Home | News & Opinion | Hey wait, I thought China was going to overtake the US THIS YEAR?

Hey wait, I thought China was going to overtake the US THIS YEAR?

By
Font size: Decrease font Enlarge font
Hey wait, I thought China was going to overtake the US THIS YEAR?

Hey wait, I thought China was going to overtake the US THIS YEAR?

For heaven’s sake.

Last May, the World Bank garnered many headlines and much hand-wringing with its proclamation that China would replace the United States as the world’s largest economy this year.  At that time, I wrote the following:

 “The U.S. is not the tail that wags the dog, but is more often than not the dog that wags the tail."

The old cliché that there are lies, damned lies and statistics has never been more relevant. In order to arrive at its conclusion, the World Bank has had to use a measure that is highly dubious – the respective countries’ purchasing power, unadjusted for exchange rate differences. For a variety of reasons, this measure obscures more than it illuminates.

Even the Chinese government disagrees with it – although that mendacious government has a lot of reasons to do so.  By continuing to portray itself as an “emerging economy”  (emerging from what, one must ask; it’s the second largest economy in the world), China can ward off calls for better environmental stewardship, first-world labor protections, monetary transparency and consistency, and all the other practices that first-world economies embrace.

But, nevertheless, the simple fact is that US GDP is nearly twice the size of China’s, and that the average Chinese citizen has about one tenth the amount of money to spend as the average American.

I went on to point out that we do, indeed, face challenges, and that we needed to get our house in order, etc.  But the notion that China would shove us aside for the top spot in the world’s economic standings in the next few months was, I said, nonsense.

Well, behold one of today’s headline stories in Bloomberg:

US Still The Dog Wagging Tail of World Economy As China Slows

Imagine that.

In the article, JP Morgan economist Joseph Lupton is quoted as saying “The U.S. is not the tail that wags the dog, but is more often than not the dog that wags the tail. It’s a big economy, it’s a big domestic-demand engine that drives trade flows.”

I couldn’t have said it better myself.  I repeat the close of my previous column: 

For now, China can wait.

Share this:

 

 

 

Join PRESIDENT&CEO on LinkedIn

Subscribe to comments feed Comments (0 posted)

total: | displaying:

Post your comment

  • Bold
  • Italic
  • Underline
  • Quote

Please enter the code you see in the image:

Captcha
Angus DuBois
Angus DuBois
Contributor
Angus DuBois is the nom de plume of an entrepreneur of 20 years who, in cowardly fashion, prefers to keep his/her business identity a secret. Comments can be forwarded to angus@nexxuspublishing.com.

More from Angus DuBois