As Recession Visits, China’s Middle Class Riots

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"One riot, one Ranger"–inscription on statue dedicated to Texas Rangers, 1960.

During the last century, Texas was long on land and short on lawmen. That means that each dispute got one constable.

The Chinese should be so lucky. Unrest is becoming so great among the middle class that the central government may have to turn out the entire Red Army. Cities facing strikes and unrest are spread across hundreds of miles, distant from Shanghai and Beijing.

According to The Washington Post, taxi drivers brought traffic in Chongqing, a city of 31 million, to a crawl. The wanted a modest increase in pay.

"China’s government has long feared the rise of labor movements, banning unauthorized unions and arresting those who speak out for workers’ rights. The strikes, driven in part by China’s economic downturn, have caught officials off guard."

It is going to get worse. Inflation in China has run about 10% this year, with the price of food up by closer to 15%. In the meantime, slowing demand for exports is leading to factory closings and a flattening in wages. Some of the signs of a recession are already beginning to appear. Car sales, which have been up sharply for over a decade, fell in each of the last two months.

The average member of the Chinese middle class does not look much different from his counterpart in the US, at least no economically. He has to fear that his employment will end. Even if he remains in his job, a stagnation of pay levels is leaving him unable to pay for basic living costs, with luxuries out of the question.

The fall-off in consumer spending makes the Chinese economic problem worse as each month passes. Much of what the Chinese buy is made in China. As the ability of citizens to use goods and services drops, so does overall national production.

It moves the economy into a flat spin.

Douglas A. McIntyre