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| Economy |
| The Party's Over: China 's Endgame |
| 2010-05-04 |
| MOD: second posting of this Gordon G. Chang On October 1 last year, China's Communist Party celebrated the country's National Day, marking the sixtieth anniversary of the founding of the People's Republic. As they did ten years before, senior leaders put on a military parade of immense proportions in their majestic capital of Beijing . Like the Olympic Games in 2008, the parade was a perfectly executed and magnificently staged spectacle, but instead of international fellowship, the theme was the power of China 's ruling organization and the rise of the Chinese nation. But did Beijing need two hundred thousand soldiers and school children to demonstrate its strength or ascendancy? The dominant narrative about China today is that it will, within a few short decades, become the preeminent power in the international system. Its economy, according to the conventional wisdom, was the first to recover from the global downturn and will eventually go on to become the world's largest. Geopolitical dominance will inevitably follow. How did this notion of Chinese supremacy gain hold? The answer is nothing more profound than statistical extrapolation. China was destitute when Deng Xiaoping grabbed power in December 1978. Since then, the country has averaged, according to official statistics, a spectacular annual growth of 9.9 percent. This rate, if carried forward, gives China the world's largest economy in a few decades-2027, to be exact, according to a now-famous Goldman Sachs estimate. So will ours be the Chinese century? Probably not. China has just about reached high tide, and will soon begin a long painful process of falling back. The most recent period of China 's fast growth began with Deng's Southern Tour in early 1992, the event that signaled the restarting of reforms after the 1989 Tiananmen Square massacre. Fortunately for the Communist Party of China, this event coincided with the beginning of an era wherein political barriers to trade were falling and globalization was kicking into high gear, which set the table for a period of tremendous wealth generation. |
| Posted by:Besoeker |
| #6 Yes, Joe, but one wonders what can China do anytime to hard boyz. |
| Posted by: twobyfour 2010-05-04 22:18 |
| #5 OTOH VARIOUS > 140 SUSPECTED AL QAEDA TERRORISTS SNEAK IN INDIA, via Sri Lankan fishing boats. The Hard Boyz can do the same anytime to CHINA. |
| Posted by: JosephMendiola 2010-05-04 20:43 |
| #4 Technology and its attendant impacts have a tendency to compress time on the usual historical cycles. |
| Posted by: Procopius2k 2010-05-04 19:47 |
| #3 China can continue to sell goods for worthless paper, but at some point today's Chinese workers will get old, the young will be stuck with too many old people to support and won't remember poverty as did their parents, and will get impatient with the rate at which their standard of living increases. None of these are a problem today. I'd give the Chinese 10-20 years before things fall apart. |
| Posted by: Nimble Spemble 2010-05-04 19:18 |
| #2 He gets one thing right. China was the big winner from globalization. Although he, like most, doesn't consider the other side of the globalization coin - exporting a lot to other countries means holding a lot of other countries debt. Globalization won't unwind due to trade restrictions. It will unwind on sovereign debt defaults. No one will want to exchange goods for worthless paper (which is what China is doing now). |
| Posted by: phil_b 2010-05-04 19:12 |
| #1 I think Gordon Chang has predicted eight of the last two Chinese recessions. |
| Posted by: Thing From Snowy Mountain 2010-05-04 11:13 |