Monthly Archives: June 2015

PRC and Asian “Benefits”

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A senior Chinese naval commander has claimed new islands his country is building in the South China Sea will benefit the region, while stressing that such activities “fall well within the scope of China’s sovereignty.”

Yeah. Because the People’s Republic of China is Asia. Especially if its sea grab is allowed to stand, and its bogus claim that the East and South China Sea are PRC domestic lakes is accepted.

Who in Asia would benefit from such a thing? The PRC, getting all the oil and natural gas that lie under the South China Sea, and perhaps the East China Sea. The PRC, getting all the minerals, especially the rare earth metals, that lie on the sea bottom(s). The PRC, getting all the fisheries around the islands the PRC is trying to seize.

Who in Asia does not benefit? All the other nations on the rims of those seas, who are denied access to those same items that lie both in the international waters that are those two seas and in those nations’ respective Exclusive Economic Zones—which the PRC’s grab obliterates. All the other nations on the rims of those seas, who now are front line defense barriers for the PRC—now the First Island Barrier.

There’s this, too, in particular, on the north shore of the South China Sea.

Beijing officials emphasized that there will be no concessions over electoral reform in Hong Kong during a rare meeting with pro-democracy lawmakers Sunday, effectively quashing any possibility of a compromise between the two sides.

Readers will recall, perhaps, this particular…disagreement…notable for both the PRC’s attitude toward agreements it’s made when those agreements prove inconvenient to it, and the PRC’s attitude toward decision-making by anyone other than the Communist Party of China.

These are the benefits the PRC touts.

Symptoms

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The headline for Greg Ip’s piece in The Wall Street Journal pretty much says it all:

In a Slow Economy, Negative Quarters Shouldn’t Surprise

No, they shouldn’t. But their frequent occurrence without the economy formally falling into recession is dispositively symptomatic of a slow economy. When economic progress is running at a sound 3.5% GDP growth year-on-year, a one quarter slowing of growth rate by, say, 1.5 per centage points—a common enough occurrence in an economy—would drop GDP’s year-on-year number to 2%. On the other hand, when economic progress is bumping along at that anemic 2% for its longer term, a 1.5 point drop takes growth to near zero. In the workaday volatile world of economics, a quarter’s slowing by 2 or 2.5 points—less common, but far from unheard of—moves the year-on-year number to outright shrinkage from merely slowed growth.

As this year’s first quarter GDP “growth”—a negative 0.7%–illustrates, coming as it does on a string of 1st quarter negative numbers and coupled with lots of quarters of less than 2% growth, here we are six years after the Panic of 2008 in a still slow economy.