The percentage swings in output for primary producers is proportionally large as an economy moves through its business cycles/bubbles.

Construction is a poster boy industry for illiquid supply meeting liquid demand, with even small downward swings in demand causing huge shake ups within the industry. It of course is also an industry where the inventory part of the business cycle can hit hard.

To the extent that both the industrial and construction portions of China’s economy make up a large portion of their economy, you would expect to see some very deep swings regardless of where the drop in demand comes from.

There’s a simple reason why none of the migrant workers want to go back to the countrywide.

There’s no friggin food there! As in starvation level no food, not go back and go onto food stamps US style the cupboards are bare.

Also don’t forget much of the better farm-land was in the South which has now been turned into factories.

Petty crime and social unrest is skyrocketing in the cities due to lack of work and lack of social services.

The CCP is extremely aware of the issues with lack of basic services, high cost of basic necessities and how easily things can spiral out of control.

The Chinese can simmer for a long time, but when they blow it can be very bad and very bloody.

which, given the transnational restructuring of E. Asia, seriously begs questions of control and whether that nation can reverse its capital deepening, export hub course without greatly destabilizing the region and beyond. Of course, should this global recession be sufficiently intense and prolonged, the party-state may have little option,,,how could it ever have imagined otherwise.

East Asia specialist Martin Hart-Landsberg and economist Paul Burkett’s 2006 paper China and the Dynamics of Transnational Accumulation: Causes and Consequences (PDF) provides some insight and yes, Richard, data into what has been a decidedly beyond-national development process.

Roubini is closer to correct.

the reference to net exports in my post is reference to the net contribution of exports to annual GDP growth — which has been quite large absolutely over the past few years in china even if hasn’t accounted for the majority of China’s GDP growth.

Yves — I wasn’t really arguing against Nouriel so much as against the Economists’ argument that exports have played no role in Chnia’s GDP growth (in which case, there is no reason to worry — china can plug along just fine, as it doesn’t rely on international banks for financing/ benefits from lower commodity prices). My main different with Nouriel is one of tone rather than substance — he wants to fit China’s slump into his global hard landing meme; i preferred to steer clear of the term hard landing.

bsetser

But Sester correctly mentioned that most of export value are actually import value. It means that those jobs added a little value then re-export to US or EU.

Thus, when US and EU have a crisis and demand falls, those very low-value-added low paid jobs will difinitely lose. The people would possibly go back to the countryside…if the CCP can maintain the stable situation during this process. Those people will wait for another boom time to come out and work again…