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World Association of International Studies

Post Chinese Progress?
Created by John Eipper on 12/28/14 4:25 PM

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Chinese Progress? (Tor Guimaraes, USA, 12/28/14 4:25 pm)

Richard Hancock (27 December) shared with us some interesting thoughts: "We sometimes believe that China is a juggernaut which is rapidly going to surpass the US as the world's No. 1 superpower, [but] in my opinion, China is about in the same phase as the US was in 1932 when FDR was elected president and began his New Deal that gave workers social security, unemployment compensation, and set wage and production standards for industry."

I agree with Richard's comment that "as workers achieve a better standard of living, it will be more difficult for China to continue ignoring Roosevelt's Four Freedoms enunciated in a speech before Congress on January 6, 1941--freedom of speech and religion, freedom from want and fear." In fact, many very well-informed people believe that maintaining social harmony when large segments of the Chinese population experience economic/financial benefits at significantly different rates is the most serious challenge to the Party's rule.

Contrary to what Richard opined, comparing China today with the US in 1932 is an impossible task, given the large number of variables which must be considered. Nevertheless, based on my own social, political, and economic estimations, for how long must the present trends in their favor and against us continue for China to clearly overtake us as "the world's No. 1 superpower" depends on what both sides do. To me, it will all be about what both sides do to their respective middle classes. If Mr. Magnier of the WSJ is correct in saying that "the ground is shifting in favor of workers, ... forcing companies to offer better conditions. Wages for migrant workers have increased at double-digit rates since 2010, reaching 2,609 yuan ($423) a month last year," and the US government continues to allow its middle class to get weakened (watering down Roosevelt's Four Freedoms), then China will overtake the US sooner rather than later.

On the other hand, if the Chinese government mimics the US government in the last few decades and allows the Chinese middle class to stagnate to the benefit of corporate/elite profits, then China may never surpass the US.

JE comments:  Also, there is the factor of China pricing itself out of the labor market.  Isn't cheap labor the only real advantage China enjoys at present?  Even cheaper nations (Vietnam comes to mind) are eager and willing--and there is the "race to the bottom" in the US, which is making this nation's manufacturing more competitive.

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