Instead of a stable series of policies producing steady growth, China's financial sector has boomed and gone bust with regularity in each decade. The latest decade is little different. Chinese banks have become objects of political struggle while they totter under balance sheets bloated by the excessive state-directed lending and bond issuance of 2009. Looking forward, the government's response to the global financial crisis has created a banking system the stability of which can be maintained only behind the walls of a non-convertible currency, a myriad of off-balance sheet arrangements with non-public state entities and the strong support of its best borrowers--the politically potent National Champions--who are the greatest beneficiaries of the financial status quo.China's financial system is not a model for the west and, indeed, is not a sustainable arrangement for China itself as it seeks increasingly to assert its influence internationally. This is not a story of impending collapse, but of frustrated reforms that suggests that any full opening and meaningful reform of the financial sector is not, indeed cannot be, on the government's agenda anytime soon.

    In the 1980s China was an impoverished backwater, struggling to escape the political turmoil and economic mismanagement of the Mao era. Today it isthe world's second biggest economy, the largest manufacturing and trading nation, the consumer of half the world's steel and coal, the biggest source of international tourists, and one of the most influential investors in developing countries from southeast Asia to Africa to Latin America.China's growth has lifted 700 million people out of poverty. It has also created a monumental environmental mess, with smog-blanketed cities and carbon emissions that are a leading cause of climate change. Multinational companies make billions of dollars in profits in China each year, but tradersaround the world shudder at every gyration of the country's unruly stock markets. Most surprising of all, its capitalist economy is governed by an authoritarian Communist Party that shows no sign of loosening its grip.How did China grow so fast for so long? Can it keep growing and still solve its problems of environmental damage, fast-rising debt and rampant corruption? How long can its vibrant economy co-exist with the repressive one-party state? What do China's changes mean for the rest of the world? China'sEconomy: What Everyone Needs to Know(R) answers these questions in straightforward language that you don't need to be an economist to understand, but with a wealth of detail drawn from academic research, interviews with dozens of company executives and policy makers, and a quarter-century of personalexperience. Whether you're doing business in China, negotiating with its government officials, or a student trying to navigate the complexities of this fascinating and diverse country, this is the one book that will tell you everything you need to know about how China works, where it came from andwhere it's going.

    It is also a crucial question for Australia, affecting our future economy and security.In this essential book, White considers the options for the Asian century.As China's economy grows to become the world's largest, America has three choices: it can compete, share power or concede leadership in Asia. The choice is momentous – as significant for America's future as any it has faced.White controversially argues that America's best option is to share power with China and relinquish its supremacy. As these two behemoths face off across the Pacific, the choice America makes will also have an enormous impact on Australia. The China Choice is an urgent intervention in the China debate and provides a blueprint for a peaceful future.'White brings erudition and a first-rate intellect, without the baggage of prejudice, to analyse the single most important issue that will determine whether Australia lives in a peaceable environment in the years ahead – a must-read.' —Bob Hawke'Hugh White's The China Choice is an exceptionally thoughtful synthesis of the arguments and influences which bear upon the coming shape of the Pacific.' —Paul Keating

    This is not in dispute. By exactly what mechanism has China managed to grow so fast? There is more room for debate on this question. A widespread view is that private entrepreneurship, financial liberation, and political reforms played a minor role in explaining China's economic takeoff. Based on archival research and survey data, this book offers an alternative view: Private entrepreneurship, facilitated by access to capital and microeconomic flexibility, was at the center of China's takeoff in the 1980s. The political system, then as now, was authoritarian, but it was moving in a liberal direction. China lacked well-specified property rights, but it substantially improved security of proprietors. But given this initial success, how then to explain the substantial distortions in Chinese economy today? The key to getting the China story right is to recognize the existence of two Chinas - an entrepreneurial rural China and a state-controlled urban China. In the 1980s, rural China gained the upper hand, and the result was rapid as well as broad-based growth. In the 1990s, urban China triumphed when the Chinese state reversed many of the productive rural experiments of the previous decade. While this reversal does not show up in the GDP numbers, it shows up in the welfare implications of growth. Since the early 1990s, household income has lagged behind economic growth and the labor share of GDP has fallen. Social performance has deteriorated. The directional liberalism of China in the 1980s and the emerging India miracle today debunk the widespread notion that democracy is automatically anti-growth. As the country marks its 30th anniversary of reforms in 2008, China faces some of its toughest economic challenges and vulnerabilities. The long overdue political reforms are required to improve governance and accountability and to put China on a sustainable path of development.Professor Yasheng Huang teaches political economy international management at the Sloan School of Management, Massachusetts Institute of Technology. He previously held faculty positions at the University of Michigan and at the Harvard Business School and as a consultant at the World Bank. He has published Inflation and Investment Controls in China (1996), FDI in China (1998), and Selling China (2003; Chinese version in 2005). His work on FDI in China has been featured in the Wall Street Journal, the Economist, Bloomberg, Businessworld, Le Monde, Economic and Political Weekly, and Economic Times, as well as in Chinese publications such as Nanfang Zhoumo, Nanfang Dushibao, Economic Observer, Global Entrepreneur, China Entrepreneur, Fortune Weekly, 21st Century Business Herald, Liangwang, and Xinhuanet. In addition to academic journal articles, he has written for Financial Times, Foreign Policy, and New York Times. In collaboration with other scholars, Professor Huang is conducting research on education and human capital in China and India, and non-performing loans, privatization, and entrepreneurship in China. At MIT, Professor Huang runs a "China Lab" and an "India Lab" that help entrepreneurial businesses in China and in India improve their management."Yasheng Huang is an insightful scholar of China's political economy. In this important book, he shows how China's rural economy took off in the 1980s, led by 'township and village enterprises' that were essentially private, only to be ignored in the 1990s by state-led development that focused on urban regions such as Shanghai. The 'Shanghai miracle,' he argues - and as any businessman who has worked there knows - was not the simple triumph of capitalism but of a stronger and more intrusive (and effective) state. If one wants to understand the policy origins of China's growing divide between rich and poor, urban and rural, one need look no further than this book." - William Kirby, Harvard University"Sure to generate a lively debate, Professor Huang's study provides a provocative and well-researched challenge to much current thinking on China's economic development. The widely shared gains of the 1980s have not been matched in more recent years. Danger signs include the stagnation in household incomes, growing inequality and illiteracy, and heightened governance problems. Huang argues that China will not be able to continue to grow unless the benefits of growth are widely shared through fundamental political and legal reforms." - Susan Rose-Ackerman, Yale Law School

    We need to remember that sustained economic success is a rare phenomenon.As an era of easy money and easy growth comes to a close, China in particular will cool down. Other major players including Brazil, Russia, and India face their own daunting challenges and inflated expectations. The new "breakout nations" will probably spring from the margins, even from the shadows. Ruchir Sharma, one of the world’s largest investors in emerging markets for Morgan Stanley, here identifies which are most likely to leap ahead and why.After two decades spent traveling the globe tracking the progress of developing countries, Sharma has produced a book full of surprises: why the overpriced cocktails in Rio are a sign of revival in Detroit; how the threat of the "population bomb" came to be seen as a competitive advantage; how an industrial revolution in Asia is redefining what manufacturing can do for a modern economy; and how the coming shakeout in the big emerging markets could shift the spotlight back to the West, especially American technology and German manufacturing.What emerges is a clear picture of the shifting balance of global economic power and how it plays out for emerging nations and for the West. In a captivating exploration studded with vignettes, Sharma reveals his rules on how to spot economic success stories. Breakout Nations is a rollicking education for anyone looking to understand where the future will happen.

    Mounting debt and rising internal distortions mean that rebalancing is inevitable. Beijing has no choice but to take significant steps to restructure its economy. The only question is how to proceed.Michael Pettis debunks the lingering bullish expectations for China's economic rise and details Beijing's options. The urgent task of shifting toward greater domestic consumption will come with political costs, but Beijing must increase household income and reduce its reliance on investment to avoid a fall.

    Policies governing everything from trade and investment to energy and exchange rates are wielded as tools to win diplomatic allies, punish adversaries, and coerce those in between. Not so in the United States, however. America still too often reaches for the gun over the purse to advance its interests abroad. The result is a playing field sharply tilting against the United States.In a cogent analysis of why the United States is losing ground as a world power and what it can do to reverse the trend, War by Other Means describes the statecraft of geoeconomics: the use of economic instruments to achieve geopolitical goals. Geoeconomics has long been a lever of America’s foreign policy. But factors ranging from U.S. bureaucratic politics to theories separating economics from foreign policy leave America ill prepared for this new era of geoeconomic contest, while rising powers, especially China, are adapting rapidly. The rules-based system Americans set in place after World War II benefited the United States for decades, but now, as the system frays and global competitors take advantage, America is uniquely self-constrained. Its geoeconomic policies are hampered by neglect and resistance, leaving the United States overly reliant on traditional military force.Drawing on immense scholarship and government experience, Robert Blackwill and Jennifer Harris show that if America’s policies are left uncorrected, the price in American blood and treasure will only grow. What geoeconomic warfare requires is a new vision of U.S. statecraft.

    It has to deal with political, economic, social and international tests, each of which involves structural difficulties that will put the system under strain. The picture of China invoked by admirers to argue that it will rule the world does not accord with reality.Based on Fenby's extensive knowledge of contemporary China, this punchy analysis offers a pragmatic view of where the PRC is heading at a time when its future is too important an issue for wishful theorizing.

    Reich, and now he reveals the cycles of power and influence that have perpetuated a new American oligarchy, a shrinking middle class, and the greatest income inequality and wealth disparity in eighty years. He makes clear how centrally problematic our veneration of the "free market" is, and how it has masked the power of the moneyed interests to tilt the market to their benefit. He exposes the falsehoods that have been bolstered by the corruption of our democracy by big corporations and the revolving door between Washington and Wall Street-- that all workers are paid what they're "worth," a higher minimum wage equals fewer jobs, corporations must serve shareholders before employees. Ever the pragmatist, Reich sees hope for reversing our slide toward inequality and diminished opportunity by shoring up the countervailing power of everyone else. Here is a revelatory indictment of our economic status quo and an empowering call to civic action.

    While stories of newly built but empty cities, white elephant state projects, and a byzantine shadow banking system, have all become a regular fixture in the press in recent years, McMahon goes beyond the headlines to explain how such waste has been allowed to flourish, and why one of the most powerful governments in the world has been at a loss to stop it.Through the stories of ordinary Chinese citizens, McMahon tries to make sense of the unique--and often bizarre--mechanics of the Chinese economy, whether it be the state's addiction to appropriating land from poor farmers; or why a Chinese entrepreneur decided it was cheaper to move his yarn factory to South Carolina; or why ambitious Chinese mayors build ghost cities; or why the Chinese bureaucracy was able to stare down Beijing's attempts to break up the state's pointless monopoly over the distribution of table salt.Debt, entrenched vested interests, a frenzy of speculation, and an aging population are all pushing China toward an economic reckoning. China's Great Wall of Debt unravels an incredibly complex and opaque economy, one whose fortunes--for better or worse--will shape the globe like never before.

    Drawing on historical records as well as his conversations with Chinese leaders over the past forty years, Kissinger examines how China has approached diplomacy, strategy, and negotiation throughout its history, and reflects on the consequences for the global balance of power in the 21st century. Since no other country can claim a more powerful link to its ancient past and classical principles, any attempt to understand China's future world role must begin with an appreciation of its long history. For centuries, China rarely encountered other societies of comparable size and sophistication; it was the "Middle Kingdom," treating the peoples on its periphery as vassal states. At the same time, Chinese statesmen-facing threats of invasion from without, and the contests of competing factions within-developed a canon of strategic thought that prized the virtues of subtlety, patience, and indirection over feats of martial prowess. In On China, Kissinger examines key episodes in Chinese foreign policy from the classical era to the present day, with a particular emphasis on the decades since the rise of Mao Zedong. He illuminates the inner workings of Chinese diplomacy during such pivotal events as the initial encounters between China and modern European powers, the formation and breakdown of the Sino-Soviet alliance, the Korean War, Richard Nixon's historic trip to Beijing, and three crises in the Taiwan Straits. Drawing on his extensive personal experience with four generation of Chinese leaders, he brings to life towering figures such as Mao, Zhou Enlai, and Deng Xiaoping, revealing how their different visions have shaped China's modern destiny. With his singular vantage on U.S.-China relations, Kissinger traces the evolution of this fraught but crucial relationship over the past 60 years, following its dramatic course from estrangement to strategic partnership to economic interdependence, and toward an uncertain future. With a final chapter on the emerging superpower's 21st-century world role, On China provides an intimate historical perspective on Chinese foreign affairs from one of the premier statesmen of the 20th century.

    In The Third Pillar he offers up a magnificent big-picture framework for understanding how these three forces--the state, markets, and our communities--interact, why things begin to break down, and how we can find our way back to a more secure and stable plane.The "third pillar" of the title is the community we live in. Economists all too often understand their field as the relationship between markets and the state, and they leave squishy social issues for other people. That's not just myopic, Rajan argues; it's dangerous. All economics is actually socioeconomics - all markets are embedded in a web of human relations, values and norms. As he shows, throughout history, technological phase shifts have ripped the market out of those old webs and led to violent backlashes, and to what we now call populism. Eventually, a new equilibrium is reached, but it can be ugly and messy, especially if done wrong.Right now, we're doing it wrong. As markets scale up, the state scales up with it, concentrating economic and political power in flourishing central hubs and leaving the periphery to decompose, figuratively and even literally. Instead, Rajan offers a way to rethink the relationship between the market and civil society and argues for a return to strengthening and empowering local communities as an antidote to growing despair and unrest. Rajan is not a doctrinaire conservative, so his ultimate argument that decision-making has to be devolved to the grass roots or our democracy will continue to wither, is sure to be provocative. But even setting aside its solutions, The Third Pillar is a masterpiece of explication, a book that will be a classic of its kind for its offering of a wise, authoritative and humane explanation of the forces that have wrought such a sea change in our lives.

    Klein and Michael Pettis show in this book, they are often the unexpected result of domestic political choices to serve the interests of the rich at the expense of workers and ordinary retirees.   Klein and Pettis trace the origins of today’s trade wars to decisions made by politicians and business leaders in China, Europe, and the United States over the past thirty years. Across the world, the rich have prospered while workers can no longer afford to buy what they produce, have lost their jobs, or have been forced into higher levels of debt. In this thought-provoking challenge to mainstream views, the authors provide a cohesive narrative that shows how the class wars of rising inequality are a threat to the global economy and international peace—and what we can do about it.

    financial system, which had grown far too complex for its own good-and too unregulated for the public good-experienced a perfect storm beginning in 2007. When America's financial structure crumbled, the damage proved to be not only deep, but wide. It took the crisis for the world to discover, to its horror, just how truly interconnected-and fragile-the global financial system is. The second part of the story explains how American and international government intervention kept us from a total meltdown. Many of the U.S. government's actions, particularly the Fed's, were previously unimaginable. And to an amazing-and certainly misunderstood-extent, they worked. The worst did not happen. Blinder offers clear-eyed answers to the questions still before us, even if some of the choices ahead are as divisive as they are unavoidable. After the Music Stopped is an essential history that we cannot afford to forget, because one thing history teaches is that it will happen here again.

    In the wake of the Fail Decade, Americans have historically low levels of trust in their institutions; the social contract between ordinary citizens and elites lies in tatters.How did we get here? With Twilight of the Elites, Christopher Hayes offers a radically novel answer. Since the 1960s, as the meritocracy elevated a more diverse group of men and women into power, they learned to embrace the accelerating inequality that had placed them near the very top. Their ascension heightened social distance and spawned a new American elite--one more prone to failure and corruption than any that came before it.Mixing deft political analysis, timely social commentary, and deep historical understanding, Twilight of the Elites describes how the society we have come to inhabit – utterly forgiving at the top and relentlessly punitive at the bottom – produces leaders who are out of touch with the people they have been trusted to govern. Hayes argues that the public's failure to trust the federal government, corporate America, and the media has led to a crisis of authority that threatens to engulf not just our politics but our day-to-day lives.Upending well-worn ideological and partisan categories, Hayes entirely reorients our perspective on our times. Twilight of the Elites is the defining work of social criticism for the post-bailout age.