... [In the 1990s] Deng Xiaoping reignited economic reforms by taking on the Communist Party’s powerful left wing.... Mr. Deng brought in reformers like the now-retired President Jiang Zemin and Prime Minister Zhu Rongji to scale back state control, moves that eventually paid off with China joining the World Trade Organization in 2002.Much more at the link.
But when they retired, replaced by Mr. Hu and Prime Minister Wen Jiabao, the atmosphere changed. Economic modernization was seen as causing social unrest, which rose steadily during the 2000s. In response, the country put in place a “stability maintenance” apparatus to tamp down criticism.
....Publicly controlled enterprises have become increasingly lucrative, generating wealth and privileges for hundreds of thousands of Communist Party members and their families. And in a clear sign of its position, the government has moved to limit public debate on economic policy, shutting out voices for change. While political reform has always been a taboo topic in China, in economics, from the late 1970s to the early 2000s, almost anything went, with powerful voices backing strong measures that challenged the status quo. But now, despite the rise of social media, fewer prominent voices within China are able to make the case for a systemic overhaul that would prepare the nation for long-term prosperity on sturdier foundations.
“It’s not a good time to speak out for reforms, but it’s a good time to speak out against them,” said Li Shuguang, a professor at the China University of Politics and Law. “The government doesn’t encourage debate.”
Few people illustrate this conundrum better than Zhang Weiying, a 53-year-old Peking University professor who is probably the closest China has to an economic dissident.
A cause célèbre in Chinese economics circles, Mr. Zhang was fired a year and a half ago from his post as dean of the university’s Guanghua School of Management. Since then, he has been on an extended sabbatical, traveling widely and giving speeches on the country’s brewing economic troubles, among them slowing domestic growth and a collapse of financing for private enterprise _NYT
A Broad Look at China's Economic Problems
Stealth Problem Alert from Patrick Chovanec: A potential mess in the making.
More potential problems for China's government and economy
Interesting overview of China's situation from Vitaliy Katsenelson in Scribd slideshow format
Each of these links contains a slightly different assessment of China's problems, with some important factual information which you might not run into otherwise.