China’s stock market has crashed. Its economy is struggling, and there are obvious signs of malinvestment.
Libertarians and American jingoists both are rejoicing. Libertarians feel vindicated, declare only Austrian economics could develop a society. Meanwhile, the jingoists shout, “America über alles!”
However, China has enjoyed economic success in part by rejecting Adam Smith for Friedrich List. If China had embraced Smith, its economy might look like free-trade Australia: Little more than an agricultural and mining colony.
And while the American economy remains number 1, for now, its growth strategy has been to pump in the maximum number of people which leads to: diminishment of wages and quality of life, dispossession of the previous inhabitants, exacerbation of wealth gap. America’s future is to fall increasingly into third world status as diversity, overpopulation, and diminished human resources overwhelm the society.
Yes, an aging population is a relevant burden on America and China, but unlike Japan both the US and China have resources. And China has an intelligent, largely homogeneous population. America does not.
For years Europeans have embraced bad ideology, rejecting all that came before the Enlightenment. And Europeans, as a race, are on the decline. Perhaps we could learn something about survival from Asia.:
*Homogenous populations are a positive.
*Unnecessary foreign intervention will bankrupt a society. (Japan’s low military budget was part of its early success.)
*Trade protections can work.
*The greed of investors will eat a society if allowed to.
After World War II, America was not simply the lead economy. America *was* the global economy. And China was the “Sickman of Asia”. Today these roles are reversing.
China is wrong on many things, but the same can be said of any human society. China’s critics do not wear clothes, meaning they offer worse alternatives (America and Austrian economics).
A note of bias: You can count me in a quasi-ideological camp: I believe smaller societies are generally better and more durable. And this ideology is perhaps rejected somewhat by the success of the Chinese megastate. There’s much to be said for Chinese economy-of-scale and potential autarky.