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The Coming Collapse of China [Paperback]

Gordon G. Chang (Author)
2.6 out of 5 stars  See all reviews (89 customer reviews)

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Book Description

July 31, 2001
China is hot. The world sees a glorious future for this sleeping giant, three times larger than the United States, predicting it will blossom into the world's biggest economy by 2010. According to Chang, however, a Chinese-American lawyer and China specialist, the People's Republic is a paper dragon. Peer beneath the veneer of modernization since Mao's death, and the symptoms of decay are everywhere: Deflation grips the economy, state-owned enterprises are failing, banks are hopelessly insolvent, foreign investment continues to decline, and Communist party corruption eats away at the fabric of society.

Beijing's cautious reforms have left the country stuck midway between communism and capitalism, Chang writes. With its impending World Trade Organization membership, for the first time China will be forced to open itself to foreign competition, which will shake the country to its foundations. Economic failure will be followed by government collapse. Covering subjects from party politics to the Falun Gong to the government's insupportable position on Taiwan, Chang presents a thorough and very chilling overview of China's present and not-so-distant future.


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From 1978 through the mid-1990s, China had the fastest-growing economy in the world, and it appeared poised to dominate Asia, and beyond, in the near future. But after focusing on facts rather than theory and looking at the conditions behind the spectacular numbers, Gordon Chang presents the People's Republic as a study in wasted potential: "Peer beneath the surface, and there is a weak China, one that is in long-term decline and even on the verge of collapse. The symptoms of decay are to be seen everywhere." For a nation that has always taken a long view of history, time is quickly running out. Chang believes China has about five years to get its economy in order before it suffers a crippling financial collapse--a timeline he seriously doubts can be met.

By failing to complete its reformation, China has maintained an illusion of progress, Chang explains, but in reality has caused more problems than opportunities for would-be entrepreneurs and foreign investors. Because reform has not been fast enough or comprehensive enough, China is unable to benefit from its modernization or keep up technologically with much of the world. The government's reluctance to get rid of state-owned enterprises has not only rendered China uncompetitive just as it prepares to join the World Trade Organization, but is causing the banks--which were forced to lend money to SOEs--to fail alongside them. Widespread unemployment, corruption within the Communist party, millions of resentful peasants, and a general lack of leadership further threaten stability. The Communist party "knows how to suppress but it no longer has the power to lead," Chang writes, arguing that the party is maintaining control only through the use of brute force and the people's instinct for obedience--popular support that could deteriorate as soon as the economy plunges. Simultaneously, societal ills such as gambling, drugs, and prostitution have become huge problems.

Stuck between Communism and capitalism, "China is drifting, unwilling to go forward as fast as it must and unable to turn back." It is uncertain what will be in the way when the giant finally falls. --Shawn Carkonen --This text refers to an out of print or unavailable edition of this title.

From Publishers Weekly

redicting the rapid fall of the Communist government, Chang, counsel to an American law firm in Shanghai and freelance journalist with the New York Times, the Asian Wall Street Journal and elsewhere, attempts to support his prediction by discussing a number of phenomena in China: the volatile discontent of political minorities and the unemployed; the futility of state-owned enterprises and industrial policies; the vulnerability of the private sector and the WTO economy; the threats the Internet poses to party censorship; the dangers lurking behind the banking system; and the failing role of Marxist ideology. By maintaining power at all costs and suppressing dissent, the regime, Chang says, has jeopardized the economy and Chinese society at large. His adept business policy evaluation and socioeconomic criticism ("Party cadres... insist on commanding as if they still had a command economy") connect names and anecdotes with otherwise abstract social ills. But his success ends there, for his sweeping historical analyses and social forecasts falter. "Today the people no longer want Mao's revolution or the party that administers it. And so the People's Republic is going to fall, just like its predecessors," writes Chang, hastily recounting the quick endings of the Qing Dynasty and the Kuomintang. His invocations of the "power of the Chinese people," or of an imaginary individual who will one day "end the Chinese state as it now exists," read more like political soap opera than judicious analyses. Preoccupied with such rhetorical (and often highly cynical) flourishes, he fails to pay adequate attention to something that would have better supported his predictions: the imminent intra-Party power turnover in 2002. Chang needs more than denunciations and calls for change to support his bold prophetic claims. (On-sale date: Aug. 14)

Copyright 2001 Cahners Business Information, Inc.

--This text refers to an out of print or unavailable edition of this title.

Product Details

  • Paperback: 368 pages
  • Publisher: Random House (July 31, 2001)
  • Language: English
  • ISBN-10: 0812977564
  • ISBN-13: 978-0812977561
  • Product Dimensions: 9 x 6 x 0.8 inches
  • Shipping Weight: 1.2 pounds (View shipping rates and policies)
  • Average Customer Review: 2.6 out of 5 stars  See all reviews (89 customer reviews)
  • Amazon Best Sellers Rank: #298,674 in Books (See Top 100 in Books)

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Customer Reviews

89 Reviews
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Average Customer Review
2.6 out of 5 stars (89 customer reviews)
 
 
 
 
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138 of 163 people found the following review helpful:
2.0 out of 5 stars Doom and Gloom Sell (Again), July 28, 2005
By 
Steve Koss (New York, NY United States) - See all my reviews
(VINE VOICE)    (REAL NAME)   
Remember the names? THE WARNING: THE COMING GREAT CRASH IN THE STOCK MARKET, Y2K - IT'S ALREADY TOO LATE, CONQUER THE CRASH, THE COMING CRASH IN THE HOUSING MARKET, PATRIOTS: SURVIVING THE COMING CRASH, THE COMING COLLAPSE OF THE DOLLAR AND HOW TO PROFIT FROM IT, and, of course, the greatest (and silliest) doomsday collection of all time, THE LEFT BEHIND SERIES. Doom will always have its day, Chicken Littles will watch and read and fret, authors and publishers will collect their take, and the unfilled prophecies of ruin will soon be forgotten in the wake of a newer batch. And thus it is with Gordon Chang's THE COMING COLLAPSE OF CHINA.

Published in 2001, Chang argues that China's deeply entrenched and long-standing economic difficulties, the Communist Pary's intransigence and desperate efforts at self-preservation, and the country's coming accession to the World Trade Organization (WTO) will combine to create the necessary conditions for revolution and overthrow. All that will be needed will be the right spark and the emergence of the right leader to take advantage. The thesis is, of course, plausible enough, but what doomsday prophecy doesn't have its elements of plausibility? Marshal enough arguments on one side of any issue and ignore the counterbalancing factors, and any situation can start looking like an imminent crisis.

This type of one-sided presentation is, unfortunately, precisely what Mr. Chang gives us. He is clearly knowledgeable about China, and he certainly identifies most of the country's major problems: bankrupt State-owned enterprises (SOE's), technically insolvent banks with huge quantities of non-performing loans, a ruling party lacking in ideas and the political will to change, a government addicted to creeping incrementalism out of fear of losing control, stifling of private enterprise and innovation, declining quality of life for millions of peasants, and the people's own access to information, and to each other, via the Internet. Yet at the same time, he either ignores or diminishes the importance of foreign investment capital, building of thousands of new factories, a seemingly inexhaustible pool of cheap and willing labor, the Chinese people's own rampant entrepreneurialism, and their enormous drive for material goods and a better life.

Chang's writing style tends toward the dry and overly repetitive, as if saying something often enough will make it so. His arguments are often perceptive, yet at the same time they sound heavily opinionated, lacking in substantive supporting detail or statistics. His writing is best when he humanizes it, telling us stories of individual Chinese people - more of this would have been better. `

Chang's book is also littered with odd inaccuracies and unfairly negative interpretations that left me questioning the merits of his bigger arguments. On the lesser side, for example, he incorrectly identifies pop singer A Mei (Zhang Huimei) as "Ah Mei" and describes internationally renowned architect I.M. Pei as born in Guangzhou. Pei himself says (in a June, 2004 interview in Archtectural Record) that he was born in Suzhou. Chang twice describes the White Swan Hotel in Guangzhou as "aging" and once as "dingy" - it is no such thing (I was there in 2002, 2003, and 2004). He also claims the Chinese government makes Westerners stay if they are adopting Chinese babies from Guangzhou - wrong on both counts. The babies come from all over China, and the adoptive parents stay at the White Swan because it is a five minute walk from the American Consulate where they will pick up their infants' American travel visas. More disturbing, he disparages Western companies' first mover advantage as nonexistent while ignoring the experiences of KFC, Coke, Pepsi, Nike, Polo, Budweiser, P&G's Crest and Pampers brands, Nestle's, and VW. Chang inappropriately equates China's 40% national savings rate as a vote of no confidence in the government, ignoring the lessons of decades if not centuries of historical experience and upheavals as well as cultural tradition (such as parents saving to buy a home for their son and his new bride). He also manages to describe Internet usage in China as "hobbled" even as it grew from October 1997 to December 2003 at a compound rate of over 100% per year!

THE COMING COLLAPSE OF CHINA is an informative book for those not familiar with China, as it offers good insight into the country's economic, political, and social systems and their shortcomings. The danger is that the reader will come away with a profoundly negative and pessimistic view of China beyond what the country warrants. Imagine the roles being reversed, with Chinese people reading about America's negatives (rabid political polarization, manufacturing job loss, staggering corporate frauds and bankruptcies,decaying infrastructure, broken health care system, low-functioning educational system, massive government budget deficits and trade imbalances, terrorism, gun crimes, religious fundamentalism), and you see the problem.

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54 of 62 people found the following review helpful:
1.0 out of 5 stars A "Brilliant" Forecaster Gordon Chang is not, February 9, 2010
By 
Steven Lee "A Reader from SF" (San Francisco, CA United States) - See all my reviews
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One might make a prediction or two about the fate of the world in the comfort of one's home, among one's close friends and family after a couple of stiff drinks and no one could care less about them in a day or two. Gordon Chang made the mistake of writing a book about his predictions of China so that for as long as he shall live, people could hold his predictions against him. This reader wouldn't really care about someon who thinks he knows a thing or two about China simply because he's of Chinese descent but for the fact that 10 years after the book was written, the collapse (which was supposed to take place within ten years from when the book was written) as predicted by the author still has not happened and the forecaster is nevertheless being interviewed by Western media as some China "expert".

China no doubt has many problems, some hidden from outsiders' view but some of the key predictions made in the book - China's economy was to be destroyed by its inefficient state owned enterprises, the Communist party was soon going to be overthrown by the people whom it rules with an iron fist, joining the WTO was going to completely expose China's lack of competitiveness and destroy its economy, and the internet was going to usher in an era of unprecedented free discourse which would eventually lead to democracy - have turned out to be completely wrong (and some to the detriment of China's people and the rest of the world). In fact, one would have trouble being more wrong making predictions about anything, including the weather and the timing of the end of the world.

Why was Chang so off? This reader's guess is that although he spent (and still spends) considerable amounts of time in China, he isolated himself in the elitist/intellectual/expat circle and really had little understanding of things happening outside of that small circle. For example, as much as Chang and other westerners may wish and believe, China's Communist Party enjoys popular support among the vast majority of peasants and the very poor. Call it ignorance and the result of brain-washing if you wish. It is also popular among the wealthy and the powerful who owe their recently found wealth and power to the policies and direct handouts by the Party. So the people who are truly unhappy under the rule by the communists are the still relative small middle class and the intellectuals (Chang's small circle of friends). So while the corrupt current regime may not be there forever, they are going to prove many western forecasters wrong for many years to come.

Also, Chang thought the lack of a credible belief system was going to lead the people to turn toward religions and cults en mass. He thought the Chinese could not become more materialistic than they already were. But 10 years later, the Chinese are at once more religious and more materialistic. There are thriving underground church communities, who are, contrary to Chang's prediction, not preaching violence or hostility against their government who in turn (again contrary to Chang's prediction) has for the most part tolerated their growth. At the same time, many Chinese, if not most, have made "a pact with the devil" agreeing to give up a substantial part of their personal liberty in exchange for greater material wealth. This reviewer is not suggesting that this scenario is a) preferred or b) will last forever but any forecasts of the communists' imminent demise are simply laughable.

And of course, nothing is a bigger slap on Chang's face than the miraculous growth of the Chinese economy over the past decade in direct contradiction to his forecast of a total collapse. This reviewer can't help but wonder what state of economic health Chang's in? If he is doing well then he must have either joined the corrupt elite or benefited from the government's liberal economic policies. For he could not have benefited from being a so-called China expert. This reader enjoyed reading his book, mainly from counting the mistakes Chang makes on every page.

China's economy or its government may one day collapse yet but their timing is surely out of the grasp of some intellectual light weight like Chang. Here is one last question: who is the bigger fool, Chang or the media outlets that hire him?
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41 of 47 people found the following review helpful:
2.0 out of 5 stars Those Who Live in Glass Houses Shouldn't Throw Rocks, July 26, 2002
By A Customer
As an expatriate living in Hong Kong, I've had many opportunities to travel into China. I have seen many of China's flaws pointed out by Gordon Chang, like the absence of the rule of law and rampant corruption. Like the reader from New York, I would have liked to see Chang put more emphasis on these and other issues. Instead, Chang devoted about 300 pages to criticizing the Chinese Communist Party. This is not without justification, but Chang made it seem as if the CCP operated in a vacuum, with no outside forces involved.

Being a corporate lawyer, Chang was evidently reluctant to incriminate his own economic ideology by linking party corruption with the influence of multinational corporations. The latter, while no admirers of Communism, have been complicit in exploiting China's resources, impoverished masses, and lax labor and environmental laws for their own gain. Human rights were never part of the equation, and Chang conveniently left out Secretary of State Warren Christopher's 1994 plea to the American business community in China to pay some attention to this issue. (The plea fell on deaf ears.)

With the current wave of corporate scandals in the U.S. (sorry reader from Alaska, they're not exceptions to the rule), one may wonder if Chang should be examining his own country's problems instead of looking to the other side of the world. The reader from Alaska (sorry again) remarked how much of China's wealth was created by foreigners, while America's wealth was created by Americans. Either he sews his own clothes, or he goes half naked (not a good idea in Alaska). Where would America's economy be without China? Its clothes, army berets (gasp!), and 9/11 souvenirs (double gasp!) are made primarily in China! How can you have wealth if you don't have labor? Who provides the labor that produces so many of the products found in American stores? Guess who.

Chang went off the wall when he placed sole blame for the 1999 Chinese Embassy bombing in Yugoslavia and the spyplane incident in 2001 on the Chinese. Not a word on American errors, intentions, or double standards (i.e. the U.S. maintains a 200-mile security zone beyond its borders, not the international standard of 12 miles). How self-deceiving some Americans continue to be even when their own country is riddled with problems. They pat themselves on the back and congratulate each other for being "right".

For the record, China does have many problems, some of which are very serious. But Chang's book won't give uninformed readers a balanced treatment of the subject.

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