A concept map to explain why the China's ageing population could be a driving factor for crises in the future.
This basically suggests that there are no silver bullets to address this - this is a structural issue and the Chinese Communist Party has 'least-bad' options.
It can only use deficit spending when it has decent capital markets, and the transparency that goes along with it. Otherwise, investors will not be willing to buy China's debt - the same way they buy America's debt at the moment. Given how China wants to retain the control of the currency - this prospect is still sometime away. It will also mean a decline in control of the Chinese Communist Party - another distant prospect.
It can go for higher taxes, but that will risk competitiveness issues. Chinese companies can simply move production away, creating unemployment. Similarly for foreign companies as well.
It can go for reforms and changes in pensions, although that will provoke major social discontent in an ageing society, causing social dissatisfaction.
It can try for immigration, but that requires a different narrative about China - China not just as belonging to the Chinese, but about an openness to the world - another difficult prospect.
It could try distraction - raising the temperature on nationalism, but that will risk military skirmishes it is ill-prepared for, which will cause even greater political instability in the country.
No good choices.
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