Whether you look at China's economic rise with hope or worry, counting your chips before the last bet is never a good idea:
As the Global Trends report notes, predicting the future is “an impossible feat,” but spotting the flaws in this report is quite easy. For one thing, its recommendations rest on a flawed premise, that “China’s current economic growth rate” is “8 to 10 percent.” ...
By far the best indicator of Chinese economic activity is the production of electricity. In the third quarter of this year, the average monthly increase in electricity production was just 2.1 percent. And electricity growth was on a downward trend at the end of the quarter. In September, the growth of electricity was just 1.5 percent. ...
The downward trend evident from the electricity statistics is consistent with manufacturing surveys, corporate results, and price indexes. Capital flight is another telltale sign that the economy is in distress.
Worse for China's prospects, China's one-party dictatorship rests on economic progress. And faltering economic progress may require opening up society just when control cannot allow for any more opening. China has gotten perestroika without glasnost, so far. But China started from a much lower level than the USSR did. It may not be possible to fix the economy without sacrificing party control of the government and military.
Worse still, Peking's Plan B seems to be anti-foreigner nationalism.
Assuming our recent economic problems and demographic dip aren't long-range trends that save China from their deomographic trends, China might already be living in their Golden Age that will pass back to us--or someone else, I suppose--sooner or later.
