How many years before China is No. 1? by TraineeAlternate

I have a vote and I'm not afraid to use it!

With all the bonds China is holding, they already own the US.

Nearly everything I know I learned by the grace of others.

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Monday, December 5, 2005 7:42 AM

How many years before China is No. 1?
TRAINEEALTERNATE

What? You mean they're not?

Made in Japan used to mean something Chrisisall

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Monday, December 5, 2005 7:49 AM

I have a vote and I'm not afraid to use it!

HA HA HA HA HA HA HA HA HA HA HA HA HA HA HA Ha Ha Ha Ha Ha ha ha ha ha ha ha ha ha ha ha ha (snort) hee hee hee hee hee hee .... (titter)

Nearly everything I know I learned by the grace of others.

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Sunday, December 11, 2005 2:37 AM

HAOLEHAOLE

... China can be a scary place. They are every bit as prideful as Americans, and at least as patriotic (or is that "nationalistic", as they're not us). They nearly ALL see China's rise to domination as some kind of definate, Manifest Destiny".

... But they have no liberty... very sad. What's even more sad is that most of those I met who actually know they are being manipulated and having terrible truths hidden from them, don't really care all that much. It's a relative thing. Compared to twenty-five years ago they've got mountains of cash, stuff they can buy, and more freedom (relatively speaking) than they've ever known.

... Still, I was pretty upset to see them cheering when 9/11 went down. That upset me pretty bad. (American news didn't discuss that much, did they? Think about why that might be...) Hell, people were setting off firecrackers for God's sake.

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Sunday, December 11, 2005 12:14 PM

GIANTEVILHEAD

China probably will never be number 1. There are some potentially passive catastrophes ahead of China right now. There’s an AIDS crisis in rural China. The one child policy is working out a bit too well. The majority of the families are having only boys. A lot of families that have girls kill them, especially families in rural areas. In some places, the boys outnumber the girls ten to one. Many people in China are still very superstitious and fall easily to cults like Falun Gong and mystical crap like Fung Shui, the ancient magical art of not making stuff look like crap.

"I swallowed a bug." -River Tam

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Sunday, December 11, 2005 5:08 PM

GINOBIFFARONI

Quote:
Originally posted by GunRunner:
Well at least for the next ten years we will have assured military dominance beyond the Taiwan strait due to the fact they lack any creditable power projection capability in their navy i.e. they have no Carriers and only a few guided missile Destroyers.

Yeah, but they have cash... and how long does it take to buy pretty much anything you want ? Well they already have :

http://www.findarticles.com/p/articles/mi_m0JIW/is_1_57/ai_113755343

3 carriers bought, negotiations to buy / build several more.

Seems they have their act together more than you would like to believe.

Hell, soon they will be ahead of the US in space as well

http://english.aljazeera.net/NR/exeres/7AE1968B-9551-42E8-820F-9D4E977
E8F8F.htm

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Sunday, December 11, 2005 6:38 PM

GUNRUNNER

Quote:
Originally posted by GinoBiffaroni:
Quote:
Originally posted by GunRunner:
Well at least for the next ten years we will have assured military dominance beyond the Taiwan strait due to the fact they lack any creditable power projection capability in their navy i.e. they have no Carriers and only a few guided missile Destroyers.

Yeah, but they have cash... and how long does it take to buy pretty much anything you want ? Well they already have :

http://www.findarticles.com/p/articles/mi_m0JIW/is_1_57/ai_113755343

3 carriers bought, negotiations to buy / build several more.

Seems they have their act together more than you would like to believe.

Hell, soon they will be ahead of the US in space as well

http://english.aljazeera.net/NR/exeres/7AE1968B-9551-42E8-820F-9D4E977
E8F8F.htm

They can have the Kievs and the Varyag! Varyag just spent two decades rotting away in the Ukrane and the Kievs are a joke. The US has 14 carriers each with more fixed wing jets than all three combined (that’s assuming they could get all three operational and train the pilots for carrier operations) and we have 12 amphibious assault ships that can carry over half of what they carry plus a MEU. Plus if you count in NATO you can add 5 more dedicated flat tops and at least one other Harrier capable deck. Those Russian carriers were designed to launch their missiles and then get blown out of the water when NATO air and sea forces sweep the seas clean of anything that flies the hammer and sickle, that’s why they don’t carry many if any reloads for their big surface to surface missiles and that’s why they are hard to reload while underway (you have to roll the missile out on deck and load it or bring it in by crane).

Also remember just buying a flat top or two doesn’t mean they have a creditable force Argentina had a carrier in the Falklands War, which was on paper superior to any of the Royal Navy’s carriers (ironically the carrier was built in England). But when the attack sub HMS Conquer sunk one of their light cruisers they had to turn tail because they had no defenses that could take on an SSN. The PLAN is the same way their two best ships (well they did built another ship but I don’t have the specs on hand) are two Russian destroyers built to fight surface battles and don’t have the sophisticated sonar systems of dedicated ASW units. A US SSN could run wild in a sea of PLAN warships if they ever ventured in to deep water. You need to have a full hierarchy of trained personnel that takes decades to develop. The US has been playing the carrier game for over 70 years that kind of experience can’t be bought.

EV Nova Firefly mod Message Board:
http://s4.invisionfree.com/GunRunner/index.php?act=idx

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Sunday, December 11, 2005 8:20 PM

"At one time, only slightly more than a lifetime ago, the same was being said about the Japanese - that they had no innovation and that they had begged, borrowed, or stolen everything they had from the US and the British. By the time it was too late they had beaten the Russians and were well on their way towards becoming an imperialist power;"

The only reason that the Japanese were able to focus their economy towards innovation is because of massive American investment and trade with the Japanese economy post WWII. Despite their relative strength in innovation and technology (second only to the US), they have lost ground to the US over the past 15 years due to their overaly restrictive economic policies.

In any event, with regards to China, I actually got the opportunity to work there (in the heartland) for a few months, and I can tell you, with all honesty, that it will take several decades before they even begin to approach the economic and military strength of the US. Quite simply, despite their vasts amounts of cash, they DO NOT have their act together from a policy standpoint. Their political system is slowly coming apart at the seams, and they are constantly putting down local riots. Their education system is virtually nonexistent, and I can tell you from first-hand experience that their "university" educated engineers are about on par with your average US high school student in terms of knowledge and experience. Pretty dismal. Their best long-term asset, Western-educated nationals, are more likely to stay in their adopted countties than to return to China. The Economist recently reported that something like 70-80% of Chinese that go to be educated in the US actually stay in the US to work.

Even if the current long-term economic growth rates continue, by 2025 the Chinese economy will still only be 1/4 the size of the US, and by 2055 it will still only be 1/2 the size. So we're at least looking at another 70-80 years of US dominance. And this is assuming that China can keep up a growth rate of 8-10 % per year, which I personally believe is highly unlikely for two reasons:

1) Trend growth rates decrease as economies grow larger (e.g. the US trend rate is 3.0-3.5%, Russia is 6.0-6.5%)

2) At some point all the political turmoil bubbling underneath the surface will explode outward, and who knows what the outcome of that will be.

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Monday, December 12, 2005 5:39 AM

UNREGISTEREDCOMPANION

"Despite their relative strength in innovation and technology (second only to the US), they have lost ground to the US over the past 15 years due to their overaly restrictive economic policies."

It still baffles me that nobody gets it. The more restriction, regulation, control, taxes, etc... the LESS growth, development and inovation you get.

Freedom = Prosperity

But everyone wants MORE laws, MORE restrictions, MORE taxes. Can't resist the urge to meddle.

We are the most prosperous country on the gorram planet, but nobody wants to admit it is because we have MORE FREEDOM (not PERFECT freedom, but way more than anyone else.)

grumble grumble grumble

~~~~~
"Funny and sexy. You have no idea. And you never will."

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Monday, December 12, 2005 11:06 AM

I have a vote and I'm not afraid to use it!

If the US is "the most prosperous country on the gorram planet" then why is the standard of living so far down the list?

Nearly everything I know I learned by the grace of others.

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Monday, December 12, 2005 1:15 PM

It boggles my mind that people are so unwilling to see where we're going right now.
People who used to shop at Filene's are shopping at Target; people who used to shop at Target are shopping at Wal-Mart.
We're sliding down, and cheap goods from China are making it SEEM like nothing's happening. If we're not careful, we're gonna pull a 'Rome'.
I'm not sayin' we can't bounce back from this, but it's gonna take some tough choices, like- have less meaningless crap to fill up your life, but if you must have it, buy American. (Personally, I see us turning into a purely service and retail economy, producing nothing, not even movies and music- Canada and Mexico will end with those jobs)
Look around; we don't need terrorists with a nuclear bomb to destroy us, if nothing changes, we'll have the economy of 'Dark Angel' without a 'Pulse'.(shame on those that don't get the reference

)
The world economy is shaking America's buying power down to her roots, and the only ones who will come out on top...well, they're the ones on top- now, I mean.
I remember when $100,000 a year meant you were practically rich, now it means you can afford to send your kids to college.

Chrisisall, living in the United States of Debt

P.S., will someone please take that hammer out of Bush's hand? There's enough nails in our collective coffin allready.....

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Monday, December 12, 2005 3:36 PM

"I remember when $100,000 a year meant you were practically rich, now it means you can afford to send your kids to college."

I think this is largely due to inflation and the rising cost of higher education, but I don't think it's an indication of overall weakness in our economy. Even if families cannot pay for college out of their own funds, the US government and banking industry allows pretty flexible and solid lending opporunities, such that loans for higher education, on average, are a better investment than they ever have been in this country.

Additionally, over the past 20 years we've been able to maintain steady, solid growth while keeping down inflation, increased per capita purchasing power due to the lower prices of commodities, significant increases in productivity, and an unemploymen rate of 5.0%, which is phenomenal compared to our semi-socialist European friends. Also, the violent crime rate is at a 30-year low in this country. You can choose to be negative about the US economy, but quite frankly, the statistics show otherwise.

And your point about the US economy becoming primarily service-based is largely irrelevant. It comes down to comparative advantage - why produce the goods here when they can be bought at a cheaper price from another country? Maunfacturing hasn't been the backbone of the US economy for 40 years now, so it's ahistorical to pretend this is some sort of new phenomenon or that "it's all Bush's doing." Our economy should specialize in the areas in which it has the best advantage, which is quite clearly services, technology, and innovation. A great example is the Internet. It was developed by DARPA and then turned over to private industry and academia, and look at its effects: hundreds of thousands of jobs in the US alone (when in 1980 there were 0 Internet-related jobs). The US economy spawned an entirely new industry because it focused its energies in the areas where it had the most advantage - technological reserach and development. Trying to revert the US economy to what it was in the 1940's and 1950's (i.e. a primarily manufacturing economy) would be utterly devastating not only for the US economy, but for the world. Our best bet to continue producing ideas and innovation - these are not tangible commodities, but I would argue they are far more valuable then, say, manufactured toy or piece of furniture. Not to be a jerk, but this is all pretty standard neo-liberal economic theory.

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Monday, December 12, 2005 5:15 PM

GEEZER

Keep the Shiny side up

Quote:
Originally posted by rue:
If the US is "the most prosperous country on the gorram planet" then why is the standard of living so far down the list?

Nearly everything I know I learned by the grace of others.

Depends on who makes the list, as noted in this NY Times article:

http://www.nytimes.com/2005/04/17/weekinreview/17bawer.html?ex=1271390
400&en=44ea05b3e068feb5&ei=5090&partner=rssuserland&emc=rss

"THE received wisdom about economic life in the Nordic countries is easily summed up: people here are incomparably affluent, with all their needs met by an efficient welfare state. They believe it themselves. Yet the reality - as this Oslo-dwelling American can attest, and as some recent studies confirm - is not quite what it appears...

All this was illuminated last year in a study by a Swedish research organization, Timbro, which compared the gross domestic products of the 15 European Union members (before the 2004 expansion) with those of the 50 American states and the District of Columbia. (Norway, not being a member of the union, was not included.)

After adjusting the figures for the different purchasing powers of the dollar and euro, the only European country whose economic output per person was greater than the United States average was the tiny tax haven of Luxembourg, which ranked third, just behind Delaware and slightly ahead of Connecticut."

You can download the .pdf of the report here:
http://www.timbro.com/euvsusa/

"Keep the Shiny side up"

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Monday, December 12, 2005 6:47 PM

DREAMTROVE

Just adding this from info on the CIA home page about economic trends, etc. The answer to the question "How many years before China is No. 1?" is 11.

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Monday, December 12, 2005 9:28 PM

Haywood. What if Neo-Liberal (love that phrase) economic theory is wrong? I think we all get the point about comparative advantage but even Smith and Ricardo expected one of the trading partners to make *something.*

The problem as I see it is two fold. First service economies do not create wealth they add value. Service industries are second order economic entities, someone somewhere has to have created the wealth that they then spend on services. If nobody creates wealth how can they continue to spend it?

Second problem is that the US has no monopoly on "good ideas." In fact overall it hasn't created that many from "whole cloth" a lot of major innovation came from elsewhere it's just that America was far far better at seizing potential and exploiting it than anyone else. This idea that the US can create a brain trust who's ideas somehow buy the material goods that it no longer produces is an interesting idea for Science Fiction writers. What would a US economy based on that principle look like? Would it be a servant state? Where the few that earn the foreign exchange keep the rest of the population as various forms of domestic servant? Or would it be some pseudo socialist dictatorship with smart folks forced to think to support the unthinking, unworking masses?

I ask because I can't imagine how you could have a society that makes nothing but ideas. I can't imagine how they could maintain a big enough long term advantage or how they force the rest of the world to accept interlectual property as a reserve currency?

I believe this is like phantom WMD's. There are people now profiting big time from the current "neo-liberal" economic regime. They have no interest in if it's sustainable as long as they get to profit from it now and they sell these dumb ideas of some kind of innovation economy to reassure the masses that what they see with their own eyes is not true...

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Tuesday, December 13, 2005 4:08 AM

Quote:
Originally posted by Hayward79:
Our best bet to continue producing ideas and innovation - these are not tangible commodities, but I would argue they are far more valuable then, say, manufactured toy or piece of furniture. Not to be a jerk, but this is all pretty standard neo-liberal economic theory.

Yes, I must try to remember that all I see is false; the ice caps are not melting, the climate is not changing, our standard of living is as good as it was 25 years ago, war is fast becoming obsolete as we are but one world, united in the common good, our leaders are caring and articulate and foward-looking, corporate America has re-discovered the value of the individual....
What a deluded dumass I can sometimes be, thinking that all ain't well all the time....

Chrisisall, ignoring that little fire in his kitchen, 'cause his statistics show his house burning down to be an unlikely event.

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Tuesday, December 13, 2005 4:42 AM

DREAMTROVE

I'm going to disagree with this neo-liberal thing, whatever it is. We need to be in manufaturing as well as information industries or we have no impact on innovation and gain nothing from it.

The gas-powered vehicle clearly has to go. It's totally inevitable, and it will happen in the next 20 years. The companies that produce the best alternatives will become corporate superpowers. Since the purchase for Chrysler by Daimler, there are only two major American automakers, and both are in perilous danger of going bankrupt this year. If this happens, then you can pretty much bet that the winner of this alternative energy car thing, and event which turn an industry on its head, and yield upwards of a trillion dollars in revenue long term, will not be us.

This same idea could be applied to a lot of manufacturing that the US has already been more or less pushed out of. TVs, Computers, anything with a remote possibility of innovation should be kept alive if we're to benefit at all from that innovation.

I guess I'm wasting space, let me put it more simply. I agree with Fletch. And Chris. I don't got a lot to add here.

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Tuesday, December 13, 2005 5:11 AM

UNREGISTEREDCOMPANION

I wonder how many people bemoaning the loss of manufacturing jobs have ever HELD one? Standing on an assembly line, doing mindless repetative work, feet aching, talking to no one, hearing nothing but a machine humm, trying to not go insane waiting for your pathetic 1/2 hour lunch in the cafeteria so you can bitch about the previous 4 hours you spend standing on the line.

Now imaging being the person on the end of the line that has to check the work of the other people on the line. Write them up. Point out their mistakes. Yup, the dreaded QA aditor. Been there, done that.

~~~~~
"Funny and sexy. You have no idea. And you never will."

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Tuesday, December 13, 2005 5:57 AM

If it paid the bills, I could do it.
But if it paid crap, I could understand the resentment...

Chrisisall, with bills

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Tuesday, December 13, 2005 7:53 AM

MTNSCOTT

Thank you HAYWARD79 for providing sound economic theory to this discussion.

As for China buying US Debt, I have no problem with a country buying it at the highest prices in 50 years. Funding our economic growth at a cheap price. Communist have much to learn about capitalism.

Only the half mad are wholly alive!
E.A.

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Tuesday, December 13, 2005 8:40 AM

"Yes, I must try to remember that all I see is false; the ice caps are not melting, the climate is not changing, our standard of living is as good as it was 25 years ago, war is fast becoming obsolete as we are but one world"

Since you are but one of 6 billion + people in this world, I actually do think you have a serious case of tunnel vision if you are only going to look at the situation based on your own, limited experiences. In my experience, people are doing far better today than they were, say in, 1977, when unemployment was around 9% and inflation in double digits. However, I know better than to rely just on what I perceive around me; I look at overall trends and statistics. They aren't perfect, but they informative and I suggest you approach them with an open-mind rather than with some half-based, preconceived notions about isolationism and quasi-socialist economic thought.

Secondly, about the US not having a monopoly on innovative ideas: I never claimed that the US did have a "monopoly" in this area, I simply made the point that that is where our best advantage lays. For some reason, some people keep pretending that the loss of manufacturing is some sort of new thing in this country - it isn't. As to ideas not creating new jobs, nothing could be further from the truth. Again, look at the pioneering innovation that took place in Silicon Valley in the 80's and 90's. The development of computer technology, software, and the Internet is indeed a "whole cloth" invention created almost entirely by US and Japanese innovation, and as such, it has added hundreds of thousands of jobs to those two economies. The US is also currently leading the way in research in high-tech areas such as nanotechnology and biotechnology. It has even recently started to catch up to Japan in the area of robotics. And finally, almost every innovation in manufacturing over the past 50 years has been developed from the ground-up in US university and corporate research labs.

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Tuesday, December 13, 2005 8:41 AM

Quote:
Originally posted by MtnScott:
Thank you HAYWARD79 for providing sound economic theory to this discussion.

Chrisisall

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Tuesday, December 13, 2005 9:09 AM

Quote:
Originally posted by Hayward79:

I actually do think you have a serious case of tunnel vision if you are only going to look at the situation based on your own, limited experiences. I know better than to rely just on what I perceive around me; I look at overall trends and statistics.

Revel in all the statistics you want to pal, I'm sure they are a great comfort to you, and your VAST chair-bound 'UN-limited' experience. No need to get out into the world and talk to real people, those are just 'limiting' experiences. No, by all means, stay home in front of a computer and read the numbers that are meaningful; the Alliance would like if we all believed what we were told.
I come in contact with hundreds of people every day in this college town that I live in, many from outside the country, and talking with them is further limiting me it seems. I'm also very young, as it only takes most of the fingers of only one hand to count the decades I've been wittness to, so my perspective hasn't had time to develope. And, I've never been to Hawaii or Alaska, so how can I hope to know the whole country (Magnum P.I. and Northern Exposure aside...)?

At least I can refrain from calling you an idiot; you're new here, and I don't know you very well.
(I'm trying to break out of my tunnel-vision-like assessments of people)

Chrisisall, who was a little more gracious as a brand newbie...(at least I hope I was

)

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Tuesday, December 13, 2005 9:35 AM

HAZE

Most estimates Iv read have put China as the worlds number 1 economy in as little as 10 years. Militarily it is hard to say so I won’t comment.

Thing is, all estimates about Chinas growth as great world power, and indeed all estimates about the US’s decline fail to take into account the fact that the worlds supply of oil is slowly but surely running out. Within ten years the entire global economy could be thrown into chaos by the soaring price of oil. In that situation emerging world power will be Russia (Who are sitting on the world largest supplies of untapped oil)

It like every power and economist on earth has their fingers in their ears and is chanting “It won’t run out. It won’t run out.”

So if the oil remains the century belongs to China. If it runs out, for a time its Russias, then where all doomed. Well except France who actually generates enough Nuclear power to survive without oil. Well until one of there reactors blows up and irradiates most of Europe.

--------------------------------------------------
Who do you suppose is in there?

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Tuesday, December 13, 2005 9:41 AM

RC71

Fact.
Last September China became the number 2 Industrial power in the world.
Fact.
China is the #2 holder of US Debt. Japan is #1.

Most American's don't care about God, Family, the USA as much as they care about $$$$.

Don't believe me, how many 3 day a week church going Christians buy Made In China because it's 10% cheaper, even though China is Communist and bans religion? Walmart is the #1 importer of Chinese goods.

China could sink our economy overnight by calling in our debt. True, it would hurt them, but who do you think take poverty better, them or us.

Japan and Russia at least say they are our friends, but China hasn't even pretended to, yet we ignore it.
Japanese people think they make better 'Americans' then we do, the Chinese don't like us.

All you need for the success of evil is for good people to do nothing.

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Tuesday, December 13, 2005 9:48 AM

Quote:
Originally posted by RC71:
Japan and Russia at least say they are our friends, but China hasn't even pretended to, yet we ignore it.

Who cares that the Chinese government doesn't like us? We know all their secret Kung-Fu moves now, and can turn this to our advantage!

Chrisisall Caine

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Tuesday, December 13, 2005 10:11 AM

"Most estimates Iv read have put China as the worlds number 1 economy in as little as 10 years."

Well, then they weren't basing their esimated on total GDP, and I'm not sure what a more relevant criteria there would be in determining the #1 economy. The Economist did a study in 2003 I think that said if China averages 8-10% GDP growth over the next 20 years, and the US averages 3-4% growth, then China's economy will still only be 1/4 the size of the US economy. I will try to find the link to the article and will post it.

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Tuesday, December 13, 2005 10:36 AM

RC71

You are correct. No one comes close to us in total dollars, but issue is how strong is number one when a country like china can put us in a depression overnight.

In 1982 the Japanese made it clear to the US that they were done being told what to do and they were going to tell us how it going to be.

We slapped a tarriff and on them for not letting the US sell rice in Japan. They held the debt out and in a matter of days the tariff was repealed and we still couldn't sell rice on the Japanese open market.

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Tuesday, December 13, 2005 11:40 AM

Unregistered Companion: was that 8 hour a week, shit pay job better than no job and no prospects of a job? because that is what we are talking about here. My family were coal miners for generations. That truely is a NASTY job, nobody would want their kids to have to do that for a living. Well the mine closed and those people became unemployed and you know what? They discovered that there was worse things than being a miner, being unemployed being one of them.

The people that want you to believe this is ok don't say "well you'll loose that manufacturing job and be unemployed for the foreseeable future" they say "well you didn't really want *that* job not when there are all these marvellous theoretical high tech jobs we will replace it with."

If there is a job for those people to move into then dandy, I don't want anybody doing drudge work if there is an alternative, but this is not going to be a choice between drudge work or a better job, this is a choice between a job and no job.

Manufacturing, like farming, mining and some knowledge based professions are important because they are a primary source of wealth. The service industries that replace them only add value. If you are in a steel town and the mills close, who has money to spend at the shops and restaurants that support those service jobs.

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Tuesday, December 13, 2005 11:51 AM

Haywood, you are absolutely correct. Free trade grows markets and thus makes a bigger pie. A smaller slice of a bigger pie might still be larger than the bigger slice of a smaller pie we're all used to. We get that, really.

The problem is that there isn't some nice mom out there cutting up this economic wealth and handing it out according to need or according to virtue. The US gets the slice it can grab and hold onto in the fight for a share. I don't see how that can be done if the economic "body" is weak.

I still say that all these theories are very nice but unproved. The fact that people say "well high tech is moving to India but that's ok because it leaves us free to exploit The Next Big Thing" without being able to say what the "Next Big Thing" is worries me.

Right now there are very few things the US is so good at that she has a sustainable comparative advantage. What pays the bills going forward?

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Tuesday, December 13, 2005 12:39 PM

MTNSCOTT

The lack of understanding of basic economics and Finance in this discussion is amazing...

Positives of China buying US Debt...

1. Interest rates stay low.
a. Buying House Cheaper
b. Business' Cost of Capital Lower (=Economic Growth)
2. as mentioned before, they are buying US Debt at 50 year highs. (much the same as the Japanese did with real estate in the 80's)

China Own 2.5% of US debt. US treasuries are sold on an open Market, China can not "call" in the debt. They would have to sell it on the open market. This would cause rates to rise and would hurt our economy. At the same time China would hurt their own economy more as the value of the debt they are holding plummets in value as they are trying to sell it. Political Pressure that is already intense would exponentially grow to float the Yuan, in turn, leading to the collapse of Chinas cost advantages. Protectionism would raise its ugly head and Imports from china would Drop, thus Killing China's fledgling economy. Without a strong US economy, Chinas falls apart. They know this.

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Tuesday, December 13, 2005 1:08 PM

China isn't going to dump US debt -- what advantage is there in that? However they are not just giving the US money and that's that, the US has to repay that debt at some time and it has to finance those repayments somehow.

This is just like a credit card, you run up a bill and in theory the loan company can sell on your debt, crap on your credit rating and make your life hell but where's the profit in that? No for them the best solution is that you keep making minimum payments all your life, which is what the US is doing with that debt at the moment.

The problem with China isn't that they will dump the bonds but that they will stop buying them because then interest rates will rise and the underlying weaknesses in the current economy will be revealed. A day will come when that happens, it won't be any time soon but when it does there will be problems.

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Tuesday, December 13, 2005 2:27 PM

GUNRUNNER

Quote:
Originally posted by chrisisall:
Quote:
Originally posted by RC71:
Japan and Russia at least say they are our friends, but China hasn't even pretended to, yet we ignore it.
Who cares that the Chinese government doesn't like us? We know all their secret Kung-Fu moves now, and can turn this to our advantage!

Chrisisall Caine

Well you can take on 10,000 screaming Chinamen with your Kung-Fu, I'll keep my M-249 and stand behind you…

EV Nova Firefly mod Message Board:
http://s4.invisionfree.com/GunRunner/index.php?act=idx

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Tuesday, December 13, 2005 3:12 PM

DREAMTROVE

Hayward,

Re: China statistics

I got mine off the CIA homepage, and while I respect the Economist I don't respect regurgitated analyses that might have added flaws. The analysis you quoted failed to take into account the inevitable parity of currencies that will come with having twice the United State's rate of growth. I said 11 years someone else said 10, I think this is pretty pretty solid stuff. It's somewhere on the order of a decade.

Can this change? Sure. But there are basically four things that can change it.

Two that would improve our situation vis a vis China:

1. An economic recovery in America. I think this is just about inconceivable, it would require a drastic overhaul of American fiscal policy, which I think would have to involve about 75% reduction in federal spending and an 80% reduction in taxation. I think it's possible, but quite frankly I think it's very unlikely.

2. A collapse of the Chinese economy. This is another I frankly don't see coming. A collapse of the Chinese govt. would accellerate economic growth, just about the only thing that would slow it is the Chinese govt. taking some totally lunatic economic stance. On second thought, I take it back, this one IS possible.

Two would make things worse and might hasten a Chinese take-over:

3. An accelleration of the Chinese economic growth. This is only going to happen if the communists lose power in a relatively peaceful manner. It's unlikely, but somewhat more possible than 1 and 2.

4. An economic collapse in the United States. This is a very real reality. I would place this as most likely of the 4 and perhaps more likely to happen then not happen.

Follow this scenario:

A. Bush's insane spending will force an increase in revenue by the next administration, assuming that admin is a democrat, which is probably a safe assumption, they will do it by raising taxes.

B. When The Benator/Hillary ticket wins in '08, they will inherit the enormous debt of Bush in the mega trillions.

C. Being democrats they raise taxes on businesses and working people making hiring Americans in white collar labor markets no longer feasible. (It's already not feasible to hire Americans in working class blue collar labor markets because of the incredibly unfavorable tax and regulatory structure in the US)

D. White collar employers will flee the US in favor of Japan, Korea and India, as well as Canada, Mexico and possibly Eastern Europe. Tax revenues will fall because the work force will be shrinking.

E. The Nelson administration will be tied to its overdrawn expenses because it will have inherited the bait-and-switch campaign supporters, such as the drug companies, and because it will have overgrown social experiments such as Hillary's health plan, and it will be bogged down in a war in Iran because it will have inherited the New World Order crowd.

F. At a completely loss to cover the expenses, and unwilling to reduce expenditures to their sweetheart deals with Halliburton, Pfiezer, et al. Ben Nelson and Hillary Clinton will launch a truly hairbrained economic revenue scheme. I have no idea what this will be, but I trust that they will think of something along the lines of Wilson's War Debt reparations.

G. The new economic madness paradign will rapidly precipitate a stock market crash. A great depression will follow.

This is just one possible Scenario. It's possible Bush himself will cause this kind of disaster through a similar sequence of events.

Anyway, should something like this transpire, China will leap rapidly into first place.

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Tuesday, December 13, 2005 7:05 PM

"I got mine off the CIA homepage, and while I respect the Economist I don't respect regurgitated analyses that might have added flaws. The analysis you quoted failed to take into account the inevitable parity of currencies that will come with having twice the United State's rate of growth. I said 11 years someone else said 10, I think this is pretty pretty solid stuff. It's somewhere on the order of a decade."

I have yet to find ANY analysis that puts the Chinese economy anywhere near the US economy in size in the next 25 years, much less the next 10 or 11. I checked the CIA site and could not find this information anywhere. Also, for any economic information that the CIA does report, they don;t provide the method used for nay of their projections, while The Economist does. What was the CIA report that you found using as their basis for the comparison??? I'm sorry, but what you're saying just doesn't make any sense.

Also, what the in the 'verse do parity of currencies (which, just so you know, do not necessarily normalize due to grwoth rates, especially when when the exchange rate is artificially pegged by the Chinese government) rates ultimately have to do with total economic output?

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Tuesday, December 13, 2005 7:07 PM

"Follow this scenario:"

I tried, but it honestly defies logic, and is alarmist propaganda to boot.

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Wednesday, December 14, 2005 5:49 AM

NELLIE

I don't know why everyone seems so terrified of China's becoming a superpower in a few years' time. Really, so what?

Britain, Spain and France were all once superpowers, with Britain & Spain claiming most of the globe between them. Did that destroy the economies of all other countries? No.

And when America's turn came to rise to power, did Europe and the rest of the world collapse into abject poverty? No.

Are Europe and Australia crawling along in the mud now, just because America is rich? Um, no.

Did America invade Canada, Mexico and the whole of South America, claiming it all as US territory, just because it was rich? No.

So what do you think will happen when China gets rich? Do you think America will suddenly collapse into miserable poverty? No.

Do you think China is just itching to send great armies into the rest of the world? Do you think China wants to invade America and seize whole continents as its own? Don't be daft!!! Why waste the money?

They only want the same thing as all other Third World countries want: to develop as quickly as possible and make as much money as they can, to give their people a better life.

You are wrong to say the Chinese don't like America---they deeply admire everything western, everything American, from fast food to the NBA---they even want to look like westerners, because they think westerners are more beautiful.

(By the way, that remark about them cheering over 9/11 must have been some of the ethnic minority Muslim groups in China, not the mainstream Chinese. Just like westerners, the mainstream worries about their own Muslim groups kicking up.)

It is not true that religion is not allowed---Buddhist and Taoist temples thrive in China now, while Muslim mosques and Christian churches are open for anyone to attend. It is missionaries of any kind that are frowned upon, as in other parts of the world, because they often mix religion and politics together.

The vast majority of Chinese are not remotely interested in politics at all---they just want to make money to send their kids to college and buy a car.

How is that so different from us westerners? Why is that so awful and scary?

So for all those American guys busy barricading themselves in their houses with machine guns ready for the big invasion, you really ought to relax and get out more. Come on over and do some country line-dancing with the Chinese---they love it, and you can show them some new steps!

And if you could make some Chinese friends and forget about racial prejudice, you would see what wonderful people they really are.

If western civilization collapses, it won't be because the Chinese got rich---it will be because of climate change. And who did that, I wonder?

Anyway, that's just my opinion.

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Wednesday, December 14, 2005 6:36 AM

Quote:
Originally posted by Nellie:
If western civilization collapses, it won't be because the Chinese got rich---it will be because of climate change. And who did that, I wonder?

Certain people so bent on controlling the world and it's oil that the understanding of what's good for America in the long term has gotten lost in the shuffle.

Thanks, Nellie, for the positivity- a rare and wonderful thing on RWE!
So we take our place in between Europe and Australia...poor rich folk in the U.S., they'll have to take one less vacation per year due to the hard times

Chrisisall, rich in spirit (not that he couldn't use a yacht...)

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Wednesday, December 14, 2005 6:46 AM

I have a vote and I'm not afraid to use it!

Quote:
gross domestic products

Is different from standard of living. GDP does not take into account money distribution. Geezer, you should know better.

Nearly everything I know I learned by the grace of others.

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Wednesday, December 14, 2005 6:52 AM

I have a vote and I'm not afraid to use it!

Quote:
I wonder how many people bemoaning the loss of manufacturing jobs have ever HELD one?

I did. Assembly line. It convinced me that I wasn't cut out for that kind of work. But service jobs (of which I've held many) are just as onerous in their own way.

(PS Your description is pretty accurate for the traditional assembly line. Dirty, hot, boring, nasty work. The secret, I found, was not to look at the clock. Once you started looking, you were done for. Then you would look again and go oh man! only five minutes have gone by! this day is gonna be FOREVER And look again, and again .... I have not done clean-room assembly, it may be different.

Service jobs I have held - waiting tables (twice), child-care (once), hospital aide (once), home-cleaning (twice), gas-station attendent (once). Fortunately except for the waiting jobs, my employers were relatively decent. In most service jobs, one works at the whim of arbitrary and demanding bosses.)

Nearly everything I know I learned by the grace of others.

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Wednesday, December 14, 2005 7:02 AM

I have a vote and I'm not afraid to use it!

Quote:
In my experience, people are doing far better today than they were, say in, 1977, when unemployment was around 9% and inflation in double digits.

That was an interesting choice for a base value, which I'm sure you winnowed out b/c it 'proved' your point.

In reality, over the decades, US poverty rates are up, and inflation-adjusted WAGES (not income, which includes investement returns) are down. Numbers of uninsured - up. Children living in poverty - up.

As for unemployment, the US and other economies count it differently. The US looks at ONLY those currently receiving unemployment benefits. Other countries look at real unemployment. However, if you go far enough down through the info at the US BLS, you will see that it counts REAL unemployment (males only) at ~ 12%.

Nearly everything I know I learned by the grace of others.

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Wednesday, December 14, 2005 7:03 AM

CITIZEN

Yes, it would be truly terrible if the rich actually had to work for a living, rather than get others to do their work for them.

How will they cope, not gettin' a new yacht every year.

Citizen, kickin' bottom or what?

More insane ramblings by the people who brought you beeeer milkshakes!
Remember, the ice caps aren't melting, the water is being liberated.

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Wednesday, December 14, 2005 8:22 AM

I have a vote and I'm not afraid to use it!

Quote:
I have yet to find ANY analysis that puts the Chinese economy anywhere near the US economy in size in the next 25 years, much less the next 10 or 11.

This is a discussion I've had with my co-workers. We did a throw-away calcuation which you can reproduce with minimal effort. Take the per-capita GDP of China (in US dollars) and multiply it by the number of Chinese. Do the same for the US. The TOTAL economies of both countries are roughly the same. The difference is that most of the Chinese economy is internal.

Speaking of oil, both the Chinese and Japanese are in competition for Russian oil. They are both trying to induce Russia to run the eastern pipeline being built in their direction.

Nearly everything I know I learned by the grace of others.

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Wednesday, December 14, 2005 9:48 AM

I have a vote and I'm not afraid to use it!

Quote:
However, if you go far enough down through the info at the US BLS, you will see that it counts REAL unemployment (males only) at ~ 12%.

I somehow lost the ability to edit this post. But I wanted to add that the reason why the BLS looks only at males is b/c they don't quite know how to count female 'homemakers'. They also exclude the disabled and students. So there are all these women who are of age, not disabled and not students, who may or may not be in the labor market. It makes for an uncertain female unemployment number. They dispense with that by simply not counting females.

They also discuss the uncertainty regarding women and male students are are doing what they are doing (staying at home/ attending school) for the reason thay they couldn't find gainful employment.

They don't discuss underemployment (PT or temp workers who want/need FT permanent jobs). If you have some type of job, you are employed.

They also don't discuss wages in that particular statistic.

When it comes to manufacturing v other work, there is information elsewhere regarding total historical manufacturing v other types of jobs but you have to look pretty hard for that. (Agricultural is another category that is broken out of total employment.)

As for recent job additions to the US economy, I have not personally taken the time to see if figures are available for the types are jobs added v the types of jobs lost.

Based on overall trends, my guess is that most jobs gained are service.

Nearly everything I know I learned by the grace of others.

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Wednesday, December 14, 2005 10:30 AM

SIGNYM

I believe in solving problems, not sharing them.

I guess that depends on whether we are looking at total output, living standards, military might, regional influence, economic growth rate, environmental impact, or toothbrushes per capita.

Quote:
All this was illuminated last year in a study by a Swedish research organization, Timbro, which compared the gross domestic products of the 15 European Union members (before the 2004 expansion) with those of the 50 American states and the District of Columbia. (Norway, not being a member of the union, was not included.)

After adjusting the figures for the different purchasing powers of the dollar and euro, the only European country whose economic output per person was greater than the United States average was the tiny tax haven of Luxembourg, which ranked third, just behind Delaware and slightly ahead of Connecticut.

The reason why DC, Luxembourg, Delaware and Connecticut are so high on the scale is because they have large flows of capital pouring through them, not because of high production or good living standards: Connecticut is the haven of insurance companies, Delaware -unlike other states- allows off-shore incorporation, DC has lobbying firms connected with Washington, and Luxembourg is a tax haven. Large money changes hands there. Yet few would argue that New Haven and Washington DC have a high standard of living. The stats by themselves point out the problem of using per capita GDP as a measure of living standards: it doesn't account for money flowing into (and out of) the boundary.

And as Rue pointed out there is the problem of distribution. If you have three ballplayers sitting on the bench with an average salary of $700,000 you figure they must be pretty wealthy and have no cause to complain. But if two are making $50,000 and the third is making $2,000,000 that creates a whole different picture. Using averages is fallacious and misleading when you are dealing with unbounded values.

I know someone who has been to China several times. It has a vast and varied economic landscape. In the cities, no matter which direction you turn you will see six or seven construction cranes. In the outskirts you will see relatively modern building with primitve toilets and no AC. On the one hand, there is a mag-lev train under construction. On the other hand, road repairs are done entirely by hand and five people will wait on you in the stores because of underemployment.

China's most significant bar to becoming THE biggest per capita economy is energy (not just oil) and the next biggest is water. Unless they can solve those significant factors they will be numerically bigger than the USA in just five years or so, but per capita they will still have a long way to go. But to the other nations in the region (Japan, Koreas, Indonesia etc) China alread IS the largest economy.

------------------------
Please don't think they give a shit.

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Wednesday, December 14, 2005 12:01 PM