Patrick Chovanec: Am I a China Bear?

Tsinghua University economics professor Patrick Chovanec introduces a series of posts examining current “conventional wisdom” on China’s economy with an explanation of his own perspective.

There are two schools of thought on the Chinese economy right now. The first says “It’s always darkest just before the dawn.” The second says “It’s always darkest just before it goes pitch black.” It’s clear that China’s economy is slowing. But what happens next is far from clear, and the subject of much debate.

[…] Several important story lines have emerged, and what I’m seeing really worries me.

Indeed I am worried — not thrilled, not vindicated — because contrary to stereotypes, I do not consider myself a “bear” on China. In that respect, I would like to make a few points. Because over the next few days I’m going to be saying some very negative, critical, and even scary things about China’s economy, these points are quite important.

1) I don’t hate China. I’m not “rooting” for China to “crash and burn.” I realize that at least a few of my Chinese readers, when they hear me harshly criticize policy or make dire warnings, might conclude that — as an American — I’ve caught an acute case of China-envy and would love nothing better than to see China taken down a notch. In fact, I am so critical not because I want the worst to happen, or believe it must happen, but because I hope and believe the worst can be avoided, if clear-sighted, courageous choices are made. [… N]o matter what you think about China’s current form of government, or the implications of its rising global influence, the complex challenges and opportunities posed by a strong and prosperous China are infinitely preferable to the terrible dangers and uncertainties the world would face if China were to “collapse” or just lose its way in confusion.

Chovanec tweets on Chinese economics and other news as @prchovanec.