David Stockman has written a good, albeit polemical, summary of China’s bubble problem.
China is a case of bastardized socialism on credit steroids.
True enough, but so are essentially all the developed countries and much of the rest of the world. As I have pointed out before, the great hope after WW-II was that socialism would be self-sustaining, that its blessings would generate sufficient growth to more than cover its costs. The gospel according to Keynes held that the rise in spending would accelerate growth. Alas, not only did that notion fail but the costs proved to be much higher than expected. Rather than cut spending, nations turned to debt not only to fund government spending, but to support private consumption as well. Of course, this debt has spiraled out of control and we have bubbles everywhere.