America’s economy is now smaller than that of China

“The International Monetary Fund recently released the latest numbers for the world economy. And when you measure national economic output in “real” terms of goods and services, China will this year produce $17.6 trillion – compared with $17.4 trillion for the U.S.A… To put the numbers slightly differently, China now accounts for 16.5% of the global economy when measured in real purchasing-power terms, compared with 16.3% for the U.S.” – Brett Arends, Market Watch (1).

This is extremely bad news, and is a milestone we will refer to in the years to come as the first solid evidence of the United States’ decline as a world power.

Then again, this is by no means an unexpected development, and has been preceded by massive Chinese purchases of agribusinesses, industry, and natural resources throughout the world as China uses its new-found economic power to become a major player in the world. As Market Watch tells us, “As recently as 2000, we produced nearly three times as much as the Chinese.”

It can reasonably be said that China’s expanding economy, military might, and nuclear arsenal, have been obtained largely as the result of widespread spying activities, often carried out by their students in Western countries, and by Chinese government-financed businesses acting as “fronts” for espionage activities. But the fact remains that this strategy is astonishingly effective, and may well result in an economic collapse of the United States and the West, resulting in China becoming the dominant world power.

Military, and particularly naval, power are headed the same way; as the U.S. military declines, and China’s expands, sooner or later the two trajectories will cross, and America will become more and more vulnerable to Chinese pressure.

In a related and equally disturbing item by Roland Flamini headed “Beijing Inc? The Chinese aren’t coming – they’re here” appearing on the World Affairs Journal website (2), we are told of the massive purchases of chunks of the American economy by China. Some people are optimistic that America will benefit from this, but others are more realistic.

As Flamini says, “The sharp expansion of Chinese investments has stirred considerable unease among US lawmakers on both sides of the aisle. There is concern about the possible damage to US security and economic interests and skepticism about China’s long-term intentions. Is this stepped-up financial activity an elaborate scheme to take proprietary technology out of the US, by moving R&D to China, with a resulting loss of American jobs? That these aggressive Chinese investing firms operate under an authoritarian political regime adds another layer of worry to what some see as a slow-motion financial invasion.”

This is a massive in-depth article, and I strongly recommend that anyone concerned about America’s future take the time to read it, as well as the Market Watch article.

I am also including a link to my “U.S. – China” archive (3), which contains almost 100 posts over the last 4 1/2 years covering a variety of the above and related subjects, including China’s near-monopoly on “rare earth” metals. And also, a link to guest writer Mihael Willman’s series of articles covering his concerns about the direction Chinese-Western relations are taking (4).

Time is running out for us; it’s time to pay attention and take action.

Jeff Goodall.

(1) – Here.

(2) – Here.

(3) – Here.

(4) – Here.

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