The Chinese Communist Party's favourite word is "stability". It appears endlessly in government statements, because, above all, it means no change in the party's position, officialdom's highest objective.
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Social stability is the foundation of that: no unrest, no democratic ideas, and ensuring general satisfaction with the standard of administration.
So the party must be on the edge of its seat as China's real estate industry sags towards collapse. The sector is supposed to account for 25 to 30 per cent of the economy. And people's wealth is mainly in the homes they own - even more than in Australia. Many are up to their ears in mortgage loans.
The arrival of this crisis, centred on massively indebted developer Evergrande Group, reveals spectacular policy failure. We're not used to seeing the Chinese government mess up as badly as it has this time.
It's especially surprising because the main elements are the two that have been so familiar around the world in centuries of financial crises: excessive asset prices and debt. Couldn't they see it coming?
Evergrande owes about $400 billion (its debts are enough to pay for Australia's former French submarine program seven times). The government is now restraining excessive borrowing by such companies - but it has already let the debt-and-construction craze go on for too long.
Now told to borrow no more, Evergrande and others have run out of cash and are missing debt payments.
Since the world has seen financial crises so many times, we know the pattern of events that could come next: assets are flogged to raise cash; that drives down asset prices generally, so more companies lose solvency; lenders won't lend; more businesses run out of cash; everyone becomes fearful and stops spending; and the economy is thrown into recession.
Construction would be at the epicentre of such a disaster. It's variously estimated as employing 50 to 70 million Chinese workers. Most are poorly educated people from villages and small towns - the communities in China that have most to gripe about and are most inclined to form mass protests shouting for removal of local officials.
Millions more work in factories turning out fittings and furnishings for homes. Again, these are usually people who have left rural settlements to get adequately paid work in big towns and cities.
A married couple whom I know were in such employment a few years ago. He worked on a city construction site, she in a factory in another city, and both sent money to his mother, who was raising their toddler daughter back in their home village.
As is common, they were badly treated by their bosses, who provided rough accommodation and lousy food as part of the deal. But at least with this work they could provide for a better future for their little girl than by, say, working on a small and unproductive farm near their village. They hoped she'd have a future like that of the city people whose lifestyles they envied.
You can imagine the dissatisfaction if economic collapse takes away even this inadequate way of life for tens of millions of Chinese and those they are supporting. It's not hard to foresee unrest in villages across the country - and popular demand for removal of more than just local officials.
As for city people, they don't rely on the real estate sector so much for jobs as for retirement security. They generally don't put much faith in the superannuation-style pension system; investment funds are not much more than swindles for extracting commissions; and the share market is a casino. So they prefer to buy flats.
Whereas about 60 per cent of an Australian family's assets are in housing, the ratio is closer to 80 per cent for Chinese.
Their risk is great because housing prices are absurdly high. Two years ago, the price of an average home in Beijing was 25 years of average income. Naturally, first-home buyers settle for something much less than average and still have to load themselves up with debt.
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Two of my friends, a couple in their mid-30s, bought a small flat in a far-flung part of Beijing in 2018 for about $400,000. They have no kids and are reasonably well paid people - minor managers with two different car companies - but making the purchase was hard.
At least they've seen capital appreciation since then; people who have borrowed heavily to buy a flat in the past year should be quaking in their boots at the sight of Evergrande suddenly discounting by 30 per cent to shift stock, as it has been.
Then there are people who have paid deposits on flats that Evergrande can no longer afford to build.
If the crisis keeps developing, "stability" won't be the word to describe the national state of mind. "Bolshy" would be closer.
So the central government will pull out all stops to sever the crisis chain - and maybe it will succeed. It can use its own funds, and probably those of lower levels of government, to bail out broke developers - so local creditors can be paid, even if foreigners lose their dough.
The aim will also be preventing fire sales and therefore a collapse in prices that would bring down more real estate companies.
A recession might be avoided, but a downturn looks more likely. Developers are in trouble basically because too many homes have been built. Construction needs to slow down.
That means winding down a huge chunk of the economy. Other sectors can pick up the slack, but they won't do so immediately - especially after investors and managers have had the nasty fright of seeing the country on the edge of financial crisis.
- Bradley Perrett was based in Beijing as a journalist from 2004 to 2020.
- This article is supported by the Judith Neilson Institute for Journalism and Ideas.