US Attempts a Very Chinese Bailout

Beijing blazed this trail in '98, and dependence more important now
By Kevin Spak,  Newser Staff
Posted Oct 16, 2008 1:49 PM CDT
In this March 1, 2007 file photo, Ping An Insurance Group CEO Ma Mingzhe, right, strikes the gong during the company's initial public offering ceremony at the Shanghai Stocks Exchange.   (AP Photo/File)
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(Newser) – Wondering how the bailout will work out? Look no further than China, David Ignatius writes in the Washington Post. Beijing test-piloted exactly this kind of strategy, doling out $15.1 billion to buy up companies gashed by the 1998 Hong Kong market crash. Now, he writes, the Chinese need to move toward a more outward-facing kind of capitalism even as the West leans toward nationalization.

“We are all Chinese now,” Ignatius concludes, piloting a nominally capitalist economy we don’t really trust when the chips are down. This new philosophy “isn’t so much socialist as Confucian,” he writes, “a belief that a public-private partnership of the wise ones will get us out of the mess.” Whether or not our bailout works as well as China’s, we’ve proven “nobody likes living on the knife-edge of the market.”