The China Bubble
Beijing Compels Economists to Be More Optimistic

Beijing has resorted to various measures to prop up China’s ailing economy lately, like pumping lots of money into struggling industries to inflate demand. But it’s also trying another tactic: browbeating economists and business reporters into being more optimistic about the state of the Chinese economy. The WSJ reports:

Securities regulators, media censors and other government officials have issued verbal warnings to commentators whose public remarks on the economy are out of step with the government’s upbeat statements, according to government officials and commentators with knowledge of the matter.

The stepped-up censorship, many inside and outside the ruling Communist Party say, represents an effort by China’s leadership to quell growing concerns about the country’s economic prospects as it experiences a prolonged slowdown in growth. As more citizens try to take money out of the country, officials say, regulators and censors are trying to foster an environment of what party officials have dubbed “zhengnengliang,” or “positive energy.”

In the past, Chinese authorities have targeted mainly political dissidents while commentary about the economy and reporting on business has been left relatively unfettered in a tacit acknowledgment that a freer flow of information serves economic vitality.

In a country with notoriously unreliable official statistics, it’s especially problematic that finance and economics experts could be editing their reports based on factors separate from the underlying analysis.

China’s efforts to brighten the picture artificially suggest something else too: top officials are worried. If the economy was in fact healthy, there would be no need to press experts to say as much. As Xi Jinping’s regime gets more restrictive and authoritarian, it sends a signal that all is not well in the Middle Kingdom.

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