China Evergrande Group is one of the largest property developers on earth. They are also one of the most indebted; in mid-September 2021, a deadline to make an $83 million dollar payment came and went without indication of payment from Evergrande.
Concerns have been raised that this is China's Lehman Brother's moment; the collapse of a corporate titan that is as indebted as Evergrande in any other country would result in economic pandemonium. However, this crisis is happening in China, where the government has a greater degree of economic and sociopolitical control. As the ruling party of a one-party state, the CCP keeps a tight grip on money, corporate boardrooms, and the media.
The Chinese government is fully capable of bailing Evergrande out. However, they have kept their intentions opaque, which, according to a NYT article, is an effort to show other Chinese companies that they need to be fiscally disciplined. The CCP's reaction to protests and public unease has also been interesting; as purchasers of unfinished Evergrande condominiums worry about losing their money, the government puts the responsibility of "dealing with petitions and maintaining stability" on the heads of the property development firms.
China deals with media much differently than the US. Instead of a tug-of-war between news outlets, independent bloggers, and twitter celebrities ranging from all sides of the ideological spectrum, Chinese media (without VPN access) is highly controlled by the state. For example, in an effort to "maintain stability," the Chinese government has heavily censored social media discussion of the Evergrande issue, which makes it difficult for the public to know the extent of Evergrande's financial troubles and to organize protests. Control of media contributes heavily to the political socialization of Chinese people to CCP ideology, which of course is what the government wants to achieve.
Questions:
1. How does this crisis compare to Lehman Brother's collapse? Will it lead to a financial crisis?
2. According to the First Amendment, the US government can not infringe on peoples' right to free speech. However, the US law enforcement has been criticized for its handling of recent protests. To what extent is "social instability" harmful / helpful to a society?
Sources:
https://www.nytimes.com/2021/09/26/business/china-evergrande-crisis.html
https://www.nytimes.com/2021/10/05/business/china-businesses.html?action=click&pgtype=Article&state=default&module=styln-china-economy&variant=show®ion=MAIN_CONTENT_3&block=storyline_levelup_swipe_recirc
https://www.cnn.com/2021/09/24/investing/china-evergrande-group-debt-explainer-intl-hnk/index.html
5 comments:
I think social instability is both harmful and helpful to society. One way to make your thoughts be heard is through protests, strikes, and demonstrations. This can easily grab the attention of the media which would then spread ideas even more. For example, the sit-ins during the Civil Rights Movement spread across many states and cities through the help of the media, helping them share ideas about more justice and equality for African Americans. However, social instability can also be harmful as there could be violence and the spread of questionable or false ideas. For example, the idea of the attack on the capitol building was spread through different forms of media, ultimately leading to an attack on democracy as they wanted to overturn Trump's presidential defeat. Overall, I think freedom of speech and social instability is necessary to provoke conversations and policy changes. However, it can also spread ideas that are harmful to society.
Like Arissa said, social instability can be both harmful and helpful to society. If there isn't "instability" in the manner of people talking about what they believe and having discourse with one another about matters which are important for the health of the nation itself, like current or upcoming legislation or political candidates, then the society will have to work to suppress all other opinions and this, in turn, may make it even more socially unstable! However, too much instability can lead to polarization, with people not trying to understand the arguments of other sides, and this may also further the social instability. In my opinion, there is a balance that has to be kept with instability, because either extreme will lead to bad consequences.
Like Arissa said, social instability is kind of like a double edged sword; while it can propel much needed social change, it also can cause chaos. But also, the idea of social instability/protests, strikes, etc is also changing rapidly given new technologies such as social media supplying new forms of communication. Now, there are easier ways of banding together and generating attention for some cause. As such, police brutality can be documented and shared much easier, faster than ever before. But at the same time, it can be dangerous as it riles people up over one-sided stories. While everyone should be dedicating time to research stories before spreading them, the fact is most people don’t do that. So when a picture or video spreads around with no context (or even worse, straight up false/made-up context), the media can very quickly rile people up around a nonexistent case. That’s not to say that social media should be disregarded (it has become too ingrained in our society to separate from it now; it’s a way some people get news now), but rather that there needs to be a healthy skepticism of information we get from unknown sources. Ultimately however, social instability is helpful to society -- it is one of the ways that we can create lasting change in our societies.
Political instability, I think, is a pulse on the thoughts of the nation. Even though the capital failed coup was absolutely atrocious and should not have been created, the absolute embarrassment from the US ensured that nothing like this could happen again. They started cracking down on fake news more heavily, and it just proved to congress that there's more to be done in the country to educate people properly. Obviously, justified social movements, like the Black Lives Matter protests, are an absolute necessity in ensuring rights can be established universally. If we were to place limits on instability, I fear it would allow the government a loophole to control progressive groups, and it would bandage instead of repairing the cracks of the nation.
As others have mentioned, social instability has its pros and cons. It's almost like what Madison said in the support of factions, they are necessary in order to balance each other out and stop one from having too much power. Similar to this, social instability serves as a system of checks and balances that is necessary for calling people out and preventing harmful actions to occur from ever happening again (like the coup Maya mentioned). However, at the same time, social instability is still instability. It still causes immense conflict, hurts mental and physical health, and can end quite badly. Placing limits to prevent lives from being lost, such as violent protests that kill people, is a justified action by the government. However, hindering one's right to free speech, creating legislation that prevents certain forms of speech or ideas from being expressed, even if it's anti-US government is usually not justified and should not be allowed.
Post a Comment