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Source: WSJ

Category: Economy

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

21 Responses to “Discuss: Will China Emerge as a World Leader?”

  1. chartist says:

    Not only will China emerge as a world leader, we enabled it.

  2. catman says:

    Yes I believe they will. They have the numbers.

  3. Widgetmaker says:

    Yes. Inevitabley. Absolutely. That is, if you qualify the answer by defining leadership as economic power, GDP if you will. It’s not a question of if, but when – 25 yrs, 50 yrs, 100 yrs???

    The sheer numbers dictate this to be the case. The USA has a workforce of about 160 million, while China’s workforce constitutes 800 million. As the Chinese economy becomes better coordinated over the years the total product of their labor will eventually surpass that of the USA. If the average Chinese worker is 1/4 as productive as a US worker they will have exceeded the output of the USA.

    We tend to take a short view of history. I’ve heard it said that China was the leading world power for 38 out of the last 40 centuries, and they now believe it is time for them to reassume their position. If the tables were turned I think the average US citizen would think the same way.

  4. davedk says:

    I don’t like the word “never” and I find it more interesting to know what time horizons the 33% who think “eventually” mean. 2016-18 like the Economist and other China bullish pundits? 2030? 2100?

    Looking at quickly changing demographics and a political system that has legitimacy due only to successful economic development should worry anyone who thinks China is a certain journey to supremacy. Its current growth model has played itself out and it now has to transform its economy into a consumer society, something that will upset millions of people with entrenched interests in the current system.

    If you argue this is not necessary you are arguing that state planning is a successful model of capital allocation in perpetuity.

    “…about two-thirds of Chinese say their country has overtaken the U.S., or eventually will, and 56% say China deserves more respect, Pew found.”

    How long will the regime have this level of backing if the transition turns out to last a lot longer than originally thought?

    Here’s from Bloomberg* a few days ago:
    “Chinese Premier Li Keqiang said the nation will seek to keep economic growth, employment and inflation within limits, avoiding “wide fluctuations,” without elaborating on what the government deems acceptable.

    China should also develop a “scientific macroeconomic policy framework” to offer markets “stable predictability,” Li told a forum of advisers and executives yesterday, according to a summary of the event published on the government’s website.”

    They are obviously signaling that things could get a little rough.

    Then you got the whole issue of resources and allies. The US have a far stronger alliance of partners who together control world trade in energy and food. When push comes to shove China is just stuck behind the Pacific just as Japan was is 1941. How will it feed itself and keep its economy going without imports?

    China is and will remain one of the most powerful countries on the planet but there are many obstacles between being number two and the top spot. Ask Russia, ask Japan.

    *http://www.bloomberg.com/news/2013-07-16/china-to-avoid-wide-fluctuations-in-economy-li-says.html

  5. Petey Wheatstraw says:

    The Chinese will be an economic and military superpower, but I don’t know about an actual leadership role. While the Chinese are an ancient and persistent culture, government over modern history has been one of constant flux. Their current status as a nominal Communist government existing side-by-side with an obvious hybrid Capitalist economy is a prime example of the ongoing flux of their system.

    By comparison, our government is an Extra-Constitutional Criminal Capitalist Corporatist/Fascist Fuckwitocracy, with a proud 200 year history of graft, violence, and empire building, backed by the extended British example of the same practical function.

    Oy.

  6. capitalistic says:

    China is already a leader. The second most important leader in the world. They have adopted an economic policy vs a military policy (US), to avoid any direct confrontation with the US.

  7. VennData says:

    Already have.

    The world needs to work with the leadership to expect speedy progress on democratic values, institutions, like the rule of law, voting, and deep, permanent tax cuts for the rich.

  8. S Brennan says:

    So long as politicians of the judicial, congressional and presidential governmental branches are willing to pimp out US Citizens to Chinese Communist [now capitalist] party members flashing cash, it’s a pretty sure bet that we are going to have to face the same reality Europeans faced in the time of Genghis Khan.

    Europe barely escaped enslavement…and not by force of arms, but by sheer luck. History may repeat, but I doubt we will get lucky twice.

    https://en.wikipedia.org/wiki/Mongol_invasion_of_Europe

  9. Thomaspin says:

    Harvard, Yale, Princeton, Brown, Cornell, Columbia, Dartmouth, Penn, MIT, CalTech, JPL, Inst for Advaned Studies Princeton, Lawrence Livermore, NASA, USC, Berkeley, Stanford – uh huh!

    Intel, IBM, Apple, Microsoft, Novellus, Applied Materials – Chinese?

    Caterpillar, Deere, Monsanto – get the picture?

    Where are the Chinese equivalents?

    Sure, they can steal and copy, but we will remain one step ahead.

    And we are not aouut to revolt against a brutal oligarchy.

    C’mon people, get real and stop mouthing populist rot.

    America is far from done. We are just beginning.

    • Iamthe50percent says:

      The institutions you list and heavily laced with Chinese professors and students. The companies you list have mostly offshored their production and engineering. They are not American anymore. They are foreign companies nominally registered as US corporations. Consider Motorola, nominally an Illinois corporation. They have more employees in India than the USA. Their plants in Harvard IL and Libertyville IL have been gutted with the machinery shipped to China. Their former headquarters and software center in Schaumburg IL is a ghost town.

      • Thomaspin says:

        You completely miss the point. We can refuse entry to the thieving Chinese students, seeking to repatriate intellectual property, at will but Harvard et al, and the 200+ year culture and capital investment which gave rise to our preeminence in education, will still be in America.

  10. Crabbybill says:

    The one thing that is apparent in China is the weak supply chain. To build a plant that requires imported equipment, requires those equipment mfg’s to set up in country training and supply facilities. These mfg’s are then granted favorable sourcing status for other new plants. The Chinese realize their supply infrastructure is weak and will remain weak for two or three major product cycles — 15-20 years, if not put on the fast track. This is why they need to resort to cyber theft. The tier 2, 3 and 4 suppliers are the targets because they are the supply chain that is the missing link in the ‘super’ anything.

  11. bigsteve says:

    I remember when Japan was going to take over the world. That did not quite work out as expected. If I was betting money I would put it on the US first and India second. The US is a mature economy and they do not grow as fast as developing ones. Already China’s growth has slowed down. It’s economy is closer to a develop one now.

    We are a young country and just went through a massive immigration uptick. Every time in our history when that happen we experience an explosion of creativity and economic growth. I do not see why this time it will be any different. We have been through foreign invasion (war of 1812), Civil War, Two World Wars, A Great Depression, a cold war and the Great Recession. The US is still here and strong. Betting against the US has not been a good bet in the past or now. My best guess is that China will remain a regional power and leader. The center of civilization will remain Europe and the Americas for a while longer.

  12. GeorgeBurnsWasRight says:

    IMO, their one-party method of government cannot survive over the long run in a country as large and diverse as China along with economic prosperity. If their current governing structure survives, it will eventually kill their econcomy.

    A transition to whatever form of government comes next will be extremely tricky. If it’s done well, China will continue to prosper. The worse the transition is handled, the worse their economy will do.

    The US was so fortunate in the high quality of leadership we had in the decades following our revolution. Most countries are far less lucky.

    Obviously, the US also has major governance problems to solve. So it’s entirely possible that we won’t continue to be a superpower, but someone else besides China will take our place. And then there’s the possibility that no one will be the next superpower because the human race can’t solve the problems it’s created, and our technological civilization will be a brief, unsuccessful experiment.

  13. nofoulsontheplayground says:

    Historically, it has been difficult to become a world power and project this power without the benefit of a world class military. China is severely lacking in many facets of its military, and it will take decades before it can close the gap between it and the most formidable armies on the planet. Here are some examples of where they are lacking:

    1. Technology – Almost all of the technology they use originated elsewhere.
    2. Navy – They have one aircraft carrier, a stripped former Ukrainian vessel.
    3. The jet engines on their fighter aircraft fail after just a couple of hours or less use.
    4. Their soldiers are ill equipped and generally come from extremely poor areas. They are also poorly educated and trained.
    5. They have not fought large battles outside their territory, limiting their experience. (Korea doesn’t count).
    6. They lack foreign bases.
    7. They do not have any military alliance or treaty organization of consequence.

    On the plus side, they did give us Sun Tzu’s “The Art of War”

  14. Syd says:

    China has already overtaken the US to become the world leader in manufacturing:
    http://www.ft.com/intl/cms/s/0/002fd8f0-4d96-11e0-85e4-00144feab49a.html#axzz2ZSo2IQIZ

    China has built a lot of new infrastructure in recent decades, while the US has not.

    US military expenditure as a percentage of GDP is more than twice as much as that of China:
    http://data.worldbank.org/indicator/MS.MIL.XPND.GD.ZS

    It will be interesting to see what China does in the area of Finance/Banking/Trade, and how the west reacts. There are reports that China is considering a gold-backed Yuan.
    http://www.washingtonsblog.com/2012/05/will-china-make-the-yuan-a-gold-backed-currency.html

    I believe the US is considered a more desirable place to live than China by most. Combined with a relatively liberal immigration policy, that should give the US an edge in attracting and keeping talent.

  15. Internet Tourettes says:

    Although China is growing very rapidly, which is to be expected when economic growth has been suppressed for so long, I don’t see them being a “true” world power in the foreseeable future. Most of their growth has been easy in that they have a large labor force that can provide relatively cheap (although it’s getting relatively more expensive these days) labor. What they lack are the institutions that allow for the growth after the labor advantage has been exhausted. Academic institutions although large and impressive are largely ineffective in providing a base both for training and R&D needed for organic growth. Chinese commercial law and accounting practices are worthless and not universally enforced. Until they get their own house in order by building the internal institutions as opposed to vanity projects like high speed rail and empty shopping centers they will be much like the Saudis big money but no international credibility. Owners of high priced real estate and not much else…..

  16. b_thunder says:

    I don’t care who has bigger GDP, I don’t care who has the biggest nuclear bomb (the modern sovereign nation’s equivalent of the male reproductive organ) or the tallest building (another sign of inadequacy.)
    I especially don’t care if it’s achieved by polluting my water by fracking and causing climate change by the escaping methane.

    I care about quality of life and basic happiness: clean air/water, the rule of law, reasonable personal safety, reasonable privacy, freedom of movement among others. Except personal privacy where we’re in the lead according to Ed Snowden, on all other subject China has already lost. Although with the non-prosecution of bankers and exemption of fracking from the Clean Water/ CleanAir Act, the USA is rapidly moving from the column of “winners” to the column of “losers.”

  17. moruobai says:

    I’m actually surprised with the number of responses on this blog arguing China will overtake the US as a world leader or in terms of economic clout.

    I think there’s way too much reading into the success of the past 30 years and projecting that into the future for the next X years. People who really study the Chinese economy–and probably know it best, like Michael Pettis for example–have a much less sanguine to downright bearish view of the short to medium term. And that’s just talking about China’s economic growth model with an overreliance on investment, deflationary manufacturing fetish, and financial repression. The biggest problems I think China has are social.

    Someone above mentioned American corporations ‘pimping’ employees to Chinese CEOs. I doubt anyone who has every seriously done business in China would find that at all surprising. I used to work for a commodity supplier and a large part of our business was with China. Every year we would have a big dinner party in Beijing with the Chinese chief of police and head of the Beijing Triads in the same room! Outside of the capital in more rural areas there are party members who quite litterally own their towns–and sort of do what ever they want to, including murder.

    Let’s keep it real here guys: in the US the big argument in the past couple of years has been whether or not everyone should have healthcare. What a nice problem to have! In China the big pink elephant in the room that people can’t even argue in public about is why the politicans get to make the rules up as they go and others don’t even have access to basic human rights like: reproduction, a rule of law, right to jury by peers, rights of association, freedom of speech, and so on.

    If any civlization will manage to muddle through and come out okay on the other end, it will be the Chinese. They’ve managed okay for thousands of years and they’ll be okay this time too. But please keep it real: China has a lot of economic and social problems that just do not have any simple answers right now. At this time, the idea that China is ready to surpass the US in leadership or economic clout appears flawed to me.

    • Frilton Miedman says:

      “I think there’s way too much reading into the success of the past 30 years and projecting that into the future for the next X years.”

      China’s socialized college education system, starting in 1977, coincides with that timeframe, while an educated American engineer expects to make $60K, an educated Chinese engineer makes less than $4K with no tuition to pay and lives comfortably.

  18. Willy2 says:

    No, China will not replace the US as a “Superpower”. China influence in the world won’t rise to the level of the US. But I DO think that on a relative basis China will get more influential in the rest of the world. And that also mean that the US inevitable will lose more & more influence. Because the age of “Superpowers” is about to end.