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Why is China obsessed with 8% economic growth? Is it truly to maintain social stability or is it mainly political?...
The short answer to that would be that China quite simply has no option but to be obsessed with and ensure 8% growth at a minimum. Why does China need 8% growth you ask? Well, over the past decade or two, the Chinese have been able to grow at an astonishing rate of 10% on average, frequently crossing the 10% mark comfortably on occasions. That meant that the large Chinese population was relatively happy because they had jobs and a good quality of life. The large population of Chinese people who migrated to the cities in search of better opportunities were absorbed into the economy easily because Chinese exports were growing at a fantastic pace. The Chinese communist leadership couldn't have asked for a better scenario. The going was really good.
However, with the economic downturn that started in early 2008, things have gotten quite bad for the Chinese economy. They've suffered just as much as the rest of the world. Having an economy that depended largely on exports quite obviously didn't help. So, now we have lots and lots of Chinese people out there who've lost jobs, haven't been paid for months, or are on the verge of losing their jobs. For the Chinese regime, this obviously isn't good news. The Chinese communists have depended on their fantastic growth rates to keep their people happy and keep their mouths shut. They figured as long as they give the Chinese people economic growth and jobs and better quality of life, the Chinese people wouldn't ask for greater political rights or democracy or come out on the streets to protest against their government's policies. They were right and the system just worked fine, except for a brief period during the Tiananmen Square massacre.
However, if the Chinese growth rate plummets below 8% to say around 5-6% (as some analysts say they would), then the Chinese communists would have a serious problem on their hands. Its entirely possible that the rising number of unemployed Chinese might take to the streets and create social unrest (something that gives the jitters to the authoritarian Chinese regime). They surely wouldn't want another Tiananmen Square to happen. So, the main reason why the Chinese regime is scampering to stimulate their economy and maintain 8% growth is to avoid widespread social unrest and possible political repercussions.