For China's leaders, the 2008 Summer Olympic Games were supposed to mark the country's incredible achievements - a testament to the Celestial Empire's rebirth as a modern world power. Some observers even speak of China as the next global leader that will soon eclipse the waning power and influence of the United States. Without a doubt, China's unprecedented rate of economic growth is a feat that few, if any, countries can match. Foreign investment and manufacturing in China is huge, and the label "Made in China" now fill store shelves from Alaska to Cape Town, and from Moscow to Buenos Aires. In addition, Chinese companies have not only entered international markets, but have become transnational giants, investing throughout Africa and South America. Last, but not least, its military power is proving a force to be reckoned with. Of course, China has a few problems regarding democracy. Beijing's policies demonstrably disprove the liberal theory that economic prosperity inevitably leads to -- or results from -- democracy. I can never remember the exact order of what is supposed to cause what, but in any case, neither scenario has played out in China. The unrest in Tibet prompted demonstrations of support as the Olympic flame passed through Europe and the United States on its way to Beijing, and this somewhat tarnished the glowing picture China had been trying to paint for the international community. But as the Arabic proverb says, "The dogs bark, but the caravan moves on." The Olympic Games will be held as planned, and the human rights protests can be dismissed as "irrational idealism" or to the envy that lazy Westerners feel toward the industrious and hardworking Chinese. Even before the games have begun, China has clearly won a big victory. But this might turn out to be Pyrrhic one. Admirers of the "Chinese miracle" fail to recognize the inherent vulnerability and instability of Beijing's economic model. The new Asian capitalism, marching forward under red Communist Party banners, has combined the most abhorrent elements of both systems -- the harsh, one-party dictatorship coupled with the blind and equally harsh pursuit of profit at any cost, which includes widespread violations of workers' rights. It would seem that these two negative components of the Chinese economic miracle are the key to the country's competitive advantage in the global economy. But strangely enough, China's problem is that it has become far too successful, and this has blinded its leaders to the country's underlying systemic weaknesses and to the menacing economic crisis hovering over it. The decrease in consumption by the United States and Europe will soon result in a sharp fall in demand for Chinese exports. Given the continuing high prices for oil and food, this can easily become a catastrophe. China can't rely on its own consumer market to purchase a significant portion of its goods. In comparison with the size of its population and the scale of it economy, China's domestic market is extremely small -- a reflection of the paltry wages paid to workers laboring without rights under often appalling conditions. It is too early to guess how the Chinese people will react to the looming economic crisis. China is a closed society, but we can be fairly certain that radical economic changes are ahead. Under China's current political system, the ruling class has only one tool at its disposal for coping with such a crisis -- repression. But repressive measures are unlikely to help recover lost foreign markets or spur increased domestic demand. By destroying homes in old Beijing to pave the way for new Olympic projects, China's leaders have demonstrated that creating a pleasing facade for foreigners is more important than the welfare of their own people. But sooner or later, these silent masses will find their voice and force Beijing to respect their rights.