Pleeeease: China is a capitalist, single-party state
Monday, April 20, 2009 at 3:41AM CORPORATE NEWS: "Total, China in Talks On Venezuela Refining," by Simon Hall and Russell Gold, Wall Street Journal, 15 April 2009.
FRONT PAGE: "China Inc's Top Deal Maker Provokes a Backlash Abroad," by Shai Oster and Rick Carew, Wall Street Journal, 16 April 2009.
The lock-in mentality of the Chinese right now is intense: having been frightened by the prices they were paying during the recent energy/commodities boom (which they largely created), they now seek to lock-in as many bilat resource contracts as possible.
It is a ruthless but smart approach to this unprecedented buying opportunity, otherwise known as the global financial crisis.
China's foreign M&A activity amounted to about $1-2B in 2003 and it's on course to do something like $80 to 100B this year after topping $50B last year.
But when the top deal-maker suddenly pulls out and joins the government as a cabinet member, both he and China's unabashed strategic approach receive a lot more suspicious attention.
I mean, it's like China is just a big corporation pretending to be a government. How very Marxian in a pre-socialist sense.
If I wasn't optimistic about China's commitment to capitalism, I would say it's heading for a workers' revolution.
A country in which the government seems to exist primarily to meet the needs of flagship national corporations. Where have I seen that before in American history?
Interesting to compare this with the charge that America is now ruled by a financial oligarchy.
As always, I find the similarities between the U.S. and China more interesting and compelling than the differences. The big difference is, we've got a complete market culture and popular ideology (highly individualistic) to sustain us during rough patches, while China has yet to develop those, and really can't, so long as it remains a single-party state.
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