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Peak China update

December 19, 2012

Read the blog Monsters Abroad for a good discourse on the challenges facing new Chinese Premier Xi Jinping.  The Chinese model of an authoritarian, state-run economy has many admirers in the US, but it is hitting its natural ceiling, as the entrenched state-business interests resist reform that threatens their position.  State management guarantees monopolies and creates such power centers – this is the flaw of centralized, managed economies.  The system lacks the ability to generate natural and internal competitors to challenge these interests.

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