osewalrus (osewalrus) wrote,
osewalrus
osewalrus

Krugman On The Fallibility of Chinese Decisionmakers

http://krugman.blogs.nytimes.com/2010/12/17/chinese-confusions/

I agree with Krugman that we are seeing some return to the "Japanamania" of the mid-1980s where everything the emerging economic power does is good (provided it suits our prescription for curing the ills at home). Meanwhile, we ignore the underlying seeds of problems to come. In China's case, rampant inflation that is starting to impose serious hardships on their lower classes.

The difference is, however, that China is fully capable of resolving the crisis by undergoing an abrupt change of policy, arresting a few bankers and having them shot, and getting the rest to fall in line.
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