No. Not at all. China's problem is not fiscal incapacity (and the West's problems much less so). It's unwillingness to provide a welfare state, which it absolutely should. Anything we can do we can afford, says Keynes wisely. China gave itself the capacity to do very much. It can afford very much.

I don't know what "interest groups" you are taking about, but the whole point of the design is to prevent capture of subsidies by monopolies. Sure, stuff is subsidized, but producer surplus remains very hard fought as price is competed to (modified) variable cost. It's not a cushy subsidy.