Fearing Social Unrest, China Tries to Rein in Unbridled Capitalism

China’s economy continues to grow at more than 9 percent per year, and Beijing fears that a sudden crash would bring immeasurable consequences. Low consumer spending, government planners worry, would provide little cushioning for a slump. At the same time, distressed debt, a flimsy infrastructure, and increasing air and water pollution present further incalculable costs of China’s rapid development. In response to these growing pressures, Beijing has curbed loans for steel, cement, and real estate, all in the hopes of slowing growth. The ongoing boom, however, is fuel for the world economy. China uses a quarter of the world’s cement and steel, and a third of its coal; any curtailment of global resource purchases by China, to restrain both raging growth and pollution, could affect commodity prices worldwide. While the world monitors China’s economic growth, yet another threat looms on the horizon: In a few years, due to the effectiveness of the one-child policy, the country will not have enough working-age adults to support its aging population. – YaleGlobal