Here is a "must-see" video that came my way a few days ago. Words cannot possibly describe the video, so please give it a play.
Warning: Although I labeled it "must see", this is a very graphic video that some may find disturbing. The text below describes.
Link if video does not play: http://v.youku.com/v_show/id_XMzEzMzMyMDQw.html
I held off posting this until I could get some comments from a Chinese friend regarding the incident.
"Kevin" writes ...
Mish, my heart is filled with immense sorrow after watching this video - not only for the suffering of the little girl and her parents, but also because I know, sadly, that this is not an atypical event."Kevin" is the person who previously sent articles in Chinese that I posted in China Loan Shark Market Crashes; Scores of Chinese Business Owners Unable to Pay Black Market Loans Commit Suicide or Disappear
There are of course, many angles that how this could happen - I'll just provide two perspectives - moral deterioration and economic survivalism of the poor, which by themselves are intertwined too.
Economically, China went through amazing transformation in the last 3 decades, but the gap between have's and have-not's has increased many folds (especially with the last decade's 10 times increase of real estate value), with inflation playing a big role. Behind the facade of economic wonders, survivalism, pragmatism and materialism are the reality of many lower, middle and upper class Chinese families. The people at the bottom of the society struggle just to get by, and with the absence of social safety net and a poor justice system, many families are really just one accident / sickness / law suit / unemployment away from broken down.
The first driver in the video didn't come down, but tried to kill the little girl instead, because he knew that killing someone in an accident would probably involve a lump sum and maybe sometime in the prison, whereas being responsible for her medical bills would mean bankrupting his family. The legal system, which is enacted by and for the governing elites, is inefficient (at best) and corrupted, especially any level of governments are involved (and they are involved in almost everything). From their own observations, many people lose hope; many turn cynical; and even more just become numb. Avoiding uncertainty at all cost is not a bad strategy to protect oneself.
A media friend of ours who lives in Shanghai calls the current time in China "The Carnival before the Judgement Day". And indeed tension if built up inside and I won't be surprised it hits a wall soon. Unlike many more patriotic Chinese, I do not want China to become a new world power soon - at least not in the current form. The still growing economy is the only legitimacy left for this system to maintain in power, and I am actually hoping for an economic hard landing in China if that's what takes to wake people up to challenge the status quo for the better.
Some of your writings, and especially some comments by your readers expressed disappointments towards the system of the US - I am all up for you to challenge it for the better, but just know that as broken as it may seem to be, it is still one of the "better ones" in the world.
As you requested, here is some background from the video:
Oct 13, 5:30pm in a market in the city of Nanhai, a two year old girl Yueyue was hit and rolled over by a van. The driver did not come down to check her but drove over her with back wheels and ran away. Another car passed by and rolled over Yueyue. In the next several minutes 18 people passed by but nobody did anything, until an old lady who collects trash (for a living) moved her to the curb side and shouted for help. Her parents were devastated when they found out what happened. In the interview of the father, he mentioned someone called and offered to help financially. Initially he thought it was someone wanting to help and did not accept until the person identified himself as the driver. He could not control himself, refused the money asked the driver to throw himself to the police station and it was rejected by the driver. "I do not need money and no amount could be exchanged for my daughter's health." He said.
I really wish them the best - if you want to publish this, I'd like to request prayers from your readers for this family.
Pay Up or Die
I failed to get an email response from Bill Hopen, my sculptor friend in China, but I point you to something he said via email exchange in 2010, as posted in Ponzi "Shark Loans" Fuel China's Housing Bubble
If you get sick, you must have cash or you die if you cannot pay immediately for care, for hospital, for medicine. You are literally wheeled out into the corridor to die if you don't have money for oxygen. I am not exaggerating. There are no credit cards in peasant culture, but there is credit.For more on China from Bill Hopen, please see Inside China: A Sculptor's View.
Several people were upset at this video thinking it does not belong in an economic blog. They are mistaken.
The perpetual story regarding China is that the country will grow without end, it will overtake the US, and rule the world.
Instead I propose the China story is really about rampant credit expansion, malinvestments, unproductive assets, no free capital markets, centralized planning that people mistake for capitalism, no real legal system, no freedom of speech, and no respect for either property rights or human rights.
All the people who think China is some sort of miracle savior for the world economy are going to find out otherwise.
I thought the point was obvious, but judging from the number of emails I received, obviously it was not.
Mike "Mish" Shedlock
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