China's boom to come to an end

Thanks for posting those. I read the Mises article a while back but could not track it down for the life of me.

Humans are illogical creatures though aren't they? They can't be relied on to act in their best interests, or even to think really. They're much more impressed by spin than reason, and this I think explains the 'success' of capitalism, and of individuals like Thatcher and Blair.

I agree that Michael Moore's opposition of capitalism vs. democracy seems contrived, but then, he is an American. Democracy is a slippery term though, don't you think? We in the west like to imagine our current political systems are imperfect but still the only game in town, and we also like to think they've been handed down to us by ancient Athenians, and that civilization is something that evolves and continually gets better. Ah, if only it were that simple!

So you liked MAD, did you? (You do seem a bit of a hatter at times. j/k!) I miss the Soviet Union too actually, wasn't life so much simpler then? (The music was better too.) But I don't think that situation really made the 'capitalist' west think so carefully about "the consequences of its actions", I'm afraid I believe that collectively this is something we humans never do, it's our tragic flaw. I think you can tell from the jibber-jabber about market forces, economics etc, conducted elsewhere in this thread that inserting our heads up our own rear ends is what we do best.

The current world order reminds me of a crowd of tourists on a beach, more concerned with the placement of towels and deck chairs and the ownership and division of sun lotion and ice cream than the tsunami out on the sea, racing towards them.

Just read the article, cheers ! It sounds like a film which everyone should watch. I don't think it's going to change things much, but any increase in awareness is a good thing. He won't spark a revolution in the USA because the population there is too thoroughly indoctrinated. In general, americans mistakenly believe that they live in a classless society, and think of themselves as individuals pursuing their own interests rather than members of a group with common interests. This is no slight on the american people, just homage to the effectiveness of the propaganda machine over there. We've no reason to be smug in the UK, either, the gap between rich and poor having continued to increase under the so-called Labour Party.

He oppose Capitalism and Democracy. I think that's a bit naive. We already have democratic political systems in the West, and it seems to be more an expression of capitalism rather than it's opposite, or a 'cure' for it. Democracy has been a means of reconciling the opposing interests of different sections of a society to prevent social collapse. eg. Solon's reforms in Athens produced an oligarchical democracy which prevented the landowning classes warring the state to ruin. Also think of Runnymead, the English Civil War, and the struggle to set up the Trade Unions in the UK which resulted in the formation of the (initially fairly radical) Labour Party.

I don't know what the long-term solution is. For the moment (historically) the best that we can do, I think, is to ensure there is a fairy equal balance of power between social/national groups. The working-class movement in the UK was more or less crushed by Thatcher, and the result is a more rampant form of capitalism here. The american trades union movement is particulary ineffective, and that has given american capitalism free reign. Say what you like about the old Soviet Union, but it's existence ensured that western capitalism could not just go ahead and do whatever it liked with the world - a balance of power, you see. The situation is very different now - capitalism doesn't have to think of the consequences of it's actions any more. The threat of MAD doesn't exist any more.

I'm not cynical. I don't think the capitalistic 'mind-set' is inborn; I don't think it is part of human nature. What do you think ? Anyway, got a busy weekend ahead. Adios !

Sounds interesting! He wrote some great stuff back in the day. I remember being literally thrilled and chilled by 'The Pillar of Fire' and 'A Sound of Thunder' as a nipper! Have to check it out, (maybe as an ebook, not terribly easy to lay hands on new English books here.)

Anyway (kind of back on topic!), have you noticed this piece in the Guardian today? Capitalism is evil!

I suppose it must be in there somewhere, then. By the way (off topic), living in China, an old Ray Bradbury fan like yourself might not be aware that a new volume of previously uncollected short stories has just hit the stands. Called "We'll Always Have Paris.". It's a blast !

Hmm... it's been a while since I looked into The Histories, but it seems to be attributed to him here, albeit in a monotheist form. Where does it come from I wonder?

Are you sure that's in The Histories ?

Yeah, and those whom the gods wish to destroy die young . I think.

Hmm. brickie. I think I like that.

brickie mate, I see that like many Yorkshiremen there's a gentleman inside you wanting to get out! *bows*

I'm right of course!

But then what was it Herodotus said? 'The gods do not suffer presumption in anyone but themselves'.

This is a really interesting discussion, and I'm broadly in agreement with you, Tal. Maybe the definition of Capitalism should be sharper in order to distinguish it from other economic systems - the marxist definition is the most succinct and I imagine that many establishment theorists would not disagree too much with it. ie. Capitalism is a system of production centred solely around the production of capital by means of the accumulation of profit. Profit is ploughed back into capital in order to maintain competetiveness, and the system takes on a life of it's own. Establishment theorists would disagree with the predictions of the marxist model: that overproduction is inevitable, and results in periodic slumps which worsen over time and lead to social revolution as conditions become unbearable for the masses.

The chinese situation is so interesting. The 'communist' revolution in China has, in effect, been a means of transition from a highly beurocratised form of feudalism to capitalism, despite the intentions of the 'conscious vanguard'. I too think that China will experience huge turbulence at some time in the future, and that events will taken their own unique form because of China's unique historical and cultural conditions.

Ha ha - I'm staying with my daughter and she has been complaining 'they just don't have nice things here; they don't have the luxuries of cheese and good soap, etc.' But yes, we have the Hummers now here (in grotesque quantity). Look my main point is that there are significant differences in the 'model', mainly because of culture differences. i see the acquisition of Western 'things' fairly superficial in many respects, but yes, there can be environmental consequences. Though.. the packaging and waste .. pure Chinese wouldn't you agree? A heightened concern about the 'look' of the thing.

Interesting comment about 'turning their backs on Maoism'. As a teacher you would know that from about Grade 4 through to at least second year of an undergraduate course the Chinese receive instruction in 'right thinking'. I have observed that my students of economics challenge the received wisdom (to some extent.) But I worry about the English majors! :-) I rate this instruction at about the same level as religous instruction in Western countries - it carries certain values that are hard to shift. I think that it is more Confucian than Maoist by the way, and I do think that it leaves a mark on Chinese behaviour. The longer I live here the more I observe these instilled values. (eg. the importance of hierarchy which reinforces the classes in Chinese society.)

I guess on your other points (I don't want to diminish them but I am taking up too much space on ChinesePod servers) I tend to be more interested in the differences than the similarities.

诶，我到现在没有看过你的帖子。现在我哭。顺便，让我告诉你在澳大利亚口语"bluey"的意思是一个橙色头发的人，所以不是一个侮辱，哈哈。【加油Orangina..蓝色一】

Hey Bodawei,

Thanks for replying, and yes, it can be hard to follow the comments. I think I'll let my last reply be my last reply. This has been a fun conversation.

Xiaophil

I agree with you that Westerners are more likely to voice an opinion - therefore it is more likely Westerners arguing the point at G20 meetings and Copenhagen etc. I would describe this as a political stance. No doubt some morality arguments may be introduced to such positions.

I also agree that Chinese people don't readily voice a strong position - the 'every coin has two sides' is the bane of every foreign teacher in China. (Curse the foreigner who first volunteered this cliche that seems to be in every Chinese students' repertoire.) This reluctance can be explained in 'Confucian' terms - the Chinese are reluctant to burn bridges; they are not big on brinkmanship. Anyone may one day be called upon for assistance, so don't make enemies.

The 'milk' scandal etc. - of course it happens in China and it is immoral, but it does not prove the case. I read yesterday that China last year did half the entire world's exports (imagine an analysis of the world's economy.) The law of averages dictates that there is a great deal of immoral behaviour in China. Whether there is a disproportionate amount of immoral behaviour is another question.

My point is that the Chinese are more likely to *voice* a moral argument on something. You may not agree with the morality of the position taken; many people in the West do not align with Chinese morals. Just take the 'human rights' issue - the average Chinese position is a 'collectivist' one that does not sit well with individualistic Westerners. Furthermore, most Westerners would be oblivious to the morality being expressed (obviously language is a barrier.)

And the moral stance is unlikely to have any political overtones - not least because challenging the Government is a risky venture here. The Chinese are unlikely to say 'this is wrong; we have got to change this'. They do take these 'political' positions (eg. on loss of land, compensation, jobs, even 'milk' scandals), but in different situations to many popular 'causes' in the West.

The media itself is one reason why we don't see Chinese people voicing opinions like we do in the West. This is another factor that makes it difficult to draw the comparison I have been attempting.

[BTW - this threading does really make it difficult to follow a discussion - my last post now sits after a post you made that I had not seen when I posted. And I completely missed this one at first.]

Right. That's you crossed off my christmas card list, Bluey ! :-)

Hi Daniel70

All good points. But I would not go as far as saying that things are changing so fast that we can't come to any conclusions. Things are changing and you should update your data where possible.

Your comments about in-country variance are valuable - there is also the possible difference between generations. We seem to be grappling with that old problem of 'averages' that Barbs and I have discussed from time to time. When talking 'cultures' the use of averages is inevitable because 'average' is implied in the definition of culture. The other thing is that most data is reported at aggregated scales like province or country. At this point I have to admit that I have no workable definition of materialism nor any data to speak of, other than the considerations and sources I have already referred to above. But I believe that this is worth looking into further. When I have time..

I do not object to any of the 'materialism' factors that you would like considered - practically of course you have to ask 'what data do you have?' I have referred to Hummer ownership myself, and the rate of car ownership here suggests a materialistic society. But the facts are that car ownership is still roughly ten times higher in the United States. Whole country data I know. But the point is that perceptions cloud reality. The picture would be far worse for America if you looked at kilometres travelled by private car per capita.

There are other issues in this discussion that we have not yet raised, such as communication between these cultures and culturally appropriate measures. I did some systematic research in 2007 (at a small scale) on the subject of consumerism in China that got me thinking. I was intrigued how the Chinese words for 'environment' and 'health' conjure up different ideas in the Chinese mind to what the typical Westerner thinks of. I did not put the word 'materialism' in my survey but I think that it may have similarly yielded some surprises.

My real motivation here is to challenge some received wisdom, mainly that delivered in the Western media, which is where most Westerners get their information.

Forgive me guys if this has been addressed. I looked at the large number of comments that have come since I last weighed in and felt a bit blinded by them. I'm afraid I probably won't give them the time they deserve. Anyway, back to what I wanted to say. Bodawei said:

"No, all things considered I still think that people in the West are more materialistic, and less likely to articulate the morality of a situation."

I just cannot disagree with this more. Perhaps the problem is that you are coming from an Australian perspective and I an American, i.e. perhaps we are too casually defining the West? Anyway, let me ramble a bit... And a caveat, yes, still anecdotal...

Actually, I am not going argue against the materialist part (although I do have objections) because I am more interested in the part where you say the people of the West are "less likely to articulate the morality of a situation." Whenever I try to get my students' opinions, and this goes for university students, white collar workers, housewives and perhaps other groups of people who are at least 18 years of age, I am always struck by how many of them are unwilling to give an opinion. I tire of the "all coins have two sides" argument that basically means, "I don't want to define my position." I remember a 30ish white collar student once telling me that many Chinese people avoid saying what is on their mind as they don't want to have their opinions come back and bite them. Furthermore, for the most part, who are the people, on the basis of moral objection, picketing corporations and protesting events like the WTO? Well, mostly Westerners, or should I really say, citizens of countries who live in liberal democracies. The silence of Chinese students in these matters is deafening. I don't doubt that they have sincere opinions that they are willing to express in essays and in private or on bbs boards, but the fact is most of the lack passion, possibly understandably due to their environment, to get out there and try to change things beyond a small whimper. And when you said, "I am more interested in what people do than what they say," you really struck a chord with me. How does it happen that moral students grow up to run factories who put lead in paint and chemicals in milk? I know it isn't most Chinese that do these actions, but where is the evidence of Chinese companies saying, it is the important to do the right thing? While we might take a cynical attitude towards Google, the fact is, we can at least find Western companies trying to do the right thing even if the right thing is motivated partly by strategic planning.

Back to university students. At the university I graduated from, I remember taking a management class and having a very livid debate regarding the ethical responsibilities of managers in a globalized economy. It was so livid that afterward some students were sincerely angry at each other. In addition, I am aware that many of my university's programs that develop professionals, possibly all o them, required students to take an ethics class. As a philosophy student, I took the class and thought it was a bit amusing as most of my classmates were engineering, business and nursing students. People giving their opinions was not a problem. Actually, the problem was the professor trying to find time to explain the theory of various philosophers because the debates got out of hand (although, yes, some students just sat there). When I have asked Chinese students if they have this kind of class, they don't even seem to know what I am talking about. I know they have that 'correct thinking' class, but isn't that more like telling them what to think?

I don't know. I feel bad trumpeting the West over China, but I just find it hard to see that they are more likely to insert morality into business.

Top o' the mornin' to ya Brickie old chum :)

Hi Bodawei,

I fully agree that "cultural comparisons are possible on identifiable and measurable dimensions", but what is making it very difficult for me to agree with you on the point of materialistic behaviors is an absence of a clear specification of how materialism might be thus measured. I would object to a measure of materialism that excludes factors like hummer ownership, proportion of wealth spent on art, probability of encouraging offspring to engage in a liberal arts education as opposed to a profession oriented one, and so on ... I would object to a measure that equates materialism with level of consumption measured at the national level. I'm guessing that the relative environmental footprint of say the average American against the average Chinese is currently changing too fast to be very useful. I believe a construct like materialism would be most interesting if defined at the level of the family or the individual. I would also predict that the within country variance of any measure approaching a valid index of materialism would dwarf the between country variance -- assuming a reasonable set of control variables.

It's usually first thing in the morning when I'm planning who to murder. :-)

Hi Mr Brick,

I'm sure if I really believed that people are more bad than good, I'd have a difficult time getting up in the morning. When I wrote that last night, I was thinking of dark things. As Babs and Tal have pointed out, its easier to get lost in the dark.

thanks mate.Good information as always.Cheers :)

Well, there has for a very long time been large discrepancies between the rich and the poor in China - it was essentially a feudal system. The difference between the rich and poor has been steadily rising over the past 60 years - I wonder if it is getting back to like it was in feudal times? The deeply ingrained propensity to save was established in feudal times - when there was no financial system as such to facilitate lending and borrowing at any great scale. But the same mechanics exist at any point in history - if you are dirt poor you consume everything you earn; if you are a little better off you would respond to the incentive to save to see the family through any catastrophe (but your capacity to save is still limited), and if you are rich you have the most scope to save/accumulate assets. Often this was to pass on to your survivors, perpetuating the name and reputation etc. This incentive to save is highest in agricultural societies where shortage and famine is always a possibility. A high savings RATIO is more to do with the behaviour of the well off than the behaviour of the poor. I'm stubbornly sticking to my position that while there may be an incentive in a poor country to save, and the incentive applies to everyone in society, the capacity to save is most enjoyed by the rich. :-)

On a related point I love the 'theory' behind the invention of the wok - that most versatile cooking utensil. It is thought to represent the absolute pinnacle of efficiency in situations where fuel is scarce. It's design evolved in a country often confronted by shortages and famine. Or maybe it was something to do with soldiers cooking in their shields or helmets! I've heard both stories. :-)

Well, there has for a very long time been large discrepancies between the rich and the poor in China - it was essentially a feudal system. The difference between the rich and poor has been steadily rising over the past 60 years - I wonder if it is getting back to like it was in feudal times? The deeply ingrained propensity to save was established in feudal times - when there was no financial system as such to facilitate lending and borrowing at any great scale. But the same mechanics exist at any point in history - if you are dirt poor you consume everything you earn; if you are a little better off you would respond to the incentive to save to see the family through any catastrophe (but your capacity to save is still limited), and if you are rich you have the most scope to save/accumulate assets. Often this was to pass on to your survivors, perpetuating the name and reputation etc. This incentive to save is highest in agricultural societies where shortage and famine is always a possibility. A high savings RATIO is more to do with the behaviour of the well off than the behaviour of the poor. I'm stubbornly sticking to my position that while there may be an incentive in a poor country to save, and the incentive applies to everyone in society, the capacity to save is most enjoyed by the rich. :-)

On a related point I love the 'theory' behind the invention of the wok - that most versatile cooking utensil. It is thought to represent the absolute pinnacle of efficiency in situations where fuel is scarce. It's design evolved in a country often confronted by shortages and famine. Or maybe it was something to do with soldiers cooking in their shields or helmets! I've heard both stories. :-)

"So in China, the high savings rate is mainly generated by those that can afford to save"

..sure ,but correct me if I'm wrong but my understanding is that the nation in general was pretty poor until very recent times..the emerging middle class being prominent in only the last couple of decades or so [as I say I'm no expert here...but I hope I'm in the ballpark] so I would have thought such memories of poverty were still very much a part of the collective consciousness and learnt coping strategies and the habit of saving would live on to a degree even in those now more comfortable.Perhaps they are more acutely aware of lean times.Anyhow,just my thoughts.You know what you're talking about ,I'm just postulating.

Yes, sorry mate. I was dragging your comment (unfairly) into a discussion about savings rates. In doing so I probably mis-represented your point: where there is no social security or universal health scheme you would definitely expect a stimulus to save for insurance purposes (if you can afford to save.) You may call it 'self-insurance'. This has often been mentioned in discussion about China's savings rate.

What I should have said is that, despite this incentive, poor people anywhere (China and the West) do not contribute much to high savings rates. They don't contribute because they have to spend most of what they get in order to survive. So in China, the high savings rate is mainly generated by those that can afford to save. So, it is not those who 'have less to spend' who play a big part in generating the high savings rate. It is not the very poor and fearful, those struggling to survive, who are responsible for the high savings rates. Actually, that is what the purveyors of consumer products are certainly counting on anyway - there is a lot of talk in the West of turning around this Chinese propensity to save so that we can all profit from the Chinese consumer. Well it won't be the farmers who will be performing this miracle.

The Chinese Government itself is quite partial to the idea of everyone buying more stuff - one part of the stimulus package has the farmers being offered all kinds of domestic gadgets at subsidised prices, to get them into the 'rat race.'

Hi Daniel. Thanks for your answer. I agree with much of what you said, but I'm not inclined to believe that it is easier to find examples of hell on earth, and I don't believe in a balance of good and evil in the soul of man, even when this figure of speech is used heuristically. But I'm afraid that at this level of abstraction I can't convey what I feel. It's your value judgements which seem to give me trouble - maybe I'm a closet psychopath ?? Haha.

Anyway, you're all right about not learning enough Chinese. Back to it now. A tip: if you want to hit that Top 10 list, then make sure all your contributions are one-liners ! (joking) Cheers!

Re:

"Barbs actually suggests that they may deny themselves because they have less to spend but the reality in all societies is that poor people spend a higher proportion of their income in order to survive"

..I certainly bow to your much greater knowledge and understanding in this area mate.I mustn't have been very clear though in what I was trying to say because I am fully cognisant of the fact that poor people spend a much higher proportion of their income in order to survive.I think what I was trying to say is that if survival is a struggle then I think that would be a greater stimulus to save wherever possible as self insurance against rainy days and for the security of the offspring.

bodawei好朋友，

“been accused of not only ‘going native’”

。。控诉了？我非常喜欢这个价值观【你上面描写】：

“less materialistic ones, such as importance of friends and family, the emphasis on building and maintaining relationships, the role of food and eating in people’s lives, and the utter pragmatism that allows this society to function pretty well in the face of enormous problems. I like the connections with the past borne out in everyday communication. I appreciate the strong sense of community and the life-long associations made in school and in the workplace.

A parting thought: the Chinese are not obsessed with ‘coming first”

。。所以我想自己“去本土” ：）我真佩服那价值观。

Hi Daniel70

Perhaps the worst thing about this thread is that we've kept you from your Chinese - sorry about that.

But I feel I should make an effort to respond because I think that I have been accused of not only ‘going native’, but relativism, cheating and possibly talking nonsense! I haven't been so accused since Sunday School days! Oh, and 'mostly joking'. Nope, you must be confusing me with someone else; I'm deadly serious. ;-)

1. Savings levels - objective measures of different saving levels between US and China are indeed significant. The US scenario where parents are saving for the child's education, insurance against health problems - it is a very similar scenario n China. Well, that and saving to buy an apartment for the next generation. The difference is that the Chinese deny themselves consumption while Americans ‘want it now.’ It was a powerful factor in triggering the 2008 Global Financial Crisis. It is interesting that the Chinese have less to spend (objectively measured by % of GDP spent in the household sector) and they still deny themselves. (Barbs actually suggests that they may deny themselves because they have less to spend but the reality in all societies is that poor people spend a higher proportion of their income in order to survive. Rich people can afford to save for the future; poor people cannot.)

2. I do believe that cultural comparisons are possible on identifiable and measurable dimensions. I don’t believe that they are meaningless; they are informative. (Measurement of any phenomena in the social sciences is problematic not least because it generally relies on responses to questionnaire survey.) Somewhere along the line I think you may have assumed that I was declaring one outcome (China) superior to another (the US) but, remember, I am a relativist.  Perhaps you come to that conclusion because I spoke of ‘morality’; in some conversations that may be equated to ‘good’. But I am not saying here that Chinese society is more moral (whatever that means); I am saying that they voice moral considerations more. You go on to discuss ‘guilt’ and ‘shame’ but you lost me there. I don’t think the importance of shame in Chinese society explains why they voice their moral concerns. Yes, I know that ‘guilt’ is an individualistic matter (cf. shame which is something shared between members of society), but it does not follow that we do not talk (endlessly) about guilt.

3. On materialism/consumerism (did I mention consumerism?)/environmental footprint – I seem to be getting the ‘American defence’. Actually I agree that it is a difficult topic and that the words, particularly ‘materialism’, are cultural constructs. However, environmental footprint is readily translated into terms we can all understand so those comments stand. Again you seem to assign a value to my words that was not intended – I didn’t at any stage say I thought that being ‘materialistic’ is inferior. Did I say it was a sign of ‘poor character’? Remember, I am a relativist. Okay, I will declare my hand. There are many aspects of Chinese society & culture that I admire. And in general they are the less materialistic ones, such as importance of friends and family, the emphasis on building and maintaining relationships, the role of food and eating in people’s lives, and the utter pragmatism that allows this society to function pretty well in the face of enormous problems. I like the connections with the past borne out in everyday communication. I appreciate the strong sense of community and the life-long associations made in school and in the workplace.

A parting thought: the Chinese are not obsessed with ‘coming first’, certainly not as much as is commonly assumed in the West. There is a strong sense of aiming for the happy medium. As I get older I appreciate this more and more – but it marks a sharp division between East and West thinking.

Like Barbs says, I do enjoy the discussions – may there be many more.

RE: Education & R&D (Jckeith)

Yes, I think it has changed significantly in recent times. Measures are problematic but I would imagine that the argument that the 'US is way ahead of its rivals' does not hold any more. One problem is understanding the different institutions. Another problem is dollar value comparisons - you get a lot more for your dollar in China than you do in the US.

I haven't done any Chinese at all today, but I'm hoping to make the top ten most frequent posters for the week. ;). Once I knock that off my to-do list, I can go back to my anki decks. Thanks for your reassuring reply.

I'm not sure what gave you that impression mate[and I'm the one who's sorry for giving you that impression somehow].I'm not even slightly irritated or offended.Honest answers are great and I was just enjoying a little debate.I actually really enjoyed reading your viewpoints.Actually,I couldn't help but laugh when you first entered the friendly debate with your line to my good mate bodawei:

"I think that it is worthy of an entry in the "you know you've gone native when ..." thread. Just make sure you're ready to say "westerners just don't understand" whenever someone disagrees with you."

..I'm sure he has a good sense of humour and has also,like me, taken it all in a spirit of fun.Cheers mate :)

ps While I'm enjoying the debate,I was starting to think though that I'm not learning much Chinese at the moment and need to be a bit more focussed which was my intention this year but these discussions are always so enthralling.I must try debating in Chinese more,but I know I'd be hopeless at trying to express what I'm trying to say.Still ,good practice hey?

I'm sorry Bababardwan, I didn't mean to offend you. I didn't intend to irritate or belittle anyone. I was trying to give Mr Brick an honest answer to his question. In doing so, I think I've irritated you. I'm sorry.

"I think the world would be a much better place if we could acknowledged the d(evil) within. "

...how so? And who is there that doesn't recognise that we all have the capacity for good or evil? I agree with tal though.I never think these things are black and white or so simple.

"What a piece of work is man?" ... perhaps we are at our most magnificent when confronting our moral frailty. Hamlet and MacBeth would be among my top picks of English language literature. I'll have to have a look at the Road. I do think that literature is one of the ways we put ourselves back together again after a moral catastrophe ... The Brothers Karamazov ... Slaughterhouse Five ... you can probably come up with much better examples of this.

There might be something special about "evil." It may require a quasi-religious kind of thinking that I'm not very comfortable with. Jordan Peterson, a psychologist at the University of Toronto, has a one hour lecture on evil -> http://www.youtube.com/watch?v=GpLVwcAoSRk.

I'll leave it at that. I think I've done enough gloom mongering for one night.

We do don't we? (I've only just finished Cormac McCarthy's The Road. A great work of literature and a harrowing experience I can tell you.) Surely our culture is full of reflections and reportage on our capacity for appalling and uncivilized behavior.

BUT, that's not the whole story is it? Don't we also need to acknowledge our magnificent side? Don't we need to proactively reinforce our good qualities and all the sublime thoughts, behaviors and achievements of which we are capable?

"Evil" surely is a relative term anyway. Does "evil" really exist? Are there really "evil" people? Or is it more likely that there are damaged people, abused people, unfortunate people, who go on to spread the same disease.

I'm inclined to believe it does more harm than good. I think the world would be a much better place if we could acknowledged the d(evil) within.

Let's hope that the belief can affect the reality.

Hi Bababardwan, I think it's safe to say that today most people would agree with you. It is worthwhile, though, to remember that the belief in the overall balance of good in man is itself a cultural construction. These days it is a strongly held almost unquestionable conviction. That has not always been the case.

"Speaking metaphorically, I'm inclined to believe that there is more evil in the human soul than good". Historically, it is much easier to find examples of hell on earth than its opposite number.

..I can't agree with you here.Sure history is filled with atrocities but that doesn't prove anything.Good deeds have never been as newsworthy.

Regarding morality as universal or relative? I suppose I would have to split morality into two levels, the behavioral proclivities themselves, and conversations about these.

Right at this moment, I'm guessing that the behavioral proclivities themselves have at least two aspects. There are biological and low level psychological characteristics that lead to more or less universally shared tendencies. Then, there are historical facts that differentially actuate these tendencies in response to contextual circumstances. I don't think it is that hard to modify behavior against these basic tendencies, but they're spring loaded, and sooner or later they snap you back. So, you can take a 19 year old boy, drop him in the jungle, and easily create conditions under which he can commit unimaginable atrocities. OK, but he's going to come home a basket case and have nightmares about it for the rest of his life. It's not hard to do this at the mass level either. Consider WWI. All of western Europe went completely insane, and, at the time at least, no one noticed.

The conversations about morality are really quite different. I'm inclined to say that a good deal of moral reasoning may be directed at controlling the behavior of other people. In that regard, you might as well reason in absolute terms, because it gives you further reach. You can always slip back to relativism, though, when it suits your purpose. Western Europeans were pretty good at this in the past. The Founding Fathers may stand as an example.

In a less cynical vein, I suppose I might say that a good amount of moral thinking is directed towards forming an honest understanding of these behavioral proclivities, and trying to figure out how to control them. Speaking metaphorically, I'm inclined to believe that there is more evil in the human soul than good. Historically, it is much easier to find examples of hell on earth than its opposite number. Things go really badly wrong on a regular basis, and a good deal of energy has to go into putting things back together again. I guess a lot of this work shows up as literature.

"Apologies for intruding on this discussion."

..no need at all for apologies.My understanding is that all these discussions are open to anyone.No cliques here mate,and great to see you joining in.

I am envious of the way you reason, Daniel, and of your ability to express your reasoning. Do you yourself have a stance with regard to morality ? Apologies for intruding on this discussion.

Well, some folks assume that moral rules are valid across cultural and ethnic contexts, Andrew C recently argued along these lines in a thread about the social status of the laowai. Others tend in the opposite direction, and assume that moral values must be understood in the context (or culture) in which they arise. I believe that Bodawei leans that way. In this case, I felt that Bodawei was taking a relativistic observation (counts of explicit moral comments may be a valid metric in China) and implying that this was a meaningful point of comparison across cultures (explicit comments on the morality of a situation is irrelevant in the US). I think that's cheating.

For some people, for example, religious doctrine constitutes a fixed framework, so they have conversations in absolute terms "You must not steal, even if your child is dying from hunger." Whether or not you are of the same persuasion, you simply cannot converse with them in relativistic terms. I guess that, personally, I believe that language fails you if you go too far in either direction, and you end up talking nonsense in the literal sense.

very interesting.Let me ask though,with regards to:

"useful to know whether the discussion presupposes a relativistic background, or a more absolute"

..how you see the difference between relativistic and absolute,and how one has a discussion in the absolute?

There are other problems with the savings rate. It favors capital investments over education and innovation, which are the main drivers of wealth creation in modern economies. The U.S. devotes far more spending as a percentage of GDP to education and R&D than its nearest rivals. This drives down the savings rate but boosts long-term growth. At least this was true a few years ago. It may have changed recently.

I would also like to point out that saving levels don't say as much as you might think. The public education system in the US is perceived by many as being quite flawed. People want to provide educational opportunities for their children. The reputation of a public school is directly tied to the cost of housing in the area, so your home will cost you say three times more to send you child to a school of good repute. For the most part, the universities with the best reputations are private schools, with tuition costing $40,000 per year per child (probably more). If you are lucky enough to live in California, perhaps you might send your children to Berkley with reduced tuition. What if the state you live in has a crappy education system? With three kids, living in a $700,000 home, and looking at god only knows what kind of university expenses, can we expect to find much money in a savings account. You don't get to be $500,000 in debt by driving a hummer and putting a 50 inch plasma TV in each bedroom . One might say that a family who does that (both parents working full time), for the sake of the education of their children is misguided, but would you describe them as materialistic?

Hi Bodawei,

I assumed you were mostly joking. I suppose I'll try to make a more serious contribution.

First, if comparing two cultures on values, it is useful to know whether the discussion presupposes a relativistic background, or a more absolute. Making decisions for yourself, independent of the opinions of your parents, grandparents, etc., in many western countries is consider a sign of good character, and is seen by many as being a required behavioral alternative for breaking odious traditions. In China, going against the wishes of parents and grandparents is considered a sign of bad character, ingratitude, and self-centered recklessness. So, now, if we want to compare across these cultures, it is helpful to know which value system is being used as a reference, go with a Chinese one, go with a Western one, whatever, it needs to be declared. In the absence of this declaration, all comparisons are meaningless, and, conversely, the comparisons do not generalize across reference frames.

Going on with that, one may very well compare the extent to which members of different groups make explicit moral comments regarding ongoing behavior. I'll go out on a limb, and suggest that as a hangover of Christian tradition, members of western cultures tend to use moral compasses that are relatively more guilt based. The Chinese, possibly due to Confucian tradition, tend to use moral precepts that are based on shame. So, a Chinese guy may come home from work, greet his neighbor, and say something along the lines of the following "if I weren't so modest, I would tell you more about how I did something quite honorable today." A westerner, on the other hand, may come home, nod to his neighbor, and spending the evening drinking himself into oblivion over some offence he committed 20 years ago. You could count the number of utterances containing moral content made each day by a random sample of Chinese and Westerners, and it may tell you nothing more than morality is more of a public affair in China than it is in the west. In fact, in the west, behavioral decisions based on the perceptions of other may itself be considered immoral.

Regarding materialism, consumerism, and environmental footprint, I could argue that people of [insert favorite example of country poverty stricken beyond comprehension] are substantially less materialistic than the average Chinese, but what would that prove. First, the very notion of “materialistic”, as a sign of poor character is, taken historically, a really weird notion, and one only possible for people living under extremely luxurious conditions. In this regard, I would imagine that it belongs in a western based moral reference framework. Even if one stripped the value judgment out it, and defined it more objectively, there would still be a lot of work to do. At a minimum, you would need to control for social status, wealth, years of education, and intelligence. You would additionally have to control for availability of consumer goods, and costs associated with ownership and consumption. After that, it might also be helpful to control for the social status conferred by ownership.

In my opinion, factors like these would need to be addressed before any meaningful discussion begins regarding the elevated explicit moral concern and reduced materialism of the Chinese.

Hey, aren't you the guy who busts random pickpockets on the street, to the amazement of disinterested Chinese onlookers. How do you define morality?

thanks bodawei.The first part of your reply is insightful.I have heard those notions expressed before,and it's interesting to see how they then apply to economic decisions.

I too was a little unsure of the second half of your reply.But you know me,I'm not big on generalisations anyway.I couldn't agree more with you when you say:

"I am more interested in what people do than what they say"

xiaophil's response does give me an inkling though of what may be a cultural difference though,namely that some westerners may be a little less comfortable in directly voicing moral judgements on a situation,which is not to say that they aren't using moral judgement.

Your comment:

" 'money is everything' types - just read about them, see them behind the wheel of the big black SUV. "

..was also interesting,along with the comment about America's environmental footprint.I wonder how much of this is really just a reflection of the current differences in per capita wealth rather than a true difference in attitudes to materialism.I do like your concrete example of Chinese having a better record with saving.I don't know that this proves that there is less materialist attitude.Once again,having been an historically poor nation,for reasons of financial security it seems to make more sense on a personal level to save where possible.Folk of a wealthy nation may feel less insecure in this regard,particularly in countries like Australia with the safety net of a social security system.But you understand the mechanics of these things far better than I...I merely offer you some thoughts on attitudes.I may be way off of course and am merely speculating for what it's worth,if nothing else to see what others think.

thanks bodawei.The first part of your reply is insightful.I have heard those notions expressed before,and it's interesting to see how they then apply to economic decisions.

I too was a little unsure of the second half of your reply.But you know me,I'm not big on generalisations anyway.I couldn't agree more with you when you say:

"I am more interested in what people do than what they say"

xiaophil's response does give me an inkling though of what may be a cultural difference though,namely that some westerners may be a little less comfortable in directly voicing moral judgements on a situation,which is not to say that they aren't using moral judgement.

Your comment:

" 'money is everything' types - just read about them, see them behind the wheel of the big black SUV. "

..was also interesting,along with the comment about America's environmental footprint.I wonder how much of this is really just a reflection of the current differences in per capita wealth rather than a true difference in attitudes to materialism.I do like your concrete example of Chinese having a better record with saving.I don't know that this proves that there is less materialist attitude.Once again,having been an historically poor nation,for reasons of financial security it seems to make more sense on a personal level to save where possible.Folk of a wealthy nation may feel less insecure in this regard,particularly in countries like Australia with the safety net of a social security system.But you understand the mechanics of these things far better than I...I merely offer you some thoughts on attitudes.I may be way off of course and am merely speculating for what it's worth,if nothing else to see what others think.

thanks bodawei.The first part of your reply is insightful.I have heard those notions expressed before,and it's interesting to see how they then apply to economic decisions.

I too was a little unsure of the second half of your reply.But you know me,I'm not big on generalisations anyway.I couldn't agree more with you when you say:

"I am more interested in what people do than what they say"

xiaophil's response does give me an inkling though of what may be a cultural difference though,namely that some westerners may be a little less comfortable in directly voicing moral judgements on a situation,which is not to say that they aren't using moral judgement.

Your comment:

" 'money is everything' types - just read about them, see them behind the wheel of the big black SUV. "

..was also interesting,along with the comment about America's environmental footprint.I wonder how much of this is really just a reflection of the current differences in per capita wealth rather than a true difference in attitudes to materialism.I do like your concrete example of Chinese having a better record with saving.I don't know that this proves that there is less materialist attitude.Once again,having been an historically poor nation,for reasons of financial security it seems to make more sense on a personal level to save where possible.Folk of a wealthy nation may feel less insecure in this regard,particularly in countries like Australia with the safety net of a social security system.But you understand the mechanics of these things far better than I...I merely offer you some thoughts on attitudes.I may be way off of course and am merely speculating for what it's worth,if nothing else to see what others think.

Good points as usual. Good questions. Observed behaviour is more valuable evidence than what people say in responses to surveys (or essays) - but it's difficult to obtain useful evidence in this form. You should be sceptical about anecdotal evidence. And of course your own experience - it is powerful but of course it doesn't prove anything. :-)

Stating the limitations, most of my evidence is through interaction with students, essays etc. I try to take a 'researchers' stance on this but it is subject to the same limitations already expressed. I have work colleagues and of course Chinese friends like most of us here. You choose your friends so I don't come across too many of 'money is everything' types - just read about them, see them behind the wheel of the big black SUV.

No, all things considered I still think that people in the West are more materialistic, and less likely to articulate the morality of a situation. Chinese people do however 'flaunt' what they have in a way that many Westerners think is bad form. That's a cultural difference.

Evidence, examples - that is difficult without resorting to anecdotes that I have already qualified. Savings levels is often quoted - that is objective. The average American borrows over their lives in order to live their definition of the good life. By comparison the average Chinese person is positively monsastic. (Difficult to believe when you see the Hummers - but there it is, fact.) Americans consume significantly more than any other society on Earth, but the Chinese are at the other end of the spectrum on the 'consumerism' dimension. The environmental record (consumption of resources) in America is also not good in comparison to China - the average Chinese has a tiny environmental 'footprint'.

Charities and giving - the institutions here are so different it is difficult to make comparisons. However, my personal observations are that there is at least as much charitable giving of time and money by the Chinese as people in the West. Take the Sichuan Earthquake; the Chinese response was enormous and it still goes on. Many people gave contributions through their workplace - they were 'encouraged' to give (we would say 'rail-roaded'). I came across a collection effort just a couple of days ago - minority people selling art works to contribute to the rebuilding in the earthquake area. Not the same institutions though, as I say. But I see tables set up in the campus where people are collecting money (from students!) for 'the orphans'; the Western model is also catching on.

'Citing the Bible' - the Chinese win hands down here. :-) Not only do they enjoy a rich supply of traditional sayings, they are starting to quote from the Bible as well! (Un-nerving, I agree.) One of my students finished a a very average effort with an exam paper with a written comment (to me): 'Bless me!'. The Chinese are drilled in this of course with 'right thinking' classes and 'advisers' right through school and university. As I note above, I am more interested in what people do than what they say.

bodawei, can you clarify this:

"I think that my Chinese students are much more likely to assess the morality of a situation than their Western counterpart. Westerners are far more material and we are seen as such by the Chinese."

I just haven't seen much evidence to support this. I have seen Chinese do some honorable things, but I also see a lot of 'money is the bottom line' thinking or perhaps 'money for my family is the bottom line' thinking. Many Westerners have this trait as well, but contributions to charities are not rare, people supporting the idea of fairness is not rare, and citing the Bible in making decisions, although sometimes I find annoying, is also not rare, at least not in America. I have the feeling I just didn't grasp your point, so I would be grateful if you could clarify and if you were to give an example or two that would be a bonus.

I do know you were talking specifically students, but are students drastically different then the people in the workforce? I haven't seen much of a difference, personally, but maybe I wasn't looking hard enough. Perhaps you don't see this point as important.

Bodawei, regarding your statement on morality and materialism, east vs west: I think that it is worthy of an entry in the "you know you've gone native when ..." thread. Just make sure you're ready to say "westerners just don't understand" whenever someone disagrees with you.

Sorry Barbs, I let this sit for a bit; you deserve a response. I think that you could look at the index of a Confucian text and say that the values expressed emerge at some stage in any 'economic' discussion. Let's take the hierarchy of responsibilities and the sense that everyone has their place in the world, some lowly some exhalted (a challenging idea for someone brought up in Australia!) These values, for example, inhibit critical thinking to some extent, except of foreign teachers of course. :-) Just joking guys.

I think that my Chinese students are much more likely to assess the morality of a situation than their Western counterpart. Westerners are far more material and we are seen as such by the Chinese. Amazing, I have made that statement in a city being flooded by Hummers. I am starting to sound Chinese.

This is a very interesting concern that you raise - people have been 'worried' by China for a very long time. For years people in the West have been predicting the big 'crash' in China. And then in 2008 it was the 'United States' that dealt a severe blow to the world economy. You can rest assured that the exact mechanics of the 2008 global financial meltdown cannot be repeated in China - we do not have the pre-conditions here; Chinese institutions are radically different. (If you go to Chicago Public Radio you will find excellent commentary on the mechanics of the 2008 financial crisis.) That is not to say that there are not problems in China - there are.

You mention housing 'bubbles'. In both China and the West we have housing bubbles which 'burst' from time to time; this just means that house prices fall as well as rise. In a country like Australia the main people hurt by a housing bubble bursting are those who speculated on the inexerable house price rise. Our institutions usually prevent the knock-on effect on banks and other businesses. In the US, institutions are different and falling house prices in 2008 triggered a crisis involving the failure of many banks and other businesses. To understand whether a housing bubble is a problem in China you need to understand the institutions within which the housing markets operate. The Chinese Government has acted on several occasions to moderate house price speculation; they did so again recently when they turned off the 'stimulus' they designed to help China through the global financial crisis. Will we see house prices fall in China? Undoubtedly. It has happened before and will happen again; it is a characteristic of markets. It's normal, don't sweat. You take a risk sometimes 'you' get burnt. You personally are not likely to be hurt by this rollercoaster unless you have chosen to take the ride.

"I was looking for a definition of innovation. Is it somehow different from, for example, productivity improvement?"

I think I'm pretty flexible on the term. I think just about anything that is an improvement over previous methods, models, etc. is innovation. Maybe I should ask, what do you think is innovation? You said you were looking. I'm guessing you at least have a somewhat developed opinion.

"But is it still true of recent Chinese social/economic history?"

I think we could learn a lot from the Chinese, although I'm not exactly sure what. The fact is, they have worked wonders in the past 20 - 30 years. This shouldn't be dismissed.

"Should we really care too much who are the innovators in human history, given the gains that can be achieved from trade?"

I think the answer is no. Money is money, although I would rather make my fortune through latest technology than an underwear factory. Anyway, someone has to innovate. Someone has to produce. Technology is pretty exciting, but sometimes I worry about the fact that America can't make much anymore. What happens if we suddenly become isolated?

"I understand that this investment dwarfs any such investment currently in the United States, indeed anywhere in the West. Would China continue this investment if it was not seeing any results?"

I definitely won't argue that they aren't capable of doing something amazing. I'm sure they have had some preliminary successes and more will follow. I still think they are bound to be followers unless there are some fundamental shifts in thinking and political structure. I don't want to sound like a broken record player, but as I said, research in the universities here is really bad. That said, China is on a roll. It would be hard for me to be surprised by anything they do.

"There is a prima facie case against such a situation - it can't possibly be in China's interest. China understands as well as anyone the value of long-term relationships."

I'm not so sure. I really think that sometimes the West don't understand them and vice versa.

"anti-dumping?"我晕！;)

Actually, I really wish I knew more about this possible housing bubble coming. I'm really afraid that China is going to do to the world economy what America did to it in the past year or two. I don't understand very well the situation in technical terms, but my intuition says that something is very, very wrong. I hope China can resolve this with its apparent super skills.

I can see now that my question about innovation was poorly worded - I was looking for a definition of innovation. Is it somehow different from, for example, productivity improvement? I have followed those arguments about a long period of Chinese history that was apparently devoid of innovation - that is 'nothing much changed in this period'. Some of the geo-political reasons for it are interesting - there was another thread on this here some time ago. And there are cultural reasons put forward that no doubt still apply today. But is it still true of recent Chinese social/economic history? And even if it is, to some extent, this is a nationalistic argument that I find unsatisfactory. Should we really care too much who are the innovators in human history, given the gains that can be achieved from trade? Anyway, China can be forgiven for saying 'look at the numbers'. In my opinion 1. China is demonstrably good at problem solving; 2. much of this is due to what I would describe as innovation. Certainly a lot has changed about Chinese society - given my definition of 'lack of innovation' above, perhaps this is a workable definition of 'innovation'. But I acknowledge a communication problem when discussing 'innovation' - I am not sure if you and I are talking about the same thing.

On a related topic to 'innovation', you may have heard or read of China's enormous investment in pure and applied research and 'think tanks' in recent decades. I understand that this investment dwarfs any such investment currently in the United States, indeed anywhere in the West. Would China continue this investment if it was not seeing any results? Or if it could merely steal the ideas from someone else? Would it even suit China's self-image?

On Joint Ventures - any evidence of this 'policy of always cheating other countries'? There is a prima facie case against such a situation - it can't possibly be in China's interest. China understands as well as anyone the value of long-term relationships. I'm not disputing that certain people cheat - is there any evidence that 'China' cheats more than other countries? If you read the Joint Venture literature you will find that there are inherent incentives for 'cheating' that have nothing to do with China's recent history of Joint Ventures.

Hey Xiaophil - after we've done this topic we should get onto the subject of 'anti-dumping' cases! :-)

Well, let's see...

poor innovator = someone, or in this case a country who produces few innovations that dramatically change they way we live

great innovator = the opposite

I would say that innovations can both be sexy and not, and they can apply to all the areas you mentioned. I cannot give you a detailed examples, but in general it is said that the Yuan Dynasty was a disaster for the Chinese people, and the Ming and Qing Dynasties were quite conservative and uninterested in new ideas. I suspect that this is too simple, but that is what I have read. I am unaware of anything I commonly use that is a Chinese innovation from the past 1000 years, so from that standpoint, and I admit this is nowhere near adequate enough to draw a final conclusion, the Chinese haven't contributed much.

As for the joint-venture issue, as far as I know, if foreigners wants to do business in China, they must have a Chinese partner. You might say, yes, but nobody has to do business in China. Fair enough, but it does strike me as odd to blame the victim for being ripped off. That said, although I think stealing and cheating are wrong, I do believe a government's first responsibility is to protect the welfare of its people. In this case, I think China has done wonderfully, and actually, I blame Western governments more for not doing more to protect the interests of their people than the Chinese government for trying to get some free technology. That said, I think creating a policy of always cheating other countries under the disguise of cooperation is a bad precedent for the world as a whole, and possibly for China's future as it creates political 'disharmony' through mistrust.

Okay, I'm afraid what I just wrote might be flimsy, but unfortunately I can't add more or fine tune as I have to work now. Feel free to tear me up, though ;)

I am not going to throw anything in your face! But what does a 'poor innovator'/'great innovator' mean? How do *you* know a good innovation when you see it? Do you recognise innovation in production? Financing? Regulation? Marketing? Education? Or are we thinking the latest electronic gadgets? Social networking? What about weaponry? Public finance? Building relationships? GDP figures of course don't differentiate. I thinnk what I am trying to say is that there is 'sexy' innovation (maybe reported in popular science literature) and 'unsexy' innovation - frankly most of it does not register with the public.

Can I take it that a previous reference to Joint Ventures and stealing Western technology is behind this comment? There is no law forcing Western companies into Joint Ventures - so there is a logical problem with this suggestion that I am struggling with. There is a suggestion that China is 'getting away with something' and it is in some way unfair? Hope this doesn't annoy you too much (not my intention) but I sit inside China reading Western economic commentators (which most foreigners rely on for their information) and marvel at how much of what is written is driven by cultural prejudice.

As far as I know (and I wouldn't be surprised if somebody found a way to throw this in my face), China has been a poor innovator since at least the Yuan Dynasty. I think that it is possible for her to become a great innovator, but not if she doesn't change course, which apparently the government is trying to do. As a matter of practicality, why should they do things differently at the moment? The current model, while it will eventually reach a point that it won't work anymore, works wonderfully at present.

I think the Chinese are very keen to adopt new technology if they see it as superior -- stealing and cheating goes on but I can't bring myself to generalise. My latest intest is in Chinese companies building brands - they are apparently successful in building brands despite all this alleged acceptance of cheating and stealing as normal practice. These Chinese companies face the same or similar challenges as Western companies who think that they are getting ripped off. There is also a growing 'intellectual property' industry, and of course no shortage of laws. (I do understand that lack of legislation is not the problem - the problem in China is often enforcement.)

Finally I would not underestimate the Chinese facility for innovation - it is not an area I know much about but I am always seeing evidence of innovation. How is it generally acquired? I am am not sure about this. i suspect that there is quite a lot of home-grown innovation. Which takes me back to the growing problem for Chinese people themselves - protecting their rights in the world economy.

Historically Chinese were fabulous innovators.My guess is that it's harder to be innovative when you are a poor nation and wondering how to feed the masses.With the rise of China again hopefully we will see that innovation come to the fore again.Any thoughts? Have I missed something obvious here?

Just a somewhat quick thought. It is alleged that the Chinese government encourages joint-ventures partly so that it can, firstly, steal technological secrets, and then secondly, share this information with whoever they see fit. This is Chinese culture to the core. Chinese instinctively share in this way. I see this in other manifestations, most commonly cheating on tests (which I know I brought this up before). For many of them, stealing and cheating are okay if it helps the group. I won't go as far to say that this is totally a Chinese trait. The West has cheaters too, but I think the difference is that in China people think this kind of activity is normal.

To make a generalization: the West believes innovation is key to the future; China believes acquiring the technology of others and sharing it with whoever she sees most fit is key.

By the way, although I haven't mentioned it yet, I also have some sympathy for Tal's position.

I guess that thought wasn't all that quick. Alas...

"serious differences on key matters. All of these differences stem from underlying values - behaviours that are not going to change quickly"..now I know diddly squat about economics but that is interesting and I wonder if we'll be lucky enough to have you enlighten us on what those key differences are at some point [dare I ask...or am I going where I shouldn't again ? :) ]

@tal_

I can't do justice to your comments, I will come back. And also look at your Easter Island link. (I am currently on a problematic Internet service; in China what's more!)

I am in general sympathetic with your view of the world - you may have heard of the Tragedy of the Commons, a seminal paper on this subject. It's worth a look. Interestingly it can be used by both sides of the Governmemnt intervention/leave it to private enterprise divide. Sign of a wonderfully enlightening discussion?

I think that in general China does not slavishly follow the Western 'model' - I came to China believing that we are fairly close (they study 'Western' economics texts). six months later my economics students have convinced me that there are serious differences on key matters. All of these differences stem from underlying values - behaviours that are not going to change quickly.

Oh, Macbeth... Sadly I regret not having the maturity of appreciating Shakespeare in high school. It is one of those things that I hope someday I can go back and give it another chance, but as it is, I rather prefer history and Mandarin over fine literature.

hehe,just checking you were listening mate....you're a champ at picking me up at my most ludicrous[but that's entirely fine...keep the questions coming...of course it reminds me of good advice Matt once gave me ....don't try and say things in an English way...say it how the Chinese would say it...but sometimes I can't help myself]. I was really chuffed that you'd wanna join us and thus I said cheers good mate.I was thinking how it would indeed be great for the 3 of us to meet up and it reminded me of the famous Macbeth line....when shall we 3 meet again...in thunder,lightning or at Avatar?

看不懂,哈哈,我来试一下翻译.

Cheers mate. When will we three say goodbye? (Or did you mean see again?) When there is thunder, lightning or at Avatar?

干杯好朋友。什么时候我们三位人再见？。。在打雷，闪电，或者阿凡达？

Tal, Baba

I wish we three could have gone seen it! After I saw it I got that same feeling I had as a kid after seeing the original Star Wars. I was just thrilled. I too was a bit disappointed in the simple story. It's a shame that Hollywood thinks that most of us aren't capable of absorbing a complex story. But the rich world that was created compensated for it.

yeah sorry tal,I got interrupted partway through what I was posting and was feeling too lazy to start it again when I got back so just posted what I'd typed so far.I definitely appreciate your honest opinion no matter what it may be[it's not important to me what others opinion on this is and I don't expect anyone to like it]......actually ,it's particularly interesting to hear the honest opinion of one like yourself who does have such a developed appreciation of scifi...so thanks heaps for that.I think posting what I had so far may have come off the wrong way.I wasn't suggesting for a sec that you're hard to please;I merely meant that it's only natural if you've watched a lot of scifi that it would be hard to come up with something that wasn't predictable[thouigh i've heard this predictability comment at least once before so I take it that this may be more predictable than your average scifi....I suppose this film has had more mass appeal and also the technical achievement of the film is outstanding] or at least that you'd have more refined taste and be more discerning.I did note though that you managed to enjoy it anyway despite those shortcomings and I'm glad to hear that for your sake.Yeah,I find that as I get older movies in general are often quite predictable but I've also realised that I ,like you already do I suspect,should try to not let this predictability detract from my enjoyment and just sit back and have fun.Actually I think my kids have taught me this,hehe.

As I said, I did enjoy it! Just being honest about my response.

Well in retrospect I s'pose I should have predicted that...after all it's harder to please a die hard sci fi aficionado and things would be even more predictable for such a one as you.No need to be sorry at all.I'm sure you're right in that respect.Actually ..gotta go...be back soon

Hey baba! I finally saw that movie 2 days ago! I did enjoy it, (I mean come on, I've been a sci-fi fan since I was a kid,) and I do wish I could have watched it with you, but you know what? I found the story rather predictable and the characterization somewhat contrived! Sorry!

And the ending? Come on, you know what happens next? Humans go back to Pandora and nuke the surface from orbit, send down the robots and take all the unobtainium they want. I mean seriously, when have we humans ever done different?

tal,

"absurd and excessive exploitation of the natural world, the rape of the Earth"

...actually I doubt whether you'd get anyone arguing with you on that point.But what I really wanna say is that you are really going to love Avatar [just wish I could be there to watch it with you mate :) ]

Oh, I'm aware of the concept of public goods and have no quibble with it. National defense, justice, roads, etc are areas where government absolutely belongs.

'Meddling' is an emotive term. In fact what jckeith describes as meddling and 'dispersing the costs' in many cases leads to superior economic outcomes. This is seen most clearly with 'pure public goods' like lighthouses and national defense. Many goods and services in contemporary economies have public good characteristics - education is one of these. Most countries 'disperse the costs' to some extent in recognition of these public good characteristics. BTW 'public good' has nothing at all to do with Government ownership - sorry, it is a bit of economic jargon. It is more to do with the practicality of paying for the good or service - it can be difficult to 'connect' the service and the cost of that service.

Okay, right on.

It makes perfect sense. Fair enough. We disagree on things, but there's nothing unreasonable about what you said. I'm not looking to drag this discussion out here, just wanted to answer your question. Cheers for reasoned debate :)

Well, here comes my 业余 response again. I think that a government's job is to provide the optimal environment for people to be able to improve their lives. As an example, I believe that universal health care would encourage more people to start up businesses as they wouldn't have to worry about A) their business and B) not dying or racking up a huge debt if an emergency occurs. In addition, it will make people more likely to spend their money, always helpful for economies, instead of hoarding it for potential emergencies. Basically, I think there are a psychological elements, as other elements, to economies that perhaps can't be naturally resolved. People tend to think me, me, me. Which is good because it is usually through a healthy dose of selfishness that we improve our lives. That said, sometimes if everyone is thinking me, me, me that ,may help 'me' temporarily, but it the long-term it hurts 'we'.

Now how do we know the person doing the coercing knows better than the individuals? I suppose we can never know until later. The key is that in theory the people making decisions are experts who have debated this sufficiently to at least have made a very, very well-informed decision, something that the normal person cannot do. If in the end the people are unsatisfied with the result, the decision makers get voted out (at least in most countries with advanced economies).

Hope this makes sense as I had to wing it rather quickly, And yes, I can already anticipate some objections (i.e. universal health care), I really wish I had the time to really delve into this as much as I want to.

Of course, the keyword there is "voluntary." Transactions involving force or fraud should of course be corrected by the justice system.

I don't understand economics nearly as well as I should, but isn't dispersing and disconnecting the cost from the service a kind of meddling?

Absolutely.

Personally, I don't buy the idea that economies are entities that cannot benefit from outside adjustment.

Well, an economy is just the sum total of millions of voluntary individual transactions. Correcting these results requires coercion of some form. Who's to say the person doing the coercing knows better than those individuals what their own self-interest is? And even if they did possess such knowledge, do you believe that the coercion would be justified in the first place?

I don't understand economics nearly as well as I should, but isn't dispersing and disconnecting the cost from the service a kind of meddling?

Personally, I don't buy the idea that economies are entities that cannot benefit from outside adjustment. I can buy the idea that economies are complex, and so doing something with good intentions will often bring about the reverse effect. I can also buy the idea that governments just plain and simply do dumb-ass things.

But as I said, I am not as informed as I would like to be.

One minor correction: Swedish universities aren't free. The costs are simply dispersed and disconnected from the service itself.

Maybe your Federal Reserve is not independent enough? In Australia the monetary authority is entirely independent and is on occasions at odds with Government. Or at least with government rhetoric.

Structurally speaking, the Fed is pretty well independent. I think they truly believed that what they were doing made economic sense.

Anyway, I really appreciate the enlightening discussion. Maybe there is a "highlighted post" in your future! ;)

Good points - governments often have trouble getting it 'together'. But the 'legislation and regulation' in this case is more of the enabling kind (rather like competition law and the court system is enabling). There are Government programs in the US but these aren't the ones that particularly went bad this time. Mapping the motivations of all the players is indeed difficult. In the US in 2008 there was an unholy alliance of interests contributing to the failed loans. But in many cases the 'Government' is just weakly responding to commercial interests that have a business idea and want some kind of protection. (I saw the creation of the secondary mortgage market at close quarters in Australia.) Interestingly the Australian Government has just bought up big on these Australian non-bank securities because the 'banks' (their competitors) have been exercising a bit too much market power. The GFC did lead to this shift in power - a number of small non-banks failed and two small banks sold to large ones - reducing competition in the housing loan markets. Ironic heh?

Maybe your Federal Reserve is not independent enough? In Australia the monetary authority is entirely independent and is on occasions at odds with Government. Or at least with government rhetoric.

Ah banks, they behave just like anyone, they just want to make the money. They need to be reminded occasionally of their special and privileged role in our economies.

I should add that I'm not opposed to regulations which increase transparency. Protecting people from force and fraud are legitimate roles of government. But such regulations are significantly outnumbered by those which are merely attempts at social engineering or political favors.

However the financial engineering industry, indeed the banking industry at large, behind the toxic loans was in fact not well regulated in the United States. Poor families were sold 'no asset no income' loans that basic consumer protection would have prevented - these became toxic because families had no capacity to repay.

Well yes, this is true. However, it misses the point that Congress had been encouraging such behavior through legislation and regulation and both implicitly and explicitly guaranteeing such loans for decades. And the Federal Reserve's obsession with cheap credit further compounded the situation. Lenders and borrowers were responding rationally to the incentives created by the government. It used to be that no lender in their right mind would give you a mortgage unless you could provide a substantial down payment. And they had a good reason not to: they would go bankrupt and there would be no government bailout.

Your puzzlement about the housing industry highlights the extent to which just about 'everything' is regulated. And Governments can't 'help' themselves - they love 'solving' people's problems.

That's actually my point. When said regulations inevitably lead to unintended consequences people never question whether government can or even should be attempting to solve such problems. Instead, they call for more government.

The remark about the systematic failure of markets is attributed mainly to Stiglitz, who emphasised two things in particular: information problems and transaction costs. In other words markets would work better, with better social outcomes, if people had better information, and contracting was costless. I like the example of health services, now a pretty high tech industry. Most punters really understand very little about health problems and solutions and we put our lives in the hands of experts. The indsutry is highly specialized, reducing the possibility of arming ourselves with appropriate information. Without some Government intervention (the argument goes) we would end up very sick and exploited. What's more, suing to achieve remedies is costly, too costly for many in society. So there is a minimum cost solution whereby we (for example) license health professionals, regulate pharaceuticals, etc., setting minimum standards, and provide, in some countries, compulsory health insurance, which lowers transaction costs. Hope that makes sense.

Your puzzlement about the housing industry highlights the extent to which just about 'everything' is regulated. And Governments can't 'help' themselves - they love 'solving' people's problems. :-) However the financial engineering industry, indeed the banking industry at large, behind the toxic loans was in fact not well regulated in the United States. Poor families were sold 'no asset no income' loans that basic consumer protection would have prevented - these became toxic because families had no capacity to repay. Also, in the United States you can 'walk away' from these loans; in Australia we hunt you down after you are dead for repayment. It creates greater incentive for caution on the part of the consumer. :-)

By the way, as you can see, you've shamed me into dropping the term 'meddling.' I had my fun, and now you've had yours ;)

Well, that's a lot to chew on! I would agree with your take on how much intervention China and the West respectively undertake in their economies, and how Westerners perceive them differently. Please explain how markets systematically fail without government intervention. If you are referring to a criminal justice system, then I would agree.

The 'meddling' in the United States perhaps reached an historical peak about 12 - 18 months ago when the US taxpayer took control of several large companies.

I'm painfully aware of this. It's absolutely disgraceful.

Most people recognise now that the problem was not Government 'meddling' that caused the problem, it was the lack of effective regulation.

I'm a bit puzzled by this, since the housing and credit bubbles wouldn't have even existed absent government regulation. No?

@jckeith

Thanks for your thoughtful response. I won't deal with it all now (just got up after a late night!). At this stage I'll just ask what you think about the level of Government 'meddling' in China versus the West. No doubt like me you will recognise that the 'meddling' varies significantly between China and the West; this difference alone is interesting. (I am personally interested in the interaction of culture and 'meddling' in consumer protection.) Another interesting question concerns the net social benefits of this 'meddling'. This is the question that many economists spend their working lives investigating.

To give you some idea of my take on this, generally people in the West underestimate the 'meddling' in their own countries and overestimate the meddling in China. I put this down to the difficulty most Western people have in coming to grips with Chinese culture. Some Western responses can even be described as fear. (In Australia there was a campaign some decades ago about 'Reds under the bed'. )

All contemporary Governments (East and West) 'meddle' in their economies; mainstream economic thought on this (since Stiglitz in particular) is that this is usually socially desirable. In fact markets systematically fail without Government 'meddling'. However in the US there seems to still be a powerful myth that if you leave everything to the market the social outcomes will improve. Some of this comes down to a distrust of the political system.

The 'meddling' in the United States perhaps reached an historical peak about 12 - 18 months ago when the US taxpayer took control of several large companies.

Just a final point at this stage - I agree that you can point to the housing markets in the US for the primary cause of the global financial meltdown. Most people recognise now that the problem was not Government 'meddling' that caused the problem, it was the lack of effective regulation. Australia had almost identical housing programs in place from the mid 1980s and we came through the crisis better than all other Western countries, primarily because of better designed Government 'meddling'. There are also some important institutional differences in Australia - the only serious problem that emerged in developing these programs can be attributed to too much reliance on the US experience.

That is certainly true. It's really fascinating when you think about it, but such predictions and any actions which may or may not arise from them are themselves a part of the marketplace. It gives some perspective on the complexity of markets and why central planning is doomed to fail. This reminds me of an old anecdote. At one point, the Soviet Union's planners resorted to using the Sears catalog to determine prices for goods. Thanks for your kind words :)

jckeith,

As always a very interesting and intelligent argument.I liked your summary at the end:

"Such predictions always just project present conditions into the future, without accounting for technological, societal, or cultural changes."

...but would add that surely such predictions are still important projections of current trajectory in order to give impetus to bring about such changes.