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The Great Fall of China

latimes.com — Largely ignored by the media, the latest story to come out of Washington changes the world. The story's unlikely source was the staid World Bank, which published updated statistics on the economic output of 146 countries. China's economy, said the bank, is smaller than it thought. About 40% smaller.

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  • pateo, on 12/31/2007, -10/+73Let's bash their national bank then borrow a few more billion dollars from them. Ego boost!
  • Member148, on 12/31/2007, -26/+33Good article. I hope they run out of lead paint soon.
    • cyberdork, on 12/31/2007, -6/+53Why don't you just buy toys which are not that friggin cheap?I'm getting sick of people who want everything cheap cheap cheap and are then surprised when they end up with ***** quality.
      Instead of buying Mattel toys manufactured by Asian slave labor buy for example Lego which are only manufactured in Denmark, USA, Mexico and the Czech Republic.
      • kosan, on 12/31/2007, -4/+27I understand your sentiment but honestly it's not that easy. You give Lego as one example but that is unfortunately one of the few examples i have seen. I am having my first child in 2 months and my wife and i went around to stores like Babies-R-Us and specifically looked for toys not manufactured in China. Literally everything we looked at from sippy cups to stuffed animals are made there. Out of well over 100 toy products i looked at i only could only find 3 items that were manufactured in another country.

        I'm not trying to fight or flame, it's just that i have been trying and unable to find a ready source of non-Chinese made toys. If you or anyone else has other examples like your Lego example or know any stores that carry stuff specifically not made in China i would love to know. Unfortunately i have not found it to be as easy as simply not being so "friggin cheap" (yes i am willing to pay for good toys).
        • yutt, on 12/31/2007, -24/+2Is capitalizing "I" really that much effort that you'd rather look lazy and ignorant than bother?
          • unreg, on 12/31/2007, -1/+15somebody doesn't have a date for new years eve
          • noumuon, on 12/31/2007, -3/+11it amazes me that people continue to try and act superior to others online based on capitalization, punctuation and grammar. grow up.
          • 666dorado, on 12/31/2007, -1/+5aCTUALLY i'M hAVING a hARD tIME cAPITALIZING mY i'S, bUT dON'T tHINK iT'S bECAUSE i'M lAZY.
        • Subliminational, on 12/31/2007, -0/+9yutt: is being courteous that much effort that you'd rather look like a jerk than bother?
          • yutt, on 12/31/2007, -4/+1If I have to be a jerk to fight the tide of adults reverting to 13 year old AOL kid grammar, I will gladly do that.
      • unreg, on 12/31/2007, -3/+5It's not a matter of cheap, cheap, cheap. It's more an issue of who, who, who. The reality is the majority of toys are made overseas, in China and other Asiatic nations. Faced with that, what do you do?

        I've frequented some of the smaller boutique stores and purchased items made in the USA. Usually unique handcrafted (and expensive). But at some point, the rug rat is gonna want a Tonka or a Barbie. And they only come from one place.

        Low cost doesn't have to equal questionable quality. Companies that off-shore their manufacturing need to step up their oversight.
      • UnstableMind, on 12/31/2007, -4/+6That lead ***** is to scare people like you into not buying from abroad. 30 years ago there was lead in gas and paint, many of those people are alive and well today. Not saying it was healthy for us, just that it's completely over-blown.
        • aukxsona, on 01/01/2008, -0/+3As a parent. It is still scary as hell.
        • bacon_skoda, on 01/02/2008, -0/+1you do know about aqua dots, right?
          lead is not the point. the point is there are so many layers of "suppliers" that just contracts to other "suppliers" and the last one just finds the cheapest thing that "works" and pushes that up. it could be lead paint, it could be a date rape drug, doesn't matter. it's all about the buck.
          the blame goes from the USA to China and back.
      • 5555, on 12/31/2007, -3/+6I'm always amazed at how well the US propaganda machine works. The CEO of Mattel went on CCTV in China and OFFICIALLY APOLOGIZED to the Chinese government and people, admitting Mattel's responsibility for this lead paint fiasco, and yet Americans still blame China. Pathetic sheep.
        • pgm_01, on 01/01/2008, -2/+1Yes he apologized, in the same way that Dick Cheney's hunting buddy apologized for getting in the way of Dick's bullets. If you believe the apology, then you are the sheep.
          • 5555, on 01/03/2008, -0/+1Do you realize how utterly retarded that logic is?
      • an0nym0uz, on 12/31/2007, -1/+4American made products are really not that great, just look at our cars. A good example would be the Camry which used to be the best selling car for quite a while until they started manufacturing it in the US, now the Camry is like *****.
    • 666dorado, on 12/31/2007, -13/+49because it's easier to be a racist and blame the Chinese instead of the American consumerist culture that encourages this. profits first, safety second (until you get sued).
      • geardosdotnet, on 12/31/2007, -4/+3How is it racist to question the ethical choices of a foreign government or it's business owners who decide to pass off unsafe merchandise as safe?
        • Corrosionx, on 12/31/2007, -0/+3That's the problem, people actually trusted the Chinese government to inspect and declare those toys safe or not. You need an independent quality control firm like UL but for toys.
      • thewfirestarter, on 01/01/2008, -0/+0I don't think you know what racism is. This is because of the dangers imposed. If a [insert minority] guy carjacks me and shoots me in the leg, I don't hate him because he's [insert minority], I hate him because he stole my car and shot me in the leg.
    • monkeyrun, on 12/31/2007, -3/+16You get what you paid for.

      Less than 1% of the "Made in China" toys were ever recalled.

      You keep talking about those 1% "defective" products and the rest of the world will move on and buy the 99%.
      • williamdyer, on 01/01/2008, -2/+3The backwater factories in China make all the dollar store crap. Because of that fact alone, it is like shooting fish in a barrel to find unsafe toys from China. Same with food. Go to a major city, and the standards for restaurants are very high. The food is amazing. Bad restaurants go out of business fast. But in the countryside you find a lot of opportunists selling toxic crap.
      • saisumimen, on 01/01/2008, -1/+4That "1%" is just was has BEEN CAUGHT. God only knows how much toxic crap is being manufactured now or is already in our homes.
      • allan17, on 01/01/2008, -1/+41% is a HUGE ***** amount when you make as much ***** as China does.
      • bacon_skoda, on 01/02/2008, -1/+1that 1% was also perfectly safe and flied through customs before the recall.
    • Nichiren, on 12/31/2007, -1/+12The article also has the tone that China was ready to attack us at any minute as soon as they get strong enough but whew it seems they're still a few years off from doing that. I mean isn't it the U.S. that's been calling for an attack on Iran while it has been China and Russia trying to persuade them from doing it? Region instability is bad for everyone but lucky for the U.S., they're not IN the region so when it comes to our politicians, out of sight, out of mind as they say.
  • guitarh3ro, on 12/31/2007, -14/+3I see what you did there.
  • mightydavefish, on 12/31/2007, -33/+67Man, this REEKS of *****.
    So world bank was SO wrong every ***** year that NOW they need to adjust china down by 40%?
    So either NOW they are full of ***** or BEFORE they were incompetent.
    That is a HUGE error, not made by innocent mistake.
    • sotloo, on 12/31/2007, -13/+4Frekin aye man! Took the words right out of my brain ...
      • sensoukami, on 12/31/2007, -6/+4Not hard to do, as your brain is largely vacuum, so any stray thought would be easy to find....
    • sensoukami, on 12/31/2007, -6/+6You have a lot of experience with economics statistics then? You ever try and measure the economy of a 1.2 billion people country? No, I thought not. So, if you don't know anything about it, and you have not valid points to make, why don't you have a tall hot glass of Shut the ***** Up.
      • Sigma0, on 01/01/2008, -0/+1It really isn't that hard to keep an accurate measure of a select basket of goods which can then be used as a proxy for price levels. The fact that this hasn't been done until very recently is what reeks of *****.
        • kazamx, on 01/01/2008, -0/+1Thats the point. They were keeping track of a basket of goods. What they found was that the basket didn't represent China as well as it should have.
    • 2oonhed, on 12/31/2007, -2/+3I believe this adjustment comes AFTER the US dollar falls in value in the world market? If you want to talk conspiracy, then consider that the US took an economic "poison pill" that devalues the billions of dollars held by China.
      Keep in mind, (for comparison), this is the first year ever that the US dollar was valued BELOW the Canadian Loony.
      And keep in mind that many societies are now preferring to trade in euros, instead of the previously preferred dollar.
      • kazamx, on 01/01/2008, -0/+1China plans on Using BILLION of dollars that America has given them to invest in the US. Take a look at the Dow Jones index and the percent of stock now owned by China. They are buying up nice chunks of many American businesses. They aren't going for total ownership as they know congress/people will kick off. but they can easily buy up 5? 10? 15% of a company without anyone really paying attention. If you own 15% of the top 100 US companies, thats a pretty big investment.
    • rpgmaker, on 12/31/2007, -1/+2"With its people this poor, China will have a hard time raising enough revenue for the vast military buildup needed to challenge the United States."
      The people in China is that poor because all of their money goes into the military pockets, that's the same reason why the USA's primary school system sucks or the health care system.
      • williamdyer, on 01/01/2008, -1/+3U.S. military spending equals that of the rest of the world. China has no global military power ambitions, and, while there is a lot of corruption in state and especially military owned industries, China has nothing like the military industrial complex the U.S. has.
        • rpgmaker, on 01/02/2008, -0/+1You have a point there but I never said that China spend in their military as much the US does.
      • Treoinmypocket, on 01/01/2008, -1/+1Funny. Care to explain why states and cities with the lowest spending per pupil in th USA are actually doing the best?
    • LordRedSnake, on 12/31/2007, -2/+5I read that article and thought... no *****? Most economists worth their salt would peg China's GDP at or below $6 trillion. Anyone could tell you that $10 trillion is absolutely bogus when the US is at $13 trillion. China's a growing economic force, but still far behind the US despite its enormous population. It's been no secret that PPP computations weren't applicable when toting up China's GDP when items in the typical basket of goods used to determine PPP aren't available to much of China's population.
      • williamdyer, on 01/01/2008, -2/+2There is a Wal Mart in Beijing that is both much cheaper and much nicer than any Wal Mart in the U.S. - it's kind of a cross between Wal Mart and Carrefour, with a food hall that would give Zabar's a scare. Now what was that about PPP? I may move to China because of my job, and if I do, I will be able to live like an aristocrat, with domestic servants, a much nicer apartment than I could have in any American city, and I will be able to eat in fine restaurants regularly I would need to be making three times as much to live like that in a major U.S. city.
        • allan17, on 01/01/2008, -1/+1What does that have to with the China vs US economy size subject?
      • tech42er, on 01/01/2008, -1/+1Yeah. The World Bank was apparently vastly overestimating China's relative PPP.
    • an0nym0uz, on 12/31/2007, -1/+1They are full of ***** and incompetent
    • CookieTrain, on 01/03/2008, -0/+1The Journalist is completely biased and full of *****:

      I mean come on:

      "For Americans, the new numbers from the World Bank bring good news and bad. On the plus side, U.S. leadership in the global system seems more secure and more likely to endure through the next generation. On the other hand, the world we are called on to lead is poorer and more troubled than we anticipated."

      Trust me, no one is "Calling Upon" the US

      And this talk about China as world political leader, the need to match Chinese milletary power By India and the US ? The facts in this article are Ok, but the journalist seems to be drawing a few strange conclusions here.
      Everyone should take note that this Walter Russel Mead is writing for the opinions section.
  • hydroplane, on 12/31/2007, -14/+5Those sandal-wearing goldfish tenders? Ha ha! Bosh! Flimflaw!
  • brainboy77, on 12/31/2007, -23/+98in other news, the USA is completely bankrupt and is in tremendous debt.
    • sotloo, on 12/31/2007, -10/+3Un-paid student loans = Debt crisis part 2
    • johnn11238, on 12/31/2007, -8/+29In debt, yes.
      Bankruptcy, no.
      Look those terms up in the dictionary.
      • vertinox, on 12/31/2007, -5/+8You'll never go bankrupt as long as you can keep printing money to pay off debts!
        Never mind people's life savings in the banks have just been devalued.
    • HimThatSpeaks, on 12/31/2007, -17/+7US citizens GDP is negative $150,000 where most people make $40,000-$50,000. And that is before their own $25,000 of debt is considered.
      • sodoh, on 12/31/2007, -11/+4Would be interested to know why your comment is getting buried.
        • staxofmax, on 12/31/2007, -2/+9Because the numbers have no context and make no sense.
        • 2oonhed, on 12/31/2007, -1/+8I can do a wheely!
      • tech42er, on 01/01/2008, -1/+2Are the trolls not even trying any more? That comment makes absolutely no sense whatsoever.
    • Zap2, on 12/31/2007, -2/+3Do you just enjoy the thought that america is broke?

      And when someone points out "Hey, American isn't as F***ed as you thought" you get all sad.
      • williamdyer, on 01/01/2008, -2/+3America is more ***** than anyone here wans to admit. One word: petrodollar.

        One day we will wake up with money that has no value because nobody uses the petrodollar any more.
  • Berkana, on 12/31/2007, -7/+70If that's true, that's especially sad, since China pretty much sacrificed the cleanliness of their rivers and air for the money. Most of Chinas rivers are too polluted for safe use now, and the skies are rarely ever blue. Over 700,000 folks die due to pollution related illnesses per year. Even if their economy were 40% larger, it would not have been worth it.
    • dsendecki, on 12/31/2007, -6/+16"the skies are rarely ever blue"? Have you ever been to China? Admittedly urban area are blighted — but there are many, many beautiful areas left.
      • HimThatSpeaks, on 12/31/2007, -8/+6I was there back in 1437 and the skies were crystal blue. Saying there is pollution in China is an utter lie.
        • jerwong, on 12/31/2007, -2/+4So.... 1437, that makes you 570 years old? Given this was before the Industrial Revolution, I can understand why the skies are "crystal blue".
      • whorunbartertwn, on 12/31/2007, -0/+6I was there in last May, plenty of blue sky. Completely asinine statement.
        • williamdyer, on 01/01/2008, -0/+3It varies: Beijing is brown and smoggy about 70% of the time. Like L.A. in the early 70's. The cities with heavy industry are worse, like Gary Indiana while the steel mills were running full blast in the 60s and 70s.

          It's not healthy and they know it. They ban motor scooters in big cities. But then they open coal fired power plants faster like they were Starbucks. They are building a whole "green city." The middle class is big now, and they won't stand for being poisoned.
          • tech42er, on 01/01/2008, -0/+1How's Shanghai? I'm going there this summer. As an asthmatic, I'm a little concerned.
    • Nichiren, on 12/31/2007, -2/+4China is probably where the U.S. was during its Industrial Revolution. If we assume parallels between the two nations, China *should* realize that environmental impacts is part of economic cost and correct it accordingly. At least they have the benefit of better technology that's been produced since the 19th century... if they choose to pay for it...
      • thecatcantalk, on 12/31/2007, -2/+3Mmm, depends how that's accounted for. The method we use for our own economy calculates multi-billion dollar cleanups of environmental disasters (e.g., New Orleans after Katrina, Alaska after the Valdez spill, Three Mile Island nuclear accident, etc) as good things; they increase the size of our economy, as do cancer, car wrecks, school massacres, the demolition of the World Trade Center, etc.; any expensive disaster resulting in catastrophic injury or death is accounted as a "boost" to the U.S. economy. You'd think that stuff would be accounted as a setback, a negative, but it's not. Weird, but true.
      • Zap2, on 12/31/2007, -2/+3no...they have done a lot more damage..plus the Earth in general is in far worse shape...
        • kazamx, on 01/01/2008, -0/+1The US still produces many many many times more pollution per person, than China does.
    • whahaa, on 12/31/2007, -11/+5"Over 700,000 folks die due to pollution related illnesses per year."

      nice. they have too many people over there anyway.
    • falkonv7l, on 12/31/2007, -4/+4Population Control
    • noumuon, on 12/31/2007, -2/+7"and the skies are rarely ever blue." you obviously have no idea what you're talking about, or you're generalizing an entire country based off of .01% of it.
      • williamdyer, on 01/01/2008, -1/+2More like 10% or 20%. You have to be old enough to remember 70s smog in L.A. to not be freaked out by how smoggy Beijing can get.
        • kazamx, on 01/01/2008, -0/+1and how much land mass does all the major cities take up? like 0.1% of the total land mass of China.
      • neko6, on 01/01/2008, -0/+3I've been to several areas all over China. The north is pretty clear outside the cities, and the south is also rather nice, but in Beijing and Chengdu the sky was constantly a plain and disgusting gray.
    • NJank, on 12/31/2007, -0/+1But, hey, it got 'em the Olympics next year! What more could you want?
    • digggggggggg, on 12/31/2007, -0/+3The reason why their economy is growing is because of "extensive" growth, which is getting more people into industry, mining previously untapped areas, and building more conventional (read: coal) power plants. This ties into your thing about everything being really polluted. It's because they're willing to sacrifice just about anything for this kind of growth.

      In the not-so-distant future, their growth will start tapering off because there are only so many people who can work, only so many places to mine, and only so many tons of coal to burn. They will need more "intensive" growth, such as finding a cleaner source of energy, training workers better, and enhancing manufacturing processes, in order to continue growing. A nice side effect is that with these refinements, industry is typically more environmentally friendly as well.
    • geardosdotnet, on 12/31/2007, -5/+2If there ever were a case to actually intervene with a foreign government, it would be on environmental grounds. Pollution has an effect on the entire planet, and I don't believe china should have the right to pollute the entire planet so they can be richer. They should either follow international standards or face trade sanctions .
    • an0nym0uz, on 12/31/2007, -0/+2Your stats sound like garbage, where did you get them from? the world bank?
  • JenadaeXX, on 12/31/2007, -10/+3HAHA? Wow, umm i dunno what to say, but this is total *****... anyone got a few billion to lend me?
    • altgeeky1, on 12/31/2007, -4/+2No, but they have a few billion to lend AND lead you...
    • chrisinsocalif, on 12/31/2007, -0/+3Sure, let me go get my wallet.
    • tech42er, on 01/01/2008, -0/+1It's total *****? Proof?
  • ordig, on 12/31/2007, -16/+8If china falls, so falls the united states. They will want to collect on some of our debt.
    • jasqwerty, on 12/31/2007, -9/+6LOL, not really...

      You really think a one time charge of 375 billion would cause the US to collapse? *****, we could make that back in 1.5 year thanks to the 250 billion trade deficit not existing.
      • thefinalruin, on 12/31/2007, -3/+4Except there is a huge budget defict to make up for the trade deficit!
      • sodoh, on 12/31/2007, -3/+3You will that China won't suddenly go "Hey USA gives us back our money". What is more likely to happen is that as your debt to buy out US property and businesses. It is already happening for some time now. Saudi Arabia too, remember when they wanted to buy all the US Ports?
      • InformedCrab, on 12/31/2007, -3/+3Wow, smart. I'm sure if we just stopped purchasing Chinese products we would somehow "gain" $250 billion dollars right off the bat? Mercantilism was debunked quite a while ago buddy.
        • jasqwerty, on 12/31/2007, -1/+1Then according to you, trade deficits don't matter?
        • tech42er, on 01/01/2008, -0/+1Absolutely. The world is flat.
    • whahaa, on 12/31/2007, -5/+2ordig says, "They will want to collect on some of our debt."

      georgie w. bushie says, "Let them try. We have the moral high ground. Heh heh heh. God is on America's side, y'all. Heh heh heh. Also, we're taller than them. Heh heh heh."
    • 666dorado, on 12/31/2007, -5/+1just print more money...
      • StormyAaron, on 12/31/2007, -1/+4Printing more money reduces the value of the money. As Germany learned during the depression after WW1.
  • mdvaldosta, on 12/31/2007, -15/+9China will practically own the US in 20 years... Eh.
  • CPoe, on 12/31/2007, -12/+14Grrr, I hate how they are gearing up the public for an economic war with China...
    "America is the Only superpower!! Mwhahah!"
    http://www.youtube.com/watch?v=5DmYLrxR0Y8
  • monkeyrun, on 12/31/2007, -11/+5lol that when you know that someone is desperate.

    Why don't we talk about the US economy :)
  • zyl0x, on 12/31/2007, -14/+8Yeah right. The US wished they were doing better than China. How embarrassing for them..
    • whorunbartertwn, on 12/31/2007, -3/+1Doing better? What percentage of people in China do you think own cars or have central air conditioning?
  • mugicha, on 12/31/2007, -1/+53These numbers are way off. They farmed at least several trillions worth of gold this year, easy.
    • JJNYC, on 12/31/2007, -4/+5rofl
    • HimThatSpeaks, on 12/31/2007, -4/+4Yeah, way off. They did not include the cents that they are over. It is one thing to be off by a 4 trillion but what about 4 trillion and 25 cents. That is a whole different story.
    • majikman, on 12/31/2007, -7/+1I"m curious as to where these numbers you claim come from. Got any references?
  • tuntcickle, on 12/31/2007, -4/+10"Also, the difference in U.S. and Chinese living standards is much larger than previously thought. Average income per Chinese is less than one-tenth the U.S. level. With its people this poor, China will have a hard time raising enough revenue for the vast military buildup needed to challenge the United States."

    Wait, so who's holding the government accountable for taxing and spending? Oh yeah, that's right. NO ONE
    • dadioflex, on 12/31/2007, -1/+13It's suggesting that China is interested in some kind of military stand-off with the US. They don't need to "challenge" the US. Why would they mess with their best customer, especially if it threatened their US investments.
      • tuntcickle, on 12/31/2007, -0/+1yeah of course, but i was pointing out that the likelihood of China heavily investing in its military cannot be gauged accurately at all by this GDP estimate and PPP comparisons
    • sodoh, on 12/31/2007, -0/+2Income doesn't relate to if you are poor or not when comparing to other countries. For example a job in America that will net you 50-100k a year goes for 15k a year in India. Yet you can live like a king for 15k a year in India.

      • tuntcickle, on 12/31/2007, -0/+1i trust the LATimes to accurately report on purchasing power parity...do you?
    • Joedope, on 12/31/2007, -2/+1 Let's go pre-empt those sino pig-f**ers! BECAUSE THIS ONE'S FOR THE DALAI LAMA!! And the other yet-to-happen atrocities we will blame on you!!!
    • Corrosionx, on 12/31/2007, -3/+2China could bring the US to its knees without firing a single bullet.
  • Scrappy1850, on 12/31/2007, -6/+42Wait... you guys do know that the world bank isn't actually a bank, right?
    • dadioflex, on 12/31/2007, -0/+21Dammit, you mean I've been wasting my time phishing for people's World Bank account details???
    • atbnet, on 12/31/2007, -0/+5Wrong, this lawyer from Nigeria gave me a check that contains the assets of my cousin (never got to meet him sadly) whose family died in a car crash worth $10 million payable from the World Bank. It only cost me a few thousand for him to send it, but when it arrives I'm going to retire!
  • RyomaNagare, on 12/31/2007, -10/+14well everyone get a hold of something, because if China's economy is that small, there is no way it can save us from a huge '29 like depression, right now the incredible growth rate of china, and India are the only things keeping g the world economy in check.
    take that and the USA domestic problems, and the situation in the middle eats, will drag us all...
    so I'll be in my corner wishing for this to be just FUD
    • unreg, on 12/31/2007, -2/+0Could you explain this scenario in a bit more detail? How exactly would Chinas economy save us from a great depression? Do you even understand the circumstances that trigger the depression?
      • RyomaNagare, on 01/01/2008, -0/+1Well yes, Thank you understand it pretty well. Not living a huge superpower country like most Americans do, We depend on a stable worldwide scenario to achieve progress, most countries that have their economies centered in export of commodities have this problem.
        while USA can survive on internal demand alone, smaller countries like mine can not.
        So in order for us to be able to keep growing at a steady rate, we need to be able to sell to someone, if USA is indeed in problems like most analyst say it is, and China is in problems too, that means, Capitalist take their money to a safer place, less money around for investment, less growth, 2 periods with negative growth and you've got yourself a depression.

        Right now analyst keep thinking USA, will enter a period of slower growth or even recession. if that were to happen, at the same time with a Chinese adjustment. we could very well be watching at another world crisis the like of 1997.
  • uptwolait, on 12/31/2007, -4/+15They forgot to factor in the profits made at the millions of Chinese take-out restaurants here in the U.S., secretly importing MSG by the ton and exporting our money back to China.
    • Mesmorize, on 12/31/2007, -1/+2Hahhaa =)
    • digggggggggg, on 12/31/2007, -1/+2When in doubt, the secret ingredient is always MSG.

      Why does this big mac/chicken nugget/taco meat taste so good, but cost so little? I got two words for you: Monosodium Glutamate.
      • tech42er, on 01/01/2008, -0/+1I think it's the essence of pure flavor: plain old water, spiked with a few teaspoons of LSD.

        /futurama, RIP
  • Mesmorize, on 12/31/2007, -12/+18So basically China got freaking owned, and all the euro-twits are mad that the US will still be the only superpower for the next fourty years.
    • whahaa, on 12/31/2007, -1/+2forty.
    • vertinox, on 12/31/2007, -3/+3No, it just means China will out pace the US economy by 2022 instead of 2012. That is assuming that the US economy is still growing by then and the Chinese economy does not accelerate.

      BTW I played a game with a bunch of drunk friends one night in a Target store recently called "Find something not made in China". We called out products we saw on the shelf and bet if it was made in China or not. Took us about 30 minutes but we found a status of Buddha made in Thailand in the candle section.
      • Mesmorize, on 12/31/2007, -2/+2Uh, no. Its obvious the ten percent growth rates we've been seeing are wrong if the economy is 40% smaller than assumed.
      • Zap2, on 12/31/2007, -0/+1so do you have any reason to believe that, or are you just making it up?

        Also your assuming china keeps grow at the same rate..its possibly they will level off...
      • mcduckov, on 01/01/2008, -0/+1I trained my niece to always look for where things are made. I think some of the first words she learned were "made in China". It is kinda funny now to see her flip over everything and look for where it is made. I have also tried to get her to think about the people who made all these things we see on our shelves.

        If these new numbers are right then it is her generation that will have to deal with a near-peer rather than mine.
    • reignbow, on 01/01/2008, -1/+2Actually, the "euro-twits" were rather worried about China. In the case of Germany, chinese companies are competing rather hard on production machines, not always with original designs *coughproductpiracycough*. Doesn't sound like much, but it's a large part of our economy. I don't know anybody who really wants China to assert global influence on the same scale as the USA or the USSR, no matter what people may say about the US.
      • Mesmorize, on 01/01/2008, -0/+1They hate the US more than they hate China.
    • Zique, on 01/01/2008, -1/+2Or maybe the "euro-twits" don't care since EU is the biggest economy on the planet either way.
      • Mesmorize, on 01/01/2008, -1/+1Right, up until you finally commit your slow motion suicide.
  • soupdawg30, on 12/31/2007, -9/+12China is digging it's own grave.
    • digggggggggg, on 12/31/2007, -2/+6That can be said for a certain large North American country as well. It's neither Canada nor Mexico.
  • entrophize, on 12/31/2007, -2/+13As long as they keep making those little paper umbrellas who gives a *****?
  • jasqwerty, on 12/31/2007, -4/+6The revision is due to the vagaries of the ***** known as PPP. It's why nominal GDP is superior in all aspects, and isn't being revised at all, when judging a country's international economic leverage and power. PPP is made up of fallacious "what-ifs".
    • justinx0r, on 12/31/2007, -3/+4Nominal GDP is worthless, everyone knows that. It doesn't adjust for inflation.
      • jasqwerty, on 12/31/2007, -1/+2>>It doesn't adjust for inflation.

        That's the dumbest thing I've read in a while...
      • Zique, on 01/01/2008, -0/+1How about educating yourself before spouting crap about things you know nothing about? Inflation is reflected to exchange rates which are reflected to nominal GDP.
    • Swifti, on 12/31/2007, -0/+5Still, nominal GDP statistics from 2006 results in China having about 2.5 trillion while the United States and the EU have a nominal GDP of 13 trillion.
    • jerwong, on 12/31/2007, -0/+1Point to Point Protocol???
    • digggggggggg, on 12/31/2007, -4/+1Let's just agree that economics consists of a combination of wind direction, moon phase, and gut feeling of well paid economists.

      After all, if the consensus of economists is that we're doing a-ok, then we're going to be screwed in the next decade. If the consensus is that we're already screwed, then we're TOTALLY screwed and you should cash out all your investments into property and or gold.
      • tech42er, on 01/01/2008, -1/+2Just shut up. I understand you find macroeconomics complex and complicated, but it still counts for something and it's still an empirical science.
  • compucomp2, on 12/31/2007, -12/+6The LA Times hates China; most American media does. This is not an exception. They are making isht up straight out of their assholes.
    • sensoukami, on 12/31/2007, -1/+1and your brain is located in your *****. Perhaps you should RTFA and come up with some valid & intelligent criticism of the points made or the methodologies used. Just a thought.
      • tech42er, on 01/01/2008, -0/+1He'll just accuse the World Bank of being an American, neoconservative, Sinophobic institution. You can't reason with him.
  • mrASSMAN, on 12/31/2007, -0/+9Didn't I read about this two weeks ago? Why is this suddenly breaking news again?
  • tracespeck, on 12/31/2007, -5/+15What I always thought, I mean, you can just look at china and tell it hasn't "almost caught up" with the US. Common sense and the old numbers didn't work together.

    Comparing economies with China is like when the US compared missiles with Russia during the cold war. Turns out they didn't have nearly as much as thought. Could it have something to do with communism?
    • digggggggggg, on 12/31/2007, -1/+3Soviet economics were totally inaccurate at best, if not outright lies. Managers and planners would be demoted/imprisoned/shot if they didn't meet quotas, so they had to cover their asses somehow.

      I can't see China's economists being any better. Most likely, they're a bunch of yes-men who constantly enforce the idea that everything is going awesomely in the prosperous and glorious people's republic.
    • Zap2, on 12/31/2007, -0/+2yes, the fake communism which is being used to control the people, is to blame
  • giveer, on 12/31/2007, -4/+18They lost 4 trillion dollars? Since when is George Bush running that country as well?
    • manstein01, on 12/31/2007, -0/+3Wrong verb, if you're going to compare GW then you have to say "wasted" not "lost" - there is a difference.
    • vertinox, on 12/31/2007, -2/+1They lost 4 trillion dollars because their investment in the US dollar tanked. Of course that says nothing about what is going to happen to us.
  • BigBallistix, on 12/31/2007, -9/+8This is pure damage control propaganda, I hope some opposition tear it to shreds.
  • Hetman, on 12/31/2007, -2/+9The major problem I see China running into is that they have almost completly destroyed their enviroment. And they still refuse to cut coal immisions. And really that is the least of their enviromental problems. The government allows businesses to dumb waste into their water supply. It is only a matter of time before things get out of control and start affecting the population. It doesnt look good.
    • thecatcantalk, on 12/31/2007, -1/+3Yep. And as of last year, China, not the U.S., is officially the planet's worst polluter. Never hear about that from the "do you have a minute for the environment?" panhandlers, lol.
    • Hetman, on 12/31/2007, -0/+5I agree And I am not even talking about global warming. Im talking about ground pollution, bad infastructer, polluted rivers and streams. "The only fresh water dolphin in the world is going extinct because of it." Just think about it they have 1 billion people. For every 1 peic of garbage we throw away. They throw away like 3.2 pieces of garbage. That is a lot of waste to deal with.
    • digggggggggg, on 12/31/2007, -2/+1The same thing happened during the industrial revolution in just about every other nation. It's just a phase they're going through. Eventually they'll have to do something about it.

      Or, if they trash it _that badly_ they can just do what they did in the Simpsons: move the country north a few parallels into that place where hardly anyone lives. I think it's called "Siberia". After all that global warming it's bound to be at least somewhat habitable.
  • markgl, on 12/31/2007, -14/+4communist never win! Hehe.

    actually we are a badass country which is why everyone here shouldn't be making fun of America. We aren't perfect by a longshot, but I don't see millions of people breaking their backs to go live in china for a better life. They want to come to America.
    • Tuto, on 12/31/2007, -4/+2Seriously how can people still believe that china is a communist country? Compared to china the USA looks communist. Just because the party leading china calls it self communist and thus claims the entire country is Communist doesn't make it so.
      • markgl, on 12/31/2007, -1/+2are you the defender of china? they call themselves communist and you don't beleve that, and call us communist? I guess you have no clue how america runs.
        • hasahugedig, on 12/31/2007, -2/+0So, we call ourselves a democracy...and you see how well that worked out.
          • fallenrayne, on 12/31/2007, -1/+3And for my first comment on Digg, I need to point this one out. US Government = "Constitution-based federal republic; strong democratic tradition" as per Wikipedia, CIA World Factbook, and every other major description. The United States is a Federal Republic, not a Democracy; there is a very big difference.
        • Tuto, on 12/31/2007, -1/+1What are you babbling about? I am not defending China, I am stating a fact that china is not a communist country, at least their economy isn't. China's government, the communist party is only claiming that china is a communist country but in truth they are as far away from communism as a country can be. I thought this would be common knowledge by now
    • eqisow, on 12/31/2007, -2/+2AMEEEERICA! ***** YEAH!

      ( http://www.youtube.com/watch?v=sWS-FoXbjVI - that's what you sound like)
    • digggggggggg, on 12/31/2007, -0/+3As awesome as the US of A is, you're right that we aren't "perfect by a longshot".

      That's why we must continue to be an active part of the democratic process to ensure that our government does the right things to achieve real progress. Right now, the consensus is that, regardless of whether or not the intentions of our current administration are good, they're squandering a lot of money into military spending. Arguably, this money could be better spent solving domestic problems like education and health care.
  • unreg, on 12/31/2007, -2/+3Interesting read. While I'll reserve judgment as to the validity of the article / issue, I can see how easily it would be to under / over estimate something as volatile as the Chinese economy.
  • maroger, on 12/31/2007, -3/+3If this is true, which I highly doubt looking at those who make up the rules to come up with these numbers, then it's all the more reason this country needs competence in higher offices. If this country is truly a world leader then we need to act like it, not self-centered bullies... On the other hand, how foolish to delineate money as the factor that makes it so. Sure money, in our capitalist system, is the basis for everything, but health and well-being and happiness need to account for something. If so, the US is far behind most of the rest of the world- at least for those that aren't suffering because of us...
  • freehat704, on 12/31/2007, -3/+6This is quite old. The Economist said this in their recent magazine around a week ago and the LA Times are just reporting it.
    • cryptomystic, on 12/31/2007, -5/+2Sorry, but I didn't get to read every major news publication on the planet on that day so if you have nothing else to add to this please STFU. thx.
    • noonjab, on 12/31/2007, -0/+3Unfortunately, the LA Times is not "just reporting it" - they're putting a crazy spin on it.
      LA Times: "The political consequences will be felt far and wide. To begin with, the U.S. will remain the world's largest economy well into the future. Given that fact, fears that China will challenge the U.S. for global political leadership seem overblown."
      Economist: "In 2008 it is almost certain to overtake Germany as the world's largest exporter, and assuming recent rates of growth are sustained, within ten years it will overtake America (in PPP terms) as the world's largest economy."
      - http://www.economist.com/world/asia/displaystory.c ...
  • loquax, on 12/31/2007, -2/+4I remember a while back that the Chinese government itself expressed that somewhere between 3 to 10% of their GNP went into dealing with the environmental impacts of their industry and that this number was expected to grow over time. This coupled with a steep rise in the price of goods domestically in China is just the tip of the iceberg that they will experience over the next 10 -20 years. Corruption, a lack of truly free markets, the world perception of shoddy(or dangerous) products could begin to wear-down China's rise. I predict also that the Chinese people will begin to demand more money and freedoms for their labor, that "extra-market" (read government crack-downs) pressure will be applied.
    The best thing the Chinese can do now is to put environmental reforms into overdrive, improve their justice system (i.e. free it from ANY outside influences), and begin allowing some form of multi-party participation in government at all levels. I don't think they have the nerve to do any of this.
  • Snarfy, on 12/31/2007, -6/+5China would be doing just fine if they didnt' borrow a billion dollars/day in worthless US dollars. They borrow the dollars, the Fed manipulates the interest rates, the dollar loses value, china becomes poorer and the US richer. The same ***** been going on for centuries. It's the reason the US had its revolutionary war with Britain. When China wakes up to the fact that their whole economy is being manipulated by the World Bank, China might want a revolutionary war too.

    Hell just look at the source:

    " Walter Russell Mead, a senior fellow at the Council on Foreign Relations," is the author of "God and Gold: Britain, America and the Making of the Modern World.""
    • Mesmorize, on 12/31/2007, -0/+2That's not how the revolutionary war played out.
      • Snarfy, on 12/31/2007, -1/+2"King George outlawed the interest free currency the colonies were creating and using for themselves. Which made the Colonies forced to borrow money from the Centralized banks of Britian with high interest forcing the colonies into 0Debt.
        Benjamin Franklin himself cities this as the main cause for the revolution."

        Are you sure that's not how it played out?
        • Mesmorize, on 12/31/2007, -1/+2Yeah, I'm positive. I've taken college history courses. The revolutionary war was caused by many different things, but that wasn't the main cause. The colonists didn't want to pay their share of the French and Indian war, they hated the idea of tariffs(especially in New England, because of the shipping business, they wanted to be able to get cheaper stuff from the French), the sudden reversal of salutary neglect, public outrage over the Boston "Massacre", not to mention the wide circulation of pamphlets like and including Paine's, and Britain's declared right to "Bind the colonies in any measure whatsoever".

          Thanks for reading Wikipedia, next time delve into some history textbooks.
          • tech42er, on 01/01/2008, -0/+1He's got a point. The mercantilism that fueled Britain's colonialism certainly contributed to the colonists' anger by robbing stripping the colonies of their wealth. This mercantilism was manifested in Britain's taxes for revenue and trade.

            From Britain's point of view, the colonies existed to funnel gold to Britain. The colonies did not believe Parliament had the power to impose all these taxes, particularly those designed for raising revenue after the French and Indian War, and came to believe Parliament had no legislative authority over them at all. They felt bonded to Britain only through the king. When they realized King George III was a tyrant, they appealed to the Locke's idea of a "contract theory of government" and "fired" the king, declaring themselves independent of Britain.
    • digggggggggg, on 12/31/2007, -0/+3Um, China has invested in US bonds more than it has borrowed dollars. The net effect is that they're actually our creditor.
  • Swifti, on 12/31/2007, -4/+13I love how all these Diggers are going into cognitive dissonance mode and screaming "*****" without even addressing the methodology that the World Bank used.

    Dude, read the article guys. Make your argument center on how their calculations of purchasing power parity is wrong. Any Economics Bachelors in here? No? Only Computer Science Bachelors?
    • LukasSmith, on 12/31/2007, -6/+3No degree is about the truth on digg.com. Maybe an associates from some crap community college. Look mommy I have a degree in SCIENCE!
    • jcroweall7, on 12/31/2007, -1/+2English bachelor! I read it and understood it.
  • eddywin, on 12/31/2007, -10/+4I seriously doubt the credibility of this article.. show me the same story from some other news corp from china or some other asia country that is neutral. all american news is biased. damn patriots. "omg, remember when we said that china was going to pass china? we were wrong, US still wins and will always be the best. GO USA" by the way, i'm just pointing out how rediculous it is.. what's next, a news story saying how they brought peace to the middle east and how no soldier actually died they're just on vacation on the endless beach that is Iraq.
    • sensoukami, on 12/31/2007, -0/+2You doubt the credibility because you know nothing and probably didn't RTFA and because you know nothing about statistics or how economies are measured. In other words, you don't know ***** about *****.
    • tech42er, on 01/01/2008, -0/+1Did you actually see that it was from the World Bank and research how they measure economies using relative PPP? Of course not. You just assumed that it was biased because it was from "an American source" that must be unfairly biased against China.
  • imightbewrong, on 12/31/2007, -0/+7i read it in the economist..its more news about the yuan than china
  • sodoh, on 12/31/2007, -7/+2TBH if china is low on money it can just call in its debt on the USA. Then watch the USA fold like a house of cards. This works out great for the world bank if that happens.
    • drmangrum, on 12/31/2007, -0/+5uh huh, and how are they going to enforce it?

      There are reasons why loan sharks hire men with no necks named "tiny."
      • sodoh, on 12/31/2007, -0/+2If they don't enforce it then overnight your US currency becomes worthless to the rest of the world. Sure you will still be able to buy stuff in America but your currency will be like a third world countries.

        Add to that Chinese imports (for starters) would stop coming into the USA. Sure you can buy elsewhere but when Tiny finds out he is paying x10-x100 for general goods he isn't coming for China, he is coming for your loan sharks.

        When your $ collapses it means that other countries can walk in and pick up stuff for cents. Same thing happened during the first stock market crash (only with certain companies), so this is just on a broader scale.

        I'm finding the comments being buried hilarious with no thought. Something else that wasn't mentioned was the recent announcement of China having more power within the world bank. Considering if the $ does nose dive the World bank profits. Makes you think? No?
  • Ymeg, on 12/31/2007, -3/+5I wonder how they would be under a free market.
    • SimonGray, on 01/01/2008, -0/+2China is only communist and socialist by name. They are a capitalist country.
  • falkonv7l, on 12/31/2007, -1/+2100% un-controlled Internet access, media, and free speech, anyone?
  • nightwing2000, on 12/31/2007, -0/+2Yeah, the question is - "OK, the average Chinese make X yuan a year. How exactly does this compare to us?". The real answer is, "We can tell you, but only give or take a hand-waving 40%".

    The actual issue, as the article says - what does the Chinese government plan to do? COnsider the issues - no decent old-age pensions but generally one child per couple for the last 40 years - meaning each working couple has 8 grandparents to support, and then about the time they kick off, 4 parents. Ouch!
    Where do you spend the money to keep development happening? Build subways and trams to keep the cars and cycles off the streets; trains to cut the cost of countryside distribution. Provide electricity, communications, and associated infrastructure to help move the outlying areas into the 20th century (or the 19th); provide education. If you want to turn a nation into programmers, engineers, pilots, or even the mechanics and plumbers and electricians that keep society going - they need the education to get there, and the tools to practice and understand their skills. That becomes money well spent. As the 3rd-world tinpots find out, just running an armoured Mercedes can get very pricey if you even have to import the mechanics.

    Remember Howard Beale's commuppance in the boardroom scene? "When the politburo gets together do you think they talk about communist theory and world domination? NO! They talk about budgets for each ministry, and where to spend the money they have, just like a capitalist country..."
    The business of the world is business, because that's where the food comes from.
    • monkeyrun, on 12/31/2007, -0/+3"COnsider the issues - no decent old-age pensions but generally one child per couple for the last 40 years"

      If you know any Chinese you'll know that they don't really need a pension system.
      They could be picking up tin cans for money and still manage to buy a house.
    • digudown, on 12/31/2007, -0/+1You are forgetting Chinese have healthy saving rates unlike US, so most of the people are able to save for the old age.
      • tech42er, on 01/01/2008, -0/+1Uh...I'm not so sure about that. There are certainly demographic problems in China, from over-population, too much of the elderly, and a wide gap between in the sex ratio.
  • Kallius, on 12/31/2007, -3/+9Probably the fault of those stupid Mongorians.
    • SamuelHenderson, on 12/31/2007, -3/+0Thats one of the few Southpark episodes I enjoyed :)
  • mrzack, on 12/31/2007, -9/+4China's got something called an Economy, which is something America lacks. America's system is a system of making money by handling money, which is completely a fraudulent scam system. America no longer manufacture or produce anything. In a real economy real wealth is produced. Real wealth is something that you can see, touch, taste, smell, or hear. Financial mumbo jumbo is trickery, no more real than WoW gold.
    • whorunbartertwn, on 12/31/2007, -1/+2Don't be an idiot I could cash in my untouchable, tastable, or smellable, or hearable 401k and live like a King for 20 years in most parts of China.
      • mrzack, on 01/01/2008, -0/+1what makes you think in 20 years you still will have a 401k? and what do you think your 401k will even be worth what it's worth now with the decline of the dollar?
      • googleabcd, on 01/02/2008, -0/+1Just let you know that 401k USD is now just enough to buy a 200 sqm house in Beijing.
  • banido, on 12/31/2007, -1/+2Tricia: And here comes David Bowie!
    Tricia: David, what bings you all the way to...
    David Bowie: Shhhhhh! Oh baby, just you shut your mouth.
    Tricia: Ooooh!Me love to meet Ziggy Stardust!I take you home!I make you fish ball soup!Fish ball!
    Tom Tucker: Thank you, Tricia, for setting your people back a thousand years...
  • SLuM, on 12/31/2007, -1/+3China in truth was (is) the only thing standing between western banks and promote from suffering and slavery. Not saying China's a saint but this is the matter of truth. Also I feel terribly sad that a billion people will suffer because the idiot politicians cared more about political sway than true power (which is represented by the well being of citizens in a state).
  • sixsidepentagon, on 12/31/2007, -4/+4It's because they're not going to vote for Ron Paul.
    Sorry guys, I needed to add the obligatory Ron Paul comment to keep Digg 100% accurate.
  • gleongelpi, on 12/31/2007, -2/+5Oh yeah, as if somebody's decision to place a certain number by a country changes the reality. This is neither good or bad news; this is only another attempt at measuring the unmeasurable. It changes nothing. Businesses already know what their business is. Some clowns in suits do not determine anything when they put out numbers like that. Considering all I know of China, I'd said that its economy is already larger than ours, and that its population has an average income much higher than 10% of ours. Just imagine, if the average American had an income of 2,000 to 3,000 per year, they would be sleeping under bridges. They could not even afford to eat and cloth themselves. The standard of living of the average Chinese can be no less than somewhere between 8,000 and 10,000 considering the way they conduct their lives. Who concocted this nonsense.
  • defektiv, on 12/31/2007, -1/+3someone said china is digging its own grave. i don't know if that's true, but here in america that means we're not only digging our own grave but we've convinced ourselves we're searching for hidden treasure. either that or to hide from our mistakes. =
  • morningmatters, on 12/31/2007, -0/+4The author appear to completely miss that fact that it's in China's interest to have lower GDP figures so that it can remain a 3rd world nation in order to 1)get more aids from 1st world nations 2)have a great excuse for continuing its currency manipulation so it could remain competitive 3)have a great excuse NOT to implement the changes which will help out the average citizens mentioned by the author. Here is a quote from Economist.com on this matter:
    "CHINA'S rapid economic rise is undeniable. But according to the World Bank China's GDP (at purchasing-power parity) is 40% less than was previously thought, thanks to new calculation methods for international comparisons that include China for the first time. This will help China's efforts to portray itself as a poor country so America will give it more leeway over exchange rates and trade."
    http://biz.yahoo.com/economist/071220/10318927.htm ...
  • CaviMike, on 12/31/2007, -1/+1Hopefully this will bring some manufacturing work back to the states. I'm really tired of getting laid off.
    • digudown, on 12/31/2007, -0/+2I would not count on that may be you can consider moving to China.
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