The Coming Collapse of China (Paperback)

~ Gordon G. Chang (Author) "THEY WILL MOVE Mao Zedong's body soon; it lies on hallowed ground..." (more)
Key Phrases: central government leaders, unrecoverable loans, leadership compound, Jiang Zemin, People's Republic, Communist Party (more...)

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Amazon.com Review

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.

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Product Details

• Paperback: 368 pages
• Publisher: Random House (July 31, 2001)
• Language: English
• ISBN-10: 0812977564
• ISBN-13: 978-0812977561
• Product Dimensions: 8.8 x 6 x 0.9 inches
• Shipping Weight: 1.2 pounds (View shipping rates and policies)
• Average Customer Review: 2.5 out of 5 stars  See all reviews (81 customer reviews)
• Amazon.com Sales Rank: #118,009 in Books (See Bestsellers in Books)

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83 of 93 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 (TOP 500 REVIEWER)    (REAL NAME)    (VINE VOICE)

This review is from: The Coming Collapse of China (Hardcover)

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.

86 of 102 people found the following review helpful:

4.0 out of 5 stars A colossus on feet of clay, December 2, 2001

By	Boris Bangemann "boyse" (Singapore) - See all my reviews

This review is from: The Coming Collapse of China (Hardcover)

At a time when almost everybody is enthusing about China and its economic prospects, this is a sobering book. Chang argues that the economic and political system of the People's Republic is teetering on the verge of collapse; in 5 to 10 years after China's accession to the World Trade Organization (WTO) the whole house of cards will finally fall, and the Communist Party will be ousted from power in an eruption of violence. In Chang's opinion, neither the economic nor the political system can be reformed; the regime in Beijing will not win time during a slow process of reform ("crossing the river by feeling the stones"), but just make things worse as even more money is squandered by inefficient State Owned Enterprises and the corrupt Communist Party.

It is usually when people get overly optimistic and write books like "Dow 36,000" or "China as No. 1: The New Superpower Takes Center Stage" that things take a turn for the worse. Therefore, we should be glad that someone provides an antidote to the euphoria. After all, China and its 1.3 billion inhabitants produce an annual Gross Domestic Product (GDP) of just about the size of Italy's GDP. Italy has about 58 million inhabitants - and nobody considers Italy a superpower.

Gordon Chang's diagnosis is to the point. His prognosis, however, is debatable. After working for three years in Shanghai, I can only underline what Chang says about the sorry state of China's State Owned Enterprises and its banks. Doing business in China requires a good portion of sarcasm, and a lot of hope that despite the flaws in the system the whole state simply cannot collapse. In the words of a former executive of ING Bank: "The bad news is that the Big Four [banks] are insolvent; the good news is that they're sovereign." Chang's prognosis that China will collapse after 5 years because the country will honour its commitments to the WTO and open its economy to international competition is not very convincing. China will find ways to curb competition where it sees fit. Japan and the EU have been successful in protecting their agricultural interests for decades, and foreign banks have not managed to get a real foothold in the big Japanese market to this very day. In my opinion, the Chinese will be even more inventive in finding means to keep foreign products and services out of their country. No, the WTO is not the nemesis of Communism in China. Will the Communist Party be overthrown in a violent revolution? I would not bet on it. The Communist regimes in Eastern Europe went with a whimper (not a bang). Which will it be in China? I don't know. I don't pretend to know.

"The Coming Collapse of China" is an angry book written by the son of a man who "left China before the end of the Second World War and [the son] grew up hearing him say that Mao Zedong's regime would have to fall." The son returned to China to work as a lawyer in Shanghai. When he wrote this book - his first - it was a polemic in which he pounded away at the evils of Communism and predicted that Jiang Zemin's regime would have to fall. However, he would have written a better book if he had not tried to play the prophet (and defender of his father's faith). The best parts of the book are the stories in which he lets others speak for themselves, or when he pokes fun at the authorities. Unfortunately, he comes across as self-opinionated too many times. But don't let it irritate you: listen to the message even if you find the messenger annoying at times.

24 of 26 people found the following review helpful:

2.0 out of 5 stars Not quite there, July 18, 2005

By	Thomas Koetzsch (Hong Kong) - See all my reviews (REAL NAME)

This review is from: The Coming Collapse of China (Hardcover)

Gordon Chang's book on China gives an interesting but rather one-sided insight into various aspects of the China economy. The message you are likely to take home from this book is that the author believes that the Chinese people will stage a popular uprising and get rid of the Communists. The other 346 pages appear to have been written to support this belief.
Many Chinese state-owned enterprises are indeed not the most exciting credit risk on this planet, however, they are changing and those who cannot adapt will die. Similarly, the banking system leaves further room for improvement. Chang largely omits the changes the banking system in general and the Big Four banks in particular have undertaken in the last ten years, a process which should continue for at least another decade or two. Corruption is a problem, but there is nothing uniquely Chinese about it, and by itself it is not enough of a catalyst for a revolution.
That a transition from communism to a free market economy is causing all sorts of discontent especially amongst those who are not able to make that transition shouldn't come as a surprise. However, I doubt very much whether the `gasoline lake' (of discontent) Chang mentions is as large as he would like it to appear.

This book maybe a worthwhile read if you are looking for an up-date on various aspects of China. But you will notice that it is a single-issue book. A more balanced approach to the subject would have added more quality.