Tyler Cowen likely has it right, but What if he doesn’t? I had better explain myself, at least to myself. Consider this Scenario: We have a billion-person+ economy which has never been noted for adequate Supply to the consuming Public. Traditional leadership has always been hidden from 85% of the Population, even when those Figures were well-known. Americans can probably tell one more about another State in detail, than Chinese can explain How things operate in a nearby Province. American military forces have only become lately involved in Training for Riot Control (say within the last half-Century), while the Chinese Army has had this Training as the central focus of their military life for Centuries. One of the great Terrors of the Cultural Revolution was that neither Government or Student could determine if any of the Charges against the Outcasts were true or false; even the Victims perforce had to accept the speculation that Others were guilty, even when they themselves assumed they were falsely accused. What I am saying is that Chinese leadership does not know How to respond to Chinese society, even if they can determine of What those Demands consist.
The Point I have been trying to make the hard way may be the Statement that the Government structure is already overburdened with data, and cannot process even that material it deems essential for it’s own survival. I would suggest that the Chinese Unemployment rate is twice that reported by the Government, even if the Government was attempting to present accurate numbers. The number of the Poor reported is probably only about of Third of the actual number, even those Numbers utilized by internal economists; simply because the hidden population cannot be hunted down by overworked Civil Servants multi-tasked with other details. It will not help to identify the Representatives of the Government to the Public, there are simply too many functionaries to keep track of and hold accountable. One cannot even gain clarity by holding separate Offices responsible for alternate things, solely because the Offices are unremarked, and cannot themselves explain their exact relationship to superior Dept. or Government.
The greatest power-brokers in Beijing could be arrested for Vagrancy in one of the Provinces, unless the individual has some personal connection with the leadership of the Province. Restriction of communication in the Chinese penal system holds the equivalence of a Death Sentence; only family and friends can get you out of the clutches of the Chinese penal system, which is too massive to find an individual within the system. There are Those who claim the Chinese Government has changed with the advent of the Computer; but Crap In means Crap Out. There are entire Chinese Departments which are Months behind on their data entry. Chinese leadership themselves often find great difficulty in locating family or friends within the complex system. This multiplex confusion means that Information is disseminated only slowly, often with great inaccuracy, and official economic policy often extends only to the Office door. Enforcement becomes more an effect of Tradition, than it is a policy of decision. American economists are unused to such a system, and will never understand such policy behavior. The real amusement comes in the fact that, in reality, the American system does not differ greatly from the Chinese system; with all functionaries ignoring unpleasant policy. lgl