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The Default Power
Summary -- Since the United States first became a global superpower, it has been fashionable to speak of its decline. But in today's world, the United States' economic and military strength, along with the attractiveness of its ideals, will ensure its power for a long time to come.
JOSEF JOFFE is Co-Editor of Die Zeit, a Senior Fellow at Stanford's Freeman Spogli Institute for International Studies, and Marc and Anita Abramowitz Fellow in International Relations at the Hoover Institution at Stanford University.
Every ten years, it is decline time in the United States. In the late 1950s, it was the Sputnik shock, followed by the "missile gap" trumpeted by John F. Kennedy in the 1960 presidential campaign. A decade later, Richard Nixon and Henry Kissinger sounded the dirge over bipolarity, predicting a world of five, rather than two, global powers. At the end of the 1970s, Jimmy Carter's "malaise" speech invoked "a crisis of confidence" that struck "at the very heart and soul and spirit of our national will."
A decade later, academics such as the Yale historian Paul Kennedy predicted the ruin of the United States, driven by overextension abroad and profligacy at home. The United States was at risk of "imperial overstretch," Kennedy wrote in 1987, arguing that "the sum total of the United States' global interests and obligations is nowadays far larger than the country's power to defend them all simultaneously." But three years later, Washington dispatched 600,000 soldiers to fight the first Iraq war -- without reinstating the draft or raising taxes. The only price of "overstretch" turned out to be the mild recession of 1991.
Declinism took a break in the 1990s. The United States was enjoying a nice run after the suicide of the Soviet Union, and Japan, the economic powerhouse of the 1980s, was stuck in its "lost decade" of stagnation and so no longer stirred U.S. paranoia with its takeover of national treasures such as Pebble Beach and Rockefeller Center. The United States had moved into the longest economic expansion in history, which, apart from eight down months in 2001, continued until 2008. "Gloom is the dominant mood in Japan these days," one Asian commentator reported in 1997, whereas "American capitalism is resurgent, confident and brash." That year, the New York Times columnist Thomas Friedman wrote that "the defining feature of world affairs" was "globalization" and that if "you had to design a country best suited to compete in such a world, [it would be] today's America." He concluded on a triumphant note: "Globalization is us."
In those days, any declinist harrumph sounded quirky or simply generic. The indictment delivered in 1994 by the Oxford fellow John Gray could have come from any time: "The U.S. no longer possesses any recognizable common culture." It had degenerated into a melee of "warring cultural and ethnic groups," with "ungovernability" just around the corner. For Gray, it all added up to a "spectacle of American decline."
The United States remains first on any scale of power that matters, whether it is economic, military, diplomatic, or cultural. But by the end of the Bush administration, declinism had returned with a vengeance. This year, inspired by the global financial crisis, Paul Kennedy revisited the arguments he had laid out in his book The Rise and Fall of the Great Powers over 20 years ago. "The biggest loser is understood to be Uncle Sam," he wrote. Chronic fiscal deficits and military overstretch -- the twin scourge of his 1987 book -- were finally doing in the United States, he argued, and the "global tectonic power shift, toward Asia and away from the West, seems hard to reverse."
Roger Altman, a former deputy secretary of the Treasury, has written in these pages that the financial crash "has inflicted profound damage on . . . [the United States'] standing in the world." The German finance minister, Peer Steinbrück, has crowed, "The United States will lose its superpower status in the world financial system," which "will become more multipolar." And the historian Niall Ferguson has gone halfway, warning that although "the balance of global power is bound to shift," "commentators should always hesitate before they prophesy the decline and fall of the United States."
No such hesitation has befallen the new crop of declinists. Some of their lore is simply generic, divorced from time and circumstance, and thus achingly familiar to those who remember 50 years of similar boilerplate. Last year, Parag Khanna, a fellow at the New America Foundation, intoned that "America's standing in the world remains in steady decline." This has a familiar ring to it, as does Khanna's announcement that U.S. power is "competing -- and losing -- in a geopolitical marketplace alongside the world's other superpowers."
Who are these superpowers? From the 1950s through the 1970s, it was the Soviet Union, and in the 1980s, Japan. Now, Khanna fingers the European Union and China. For Europe, it is the second time around the block -- the old continent was touted as the multipolar muscleman by the previous generation of doomsters.
Finally, two foreign voices. One is that of Kishore Mahbubani, Singapore's former UN ambassador, whose bid to succeed Kofi Annan as UN secretary-general was thwarted by Washington. As the title of his 2008 book, The New Asian Hemisphere: The Irresistible Shift of Global Power to the East, suggests, he chronicles not the degeneration of the United States as much as the triumph of Asia. His tone is avuncular, if not patronizing: "Sadly, . . . Western intellectual life continues to be dominated by those who continue to celebrate the supremacy of the West." So the West, in this case the United States, is losing its grip not only on power but also on reality -- going from Chapter 11 straight to the psychiatrist's couch. In contrast, "the rest of the world has moved on. A steady delegitimization of Western power . . . is underway." And who shall inherit the earth? Mahbubani suggests China, which "should eventually take over the mantle of global leadership from America." This is a subtly contemptuous version of America perdita -- wishful thinking posing as sober analysis.
A second voice is that of Dimitry Orlov, a Russian-born writer who saw the Soviet empire disembowel itself and, in an act of psychic revenge, has projected the same fate onto the United States. "At some point during the coming years," he wrote in his 2008 book, Reinventing Collapse: The Soviet Example and American Prospects, "the economic system of the United States will teeter and fall. . . . America's economy will evaporate like the morning mist." He calls both the Soviet Union and the United States "evil empires."
This brief history of declinism shows that doom arrives in cycles, and what comes and goes, logically, does not a trend make. Today, as after past prophecies of imminent debility, the United States remains first on any scale of power that matters -- economic, military, diplomatic, or cultural -- despite being embroiled in two wars and beset by the worst economic crisis since the Great Depression. The question, then, is, how well can the projections, dreams, and fantasies chronicled above stand up to this enduring reality?
GLEE AND GLOOM
Ever since America was discovered, it has been an object of the imagination. Long before the 13 colonies jelled into a union, America was a construct more than a country -- a canvas onto which the rest of the world would endlessly project its fondest dreams and fiercest nightmares.
The canvas is painted in two colors: glee and gloom. Glee is mainly celebrated abroad. Wanting the United States to falter is the natural reflex of those forced to coexist with a looming Gulliver who terrifies simply by throwing his weight around. So every decade, hope springs anew that this Gulliver will be muscled aside by somebody else. Far from foreshadowing the United States' demise, these fantasies are actually a perverse way of paying homage to the giant's fearsome clout -- the troubles of small powers never provoke diagnoses of rampant debility.
Unless China is not of this world, society's chickens will come home to roost, demanding to be fed or freed. The gloom is mainly Made in U.S.A. These nightmare scenarios come from a prophetic tradition in which the Jeremiahs hope to prevent what they predict by convincing the wayward to atone. Latter-day prophets use the language of decay to pursue a domestic agenda, whether it is a libertarian vision of isolationism and low taxes or a liberal one of more welfare and less militarism. These familiar motifs recall the words of the Founding Fathers, who saw aggrandizement abroad as a sure path to ruin at home. Thomas Jefferson warned against "entangling alliances"; John Quincy Adams did not want the United States to turn into "the dictatress of the world." If she did, "she would no longer be the ruler of her own spirit." Expansion, accordingly, equals the loss of America's soul.
Declinism has always oscillated between projection and prophecy, between those who cheer and those who fear finis Americae. A May 2009 New Yorker cartoon gently poked fun at recidivist doomsayers. It shows a penitent with a placard: "The End Is Still Coming," and has a passerby asking his companion, "Wasn't that Paul Krugman?" But simply pointing out the cycles and agendas found in any talk of decline does not dispose of the recurrent question: What is the United States' standing in the world, and what might topple number one from its lofty perch? It is time for a look at the facts and figures.
JUST THE FACTS
In all instances of declinism, economic failure serves as Exhibit A. But current figures show the U.S. economy to be worth $14.3 trillion, three times as much as the world's second-biggest economy, Japan's, and only slightly less than the economies of its four nearest competitors combined -- Japan, China, Germany, and France. Never before in modern history have the gaps between great powers been so wide. On the eve of World War I, the key players in the European balance of power were more or less evenly matched. The German economy, with a GDP of $237 billion, had just eclipsed the British economy, then $225 billion; France's GDP was $144 billion, and Russia's was roughly $230 billion.
Today, there is only one challenge to the dominance of the U.S. economy: the European Union's aggregate GDP of $18 trillion. But the more appropriate comparison may be with the 16-member eurozone, which has a common monetary policy and a rudimentary common fiscal policy -- and a collective GDP of $13.5 trillion, less than that of the United States. But an unwieldy conglomeration of 27, or even 16, states cannot be a strategic player.
The United States also comes out ahead among major powers in terms of per capita income, with $47,000 per inhabitant. It is followed by France and Germany (both in the $44,000 range), Japan ($38,000), Russia ($11,000), China ($2,900), and India ($1,000). It is not clear how China could soon best the United States in this regard, which has a per capita income that is 7.5 times as large as China's. A country becomes neither rich nor powerful by adding up 1.3 billion very poor people -- unless its riches are falsely measured by current account surpluses.
The gaps become exorbitant in the realm of military power, where the United States plays in a league of its own. In 2008, it spent $607 billion on its military, representing almost half of the world's total military spending. The next nine states spent a total of $476 billion, and the presumptive challengers to U.S. military supremacy -- China, India, Japan, and Russia -- together devoted only $219 billion to their militaries. The military budget of China, the country most often touted as the world's next superpower, is less than one-seventh of the U.S. defense budget. Even if one includes among potential U.S. adversaries the 27 states of the EU, which together spend $288 billion on defense, the United States still outweighs them all -- $607 billion compared to $507 billion.
Nor can any other great power boast the United States' naval strength, a measure of a state's ability to project power quickly and over great distances. In 2005, as Robert Work, a defense analyst and now undersecretary of the U.S. Navy, has shown, the U.S. Navy commanded a naval tonnage exceeding the world's next 17 fleets combined. This is a dramatic shift from 1922, when the Washington Naval Conference tried to set the rules for a balance of power at sea. The three top competitors -- the United States, the United Kingdom, and Japan -- were allowed navies in the ratio of 5:5:3. At the time, the United Kingdom, the world's greatest maritime power, had a total naval tonnage of 525,000 tons. Germany, France, and Russia also had navies capable of fighting halfway around the world. Today, however, China, India, Japan, Russia, and the EU put together could not conduct a major war 8,000 miles from their shores, as the United States has done twice in Iraq and once in Afghanistan in recent years.
FALSE IDOLS
The breathtaking rise of China is at the center of the current spate of declinism, much as Japan's was in the 1980s. This argument is not about the present or the absolute decline of the United States but about its relative loss vis-à-vis China -- the United States is supposedly doomed because China's economy has been growing at three times the rate of the United States' and therefore will surpass the United States in terms of output sometime in the next several decades.
To capture a wider swath of the political imagination, it takes a country that is not just rich but also democratic and free. This would be a safe bet only if GDP is measured using purchasing power parity (PPP), which raises China's 2007 nominal GDP from $3.3 trillion to almost $8 trillion because of its extremely depressed price and wage levels. Taking a high-end estimate of Chinese growth -- an annual rate of ten percent -- China's economy would double every seven years, overtaking current U.S. GDP as early as 2015 and leaving the United States in the dust seven years later. But whatever the tipping point, this calculation suggests that China will emerge as number one. Alas, global standing is not measured by the low prices of nontradable goods, such as haircuts, bootlegged software, and government services. Think instead about advanced technology, energy, raw materials, and the cost of higher education in the West. These items are critical for growth and must be procured on the world market. Influence bought abroad, say, through foreign aid, also comes at exchange-rate prices, as does imported high-tech weaponry.
The debate over whether to consider GDP based on PPP or nominal GDP as a measure of economic power is endless. The Australian economist Saul Eslake, who predicts the déclassement of the United States on the basis of PPP as early as 2015, offers a typical caveat: "Of course, these projections may prove inaccurate: by and large they extrapolate the growth rates of the recent past, and make no allowance for a global economic downturn, or for downturns in any individual economy, and they do not seem to make much allowance for demographic factors."
Life, however, is not linear. China's uninterrupted double-digit growth rates are of a recent vintage, essentially since 2003. In 1989 and 1990, growth in China was four percent. In 1967 and 1968, China's growth actually fell, by 5.1 percent and 2.9 percent, respectively, and in 1976, it fell by 5.8 percent. These last three years are not plucked at random; the first two marked the beginning of the Cultural Revolution, and the last one, its end, and they offer a useful reminder of volatility driven by wrenching domestic upheaval. History sounded a similar warning against straight-line projections in 1989, the year of the crackdown in Tiananmen Square, when growth plummeted to four percent, compared with 11.3 percent the previous year. Karl Marx asserted that economics drives everything else -- such turmoil suggests that politics is mightier still.
to be continued....!
Summary -- Since the United States first became a global superpower, it has been fashionable to speak of its decline. But in today's world, the United States' economic and military strength, along with the attractiveness of its ideals, will ensure its power for a long time to come.
JOSEF JOFFE is Co-Editor of Die Zeit, a Senior Fellow at Stanford's Freeman Spogli Institute for International Studies, and Marc and Anita Abramowitz Fellow in International Relations at the Hoover Institution at Stanford University.
Every ten years, it is decline time in the United States. In the late 1950s, it was the Sputnik shock, followed by the "missile gap" trumpeted by John F. Kennedy in the 1960 presidential campaign. A decade later, Richard Nixon and Henry Kissinger sounded the dirge over bipolarity, predicting a world of five, rather than two, global powers. At the end of the 1970s, Jimmy Carter's "malaise" speech invoked "a crisis of confidence" that struck "at the very heart and soul and spirit of our national will."
A decade later, academics such as the Yale historian Paul Kennedy predicted the ruin of the United States, driven by overextension abroad and profligacy at home. The United States was at risk of "imperial overstretch," Kennedy wrote in 1987, arguing that "the sum total of the United States' global interests and obligations is nowadays far larger than the country's power to defend them all simultaneously." But three years later, Washington dispatched 600,000 soldiers to fight the first Iraq war -- without reinstating the draft or raising taxes. The only price of "overstretch" turned out to be the mild recession of 1991.
Declinism took a break in the 1990s. The United States was enjoying a nice run after the suicide of the Soviet Union, and Japan, the economic powerhouse of the 1980s, was stuck in its "lost decade" of stagnation and so no longer stirred U.S. paranoia with its takeover of national treasures such as Pebble Beach and Rockefeller Center. The United States had moved into the longest economic expansion in history, which, apart from eight down months in 2001, continued until 2008. "Gloom is the dominant mood in Japan these days," one Asian commentator reported in 1997, whereas "American capitalism is resurgent, confident and brash." That year, the New York Times columnist Thomas Friedman wrote that "the defining feature of world affairs" was "globalization" and that if "you had to design a country best suited to compete in such a world, [it would be] today's America." He concluded on a triumphant note: "Globalization is us."
In those days, any declinist harrumph sounded quirky or simply generic. The indictment delivered in 1994 by the Oxford fellow John Gray could have come from any time: "The U.S. no longer possesses any recognizable common culture." It had degenerated into a melee of "warring cultural and ethnic groups," with "ungovernability" just around the corner. For Gray, it all added up to a "spectacle of American decline."
The United States remains first on any scale of power that matters, whether it is economic, military, diplomatic, or cultural. But by the end of the Bush administration, declinism had returned with a vengeance. This year, inspired by the global financial crisis, Paul Kennedy revisited the arguments he had laid out in his book The Rise and Fall of the Great Powers over 20 years ago. "The biggest loser is understood to be Uncle Sam," he wrote. Chronic fiscal deficits and military overstretch -- the twin scourge of his 1987 book -- were finally doing in the United States, he argued, and the "global tectonic power shift, toward Asia and away from the West, seems hard to reverse."
Roger Altman, a former deputy secretary of the Treasury, has written in these pages that the financial crash "has inflicted profound damage on . . . [the United States'] standing in the world." The German finance minister, Peer Steinbrück, has crowed, "The United States will lose its superpower status in the world financial system," which "will become more multipolar." And the historian Niall Ferguson has gone halfway, warning that although "the balance of global power is bound to shift," "commentators should always hesitate before they prophesy the decline and fall of the United States."
No such hesitation has befallen the new crop of declinists. Some of their lore is simply generic, divorced from time and circumstance, and thus achingly familiar to those who remember 50 years of similar boilerplate. Last year, Parag Khanna, a fellow at the New America Foundation, intoned that "America's standing in the world remains in steady decline." This has a familiar ring to it, as does Khanna's announcement that U.S. power is "competing -- and losing -- in a geopolitical marketplace alongside the world's other superpowers."
Who are these superpowers? From the 1950s through the 1970s, it was the Soviet Union, and in the 1980s, Japan. Now, Khanna fingers the European Union and China. For Europe, it is the second time around the block -- the old continent was touted as the multipolar muscleman by the previous generation of doomsters.
Finally, two foreign voices. One is that of Kishore Mahbubani, Singapore's former UN ambassador, whose bid to succeed Kofi Annan as UN secretary-general was thwarted by Washington. As the title of his 2008 book, The New Asian Hemisphere: The Irresistible Shift of Global Power to the East, suggests, he chronicles not the degeneration of the United States as much as the triumph of Asia. His tone is avuncular, if not patronizing: "Sadly, . . . Western intellectual life continues to be dominated by those who continue to celebrate the supremacy of the West." So the West, in this case the United States, is losing its grip not only on power but also on reality -- going from Chapter 11 straight to the psychiatrist's couch. In contrast, "the rest of the world has moved on. A steady delegitimization of Western power . . . is underway." And who shall inherit the earth? Mahbubani suggests China, which "should eventually take over the mantle of global leadership from America." This is a subtly contemptuous version of America perdita -- wishful thinking posing as sober analysis.
A second voice is that of Dimitry Orlov, a Russian-born writer who saw the Soviet empire disembowel itself and, in an act of psychic revenge, has projected the same fate onto the United States. "At some point during the coming years," he wrote in his 2008 book, Reinventing Collapse: The Soviet Example and American Prospects, "the economic system of the United States will teeter and fall. . . . America's economy will evaporate like the morning mist." He calls both the Soviet Union and the United States "evil empires."
This brief history of declinism shows that doom arrives in cycles, and what comes and goes, logically, does not a trend make. Today, as after past prophecies of imminent debility, the United States remains first on any scale of power that matters -- economic, military, diplomatic, or cultural -- despite being embroiled in two wars and beset by the worst economic crisis since the Great Depression. The question, then, is, how well can the projections, dreams, and fantasies chronicled above stand up to this enduring reality?
GLEE AND GLOOM
Ever since America was discovered, it has been an object of the imagination. Long before the 13 colonies jelled into a union, America was a construct more than a country -- a canvas onto which the rest of the world would endlessly project its fondest dreams and fiercest nightmares.
The canvas is painted in two colors: glee and gloom. Glee is mainly celebrated abroad. Wanting the United States to falter is the natural reflex of those forced to coexist with a looming Gulliver who terrifies simply by throwing his weight around. So every decade, hope springs anew that this Gulliver will be muscled aside by somebody else. Far from foreshadowing the United States' demise, these fantasies are actually a perverse way of paying homage to the giant's fearsome clout -- the troubles of small powers never provoke diagnoses of rampant debility.
Unless China is not of this world, society's chickens will come home to roost, demanding to be fed or freed. The gloom is mainly Made in U.S.A. These nightmare scenarios come from a prophetic tradition in which the Jeremiahs hope to prevent what they predict by convincing the wayward to atone. Latter-day prophets use the language of decay to pursue a domestic agenda, whether it is a libertarian vision of isolationism and low taxes or a liberal one of more welfare and less militarism. These familiar motifs recall the words of the Founding Fathers, who saw aggrandizement abroad as a sure path to ruin at home. Thomas Jefferson warned against "entangling alliances"; John Quincy Adams did not want the United States to turn into "the dictatress of the world." If she did, "she would no longer be the ruler of her own spirit." Expansion, accordingly, equals the loss of America's soul.
Declinism has always oscillated between projection and prophecy, between those who cheer and those who fear finis Americae. A May 2009 New Yorker cartoon gently poked fun at recidivist doomsayers. It shows a penitent with a placard: "The End Is Still Coming," and has a passerby asking his companion, "Wasn't that Paul Krugman?" But simply pointing out the cycles and agendas found in any talk of decline does not dispose of the recurrent question: What is the United States' standing in the world, and what might topple number one from its lofty perch? It is time for a look at the facts and figures.
JUST THE FACTS
In all instances of declinism, economic failure serves as Exhibit A. But current figures show the U.S. economy to be worth $14.3 trillion, three times as much as the world's second-biggest economy, Japan's, and only slightly less than the economies of its four nearest competitors combined -- Japan, China, Germany, and France. Never before in modern history have the gaps between great powers been so wide. On the eve of World War I, the key players in the European balance of power were more or less evenly matched. The German economy, with a GDP of $237 billion, had just eclipsed the British economy, then $225 billion; France's GDP was $144 billion, and Russia's was roughly $230 billion.
Today, there is only one challenge to the dominance of the U.S. economy: the European Union's aggregate GDP of $18 trillion. But the more appropriate comparison may be with the 16-member eurozone, which has a common monetary policy and a rudimentary common fiscal policy -- and a collective GDP of $13.5 trillion, less than that of the United States. But an unwieldy conglomeration of 27, or even 16, states cannot be a strategic player.
The United States also comes out ahead among major powers in terms of per capita income, with $47,000 per inhabitant. It is followed by France and Germany (both in the $44,000 range), Japan ($38,000), Russia ($11,000), China ($2,900), and India ($1,000). It is not clear how China could soon best the United States in this regard, which has a per capita income that is 7.5 times as large as China's. A country becomes neither rich nor powerful by adding up 1.3 billion very poor people -- unless its riches are falsely measured by current account surpluses.
The gaps become exorbitant in the realm of military power, where the United States plays in a league of its own. In 2008, it spent $607 billion on its military, representing almost half of the world's total military spending. The next nine states spent a total of $476 billion, and the presumptive challengers to U.S. military supremacy -- China, India, Japan, and Russia -- together devoted only $219 billion to their militaries. The military budget of China, the country most often touted as the world's next superpower, is less than one-seventh of the U.S. defense budget. Even if one includes among potential U.S. adversaries the 27 states of the EU, which together spend $288 billion on defense, the United States still outweighs them all -- $607 billion compared to $507 billion.
Nor can any other great power boast the United States' naval strength, a measure of a state's ability to project power quickly and over great distances. In 2005, as Robert Work, a defense analyst and now undersecretary of the U.S. Navy, has shown, the U.S. Navy commanded a naval tonnage exceeding the world's next 17 fleets combined. This is a dramatic shift from 1922, when the Washington Naval Conference tried to set the rules for a balance of power at sea. The three top competitors -- the United States, the United Kingdom, and Japan -- were allowed navies in the ratio of 5:5:3. At the time, the United Kingdom, the world's greatest maritime power, had a total naval tonnage of 525,000 tons. Germany, France, and Russia also had navies capable of fighting halfway around the world. Today, however, China, India, Japan, Russia, and the EU put together could not conduct a major war 8,000 miles from their shores, as the United States has done twice in Iraq and once in Afghanistan in recent years.
FALSE IDOLS
The breathtaking rise of China is at the center of the current spate of declinism, much as Japan's was in the 1980s. This argument is not about the present or the absolute decline of the United States but about its relative loss vis-à-vis China -- the United States is supposedly doomed because China's economy has been growing at three times the rate of the United States' and therefore will surpass the United States in terms of output sometime in the next several decades.
To capture a wider swath of the political imagination, it takes a country that is not just rich but also democratic and free. This would be a safe bet only if GDP is measured using purchasing power parity (PPP), which raises China's 2007 nominal GDP from $3.3 trillion to almost $8 trillion because of its extremely depressed price and wage levels. Taking a high-end estimate of Chinese growth -- an annual rate of ten percent -- China's economy would double every seven years, overtaking current U.S. GDP as early as 2015 and leaving the United States in the dust seven years later. But whatever the tipping point, this calculation suggests that China will emerge as number one. Alas, global standing is not measured by the low prices of nontradable goods, such as haircuts, bootlegged software, and government services. Think instead about advanced technology, energy, raw materials, and the cost of higher education in the West. These items are critical for growth and must be procured on the world market. Influence bought abroad, say, through foreign aid, also comes at exchange-rate prices, as does imported high-tech weaponry.
The debate over whether to consider GDP based on PPP or nominal GDP as a measure of economic power is endless. The Australian economist Saul Eslake, who predicts the déclassement of the United States on the basis of PPP as early as 2015, offers a typical caveat: "Of course, these projections may prove inaccurate: by and large they extrapolate the growth rates of the recent past, and make no allowance for a global economic downturn, or for downturns in any individual economy, and they do not seem to make much allowance for demographic factors."
Life, however, is not linear. China's uninterrupted double-digit growth rates are of a recent vintage, essentially since 2003. In 1989 and 1990, growth in China was four percent. In 1967 and 1968, China's growth actually fell, by 5.1 percent and 2.9 percent, respectively, and in 1976, it fell by 5.8 percent. These last three years are not plucked at random; the first two marked the beginning of the Cultural Revolution, and the last one, its end, and they offer a useful reminder of volatility driven by wrenching domestic upheaval. History sounded a similar warning against straight-line projections in 1989, the year of the crackdown in Tiananmen Square, when growth plummeted to four percent, compared with 11.3 percent the previous year. Karl Marx asserted that economics drives everything else -- such turmoil suggests that politics is mightier still.
to be continued....!
