This is John Batchel, Conversation with Colleague Anne Stevenson Yang, author of Wild Ride,

the short history of the opening and closing of the Chinese state market,

and points to why the Central Committee of the Chinese Communist Party cannot fix what's wrong,

the crater of overbuilt housing for generations.

And the municipalities had borrowed against the prospects

that somebody would come and live in their overbuilt housing.

Nobody showed up.

The housing is overgrown with weeds and crumbling.

And the debt remains. What is to be done?

Anne answers it. It's inadequate. It won't work. China can't get out of the fix

it's in if it continues with the Chinese Communist Party. More of this later tonight.

It didn't work in 2024.

The proposal now is to do another of these sort of debt swaps so that the central government takes on a piece of the local government debt and thereby and issues bonds at lower rates so that local governments can lower the amount of interest they're

paying. This is a really like small and technical fix. I think over time it comes out to like

0.1% of GDP. It's just you know it's just kind of a shrug of the shoulders and doesn't

address the big problem, which is that local

governments, which have to pay for schools and hospitals and roads and all of that, are just

playing out of money.