• I went to Shanghai this summer, and I must say I was delightfuly surprised and worried at the same time. Shangha is a very nice city. I would never guess it was communist if I didn’t know already. Beiijing is in need of some work, but if anyone passes us up in the next 100 years it’s gonna be China, mark my words.

  • Perhaps this needs to be moved to political discussion after my comments:

    Shanghai is quite nice, and, yes, Beijing needs a ton of work.  Although I don’t think when people say that they think that Beijing city authorities should kick out thousands of poor residents on the city outskirts in preparation for the 2008 Olympics.

    Overall, though, China has some significant problems that it needs to work out if it’s going to overtake the U.S.  Their environmental policy is god-awful.  90% of their water is undrinkable, and the dust storms that roll off the northern border are large enough to create their own weather systems.  There was also that benzene spill that happened last year, the one that was 50 miles long.  Unfortunately, while that was a notable case, it’s not the only one.

    Also, China is definitely benefitting from its cheap labor supply right now.  The problem, however, is that their current birth rate is not high enough to maintain the population (1.73 children/woman versus the 2.3 widely considered necessary to prevent population declien), and in about a decade or 15 years, they will have an elderly population that makes the baby boomers and the problems associated with it look like nothing.  The Chinese need to start shifting to service industries, like India has, in order to keep their economy rolling.  It’s fine for a time to develop manufacturing capacity, but they don’t necessarily have the supply of educated workers that can compete and perform the way the country needs.  Also, some estimates of public debt mark it as 85% of GDP.

    This isn’t to say that the U.S. doesn’t have massive problems as well.  But the infrastructure in the U.S. is well-established, and the procedures time tested but still open to change and challenge.  I think that’s a significant advantage over China, and while I know you aren’t saying that China will overtake the U.S., I think these are all points in favor of caution.

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