China’s Ghost Cities and Malls

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With all the current reporting that China may be in freefall, I thought it appropriate to refresh this report from 2011. China was trying to game the world into believing they had a robust economy as indicated by their increased auto production and crazy construction projects. The results were predicted: large parking lots to mothball their cars and cities few could afford to rent and shopping malls with few retailers.

This excellent reporting provides shocking visuals and commentary exposing the issues people, and the government, are faced with by China forcing lifestyles on the population. If there is any lesson to be learned here, it illustrates the fact that if you build it, they will not necessarily come. Or perhaps in these instances… if you build it, they can not necessarily come!

Is China’s rapid and forced development of new cities and infrastructure, with little or no demand, a poor decision to increase GDP? Is it deepening social divisions?

h/t Wizbang:

What happens when a government focuses on infrastructure projects and nothing else? In one case, you get Chinese Ghost Towns! This is what happens when you ignore real market pressures, and focus on just building crap that nobody can afford. This could happen here. Make no mistake, this could be the United States.

I read a somewhat related article about China’s astonishing increase in the production and sales of new automobiles. Interestingly, several analysts and investors noticed an apparent anomaly – there was no discernible difference in China’s fuel consumption, as would have been expected.  Similar pattern? Is the government of China forward thinking? Or perhaps wishful thinking?

Alarming, however, is the observation of a prominent sociologist that polarization is causing a deepening in social divisions.

Another lesson to be learned… it’s not the quantity of GDP, it’s the quality of GDP.

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