ChinaReport.be

I am Dr.Thomas Ganschow, former professor at the University of Georgia. My research has led me to believe the government of the PRC is facing imminent collapse for a number of reasons which I will examine.China has a sick big industrial sector, which it dare not downsize for fear of exacerbating the already difficult unemployment problem. It also has an insolvent banking system. How insolvent no one knows. The accounting system is worse than Enron's, and beyond that there are systemic problems. At least in America, creative accounting eventually catches up with you. In China there is no effective bankruptcy system to clarify the situation. Indeed, modern China as a whole seems to have a "culture of non-payment." A third of all home mortgages are in arrearsChinese businessmen are astounded at the small amount of time that American businessmen spend smoozing. In China, businessmen can function because of their personal contacts with Party cadres. They involve Party members in their enterprises as partners, or simply pay protection money. Chinese companies, including SOEs, issue "stock," but no one knows quite what this equity represents. The SOEs are not responsible to their shareholders, and private companies often find that their assets, acquired with the help of friendly local authorities, are never really private property in any final sense. Thus, business success is more a matter of patronage than of economic performance