5 million units, People’s Daily reported earlier this year.

A gauge tracking property shares on the Shanghai stock exchange climbed 0.9 percent as of 10:09 a.m. local time, compared with the 0.5 percent gain in the benchmark measure.

--Stephen Engle and Bonnie Cao. Editors: Linus Chua, Andreea Papuc

Johns, johns, and more johns. Don't make excuses--go do something else.
Seriously, Chang's probably never heard of Yogi Berra's mantra, "it's hard to make predictions, especially about the future."

I'd normally dismiss you as a bad troll, but seeing that you are pretty committed to posting responses, I'm now confused as to whether if you just watched a wee bit too much FoxNews or if you are simply an ignorant racist. But here are a few points that I would like to point out to you.

1. You've never been to China. So don't pretend like you did.
2. You are not qualified to judge the Chinese people as a whole. No one is. To do so is to be racist, same as making sweeping judgments of, say, African Americans, or any other race.
3. You believe the Chinese are "sheeple" who believe what they are told. Unfortunately for you, I am Chinese (not an ABC but from China--Oh the shock!) and I don't believe the bullshit you've sprouted.
4. The origin of the term "sheeple" is the webcomic "xkcd," where it is used to mock people with unfounded sense of superiorities. See "http://xkcd.com/610/". The way you toss the word around--calling the entire Chinese ethnicity "sheeple"--actually makes you an ignorant hypocrite. Especially since your own source of information seem very limited--which, in your parlance, would probably make you a member of the "sheeple."
5. Maybe the words "inbred, inborn and ingrown" (the latter two of which do not exist in the English language) are more appropriate as the content of your autobiography than "accurate" generalizations of Chinese people.

Gordon Chang is right about one thing "Why has China as we know it survived? First and foremost, the Chinese central government has managed to avoid adhering to many of its obligations made when it joined the WTO in 2001 to open its economy and play by the rules, and the international community maintained a generally tolerant attitude toward this noncompliant behavior. As a result, Beijing has been able to protect much of its home market from foreign competitors while ramping up exports."

"By any measure, China has been phenomenally successful in developing its economy after WTO accession"

In this they are following the protect and export pattern used successfully by Japan and South Korea to rebuild their economies after WWII (deliberately ignoring the orthodox Western economic free trade mantra). The trick to pulling your country out of poverty is to manufacture the situation where other countries are keen to take your exports while they can't or won't force you to remove protections for your domestic economies.

It's very interesting to see how inflation (plus many other factors) over time can kill a country at the same time making another country prosperous. A country is only as strong as it's economy and not even insurance can help anyone when the economy collapses.

In America, the opposite was happening. The banks were bullying the government into pumping taxpayer money into the rescue -- for what? An anemic "recovery" that continued to shed jobs and worst still, shed homeownership. US banks basically transferred their massive losses onto the taxpayers backs (the effects of which could very well be multi-decades long) while continuing to foreclose on ordinary citizens and we are here talking about Chinese citizens being sheeplike. US taxpayers are paying the banks to foreclose on our neighbours. It's surreal if you ask me. How is liberal democracy working for us now?

I was pleased to read an article that sets out the facts in an unbiased fashion of the real problems China face, I too stated five years ago that there would be critical problems in 2011 but I too was wrong in the time, not substance. Please don't get me wrong I would love to seslichat be wrong altogether & China keeps powering through the 10%pa growth pattern but realism must be injected even if it only helps a few from losing everything by listening to self interested people promising the world.

Gordon Chang is still around?
You say something long enough and you'll eventually be proved right. Even a broken clock is right twice in a 24 hour period.
Economic cycles go up and down. The USA would be even in deeper doo-doo if they couldn't just print USD and Treasury bonds.
At the moment the biggest markets for China - the USA and Europe are having problems and the former's exports will be down. The Chinese still have a few tricks up their sleeves as they haven't spent all their ammunition. They could lower interest rates or bank reserve ratios to stimulate the economy. They are currently encouraging domestic consumption as they are even below that of India. They are slowly internationalizing the RMB so if they convert some of their US holdings other central banks and foreign institutions may want to hold some of the extra RMB and thus ease inflationary pressures within China. China is encouraging her population to buy gold and silver which is priced internationally in USD. China is still on the move and that is needed. As shown, any country that ceases to grow their economy actually shrinks. This is because as population ages and productive work declines. Also as in the case of Japan and other countries, people are refusing to have children thus accelerating the process of decline. In contrast, China, in this year of the dragon, is expecting a bumper baby harvest no matter how the economy turns out this year.