> The median Chinese in 2025 is also much poorer than the median Japanese in the 1980s or 1990s.

Yes, and that’s a big plus for China, it means that there’s still room for productive growth. The also means that the price of labor will still continue to be competitive.

> it means that there’s still room for productive growth

The median Chinese in 2025 is also much older than the median Japanese was in 1990 when their bubble burst. Without welfare expansion and a broad project to increase the prosperity of the median Chinese household, growth will sputter - as it already is [0]

Xi's admin remains avowedly opposed to what he termed "Welfarism" ("福利主义典范国家，中产塌陷、贫富分化、社会撕裂、民粹喧嚣，这不乏警示— 防止落入“福利主义”养懒汉陷阱") [1], and almost all stimulus provided is supply-side.

Chinese households need to either earn enough so they can save for a rainy day and consume, or the state needs to dramatically increase the scope of it's social safety net to incentivize spending.

China needs a "New Deal" style welfare reform if it wants to escape Japanification at this stage.

> The also means that the price of labor will still continue to be competitive.

It's isn't anymore. China's costs have caught up with those of Mexico and Malaysia's, so cost sensitive manufacturing began leaving over a decade ago to Vietnam, Mexico, and India.

High value manufacturing has taken off in China, but generates very few jobs, because a heavily automated factory requires much fewer and much more educated employees, which locks out a large number of Chinese as the average age of schooling amongst working age Chinese is around 8-9 years [2]

[0] - https://www.reuters.com/world/china/chinas-economy-slumps-au...

[1] - http://theory.people.com.cn/n1/2021/1116/c40531-32283350.htm...

[2] - https://ourworldindata.org/grapher/average-years-of-schoolin...