Trains For America

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Letter from China – Is China’s Economy Speeding Off the Rails? – NYTimes.com

Another view from the New York times. Now, let’s all try not to circle the wagons.

The time savings that the new system delivers may not justify the cost, creating a potential drag on long-term growth, said Michael Pettis, former head of emerging markets at Bear Stearns. The losers are Chinese consumers, who will have to wait for new health care and old-age benefits while the government focuses on public works spending, he said.

Letter from China – Is China’s Economy Speeding Off the Rails? – NYTimes.com.

Filed under: International High Speed Rail, Passenger Rail Transportatio Policy

2 Responses

  1. Jon Fostik says:

    In impartiality, apart from the economic benefit to China, there are always additional unspoken benefits. Specifically a high speed ” network”, i.e. not just an isolated line or two, would potentially be a military advantage in swiftly moving troops great distances. One could say they updated the Eisenhower rationale to the 21st century using steel wheels on steel rails. The US response, let’s debate the merits of high speed rail and require endless environmental reviews and allow costs to spiral upwards even more so as to afford less. Oh, our merchant marine has shrunken beneath the waves so we’d be reliant on foreign flags and capriciousness of other governments for emergency sea based lift capacity. Sound public policy?

  2. greg says:

    This report is basically based on the view point of Michael Pettis, professor of finance at Beijing University. Pettis is quoted in the report. The view is rather superficial and I disputed the arguments in Pettis’s blog a few weeks ago on a similar subject (http://mpettis.com/2009/10/chinese-railways-and-speculating-pig-farmers/).

    Basically, Pettis, who is perennially pessimistic about Chinese economy, has been trying to argue from all angles why China’s economy has much dimmer prospect in the future: infrastructure, finance, investment, demographics, urbanization, college graduate and anything you can think of.

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