China’s rapid growth and climb in economic power is old news and should not be a surprise to anybody. Something to keep in mind, however, is that the development of China’s infrastructure is still ages behind the United States. This should come as good news to the average American citizen who is concerned with China establishing itself as an economic powerhouse, but for those of us who are above average, we should see this an opportunity.
In order for a country like China to build its infrastructure, it needs many basic resources, such as concrete, iron, steel, food products, etc. So, where do you think China is obtaining these resources? Well, I’ll tell where they are not obtaining these resources, the United States. China is quickly becoming (or has already become) the world’s top super power, and although the United States has this infrastructural advantage over the Chinese, we do not appear to be exploiting it to try and regain a competitive advantage. Put simply, we are in the race for our lives, and we are tying our own shoes together.
While China continues to grow and expand, the United States has become too concerned with its internal reforms to take a step back and look at the big picture. We are missing out on Asian growth and may eventually be unable to compete with those other countries that are providing China (and many other Asian countries that are expanding as well) with the resources it needs to build this desirable infrastructure. In 2009, China superseded the United States as the top customer for commodity imports from Brazil. This is not a surprise because, given the circumstances that the United States’ infrastructure is so much more advanced than China’s, the United States has significantly less room for growth than China.
Because the United States has so many groups protecting blue collar workers, such as unions, and activist groups making it difficult for many companies trying to obtain natural resources, it would be impossible for the United States to provide such commodities to China at prices that are competitive with Brazil’s. As a result of this, such developing countries providing China with the resources it needs to grow have become the Home Depot for all of the expansion in Asia and the Middle East. These direct beneficiaries of Asian growth (those countries providing China with the resources it needs to expand) that are trying to develop are gaining wealth, giving those countries the opportunity to purchase more consumer goods. Basically, China is purchasing raw materials to build its infrastructure, and countries like Brazil that are accumulating wealth from selling those raw materials will eventually be purchasing goods back from China. The major problem with this picture is that the United States is completely out of it. The United States continues to pass legislation that increase taxes on the American consumer, so the American consumer will have less spending money to purchase those consumer goods. This is also a double-edged sword because China owns a large portion of the United States’ debt, so if American consumers are not buying consumer goods, the ability for the United States to get out of debt decreases therefore giving China even more power. In essence, China will not only be in control of the United States because of the mass amount of debt they own, but will also have power over those countries that are dependent on buying its products, such as those developing countries providing China with resources.
It would be wrong to say that Brazil should not be able to gain wealth by selling less expensive commodities to China because every human being should be given the opportunity to achieve a higher standard of living. However, the United States needs to figure out how to use our infrastructural advantage over China to get back into “competition shape.”
Subscribe to:
Post Comments (Atom)
Yeah, I hear you. It's a tough thing to watch a countries supply China with the materials and resources to surpass us...but in my opinion they still have a ways to go. In terms of social structure, the impoverished areas of China are still miles behind. Just look at the recent Earthquake that took place in a remote mountainous region. China hold on to remnants of it imperialistic and conquering past, like Tibet, and it is their failure to take care of the people and problems in those remote regions that will cost them in the long run.
ReplyDeleteSpeaking of other countries providing China with resources, my last entry touched on how Australia signed a $60million dollar deal with China that essentially makes them the soul coal provider of the country that polluted the atmosphere the most. It's pretty hypocritical of Australia on the one hand to join the other countries that are calling for China to stop using the dirty energy source, and then profiting by supplying all their coal. In this case, Australia can hardly be put into the same category that you talked about in your post for Brazil.
Tiffany is absolutely right about Australia. Australia has an abundance of natural resources and is also China's main supplier of iron.
ReplyDeleteAlso, I am curious as to what exactly you believe will happen when China "owns" us. I am the first to recognize my own ignorance on the topic of foreign affairs, but I don't understand why you are so concerned with China surpassing the US. How do you think things will be if/when this happens?
I agree with this post as well as the comments above. America does seem to be digging its own grave. In recent years, America has put top international issues on the back burner in order to deal with its array of domestic turmoil. Though we have a superior infrastructure, this infrastructure allows for the fluidity of solutions to be created and by the same regard, gridlock. Domestic infighting has been a cause of our political stagnancy and has held us back from advancing within the global competition.
ReplyDeleteIn all honesty, I think America has gotten too comfortable and has been sitting pretty at the top. Education plays a huge factor in this. I think our cultural leniency has been too soft and has hindered us from making technological advances like other nations are currently do. As far as advanced weaponry, America is no longer the only one with this technology and must step up. Domestic issues must be either solved or put aside for the sake of America competing in the global contest.
In response to the Australian trade agreement with China- I was completely unaware of this, but there are still several resources that make China, Brazil's number 1 trade partner (oil is a big one).
ReplyDeleteThe reason I fear China surpassing us as a top economic super power is the implications of a country even more bent on obtaining wealth than we are running the world's economy. Living in America, we get to enjoy the luxuries of working hard and receiving benefits as a result, but with the way China is run, that's not necessarily as true. I am personally afraid of having their way of life oppressed on us.
There are a number of issues I take with your post. First of all, the U.S. can provide some of the highest QUALITY infrastructure products and services, not necessarily the cheapest. China has been known to sacrifice quality for quantity or price...but you get what you pay for. We in the U.S. construct things with strict codes and safety standards, whereas in China that might not necessarily be the case. Our goods and services are also of very high quality, not necessarily the least expensive, which is why China may buy from elsewhere.
ReplyDeleteYou also mentioned that the U.S. is too concerned with internal reforms and losing sight of the big picture. However, our internal reforms are a HUGE part of the big picture. Financial and health reform are major necessities to the future of our country. While we may be missing out on profit opportunities or falling behind some countries who are doing other things, these reforms are of much greater importance and must be implemented before we can focus on other agenda items.