Is China's Economic Miracle Over? | China Considered | Hoover Institution

China’s economic model faces a critical juncture as its financial system, once a catalyst for growth, now acts as a primary constraint. Logan Wright, partner at Rhodium Group and author of *Broken China*, argues that the reliance on credit-fueled investment in unproductive state-owned enterprises has strangled future productivity. Xi Jinping’s centralization of power has exacerbated these issues by introducing unpredictable policy risks and preventing necessary structural reforms. Furthermore, the economy suffers from a persistent imbalance between investment and household consumption, compounded by a shrinking working-age population and stagnant income growth. Addressing these challenges requires a fundamental fiscal pivot from state-led capital allocation toward supporting the household sector. Meanwhile, international trade pushback against China’s export-led strategy highlights the urgent need for a collective global response to manage the risks of deindustrialization and shifting economic influence.