

America on the Rise? - cwan
http://www.newgeography.com/content/001408-americas-dubious-decline

======
dkimball
I would add that China faces the prospect of, to say the least, internal
political instability. Like all postmodern authoritarian governments, theirs
is based on the idea that in exchange for sacrificing freedom and autonomy,
the population will get very rich -- so if they don't deliver on the wealth,
they'll face a great deal of restiveness.

While a few provinces are doing well (Guangdong most prominently), inland
China is still very backwards -- and, reportedly, increasingly disgusted with
the government. The one-child policy is still enforced there, brutally;
despite the almost complete lack of journalists' access to mainland China,
I've heard reports of spontaneous, armed "mutinies" among the populace --
attacks on government officials, on account of the one-child policy, or over
taxes, or for whatever reason.

China is less politically stable than it looks; for all we know, the next Liu
Bang or Zhu Yuanzhang may have already taken to the hills. And if you think
that the Chinese government can't possibly collapse _now_, that we'll never
see a period of good old-fashioned Chinese interregnal warlordism in the 21st
century, I remind you that we saw one in the 20th, when it was equally
anachronistic and inconceivable -- the most chaotic period of the Five Races
Under One Union was the 1920s, contemporary with the Wiemar Republic and _The
Great Gatsby_.

Of course, China eventually becoming powerful is almost inevitable; sailormoon
points out that their sheer numbers argue for that, especially when combined
with a culture which, though nominally Confucian-Legalist, has a very real
"go-getting" idiom. This is the other side of China: the brash, independent
style of the world of mountain and river, ultimately tracing back to the xiá
(侠), the knights of the feudal Zhou dynasty. It may be some time before this
happens -- their current postmodern authoritarian government has to either
reform or be overthrown first, I think -- but it will arrive.

For further reading, look up Boye de Mente's _The Chinese Have a Word for It_.

~~~
netcan
_Like all postmodern authoritarian governments, theirs is based on the idea
that in exchange for sacrificing freedom and autonomy, the population will get
very rich -- so if they don't deliver on the wealth, they'll face a great deal
of restiveness._

Mybe you're right but, I think that the reason most people think this is
because _they_ are disgusted with the Chinese system and therefore are quick
to conclude that it is bad and failing in every other way. It is less table,
for example.

The truth is that any system that fails to provide growth, internal peace or
fails to meet expectations is probably at risk. Looking far enough into the
future (say, 50 years), any system is at risk.

~~~
dkimball
I agree that any system that fails to provide growth is in a certain amount of
danger. For what it's worth, I try to remain objective in appraising China's
situation; I'm not exactly delighted with them, but I try to avoid being
actively disgusted, or at least to avoid letting my disgust get in the way of
my appraisal of the situation.

I continue to think, though, that "postmodern authoritarianism" (my phrase,
but I'm sure it's been coined elsewhere) is more vulnerable than most other
systems of government, because the whole implicit promise involved here is
that the people will sacrifice certain desiderata in exchange for certain
others. When a medieval state failed to provide prosperity to its people, they
weren't happy and often became restive, but the damage was mitigated by its
being the judgment of God; when the United States faced extreme difficulties
in the Great Depression, the rate of crime went down, not up (with some
obvious fedora-wearing exceptions), as most of the population was loyal to
itself and saw the government as an extension of itself; when Imperial Japan
instituted strict rationing and drafted large numbers of soldiers in the
Second World War, their credibility was not at risk at all, since all these
were sacrifices for a cause, for the will of Amaterasu.

But a postmodern authoritarianism doesn't have a reason for its citizens to
remain loyal, it doesn't have a higher goal for them to work for, and it
doesn't have an external cause (or an external enemy: I didn't mention the
Nazis above, but I could have) to be blamed for its problems. Its whole social
contract is "give up on certain freedoms and you'll be rich!", so when that's
no longer the case, the government is in trouble.

In fairness, though, this may not be the case in China as much as in Russia.
The United Russia party's platform has been more or less explicitly this: "let
us stay in power and we'll restore the prosperity, military might, and
international prestige of Russia." Communist China doesn't really have a
"platform" of this sort, especially now that they're "CINOs" (Communists In
Name Only) in the post-Deng Xiaoping era; so economic failures might not
discredit them as much or as quickly, but, on the other hand, they're still
not going to have much of a flag to rally around.

------
mhartl
_Japan . . . was and remains a stable, functioning democracy . . . China is a
fundamentally unstable autocracy_

Why is this obviously wrong assumption about the stability of democracy vs.
autocracy so pervasive? Stable democracies (USG) are stable, unstable
democracies (Weimar) are unstable; stable autocracies (Louis XIV) are stable,
unstable autocracies (Louis XVI) are unstable. As a criterion for good
government, _stability_ simply doesn't give you a clear reason to choose one
form over the other.

~~~
golwengaud
I think the argument is that democracies tend to be more stable. Weimar was an
attempt to patch together a democratic successor to a fairly authoritarian
state, and Louis XIV's rule was at best metastable. Near the end of his reign,
the War of the Spanish Succession (among other things) was causing France to
begin to run into the financial difficulties that would cause Louis XVI
trouble.

More generally, if Amartya Sen is right
(<http://en.wikipedia.org/wiki/Amartya_Sen#Research>), democracies are rather
less likely to do things that would lead to popular unrest.

~~~
mhartl
I agree that people _argue_ that democracies are more stable (though usually
they just assume it), but the lists of unstable democracies and stable
autocracies are both incredibly long. At the very best, there may be a rough
correlation between stability and democracy; I rather suspect an anti-
correlation, but in any case I don't see anything that would justify the
blithe yet pervasive confidence of democratic stability exemplified by the
assertion quoted in my original comment.

------
discolemonade
The British Empire lasted over 300 years. America as an Empire has been around
for only around 100. The American Empire is like the British Empire squared
because of its endless capacity for self-renewal. It's like a starfish that
regenerates limbs. One of the things that makes it so dynamic is the great
universities and their relationship with business. No Chinese university is
even in the top 200 in the world. Of the world's top 20 universities, all but
three are American. Of the top 50, all but 11 are in the U.S. And then you
think about a concept like the "new economy". It's an American invention. Most
of the best startups and the best software are made in America. In just about
every measure of soft power, nobody compares.

~~~
ippisl
I'm not sure universities and start-ups matter that much.Israel is great at
doing start-ups , probably better than the u.s.(at least at start-ups per
capita). but usually the start-ups get bought by multinationals, so they get
the job creation and economic power that comes with those innovations. not
necessarily Israel.

While historically most big multinationals were centered around the u.s., this
might be changing. The shift in multinational jobs to outside the u.s. is one
datapoint. and the rise of strong non u.s. multinationals is another.just look
at the Chinese green energy sector.

And take into account that change today is much faster then at 19 century
Britain.

~~~
discolemonade
How do universities and startups not matter? They're incubators of knowledge
and wealth creation. And regarding multinationals, most of the biggest
multinationals are either Japanese, American or European. Places like China
and Indonesia do a lot of the manufacturing for them, but most of the wealth
still flows back to the countries where the knowledge for that technology is
developed. Most of Apple's wealth is concentrated in the U.S because that's
where Apple's knowledge creators are based. Same with Nokia or Toyota or any
company. The world isn't totally flat despite what Tom Friedman thinks.
Pockets of innovation will always exist. I think India is a better example of
a developing power with a strong innovation base than China is.

~~~
ippisl
1\. while money flowing back to companies is important , job creation and
unemployment are important components of economic power in my view. 2\. There
are several dozen Chinese companies that will eventually join the exclusive
500 club. That could happen within the next 10 years or even less. Currently,
15 Chinese companies are already in that club, including several telecom
operators, four banks and State Grid, China Life, BaoSteel, and SAIC, the
Shanghai based auto maker. They are all state-run. 3.The company who scales up
a technology usually wins most of the money , not the inventor(Google didn't
invent contextual advertising, just did it better and at bigger scale).And if
the startup is in one country , and the big company in another as usually
happens in israel ,most of the gains do not come to the inventing nation. 4\.
Chinese companies can buy startups if they want.Chinese companies recently
surpassed Germany's to become the world's No 2 in terms of acquisitions,
having spent $21.8 billion on such moves. I think there's less into software
companies and more into other stuff.

------
nradov
For a counterpoint see this Atlantic article: "How a New Jobless Era Will
Transform America". <http://www.theatlantic.com/doc/201003/jobless-america-
future>

_Phelps and Tilman finger several culprits: a patent system that’s become
stifling; an increasingly myopic focus among public companies on quarterly
results, rather than long-term value creation; and, not least, a financial
industry that for a generation has focused its talent and resources not on
funding business innovation, but on proprietary trading, regulatory arbitrage,
and arcane financial engineering. None of these problems is likely to
disappear quickly._

------
steveplace
Sentiment in American (and other places) is cyclical. The populous has high
points and low points. The top was just before 9/11 and we're pretty close to
the low point (I'd say March did it). March sucked, it was the end of
capitalism, guns were being stockpiled, and so on. We're on our way to a new
cycle-- assuming you don't believe what zerohedge and reddit say.

America sucks sometimes. We've got deficits, health care problems, and a
hijacked government. And yet with all this going around, immigrants are still
begging to be let in.

One of the main advantages over China is that we own shit. We have material
reserves in lumber, coal, natgas, etc. So when you hear that China's SWF just
bought out another mining operation in Africa, it's not because their looking
to difersify, it's that they don't have any decent natural resources of their
own.

If you need to feel happy, don't read reddit or watch the stock market for a
month.

------
pyre
> _Looking over the next few decades Will sees an aging, obsolescent America
> in retreat to a young and aggressive China._

China seems to put so much emphasis on their being a '3000 year old country'
so I think we should take them up on that and stop calling them 'young.'

~~~
papersmith
"China" or "Middle Kingdom" as it's called in China, was historically a fairly
vague concept. It was popularized in the 20th century by Sun Yat-sen to refer
to the 56 ethnic groups the republic inherited from the Qing empire (Han,
Manchurian, Mongolian, Tibetan, Uighur being the major ones).

The 5000-year history refers to the lineage of Han culture in particular. For
example, in Japan where most if its Sinic influence was before the republic,
Chinese medicine is called Han medicine (Kampo 漢方), Chinese writing is called
Han script (Kanji 漢字).

<http://en.wikipedia.org/wiki/Chinese_nationalism>

I believe when people describe to China as young, they are either referring to
the 1911 republic, the 1949 republic, or the 1978 reform.

~~~
pyre
I understand what people mean when they are calling China 'young.' My comment
was a bit of a snarky commentary on how China seems to pull out this "we're a
3000-year-old country" line whenever someone criticizes them. Such a response
is of laughable logic since the government -- which is what most people are
criticizing -- is far younger than 3000 years.

(I keep saying 3000 years, because I'm pretty sure the number I've seen used
on multiple occasions is 3000, not 5000. I'm not sure from what point in time
-- other than the obvious '3000 years' -- they are calling the start of this
period to which they are referring, though.)

~~~
papersmith
3000 years is about how long China existed as a state that passed from one
dynasty to another in recorded history. 7000 years is how old the civilization
is according to archeological digs, though for a long time they thought it's
5000 years, so 5000 kinda got stuck as a catchphrase.

But yeah, pulling the age card as a comeback is pretty lame sometimes.

------
bob321
The article seemed... confused. China is predicted to surpass the US not in
per-capita income/wealth, but in total economic power. China doesn't need to
reach a PPP GDP/capita of $46k to surpass us, but of around $15k. China will
have a very hard time reaching the US $45k.

The core macroeconomic trend is that communications is getting cheaper. We can
talk to people around the world essentially for free. We can ship things
pretty darned cheap. Right now, an engineer in the US makes about 10x the
salary of an engineer in China or India. Unskilled labor in the US makes
40-100x unskilled labor in China and India. This is unsustainable. US workers
are more productive, but not by this large a factor. Wages have to come closer
to equalizing. Wages here may be a factor of 2x greater than there, due to
better education, infrastructure, more natural resource, etc., but not
10x-100x greater.

This means income disparity in the US will grow, while income disparity in
China and India will shrink. The wages will come closer together. With 3x the
population, China will pass the US as an economic power in the not-too-distant
future, and India will most likely do the same a couple of decades later.

China's government is overstated as a problem. The Chinese are, by and large,
happy with its government. Government control of the internet is annoying to
human rights, but doesn't impede economic progress in any way. The government
errs on the side of less, rather than more, control. The core effect is that
getting information on Tienanmen or Taiwan or whatever is annoying, lost in a
sea of noise, and practically few people do it. It's much like getting
information on the US monetary system, or how lobbyists control the
government, or dozens of other issues affecting Americans. They are public
scandals that no one knows about; they are not reported by the media, and the
information gets lost in a sea of noise of conspiracy theories.

------
metamemetics
[http://www.businessinsider.com/chinese-stimulus-spending-
con...](http://www.businessinsider.com/chinese-stimulus-spending-constructed-
an-empty-city-in-the-middle-of-nowhere-2009-11)

"Chinese Stimulus Spending Constructed An Empty City In The Middle Of Nowhere"

check out THAT housing bubble lol

------
aresant
Finally some data to back-up what I inherently feel every time I visit hacker
news: the US has a HUGE resource in the up-and-coming generation (and of
course our friends around the world that participate!)

I loved this article, thanks for sharing.

~~~
zoba
One thing that excites me when I worry about the US losing its status is how
competitive young people are.

College admissions are absurd, and good grades are a necessity. People take
the SAT several times just to get a slightly higher score. Kids are fighting
really hard to get into good schools, and so when I think of the younger
generation being video gaming, tweeting, facebook addicts, I'm also happy to
remember how much harder we work at school than our parents did.

~~~
joe_the_user
The question is whether the competitive ethos of young people is aimed at
improving their relative position or whether they also aim to improve this
society as a whole.

(Anecdote Warning): My cousin at BP tells a story of rising executive who was
fired for stealing a PC from work. She was nonplussed because his eventual
salary would have made the cost of a PC nominal but he thought he deserved
more _right now_ \- not a good story of "millennials".

~~~
avdempsey
Watching cable tells a story of a generation that decided to fight a trillion
dollar war without including the price tag in the national budget...pushing
the cost onto future generations of Americans. Not a good story of "pre-
millennials".

~~~
joe_the_user
Indeed, the question is whether things are improving...

------
gxs
Past performance is not indicative of future success.

Even if the article were true, I think a little fear of your competition is
healthy. I like how people are sweating it. I hope it spurs innovation and
growth here at home.

------
sailormoon
I don't buy it. The whole premise is confused. On the one hand, the author
makes some well-founded points about Japan's demographic situation, which is
indeed pretty dire if gross numbers of working-age citizens are what you're
predicting. China is in a similar boat, it's true, with the one child policy.

But Japan's downfall had little to do with demographics and a lot to do with
an unsustainable bubble economy writ very large indeed. The problems with
Japan are manyfold, you could write a very long essay just covering the major
points, but basically boil down to cultural risk-averseness. There are not
many entrepreneurs in Japan. The country needed to re-invent itself and
failed.

China could not be more different. Many, many Chinese are entrepreneurial,
brash go-getters. Whereas Japan is all about social harmony and "wa" and not
rocking the boat, Chinese are the most capitalist people imaginable and a
brief visit to basically any Chinese city will convince you utterly of this
fact. I don't think you can compare the two at all.

It's true China has some systemic problems. If the banks' account sheets were
audited properly I bet many of them are in the red, deeply. There is
corruption and nepotism and all manner of petty inefficiencies imposed by
officialdom. But the raw productivity cannot be denied.

The author also assumes the instability of the Chinese government. He/she
seems to take this as a matter of faith - I see no signs of instability. If
the government can raise people from poverty into a decent middle class - and
they are doing an outstanding job of this - then their position is assured.
The rich do not revolt.

I also have questions about the whole idea that more workers is what is needed
to assure economic success. While it's true Japan's youth are dwindling in
number, there is by no means a worker shortage in that country. If there was,
wages would be high. They are not. There is plenty of youth unemployment. The
growing automation of any number of industries may make all those idle youth
obsolete. It may well turn out that in the future, less workers are needed,
not more. And it's not as if America's teeming masses are particularly well-
skilled. What will happen when a robot can flip the burgers? It's not too far
off.

I could go on and on but basically I think the article makes an awful lot of
assumptions and comes off as wishful thinking. I am not about to bet against
America, but I wouldn't exactly sell my shares in China just yet either. I
doubt China will rocket up to dominate the world like the breathless
predictions of "sinophiles" but I can't see too many alternate futures where
they don't have the largest economy by 2050. It's pretty hard to beat a 400%
larger population no matter how much "sokojikara" you have.

~~~
steveplace
_but basically boil down to cultural risk-averseness._

That's not why Japan fell.

<http://en.wikipedia.org/wiki/Japanese_asset_price_bubble>

Also, China may be the start of a new bubble-- there's more rooms being built
in CRE than there are people.

~~~
sailormoon
Yes, the asset bubble was a major - perhaps the primary - cause of the
collapse. But what I was talking about was the failure to recover. Basically,
after the crash the government had to step in and force the banks to write off
their losses, stop lending to failed companies, start lending to new ones, and
get the green shoots growing again. They just couldn't do it. Just why they
couldn't is the subject of countless books and essays but the result is not
contested - Japan needed painful, wrenching reforms, and never got them.

Risk-averseness is probably the wrong word to describe this phenomenon but I
didn't know how else to put it. Basically there's a cultural tendency there to
try to keep the status quo at all costs. Risk averse, resistance to change,
unwillingness to step up and be the one who proclaims the nakedness of the
emperor - call it what you want, but what it boils down to is they needed to
make a hard decision, and in the end, couldn't. Whether or not other countries
could have is a matter for further discussion!

 _there's more rooms being built in CRE than there are people._

CRE? I presume you mean Chinese Real Estate? Really, there's over 1.3 billion
rooms being built? I'm going to need a citation for that. It seems
ridiculously high and, indeed, impossible.

------
tybris
I, for one, welcome our existing American overlords.

but more seriously, I'm not that sure the 21th century will be decided by
population size. The level of American consumption is already unsustainable.

~~~
noonespecial
It occurs to me that the level of American consumption has _always_ been
unsustainable in the long term given the contemporary technology at any given
time. New York city was on the verge of uninhabitable because of all of the
horses and their needs before Mr. Ford got his groove on.

The best that can be said is that the level of American consumption is
unsustainable given the current level of technological development. What I
think has made America such a singularity on the world stage is that the
Americans have been able to use innovation to stay just a tiny bit ahead of
"unsustainability" and do so with remarkable consistency.

