Communist in Name Only: China’s Rising Inequality

The official name is the People’s Republic of China, in case you might forget. You’d be forgiven of course–today’s China does not look much like a “people’s” anything. Increasingly socially and economically stratified, China’s one-party system is about the full extent of its communist or socialist leanings. Or at least, so it seems if you believe a new study out from a Chinese university in Chengdu, which puts China’s Gini coefficient at an utterly ridiculous 0.61.

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The Decision: Obama’s Difficult Position

Rumour has it the republicans have given Obama an offer to avert the fiscal cliff, the combination of deep, immediate spending cuts and tax increases that the CBO predicts would send the country into a new recession. The offer gives Obama something he cannot get without a deal–most notably, an extension of emergency unemployment benefits. The offer comes at a cost, however. In exchange, the republicans demand a small but painful cut in social security benefits.

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If You Believe in the Fiscal Cliff…

Lest we forget, the fiscal cliff is still coming–the dismal set of negative economic consequences that come from cutting government spending and raising taxes too fast in the face of a weak economic recovery. While 87% of the general public do not realise that the fiscal cliff is about preventing spending cuts rather than making them, regular readers (and those of you who read the linked pieces) know better. That’s all ground we have covered. However, that there is a particularly interesting implication of belief in the danger of the fiscal cliff that I have yet to discuss, and this I seek to remedy.

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Territorial Disputes and the Future of Asia

It has been in and out of the corner of the western press’s eye the last few years. China has been flexing its muscle in Asia, attempting to press claims to territory, both land and sea, on its various borders. This has not gone unnoticed by China’s neighbours,  who are quite furious with China over some of its more belligerent acts. The matter has been simmering, off and on, for some time. What I find most interesting about it, however, is how this dispute has set the nations of Asia against each other, dividing it between two sides, one pro-China, the other against.

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The HSBC Moral Hazard Paradox

Recently HSBC, the British bank, was found by the Department of Homeland Security to have laundered vast amounts of money for drug cartels, terrorist organisations, and rogue states. One would expect a steep penalty for aiding and  abetting such malevolent organisations. Consider Salim Hamdan, a man whose sole crime was to drive Osama bin Laden around for $200 a month, yet nonetheless ended up in prison from 2001 to 2009 and was subjected to “coercive interrogation” and “sexual humiliation”, whatever that means. Given the billions of dollars HSBC laundered for these kinds of groups, what Hamdan got should be a picnic in comparison, right? Well it turns out, not so right, as the Justice Department decided not to prosecute.

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