Re: So Long US, Hello India, China
Asia Times, 11.11.2004
The conclusion made by David Fullbrook in his article So long US; hello China, India [Nov 4] can be summed up in one sentence – China's boom is probably the world's greatest, ever. As night follows day, bust follows boom. A bust to match China's, or even India's, boom will shatter the evolving geopolitical reality, bringing much instability for Southeast Asia, while creating an opportunity for a weaker, but stable, United States of America. Unfortunately for him, this boils down to reaching far bigger conclusions without any considerable analysis to back his views. Firstly, a bust does not have to be necessarily comparable to the boom a country experiences. The Industrial Revolution has shown us that the boom can be spread out over a longer period and different patterns of growth can be identified, some of which are short-term, while others much more long-term. Economic policies of Europe, Japan and the US reflect the gradualist approach of economic development after sizzling boom during their developing period. Secondly, although we can argue China to be the potentially "boom prone" economy of Asia, in no way can this be said of India. China has grown on excessive and futile government spending, too much dependence on foreign-based corporations, suppression of alternate views by a ruthless governmental structure and by a "herd behavior" by foreign speculators. Its capital markets are shuddery, its banks are a mess, the rural areas which are hidden from the world speak volume of the misery rife in the countryside and its nuclear arsenal pointing at half a dozen countries speak of its political nature. India, though much slower at generating growth, grows under a functioning democracy, domestic companies, domestic investment and a retreating government. India has mature and stable capital markets and a strong banking sector. It shows all the right trends to become a liberalized economy over the past 15 years as the government has consistently, albeit slowly, pursued economic reform. China has been more of a spurt – India is more of an ever-flowing river. Secondly, China has many more political enemies than India and is more prone to going to war than the latter. The world is [starkly] different to what Mr Fullbrook sees it to be – the most likely scenario would be a mutually destructive war between the United States and China in the future as a result of China's ambitions clashing with the US's reluctance to share the superpower tag. This would leave the world without a core state, an attracting pole. The stage will be set for the peaceful people of India to take up their place at the helm of the world community, and so they shall.