Investing with Communists

[BradK]

Hi,

This morning's SMH runs a front page story about Chinese 'racing against time' to invest in resource-rich countries like Australia.

It seems that the rest of the capitalist world (Britain, USA and Australia) are tripping over themselves to get trade deals, foreign investment and favoured status with THE WORLDS BIGGEST COMMUNIST NATION.

Didn't we spend billions and 40 years fighting the tide of communism? Does it matter that they are communist anymore? Is it irrelevant? Was the Cold War for nothing?

Not being racist - just asking a core political question that seems to be thoroughly lost on the world now. Do we want to deal with these yellow reds? What are the alternatives? World wide seizure of the economy?

Ahhh... too many questions. I just don't want my national sovereignty to be compromised 50 years down the track because the Chinese own all Australia's mines.

Brad

 

[RamonR]

Would it be alright if the Americans owned all the Australian mines?

Seeing as the Chinese are using the capitalistic system to get these assets then what is the problem. They are becoming less communist.

It seems wrong to me that due to their habit of saving they have avoided the excesses that the west has indulged in and even though their cash is keeping us out of recession people get upset when they use it to their advantage.

 

[kyme]

I think people worried about todays so called communist countries have been partly influenced by the past ie China under Mao and Russia under Stalin, those were not communist governments but straight out dictatorships. No difference to Saddam Hussein in Iraq who was democatically elected each election, was he communist?. Forget Communism, China today is one of the most successful Capitalist nations on earth. China is however a one party state, that is different to our system but not sure whether that is really a bad thing as if you think about it,one party state equates to no party state. That means their poilticians include broad spectrum of views within their community and policies are debated on merit. Not like Australia where Liberals or Labour oppose each other policies often only because it was the idea of a different party. I'm not concerned re China buying up our resources within reason. Think that could only strenghten our security. China not gonna tolerate other countries causing Australia security problems if it impacts on their flow of resources.

 

[Fishbulb]

China is communist. Marxist ideals established its regime in Mao over the period of the long march. It was Deng Xaoping who tinkered with its "vow of poverty" and declared that to be rich is glorious, and communism didn't mean one had to be poor. Yes, it's a communist state still, and very brutally enforced.

The fact that it has a massive population, and engages in trade, is too seductive for capitalist nations to ignore and the reason why they're all "falling over themselves" to get that trade. I personally believe it's a dangerous game as China isn't really a "world citizen" as such. I guess that could be said of its capitalist counterpart America, but I know who I'd trust in a pinch and it wouldn't be China.

 

[explod]

A great difficulty we have is recognising where we are socially in the now. Our constraint is the personal experience with the past and a difficulty in seeing what is emerging outside of our own sphere.

Marx and Engels in the Communist Manifesto were really only setting out a way in which the workers could give themselves and even fair go. The ideal has not yet played out as they also discussed mass production and in the end how unproductive this would eventually be. Maybe we are getting close to this last point.

Totalitarian regimes have prospered under its guise, ie. Stalin and Mao, which has allowed the more wealthy west to point the bone and keep the little sheeple cloistered and controlled.

Sweden is a state (and there are others) in which the Marz/Engels principals have worked very well. All are provided for, there is still some room for the capitalism from individual endeavour and they are well off without the obscene debt of the west.

Now about the US of A, the recent GFC has seen the state take over many of the big banks and institutions. General Motors is now majority owned by the state. The debt they have to China is so bad in my view that they will default. Now if push does come to shove on this propblem and all the US has behind them is their tremendous arsenal, could we see new developments in world history unfold. Sara Pauline in charge in two or three years could be interesting.

Watch this space.

Now before anyone gets on their high horse, this is just my take and a proper explanation would take rheems of space.

 

[GumbyLearner]

What are the alternatives?

You could always invest in the arms trade in Darfur, Sudan as an alternative. Or in boat-building in Somalia for long-haul one-way passenger services to Australia? After all, the Chinese don't have any ongoing financial colonial interests in those regions. Just kidding, I lied they actually do!

 

[Happy]

For some time made me wander why learn history if sworn enemies from W.W. II that lost, in some places in our country get streets named in their language as gesture to number of their citizens here.

Same goes to trade with whoever for whatever reason.

I would happily pay more knowing that we have tariffs and local industry protected.

What is the point to have cheaper products imported and money paid to unemployed so they don't starve?

We have some Sheltered Workshops for mentally or physically disabled people.
What would be wrong with similar type of Workshops for people who cannot find a job?

 

[Smurf1976]

Same goes to trade with whoever for whatever reason.

I would happily pay more knowing that we have tariffs and local industry protected.

What is the point to have cheaper products imported and money paid to unemployed so they don't starve?

Look around you... The entire economic rationalist / competition / privatisation / globalisation agenda clearly isn't working.

Unaffordable housing, unrepayable debts both private and public, infrastructure falling apart, environment being wrecked, human freedoms frittered away, taxpayers bled dry for private profit while public services cease to exist...

It's been an interesting experiment and one hell of a party while it lasted. But stand back and look at what's really been achieved? Australia turned from a developed first world country into little more than a quarry. USA effectively bankrupted. Much the same in most other developed countries - we've spent the past and mortgaged the future all in just a few short years.

I should point out that I'm not at all anti-capitalist. But there are few if any countries that actually have capitalism as their economic system. What most have, and which many wrongly assume to be capitalism, is government manipulated markets within which some types of capitalist-like activity exist. The extent of control is so pervasive that most seem blind to its existence.

We're not really that different to China etc, it's just that in Australia, US etc the extent of government control over the economy isn't as widely acknowledged despite being widespread.

 

[prawn_86]

These things tend to last longer than anyone expects.

Agreed. At some point there will be a dramatic crash/change/upheaval/overhaul but when is anyones guess.

I liked WayneL's analogy of its like running a car without oil. You know it will blow up, but it surprises you as to how long it actually takes to die.

 

[So_Cynical]

Would it be alright if the Americans owned all the Australian mines?

Seeing as the Chinese are using the capitalistic system to get these assets then what is the problem. They are becoming less communist.

It seems wrong to me that due to their habit of saving they have avoided the excesses that the west has indulged in and even though their cash is keeping us out of recession people get upset when they use it to their advantage.

Thing is the Chinese Govt has total control over the savings of Chinese nationals in china at 0% risk cos there paying in Chinese currency.

_________________

Amazing really that the whole end of communism thing seems to be a non issue, because when it happens it wont be a friendly change over...the potential for national splits and civil war and anarchy in general is very high.

Chinese industry could be at a stand still for many many years.

 

[Smurf1976]

Agreed. At some point there will be a dramatic crash/change/upheaval/overhaul but when is anyones guess.

I liked WayneL's analogy of its like running a car without oil. You know it will blow up, but it surprises you as to how long it actually takes to die.

Every example of a complex system failing (mostly engineering related but also financial) that I can think of involves a system that was pushed beyond its limits for a considerable period and then subjected to some sort of shock which triggered the actual failure.

The buffer that ought to have been built up when times were good wasn't there, it was consumed just to keep the game going. Then something happenes that requires the buffer to be drawn down - and there's nothing to draw on, the cupboard's bare. Then you get a bad day / season / year and it spectacularly falls in heap.

When and due to what trigger is anyone's guess. But the system is clearly unsustainable in my opinion.

 

[doctorj]

For some time made me wander why learn history if sworn enemies from W.W. II that lost, in some places in our country get streets named in their language as gesture to number of their citizens here.

The world has moved on - thankfully. Look at how the German people were treated post WW1 and it's not too much of a surprise how an Austrian chap managed to unite Germany and start WW2. I can understand that many that fought in the war haven't forgiven or forgotten, but it's a good thing the rest of world has moved on. The vast majority of Germans and Japanese (etc) people that are around today had absolutely nothing to do with the war (a good number weren't even born yet), so why continue to lay blame?

Globalisation (and capitalism) isn't perfect, but I'm yet to see any better alternatives.

 

[wayneL]

The buffer that ought to have been built up when times were good wasn't there, it was consumed just to keep the game going. Then something happenes that requires the buffer to be drawn down - and there's nothing to draw on, the cupboard's bare. Then you get a bad day / season / year and it spectacularly falls in heap.

When and due to what trigger is anyone's guess. But the system is clearly unsustainable in my opinion.

This is why I get so distressed about the current bout of Keynesianism. True Keynesianism may advocate spending up in recessions, but it also advocates squirrelling away in the boom... in fact advocates a number of braking mechanisms during booms.

You cannot invoke Keynes, only during recessions after figuratively spending up on prostitutes, drugs and booze during the boom... not without consequences later. (like the massive tax rises that will be necessary)

So addicted to the unsustainable and distorted version of la dolce vita we have been sold in the west, that we'll sell the farm to keep up appearances.

Would it be alright if the Americans owned all the Australian mines?

NO!!!

Aus business culture (and popular culture) has already been changed by American business practices introduced via franchises and other businesses, to the detriment of Aus national character IMO.

Some foreign investment is fine, healthy even, but we don't want a financial invasion, takeover and occupation by any foreign country.

 

[Smurf1976]

Some foreign investment is fine, healthy even, but we don't want a financial invasion, takeover and occupation by any foreign country.

Four options:

1. Produce what we consume.
2. Produce something that can be exchanged for what we consume.
3. Borrow to fund our consumption.
4. Sell the farm to fund our consumption.

We used to do 1 and 2, then we put so-called economists in charge and switched to 3 and 4. It can't possibly work to our advantage in the long term when you think of the consequences.

 

[nulla nulla]

Good article by Ian Verrender in todays Sydney Morning Herald: "Rapproachment with China already underway".

 

[Tysonboss1]

It does seem a bit wrong that we happily take and consume the goods that the chinese produce and then complain when they try and spend the money they have earned.

The chinese should have the same rights to invest in australia as any other nation.

 

[Smurf1976]

It does seem a bit wrong that we happily take and consume the goods that the chinese produce and then complain when they try and spend the money they have earned.

The chinese should have the same rights to invest in australia as any other nation.

No problem with the Chinese investing per se. It's just that we're fools to be spending so much / producing so little in the first place - others build their wealth and invest while the West spends like there's no tomorrow.

 

[skyQuake]

Amazing really that the whole end of communism thing seems to be a non issue, because when it happens it wont be a friendly change over...the potential for national splits and civil war and anarchy in general is very high.

Chinese industry could be at a stand still for many many years.

Disagree with the changeover thing. Its already very much a capitalist society controlled by 'the communist party' (who are in fact the biggest bunch of capitalists ever...
China now doesn't fit the communism bill anymore, its more of a political leftover than anything socailly imo.