China's Kleptocracy?

Prof. Krugman points to this post about China and wonders if it is correct.  Prof. Krugman's synopsis is:

Hempton basically argues that China has turned financial repression — controlled interest rates on deposits, which ensure a negative real rate of return — into a giant engine of kleptocracy. The banks extract rent from depositors, transfer those rents on to state-owned enterprises in the form of cheap loans, and then the Party elite essentially embezzles the money. Underlying the whole system is a high savings rate that Hempton attributes to the one-child policy.

His readers point to these writers, here are links to some or other of their writings.
Arthur Kroeber.
Patrick Chovanec 
Nick Lardy
Michael Pettis

and a direct reply:
Thomas Barnett

So yeah, an accurate description, and yeah, way over-the-top in its gloom-and-doomism.