Salient to Investors:

China understands that its economy needs to slow down. Too much money is flowing into unproductive investments with local officials often to blame. Its effort to engineer a soft landing is laudable and long overdue, but unless it pushes ahead with political as well as market reforms, surrenders some of its control to the people, it is doomed to failure.

Reforms will cause pain yet there is no new means for ordinary Chinese to vent their grievances. China spends more on internal security than it does on external defense.

Minxin Pei at Claremont McKenna College said Li recently encouraged Politburo members to read Alexis de Tocqueville on the French Revolution.

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