Lestat. You would like the government to control everything. That is a communist system and good look with it. I believe in the free enterprise system that existed here prior to 1913 with no central bank and no income tax. I would not be bailing out Northern Rock on the backs of poor people. Thankfully a good economic lesson is at hand now. Next week you will see calls for even more taxes. A bit of starvation will test your mettle.

Lestat wrote:

The picture you and Kate P paint is not one of a country that is going to replace the US as the economic engine of the world.

It already has, the Chinese contribute more to global output growth than a slowing US economy.

youngdan wrote:

Lestat. You would like the government to control everything.

Government must control everything. That is it's function. It's how democracy works.

youngdan wrote:

That is a communist system and good look with it.

Communism advocates society without any form of government which is what you are advocating.

youngdan wrote:

I believe in the free enterprise system that existed here prior to 1913 with no central bank and no income tax..

The US introduced Income Tax in 1861 to pay for the Civil War.

youngdan wrote:

I would not be bailing out Northern Rock on the backs of poor people. ..

Northern Rock is a British bank. And it had to be baled out for the sake of poor people.

youngdan wrote:

Thankfully a good economic lesson is at hand now. Next week you will see calls for even more taxes. A bit of starvation will test your mettle.

I could do with losing a few pounds.

Ard-Taoiseach wrote:

It already has, the Chinese contribute more to global output growth than a slowing US economy.

I don't see China overcoming it's internal problems to maintain that economic growth.

Ard-Taoiseach wrote:

Lestat wrote:

The picture you and Kate P paint is not one of a country that is going to replace the US as the economic engine of the world.

It already has, the Chinese contribute more to global output growth than a slowing US economy.

Lestat, you suggest that it's the internal problems that will prevent China maintaining that growth. I'd be inclined to disagree. The biggest problems that China faces will never be internal, because there will always be a workforce willing to work for very little money and there will always be a class of people who spend every cent they have on the best education they can afford for their child. If you visit Beijing, you'll notice that you don't see a certain type of teenager hanging around - they're all working and studying and bettering themselves. Middle class kids don't play, they study.

The threat to China I would argue comes from outside because of an increased awareness of human rights violations and the reluctance of outsiders to be associated with that. Balancing the economic advantages of investment in China with the disadvantages of being seen to take advantage of those advantages is a tricky tightrope walk.

I base this on discussions with a friend who works for a massive multinational who says that both his company and others in the same field (it's tech based) are being requested by their customers to provide them with product that has not been produced in China because of human rights and workers' rights concerns. He says they've had to shift some production back to Europe as a result. It's quite startling, I know.

That, however, doesn't prevent China from using its own resources in the way it sees fit for its own best advantage.

Lestat. Over here when we refer to the income tax it is understood that we speak of the 16th Amendment to the Constitution which dates from 1913. In much the same way when we speak of the central bank it is understood that we are talking about The Federal Reserve and neither of the other 2 central banks.
Do you understand how bailouts lead to inflation.

youngdan wrote:

Lestat. Over here when we refer to the income tax it is understood that we speak of the 16th Amendment to the Constitution which dates from 1913. .

Yeah? Well you're wrong. Again.

Kate P wrote:

Lestat, you suggest that it's the internal problems that will prevent China maintaining that growth. I'd be inclined to disagree. The biggest problems that China faces will never be internal, because there will always be a workforce willing to work for very little money and there will always be a class of people who spend every cent they have on the best education they can afford for their child. If you visit Beijing, you'll notice that you don't see a certain type of teenager hanging around - they're all working and studying and bettering themselves. Middle class kids don't play, they study. .

Again you are assuming that what is true today will always hold true. Chinese workers will start to demand the standards of living that they see in the west. They'll want consumer products, night clubs and fast food restaurants. With that will come the demand for better pay. If they don't get them in China they will emigrate. But that aside , with China's population predicted to start declining (hopefully) then the population will inevitably start to age and consequently the most productive sector will start to shrink and the least productive start to increase. Also China doesn't produce enough energy for it's industrial needs, has a relatively poor transportation network, it's agricultural output is falling and it's over polluted.

Kate P wrote:

The threat to China I would argue comes from outside because of an increased awareness of human rights violations and the reluctance of outsiders to be associated with that. .

OK, but as China is forced to become a freer society it leaves itself open to separatists- Tibetans and the Uighurs in Xinjiang for instance. Not alone that but India, as Squire, pointed out, is set to overtake China in population growth. And India also faces many of China's problems, including feeding it's people. Having two overcrowded and hungry, nuclear-armed neighbours jostling for the same space is not an encouraging thought.

Lestat. Do you know what the 16th Amendment is, even. Can you figure out how bailouts affect inflation. You come on and say the income tax system was not set up with this amendment and even a 4th grade schoolchild realises you don't even know the basics.

Lestat wrote:

Squire wrote:

But surely that happens often enough today and in the past. There are many countries with starving people which export food.

Such as?

Many countries in Africa, in fact almost all countries where people starve also export food. It happened in Ireland and the attitude that allowed that to happen here still exists.

Lestat wrote:

Squire wrote:

....India would take considerable measures to avoid famine, in China some may even welcome it.

Aren't you contradicting your own argument.

No they will buy what they can, but do not expect them to shed tears if there is famine, unless that famine threatens internal stability.

Lestat wrote:

Squire wrote:

The problem is not China feeding itself but them and us buying up food on the world markets resulting in famine elsewhere. .

The picture you and Kate P paint is not one of a country that is going to replace the US as the economic engine of the world.

I think you are looking at this from a very Western perspective. China, India and Russia do not have to generate world trade. Why should they feel obliged to do so? What they need to do is build their own countries and that does not necessarily need to involve us except as a place to export to and drain wealth from. There is very little that we can sell them that they cannot produce cheaper at home. That is the stark reality.

The USA is hell bent on destroying its economy, you can't print money forever. So as it declines which countries start to become more prominent? The EU, couldn't agree on the shape of a banana, Russia has to much to do at home and has a resource based economy, India does not really have an expansionist mentality. If you take a trip to Africa you will find that Chinese influence is on the rise in that region. Chinese economic influence is expanding but more in the form of securing resources for home production.

Squire wrote:

Many countries in Africa, in fact almost all countries where people starve also export food. .

Which countries in Africa?

And are you talking about wide spread famine or just people who are too poor to eat well? I'm sure that there are quite a few people who will go to bed hungry tonight in Ireland but that isn't starvation. Starvation is your Ethiopia-Feed-the-World type crisis where there literally is nothing growing.

Squire wrote:

China, India and Russia do not have to generate world trade..........
that does not necessarily need to involve us except as a place to export to and drain wealth from.

You're contradicting yourself again.

Squire wrote:

There is very little that we can sell them that they cannot produce cheaper at home. That is the stark reality.

Apart from food apparently.

Squire wrote:

Chinese economic influence is expanding but more in the form of securing resources for home production.

Exactly. So we don't need to learn Chinese at all then since they have nothing that we need.

Lestat wrote:

Exactly. So we don't need to learn Chinese at all then since they have nothing that we need.

Fancy a 'Sweet & Sour'.

What exactly is the general point that you are endeavouring to make?

Lestat wrote:

Ard-Taoiseach wrote:

It already has, the Chinese contribute more to global output growth than a slowing US economy.

I don't see China overcoming it's internal problems to maintain that economic growth.

Whatever about that, the point remains that China is the engine of world growth. The US consumer kept the States as the engine of world growth till 2005/06. Ever since last year, China has replaced the US as the world's economic engine. It is likely given its consistent ability to beat growth forecasts, overcome deflationary government policies and remain a vibrant dragon that it will remain the world's central economic actor well into the next decade.

What is the difference between famine and people being too poor to eat? Can anybody think of a famine in the last 200 years where rich people starved?

As for Chinese having an equally imperialistic history, that is probably true if you view matters over a number of millenia though most of the expansion was within China. In any event, China is now ruled by anti-imperialist Communists and has a history of being the victim of imperialism over the last 200 years or so. That is not to say that China didn't have the goal of spreading communism to other countries. However to suggest the the Chinese are going to have a crisis of conscience and to see themselves as imperialists is a bit far-fetched imho.

Also, as far as the Chinese are concerned, their forays into Africa and elsewhere are based on non-intervention in political matters. That is most likely a pragmatic move to make them more palatable to the locals.

As regards China's economic future and internal problems, one would need a crystal ball to know how things will pan out. The fact is though that Lestat's analysis is courageous in that it flies in the face of the prevalent view amongst commentators and economists that China is the economy most likely to be dominant in years to come, together with India and Brazil. I myself agree with the commentators, especially having seen the manifestations of Chinese nationalism at the time of the upheaval in Tibet.