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Crisis Management
Beijing Struggles With Tianjin Fallout

China is struggling to contain the political fallout from explosions in the port city of Tianjin (which has a population roughly equal to New York’s). The explosions damaged an estimated 17,000 homes last month, and, according to the New York Times, some 8,000 households have yet to receive any compensation:

Tianjin officials announced that as of midnight Thursday, more than 9,000 households, representing more than half of those affected, had signed agreements to settle their cases. Some chose to sell their damaged apartments to private developers, at 130 percent of the original price, while others decided to keep their homes and allow the government to make basic repairs for free.

As an added incentive, the local government, eager to quell public outrage over the disaster, offered bonuses of 20,000 renminbi, or more than $3,100, for those who agreed to settle their claims by Thursday night.

Several Tianjin residents said on social media sites and in interviews that they had been pressured into dropping their cases.

As we observed after the explosions occurred, an insufficient response to this crisis would do serious damage to President Xi Jinping’s reputation for competence, particularly amidst deepening economic troubles. So far, Beijing has sought to minimize the damage by silencing critics: The government has jailed hundreds of people for “irresponsible” reporting on both Tianjin and the stock market, even as Xi was taking his lumps  on social media for the country’s economic troubles.

Beijing needs to make this all go away fast. Tianjin may not be a make-or-break crisis for Xi on its own, but as part of a broader storm that China is be sailing into, it cannot be ignored.

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  • Jacksonian_Libertarian

    “an insufficient response to this crisis would do serious damage to President Xi Jinping’s reputation for competence”

    The Government Monopoly is ALWAYS incompetent. It lacks the information and motivation to ever be anything else. People operate on self interest, and in a Monopoly self interest decrees that the best strategy is to avoid blame for anything. This means never putting forward any initiative that isn’t signed off on by as many other people as possible. If everyone is responsible, then No One is responsible. When disaster strikes as it always does, always have someone else to pin the blame on or scapegoat. In a monopoly the people that rise to the top are those that avoid ever being blamed for anything, and can maneuver their superiors into getting the blame, so they can move up.


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