Bloomberg Censored in China

China’s authoritarian tendencies can still be seen from her continuing censorship of Bloomberg which seems in retaliation for the latter’s recent exposure of the China’s crony capitalist political economy.

Notes the CNN/Financial Times

Bloomberg's news website remains blocked by China's state censors a full month after it detailed the riches amassed by the family of Xi Jinping, the man who is expected to be the country's next president.

Although periodic outages of foreign media websites in China are common, the month-long total blackout of Bloomberg is an unusually harsh response, highlighting the extent to which its coverage angered the government.

Beijing has tried to apply pressure in other ways, too. In the weeks since the article was published, people believed to be state security agents have tailed some Bloomberg employees; Chinese bankers and financial regulators have cancelled previously arranged meetings with Matthew Winkler, Bloomberg's editor-in-chief; and Chinese investigators have visited local investment banks to see if they shared any information with Bloomberg, according to people with knowledge of these incidents…

In the report published on June 29, Bloomberg used publicly available records to show that Mr Xi's extended family had investments in companies with total assets of $376m; an 18 per cent indirect stake in a rare earths company with $1.73bn in assets; a $20.2m holding in a publicly traded technology company; a luxury villa in Hong Kong worth about $31.5m and at least six other Hong Kong properties worth a combined $24.1m.

Bloomberg was unable to trace any assets to Mr Xi himself, or to his wife or daughter. There was also no evidence of any wrongdoing by Mr Xi or his family.

Nevertheless, the report was seen as embarrassing for Mr Xi, threatening to undermine his image as a clean official in a country rife with corruption just months before he is set to succeed Hu Jintao as president in a once-in-a-decade leadership transition…

No other English-language mainstream media website has been blocked in China for longer than a few days since the 2008 Beijing Olympics. Censors now target specific articles or disrupt access to sites at politically sensitive times such as when dissident Liu Xiaobo was awarded the Nobel Peace Prize in 2010.

This just goes to show why the Panglossian view of China’s future seems unwarranted.

China’s fate will ultimately depend on how political trends evolve (Will China revert to socialism or statism or a closed economy? Or will China embrace deeper liberalization?).

This cannot be interpreted merely from past performance. The above may also be symptoms of the strains from ongoing political deadlock and from economic slowdown (or bubble bust?).

For now China’s bubbles from previous Keynesian quasi boom bust policies will have to be addressed.

So far, the Shanghai Composite index keeps plumbing to new depths.