Is China really taking over?

[thyme4change]

I read an article in the Wall Street Journal last week that was talking about how the 1-child policy in China has started to really affect the number of young workers there are in the country. Some groups within China are worried that as their workforce ages, they won't be able to stay competitively priced worldwide. The article referenced all the same concerns we have with a population where more people are older and less are younger.

If the one-child policy was effective and is kept in place, will China really be able to take over the world economy? Or will another country come in and under-cut China's labor prices? Remember in the 70's when everything was "Made in Taiwan"? Things change.

[marshabar1]

China isn't quite natural. So much command control and artificial society is hard to maintain. Not an organic expression of human energy. Unbalanced. Not fundamentally strong.

[Deleted]

May 5, 2011 11:49:20 GMT -5 thyme4change said:

I read an article in the Wall Street Journal last week that was talking about how the 1-child policy in China has started to really affect the number of young workers there are in the country. Some groups within China are worried that as their workforce ages, they won't be able to stay competitively priced worldwide. The article referenced all the same concerns we have with a population where more people are older and less are younger.

If the one-child policy was effective and is kept in place, will China really be able to take over the world economy? Or will another country come in and under-cut China's labor prices? Remember in the 70's when everything was "Made in Taiwan"? Things change.

I heard a demographer talk about about the same thing. He said the Chinese economy would like take over the number 1 spot, but only for a short time, maybe 20 years or so. Then their labor market would not be able to handle the increased demand and jobs would come back to the US (or somewhere else) where the popluation would be primed and ready to go.

[Phoenix84]

May 5, 2011 11:57:17 GMT -5 @marshabar1 said:

China isn't quite natural. So much command control and artificial society is hard to maintain. Not an organic expression of human energy. Unbalanced. Not fundamentally strong.

Well said.

China has undergone an economic miracle, but I'm not totally convinced they're the boogymen some make them out to be. In my opinion (granted I'm not an economist) their economy does have holes and could come crashing down hard if the right conditions were met.

"Wayne M. Morrison of the Congressional Research Service wrote in 2009 that "Despite the relatively positive outlook for its economy, China faces a number of difficult challenges that, if not addressed, could undermine its future economic growth and stability. These include pervasive government corruption, an inefficient banking system, over-dependence on exports and fixed investment for growth, the lack of rule of law, severe pollution, and widening income disparities."[28] Economic consultant David Smick adds that the recent actions by the Chinese government to stimulate their economy have only added to a huge industrial overcapacity and commercial real estate vacancy problems."

[Phoenix84]

The government has in recent years struggled to contain the social strife and environmental damage related to the economy's rapid transformation; collect public receipts due from provinces, businesses, and individuals; reduce corruption and other economic crimes; sustain adequate job growth for tens of millions of workers laid off from state-owned enterprises, migrants, and new entrants to the work force; and keep afloat the large state-owned enterprises, most of which had not participated in the vigorous expansion of the economy and many of which had been losing the ability to pay full wages and pensions. From 50 to 100 million surplus rural workers were adrift between the villages and the cities, many subsisting through part-time low-paying jobs. Popular resistance, changes in central policy, and loss of authority by rural cadres have weakened China's population control program. Another long-term threat to continued rapid economic growth has been the deterioration in the environment, notably air and water pollution, soil erosion, growing desertification and the steady fall of the water table especially in the north. China also has continued to lose arable land because of erosion and infrastructure development.

Other major problems concern the labor force and the pricing system. There is large-scale underemployment in both urban and rural areas, and the fear of the disruptive effects of major, explicit unemployment is strong. The prices of certain key commodities, especially of industrial raw materials and major industrial products, are determined by the state. In most cases, basic price ratios were set in the 1950s and are often irrational in terms of current production capabilities and demands. Over the years, large subsidies were built into the price structure, and these subsidies grew substantially in the late 1970s and 1980s.[27] By the early 1990s these subsidies began to be eliminated, in large part due to China's admission into the World Trade Organization (WTO) in 2001, which carried with it requirements for further economic liberalization and deregulation. China's ongoing economic transformation has had a profound impact not only on China but on the world. The market-oriented reforms China has implemented over the past two decades have unleashed individual initiative and entrepreneurship.

By 2010, rapidly rising wages and a general increase in the standard of living had put increased energy use on a collision course with the need to reduce carbon emissions in order to control global warming. There were diligent efforts to increase energy efficiency and increase use of renewable sources; over 1,000 inefficient power plants had been closed, but projections continued to show a dramatic rise in carbon emissions from burning fossil fuels.[54]

en.wikipedia.org/wiki/Economy_of_the_People%27s_Republic_of_China