Explainer: How ‘Common Prosperity’ is Changing China

Read the Story

Show Top Comments

It would be interesting if China focusing on property taxes resulted in a Georgist tax structure as the foundation of government economics. This would arguably be superior to how top developed nations structure taxes, at least right now.

m0llusk

The only thing I got out of the article was that China MAY increase transfer payments from the upper class to the lower classes, and that it is increasing tech regulations. Both of which could be said about the US right now. Without specific policy information, it just feels like fearmongering to me. Don’t get me wrong, Xi is consolidating power, and Chinese foreign policy is becoming more provocative, but I don’t see anything earth-shattering from “Common Prosperity”, it just seems like leftist-populism like “Build Back Better”, except with less substantive policies that can be analyzed.

meowmeowbomb

>In September, ARK Invest admitted it would be reducing its China exposure, with founder Cathie Wood telling Reuters she believed “policy makers in China are beginning to play with fire” and that a major slowdown in China is “obvious.” > >As such, investors are divided on future China strategies. Like ARK Invest, some have chosen to dump their stocks, including Australia-based Munro Partners, who cited “overreach” by the government as one of the factors influencing their decision. Previously, Chinese equities accounted for 15% of their portfolio. Always a refreshing perspective from the West. When there’s an attempt to do something for ordinary people, now that’s “beginning to play with fire” and “overreach”. Letting the wealthy run roughshod over society ought to be the normal state of things, and of course it’s “obvious” this is good for the economy, even when they crash the economy and receive welfare in the form of government bailouts – no “overreach” or “play[ing] with fire” here. This is the socialism they like, but for the rest of society, it’s raw, corrupt capitalism they prefer. Perhaps the real fear is that China might succeed and show up the West for their hypocrisy and utter betrayal of democratic ideals. Perhaps they know China is likely to succeed. The US had a period of “common prosperity” (post-WWII Golden Age) from 1947 to 1973. Productivity growth averaged almost 3%, and wages kept up with this growth (not just inflation) until about 1968. Huge expansion in the middle class and broadly-shared prosperity (albeit qualified by segregationist policies that left out Black and Brown people). This is a period the wealthy would rather forget and banish from our collective memories. Perhaps it’s in this context that China is “beginning to play with fire”. Imagine what people might demand from *demo*cracies when they see ‘evil’ Communist China of all nations providing benefits for their citizens – or, worse, what if China starts spreading these ideals!

_m3r1u5_

I think this is a good thing. The Chinese gov is focused on uplifting the poorest of their country, while we ignore the poor here. If the Chinese model succeeds then it would provide a pathway for us to do as well, if we choose to.

iamwhatswrongwithusa

This has such far reaching implications that we can’t even begin to guess how it could change the entire world in 10 years or less if they really pivot hard towards that. I guess most everyone isn’t really discussing it because we can’t really do much of anything about it. It will be one of those things that looks really clear in hindsight.

qoning