The Myth of China Surpassing the U.S.
Note: This is an article variation of Peter St Onge's video, China "will never catch up to US".
For the longest time, the narrative has been that China's economic ascent is unstoppable and that it's only a matter of time before it dethrones the United States. That may no longer be the case, as Peter St Onge, Ph.D., reveals in his latest video titled "China 'will never catch up to the U.S.'"
Is China's Growth Sustainable?
St Onge argues that China's rapid expansion isn't as solid as it seems. According to him, the Communist Party's investment in politically favored industries has led to an unhealthy concentration of capital. "China channeled trillions to politically favored industries, leading to both manufacturing and property sectors now in free fall," St Onge states. These two sectors alone account for half of China's economy, resulting in rising unemployment rates and bank failures, both indicating a volatile financial landscape.
Structural Challenges and Demographic Shifts
It's not just the economy; China also faces deep-seated structural challenges. A recent report from Bloomberg cited similar concerns, predicting slower growth for China for decades to come. St Onge notes that China's stringent one-child policy, which has become a social norm, has led to an unsustainable population pyramid. "China is currently sporting 1.09 births per woman. If this continues for three generations, China's population would drop eightfold," he elaborates.
Political Landscape in China
However, St Onge also points out that China's authoritarian governance could change. "Xi Jinping himself has a lot of opposition inside the Chinese government, despite building a personal police state," says St Onge. This suggests that the country might see a shift in its leadership sooner than anticipated, which could alter its economic policies.
The Changing Global Balance
St Onge further contends that its influence will remain significant even if China faces lean days ahead. However, he warns the West against complacency. "Unless the West reverses its rapid plunge into socialism, the Asian policy mix will win, whether or not China's on board," he says.
A Different Perspective
St Onge sees promise in other Asian economies like Korea, Singapore, and Taiwan, where economic prosperity is nurtured as a social safety net. "It leads to stability and prosperity, rather than today's West which crushes the real economy to buy votes or to fund activists who prefer to burn things," St Onge concludes.
In this age of shifting paradigms and economic uncertainties, keeping an eye on China is more crucial than ever. The country's influence may not be as inevitable as previously thought, leading to re-evaluating long-held beliefs about global economic leadership.