I wrote this a few months ago when we traveled to Henan. It's just a rant I wrote down because I was so shocked by all the buildings. There's not really a point to it--just observations--because I still haven't decided what my point would be if I argued one way or another.
The development is ridiculous. Driving through the outskirts of 郑州 (Zhengzhou), I saw about as many unfinished new buildings as old ones. I have to wonder if the newly ordained capitalists who are funding these projects have done their due diligence. Are they expecting the millions of people who are increasingly affected by inflation and who haven't received the fruits of China's economic development to move into these shiny, new apartments? I have no doubt that these developers are well-educated businessmen, but China has never been a capitalist market before in the Western sense. And I refuse to believe that transitioning into it the way China's economy has, or the way any country could, can yield unending growth or anything resembling economic stability.
Now, I'm not working out the numbers. I'm no economist, and even the opinions of economists are often dead wrong, just as intuition is. But, the way capital is used sets expectations of returns. If the returns meet the expectations, then the owners of capital--and possibly even the renters get something out of it. If the returns don't at least meet the inputs, then no one is happy.
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