14 December 2011

Chi-Com Wonderland Reveals Hollowed Out Growth

Photo blogger David Gray wrote a fantastic post called  "China's deserted faked Disneyland"  about Wonderland, a failed, partially constructed amusement park that is 45 minutes from central Beijing.  Originally, the 100 acre site was slated to be the largest amusement park in Asia.  But a decade ago, regional government officials could not come to terms with the tenant farmers of compensation for the property that would be expropriated and the development came to a halt, leaving a partially built palace and castle along with the skelton of a huge indoor playland.

After a decade of stagnation, the local farmers figured out that the developers were not coming back so they resumed cultivating the land around the failed faux Disneyland.

Wonderland highlight several endemic problems that plague China.  Firstly, there is not a well respected rule of law regarding property.  While Americans may grumble about the injustices of eminent domain abuse encompassed in the 2005 US Supreme Court decision of Kelo v. New London, at least there is an established order and some semblance of reasoning regarding expropriation of private property for business purposes which “benefit” the public. Chinese law does not seem to have as well respected of a legal regimen and the state did not lay its heavy hands in the matter.

The sporadic spasms of commercial development that is subsequently abandoned can be attributed to a fascistic state system which rewards growth numbers whether or not there is the consumer demand.  The Chinese Government has committed to build twenty cities over the next twenty years, while newly built fledgling metropolis’ remain empty due to no demand.  These Chinese ghosts cities are ironic considering the growth of Shenzhen, which transformed from a fishing village of 700 residents  in the late 1970s to a city of 14 million people today.  The Peoples Republic of China uses an internal passport system to prevent cities that have work being overloaded by peasants

The PRC government has been lauded their efforts into building High Speed Rail lines to show the modernity of China as a first rate power.  While the Chinese take great pride in building the world’s largest high speed rail system in just four years, the problem is that most people can not afford tickets for the bullet train boondoggles.  Consequently, these HRS trains run near empty and most ordinary people need to take buses, which overloads the roadways.

While the American public needs to deal with the rise of China in international affairs and our growing debt and trade imbalance to the PRC, it is important to keep in mind that not all that glitters is gold when seen from afar. The Chinese hyperactive expansion may not be healthy growth.  And as Jimi Hendrix warned: “Castles made of sand, fall into the sea eventually.”

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