Whatever measure one prefers, it’s pretty clear that the incoming US government is likely not up to the task of containing or opposing an increasingly aggressive Chinese regime. In fact, given his established record, Trump literally might not even want to. He’s already shown he’s too willing to throw our neighbors and allies under the bus and kowtow to foreign strongmen. I’m not looking forward to being proven correct about this.
Don't forget his pledges to destroy both CHIPS and IRA. Microprocessors and batteries are now essential strategic resources. And for drone warfare in particular. They will be crucial in the war that China might start in only a few years.
The GOP can't or won't understand this, as they're blinded by their need to please their Fossil Fuel constituents. But maybe President Musk can help with preserving IRA, of which Tesla--and many GOP Congressional districts--are major beneficiaries.
“Thought leaders” and pundits are still viewing the world in conventional fashion, numbers, economic models, various methods for measuring the size of GDPs. Consider the cost of ignoring increasing global warming that is threatening more than the insurance markets. Nobody is safe in the long term if the climate-change consequences of economic “growth” or theories of “abundance” are discounted. Climate change is annually costing billions in the U.S., is the reason so many countries have a migrant problem, is the reason why all but two U.S. were in droughts at the end of October.
What’s “dangerous” to the U.S. and the rest of the world is that all that Chinese manufacturing prowess is also accelerating global warming. For all the talk of China leading the world in alternative energy, it’s still building coal-fired power plants at a rapid pace. China permitted more coal power plants in 2023 than any time in the previous seven years.
The billions that climate is now costing the US are only for electric cars and subsidies for wind and solar, and are not reducing any emissions which mostly come from China and India. The IPCC attributes no detectable changes in hurricanes and forest fires to climate change, insurance costs are up because housing, home construction and car repairs are more expensive and more houses are built on seashores and wilderness boundaries. What is the evidence migration in US, or EU is due to climate, the refugees are escaping economic and social hellholes like Venezuela, Haiti, Syria and Sudan, not because the temperatures are up 1.5°C.
Most sectors of the North American economy have been affected by and have responded to extreme weather, including hurricanes, flooding and intense rainfall.
There is high confidence (Seneviratne et al., 2021) that anthropogenic climate change has contributed to extreme precipitation associated with recent intense hurricanes, such as Harvey in 2017.
Using this strategy, multiple studies have estimated that the historically extreme rainfall amount that fell across the Houston area from Hurricane Harvey (2017) was three to ten times more likely as the result of climate change.
Extreme weather events, including hurricanes, droughts and flooding, and wildfires, have been partly attributed to anthropogenic climate change (high confidence)
etc
Of course you can take issue with those findings, level of confidence etc but saying the IPCC hasn't made any attribution isn't a plausible claim in my view.
Thank you for the article. A question/comment. Not all of the numbers cited by the articles you used are equally relevant. China producing 50% of all shipping or x times more steel is much more important than the fact that a country with 4-5x more population ate more pork. So if you could make a list of relevant production/consumption indicators for national power, what would they be? What should we be looking at, and how do US/China (or West/Axis of resistance) stack up? Is it steel/oil/rare minerals + certain levels of manufacturing capability?
It does, but what are liberal societies to do? China has chosen to focus its state capacity towards defense and industry in pursuit of zero-sum nationalist goals. A pursuit and effort that has spanned the last decade or so, with Chinese belligerance in the South China Sea, military exercises around Taiwan, and hostile knowledge transfers from Western Industry, Academia and government to jump-start and power their impressive achievements.
Liberal societies already tried the path of economic relations with China, in the hopes of encouraging liberalization of the country but that is not what happened. China doubled down on authoritarianism - suppressing ethnic minorities and dissent using technologies American firms shared with them. Now it is attempting to subvert heavy industry - automotive, manufacturing, etc - abroad knowing full well those industries are the backbone of defense.
The current tension between China and the USA offers no easy answers, I do not know what the liberal societies are to do.
Your point is well taken. However, the boundary between deterrence and threat seems to be quite blurry. With the long history of international aggression our particular "liberal society" has, I wish we are a bit more thoughtful in our strategic planning.
PPP is garbage !!! There , I just wanted to say that . I do not believe it though . Thanks Noah , you made me think harder and deeper about what PPP is . I believe this relates to a central problem in economics and social sciences - viz, just what to measure and how to . We need to keep asking questions about PPP , and keep doing it better and better.
Part of this confuses me. My simple reading of economics says that if a country produces more and exports more, then their trade partners have to obtain more of their currency with which to buy those exports which will naturally cause the exchange rate to rise. How is it that when the U.S. continues to buy far more from China than China buys from the U.S. does the exchange rate continue to lower the value of the Yuan? Is it that China accepts U.S. dollars as payment for its exports so the normal exchange rate "rules" don't apply?
A system dynamics source advised: Think physics. That is what the military comparison--steel, ships, etc.--is doing. Another point is leadership quality. In hindsight I think Obama and Biden were much too touchy feely let's talk about it when Russia invaded Ukraine. The American bombs dropped on Gaza should have been dropped on Russian forces in Ukraine. Israel's over use of disproportionate force threatens the country's unity, international support, and moral integrity. Contradicting "Jewish values" can't be a formula for long term success for a supposedly Jewish state. Russian victory in Ukraine gives China a green light in Taiwan. And for wars elsewhere.
So China seems on the brink of deflation and may have already entered it. The arithmetic results in rising PPP for China if its economy deflates. Does that really make good sense?
There is simply no way that a country of 330 million people is going to have a manufacturing sector comparable to a country of 1.4 billion people, assuming that the latter has enough economic development to have a domestic market commensurate to its size. The U.S. must maintain a large munitions manufacturing sector by keeping a large army in readiness. The voters in this country will not stand for this, so we must just hope that we are never obliged to fight the Chinese. I suppose that the U.S. plus the E.U. plus the Pacific rim countries could compete with China but, once again, this presumes a sophistication that is beyond either American or E.U. voters.
Charles' note raises a point not discussed in the essay. What's the value of per capita GDP (nominal or PPP) versus total national GDP. Would think that per capita would be a better expression of personal wealth, well being or what have you.
National GDP (is that a phrase?) clearly is central to manufacturing prowess and defense production specifically, and perhaps even innovation. Would seem that smaller population countries would need to maximize the effectiveness of their manufacturing and distribution GDP. Is there a way to measure this, I'd think not. Would expect it more a subjective than objective call.
The point that we in the US are no longer the leviathan and need to make more stuff comes out clear as a bell. And, happy to report, you've sketched out effective ways that we might do so. Hopefully the new administration will clear the path staked out, somewhat ineffectively, by the outgoing administration.
PPP should not be used in China because it is a massively heterogeneous economy.
PPP is calculated at a national level. But the GDP is disproportionately generated in areas where prices FAR exceed the national average. This substantially exaggerates Chinas PPP adjusted GDP.
This raises an interesting hypothetical. In 2030, or some year closely thereafter, when China controls the world economically and non-nuclear militarily, and demands that the US submit to China's authority and forsake all of our individual freedoms or they will starve us to death or conquer us, do we use nuclear weapons as a threat? Luckily, I probably won't be here to experience that decision but I am not sure which way I would vote.
The qualitative aspects of "national power" industries are equally relevant however. A steel and shipbuilding industry will be important in the next great power war. As will the ability to manufacture drones and high end aircraft. But so will the ability to rapidly develop and field new technologies. So will each country's orbital launch capabilities, and integrated air defense systems, and ability to product high end EW equipment.
The better question is how does one measure the relative importance of these things for the next war? If America and China were getting ready to fight WWII right now, we'd definitely be on the back foot. As things are, I think it is hard to say. There are some aspects of national power where I would prefer to be in their shoes, and others where they don't seem to have a realistic path to catching up.
"Nice housing, quality medical care, or high-quality insurance services won’t help you much when a foreign empire’s bombs are raining down on your cities and foreign missiles are sending your country’s fleet to the bottom of the sea. "
Of course not, but America's projection to the rest of the world as a place that has a nice quality of life and personal freedoms, a place where the Chinese want to come to study, trade with or move to, is probably a strong deterrent to drop those bombs in the first place.
I'm concerned that the post-Trump reactionary turn in America is decreasing it's soft power with China, increasing the likelihood of conflict and decreasing our safety. Surely there's a way to compete better with them without demonizing them.
Maybe president Elon will save us. Tesla depends on the Chinese market.
Whatever measure one prefers, it’s pretty clear that the incoming US government is likely not up to the task of containing or opposing an increasingly aggressive Chinese regime. In fact, given his established record, Trump literally might not even want to. He’s already shown he’s too willing to throw our neighbors and allies under the bus and kowtow to foreign strongmen. I’m not looking forward to being proven correct about this.
Don't forget his pledges to destroy both CHIPS and IRA. Microprocessors and batteries are now essential strategic resources. And for drone warfare in particular. They will be crucial in the war that China might start in only a few years.
The GOP can't or won't understand this, as they're blinded by their need to please their Fossil Fuel constituents. But maybe President Musk can help with preserving IRA, of which Tesla--and many GOP Congressional districts--are major beneficiaries.
I'm totally going to ask for a World Bank Research Cut next time I'm at the barber.
“Thought leaders” and pundits are still viewing the world in conventional fashion, numbers, economic models, various methods for measuring the size of GDPs. Consider the cost of ignoring increasing global warming that is threatening more than the insurance markets. Nobody is safe in the long term if the climate-change consequences of economic “growth” or theories of “abundance” are discounted. Climate change is annually costing billions in the U.S., is the reason so many countries have a migrant problem, is the reason why all but two U.S. were in droughts at the end of October.
What’s “dangerous” to the U.S. and the rest of the world is that all that Chinese manufacturing prowess is also accelerating global warming. For all the talk of China leading the world in alternative energy, it’s still building coal-fired power plants at a rapid pace. China permitted more coal power plants in 2023 than any time in the previous seven years.
Growth and abundance at what cost?
The billions that climate is now costing the US are only for electric cars and subsidies for wind and solar, and are not reducing any emissions which mostly come from China and India. The IPCC attributes no detectable changes in hurricanes and forest fires to climate change, insurance costs are up because housing, home construction and car repairs are more expensive and more houses are built on seashores and wilderness boundaries. What is the evidence migration in US, or EU is due to climate, the refugees are escaping economic and social hellholes like Venezuela, Haiti, Syria and Sudan, not because the temperatures are up 1.5°C.
"The IPCC attributes no detectable changes in hurricanes and forest fires to climate change"
https://www.ipcc.ch/report/ar6/wg2/chapter/chapter-14/
Selective quotes:
Most sectors of the North American economy have been affected by and have responded to extreme weather, including hurricanes, flooding and intense rainfall.
There is high confidence (Seneviratne et al., 2021) that anthropogenic climate change has contributed to extreme precipitation associated with recent intense hurricanes, such as Harvey in 2017.
Using this strategy, multiple studies have estimated that the historically extreme rainfall amount that fell across the Houston area from Hurricane Harvey (2017) was three to ten times more likely as the result of climate change.
Extreme weather events, including hurricanes, droughts and flooding, and wildfires, have been partly attributed to anthropogenic climate change (high confidence)
etc
Of course you can take issue with those findings, level of confidence etc but saying the IPCC hasn't made any attribution isn't a plausible claim in my view.
Thank you for the article. A question/comment. Not all of the numbers cited by the articles you used are equally relevant. China producing 50% of all shipping or x times more steel is much more important than the fact that a country with 4-5x more population ate more pork. So if you could make a list of relevant production/consumption indicators for national power, what would they be? What should we be looking at, and how do US/China (or West/Axis of resistance) stack up? Is it steel/oil/rare minerals + certain levels of manufacturing capability?
Don’t you think this constant focus on arms/resources competition brings us closer to a war, in a self-fulfilling prophecy?
It does, but what are liberal societies to do? China has chosen to focus its state capacity towards defense and industry in pursuit of zero-sum nationalist goals. A pursuit and effort that has spanned the last decade or so, with Chinese belligerance in the South China Sea, military exercises around Taiwan, and hostile knowledge transfers from Western Industry, Academia and government to jump-start and power their impressive achievements.
Liberal societies already tried the path of economic relations with China, in the hopes of encouraging liberalization of the country but that is not what happened. China doubled down on authoritarianism - suppressing ethnic minorities and dissent using technologies American firms shared with them. Now it is attempting to subvert heavy industry - automotive, manufacturing, etc - abroad knowing full well those industries are the backbone of defense.
The current tension between China and the USA offers no easy answers, I do not know what the liberal societies are to do.
Your point is well taken. However, the boundary between deterrence and threat seems to be quite blurry. With the long history of international aggression our particular "liberal society" has, I wish we are a bit more thoughtful in our strategic planning.
PPP is garbage !!! There , I just wanted to say that . I do not believe it though . Thanks Noah , you made me think harder and deeper about what PPP is . I believe this relates to a central problem in economics and social sciences - viz, just what to measure and how to . We need to keep asking questions about PPP , and keep doing it better and better.
Part of this confuses me. My simple reading of economics says that if a country produces more and exports more, then their trade partners have to obtain more of their currency with which to buy those exports which will naturally cause the exchange rate to rise. How is it that when the U.S. continues to buy far more from China than China buys from the U.S. does the exchange rate continue to lower the value of the Yuan? Is it that China accepts U.S. dollars as payment for its exports so the normal exchange rate "rules" don't apply?
A system dynamics source advised: Think physics. That is what the military comparison--steel, ships, etc.--is doing. Another point is leadership quality. In hindsight I think Obama and Biden were much too touchy feely let's talk about it when Russia invaded Ukraine. The American bombs dropped on Gaza should have been dropped on Russian forces in Ukraine. Israel's over use of disproportionate force threatens the country's unity, international support, and moral integrity. Contradicting "Jewish values" can't be a formula for long term success for a supposedly Jewish state. Russian victory in Ukraine gives China a green light in Taiwan. And for wars elsewhere.
> The American bombs dropped on Gaza should have been dropped on Russian forces in Ukraine.
And China, of course
So China seems on the brink of deflation and may have already entered it. The arithmetic results in rising PPP for China if its economy deflates. Does that really make good sense?
There is simply no way that a country of 330 million people is going to have a manufacturing sector comparable to a country of 1.4 billion people, assuming that the latter has enough economic development to have a domestic market commensurate to its size. The U.S. must maintain a large munitions manufacturing sector by keeping a large army in readiness. The voters in this country will not stand for this, so we must just hope that we are never obliged to fight the Chinese. I suppose that the U.S. plus the E.U. plus the Pacific rim countries could compete with China but, once again, this presumes a sophistication that is beyond either American or E.U. voters.
Charles' note raises a point not discussed in the essay. What's the value of per capita GDP (nominal or PPP) versus total national GDP. Would think that per capita would be a better expression of personal wealth, well being or what have you.
National GDP (is that a phrase?) clearly is central to manufacturing prowess and defense production specifically, and perhaps even innovation. Would seem that smaller population countries would need to maximize the effectiveness of their manufacturing and distribution GDP. Is there a way to measure this, I'd think not. Would expect it more a subjective than objective call.
The point that we in the US are no longer the leviathan and need to make more stuff comes out clear as a bell. And, happy to report, you've sketched out effective ways that we might do so. Hopefully the new administration will clear the path staked out, somewhat ineffectively, by the outgoing administration.
PPP should not be used in China because it is a massively heterogeneous economy.
PPP is calculated at a national level. But the GDP is disproportionately generated in areas where prices FAR exceed the national average. This substantially exaggerates Chinas PPP adjusted GDP.
“How do we measure whether China’s economy is ‘ahead’ of the U.S.?”
Let’s ask McKinsey & Co.
https://www.thebignewsletter.com/p/cutting-government-is-easy-if-
This raises an interesting hypothetical. In 2030, or some year closely thereafter, when China controls the world economically and non-nuclear militarily, and demands that the US submit to China's authority and forsake all of our individual freedoms or they will starve us to death or conquer us, do we use nuclear weapons as a threat? Luckily, I probably won't be here to experience that decision but I am not sure which way I would vote.
The qualitative aspects of "national power" industries are equally relevant however. A steel and shipbuilding industry will be important in the next great power war. As will the ability to manufacture drones and high end aircraft. But so will the ability to rapidly develop and field new technologies. So will each country's orbital launch capabilities, and integrated air defense systems, and ability to product high end EW equipment.
The better question is how does one measure the relative importance of these things for the next war? If America and China were getting ready to fight WWII right now, we'd definitely be on the back foot. As things are, I think it is hard to say. There are some aspects of national power where I would prefer to be in their shoes, and others where they don't seem to have a realistic path to catching up.
"Nice housing, quality medical care, or high-quality insurance services won’t help you much when a foreign empire’s bombs are raining down on your cities and foreign missiles are sending your country’s fleet to the bottom of the sea. "
Of course not, but America's projection to the rest of the world as a place that has a nice quality of life and personal freedoms, a place where the Chinese want to come to study, trade with or move to, is probably a strong deterrent to drop those bombs in the first place.
I'm concerned that the post-Trump reactionary turn in America is decreasing it's soft power with China, increasing the likelihood of conflict and decreasing our safety. Surely there's a way to compete better with them without demonizing them.
Maybe president Elon will save us. Tesla depends on the Chinese market.
Eff it. “Managed Float 2028”.