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According to Paulson, the two pillars of growth that have driven China's economic emergence and global prosperity - investment and exports - are "delivering diminishing returns," He proposes that China adopt a new model for future success, “one that relies on consumption to generate growth, while addressing debt and broadening the use of sustainable energy and environmental practices.” Amid continued urbanization, the country's cities are key to this transformation.
Paulson highlights problems with China's local governance, construction industries and environmental factors, and illustrates how these affect the rest of world. For example, he points out, “[e]xperts found that dirty air from China contributed up to 20 percent of the ground-level pollution on the American West Coast in 2010.” China's air quality will only worsen as more of the hundreds of millions of Chinese consumers begin to own cars. To give a sense of its scale, Paulson writes, “[b]y 2025, China is projected to have a staggering 200 cities with populations over one million. America has just nine.”
For Paulson, cities are at the root of China's problems, as well as the source for solutions, especially now, as it experiences “its most severe economic downturn in decades." Chinese cities are home to hundreds of millions of consumers, often plagued by “debt, corruption and dissent," and responsible for producing “monster traffic jams and syrocketing pollution,” he explains. But, if China embraces new approaches and tools, including "instruction in sustainable practices for government leaders, public education in environmental issues and specialized training for the country’s urban planners,” it may be able to address the many issues it faces as it continues to urbanize.