The US situation is mitigated by both Russia and China deciding to make massive, foolish maneuvers at the same time as ours. However neither can match how stupendously we are lighting our future on fire in every possible dimension.
China is undergoing a 2008 style financial crisis due to real estate speculation and deflation due to very weak domestic spending.
They have drowned their municipalities in debt cumulatively equivalent to the US federal and state debt as a percentage of GDP. Localities aren’t allowed to tax but are responsible for local services and industry. Local governments borrowed heavily to hit GDP growth targets and compete with each other for investment and talent.
There is now a backwards migration of the working class back to rural towns from the cities because the incentives China gives is towards technologies that only benefit their already upper-middle class workers. About 500 million Chinese live in rural areas and over 20% of their workforce toils in the fields. That’s not changing anytime soon. Youth unemployment has been 15-20+ percent for some time.
Not at all what’s happening. China’s government privatized real estate and was the engine of the bubble by disallowing localities from taxing and only allowing revenues via land sales. See above how central planning in the CCP has forced massive debt upon localities.
State banks backed Evergrande’s with cheap credit and govt guarantees.
Local officials were promoted for hitting GDP growth targets - see above how they put localities deep in debt by speculating on real estate.
The CCP gave households social credit for moving to cities and buying real estate.
The CCP is not protecting consumers in the aftermath. They won’t let consumers out of mortgages for unfinished condos because they don’t want the crisis to worsen - effectively bailing out developers.
Not sure where you came up with the idea that China is acting in the interest of its citizens rather than the state. That’s not a fundamental characteristic of an autocratic socialist state.
The citizens with real estate were the speculators. They gambled on being able to squeeze even more out of the next guy and they lost. In the US, we would just have taxed the kids (again) to bail out the homeowners (again). I have a hard time calling that more responsible.
They bailed out the little people and jailed the CEO's.
What happened was these companies went into massive debt building buildings based on the belief that real estate prices would increase forever infinitely.
The Chinese govt popped the bubble.
These real estate companies went bankrupt, many of them took payments from retail for apartments that weren't built.
They arrested the CEO's and upper management, siezed and sold their assets.
But the people did get bailed out by the government, all the little folk who bought apartments were refunded or had the construction project finished by the government.
Nope they didn’t. They refuse to let citizens cancel the mortgages even though developers haven’t delivered condos for years and they haven’t bailed out the little folk.
Moreover China’s govt was the cause of this by setting gdp growth quotas to get promoted, see all my other comments regarding this.
You’re just repeating propaganda and interestingly the other commenter responding to me has said the exact opposite, but also has said that China’s response was “morally superior”
For Building projects that were canceled the little people got full refunds
For Building projects that were resumed with the govt footing the money for their completion. People who bought apartments did not have their mortages canceled, they were forced to pay their mortages and will be receiving their apartments when completed.
So yes the little people did get bailed out. The government is footing to continue the housing projects while maintaining the terms of the mortages.
In the US, we saw all the people who could no longer pay their mortages because of interest rates skyrocketing lose everything.
We saw Federal marshalls marching into homes, and throwing crying people out, we saw crying people who have paid hundreds of thousands being thrown out into the street. In the US real estate crash, if you took a ninja loan and the housing crash happened, the banks suddenly demanded higher interest rates and you couldn't pay your house was foreclosed and all equity wiped.
These are all confirmed facts
In the US many little people lost their equity and were thrown out of their homes, many lost hundreds of thousands of dollars as they defaulted on loans and had their property siezed.
In China none of the little people lost anything
The buildings that were canceled the little people got full refunds
The buildings that were continued thanks to cash infusions by the government the little people will get their homes when it is finished.
The only person spreading propaganda is you.
This statement for example is a complete disinformation because you did not acknowledge that the chinese govt gave cash infusions to these stalled projects, and mortage payers will get their apartments
>Nope they didn’t. They refuse to let citizens cancel the mortgages even though developers haven’t delivered condos for years and they haven’t bailed out the little folk.
Not is but the obvious one was COVID policy during 2020-2022. It triggered the closest thing to a domestic unrest you can get in China after 1989, a large exodus of middle class, and an almost 50% crash in their real estate market. The last one is very deadly and still ongoing because that is how China financed its growth for decades.
That would require making babies and not making mistakes. Humans are generally/historically better at the former, but these days both seem to be a challenge.
I don't see that happening. The US debt will hinder any big expense that could keep it in any game long term.
Take AI for instance. The US grid is struggling to keep up with demand, while Chinese one has a lot of headway [1]. Usually, this could be solved by an increase in spending lasting a few years which would make the debt tick up, but that would've been an absolutely fine use of debt since it buys some shiny new infra that will pay dividends for the next 20ish years.
Now? Not possible. The US is already drowning in debt and the usual buyers are not showing up to buy it because of the Iran fiasco. With oil so expensive everyone was using their USD reserves to buy oil, not debt. Which mades interest rates go up considerably, and for a country with already ~130% of debt/gdp ratio these are terrible news.
So, I don't think there will be a great power race. Europe is fucked by both high debt, and lack of innovation. Russia is struggling already to finance a war of conquest they started. China is the only one that can run if it comes down to it (unless of course the numbers coming out of China are mega bogus, but for that I don't know enough to have an opinion).
> Take AI for instance. The US grid is struggling to keep up with demand, while Chinese one has a lot of headway [1]. Usually, this could be solved by an increase in spending lasting a few years which would make the debt tick up, but that would've been an absolutely fine use of debt since it buys some shiny new infra that will pay dividends for the next 20ish years.
I object. The CCP is much more deeply indebted than the US when taking into account provincial and local governments as well as state-owned enterprises.[0] And of course the US debt is financed in its own currency while Chinese foreign debt is financed in dollars or other currencies.
The problem in the US is regulation. An environmental impact study takes 54 months in the US.[1] The CCP, which has no problem poisoning its people or even launching rockets over inhabited villages, doesn't delay itself at all.[2] I'm glad we don't poison our people or place dangerous industry in places that could harm populated areas, or even perform some prophylactic measures to protect nature, but I'm confident that we could do this in less then a year (less than six months?) and make much faster progress. Even for something like nuclear, the ten years (mostly caused by red tape) are really onerous.
> China is the only one that can run if it comes down to it (unless of course the numbers coming out of China are mega bogus, but for that I don't know enough to have an opinion).
Yes, the common opinion among China watchers is that any number the CCP touches is "mega bogus." They're actually in the midst of something of a financial crisis at the moment because of the high debt.
It is absolutely a Chinese century. Even the comment above isn’t wrong per se - great power competition is normal during the interregnum, ie as Arrighi described it - one hegemon is rising while another is declining. But eventually one of them does rise and the world conforms to that - ie America in post WW2.
I think it's difficult, if you're a millenial/zoomer/whatever we're calling these things, to understand just how much of the world genuinely liked and respected and wanted america involved in their local affairs.
America obviously wasn't perfect and many, many more people than trump were involved with squandering all of this goodwill, but we still had some left over before he showed up.
Its not a static system. Things will swing back and forth like a pendulum. And through those oscillation we move forward. Diff today is everyone is getting their heads filled 24x7 with a whole lot of info their grandparents never had to digest about how the system moves.
The US has DOUBLE its current power production in proposed expansions, mostly solar and batteries. In 2004 it had like 20%. The US grid is set to grow.
> Europe is fucked by both high debt, and lack of innovation
Spoken like somebody who has no idea what they are talking about.
Apart from the large share of fundamental science which Europe has always been bigger in and better at (I mean, there's a huge tunnel in Texas to show that Americans at some point understood this and tried to compete), Europe is funding the military tools of the next generation in Ukraine.
Americans used to be excellent executors, then China took that role. What's left?
Look at GDP growth in the US vs EU over the last 10 years or so if you want to talk about innovation. Europe has been stagnating economically and real productivity growth is critical to a modern economy. The large hadron collider does some impressive research, but it doesn't move the sort of innovation in practical machinery and infrastructure that powers a modern economy.
Google's research team invented the Transformer Architecture at the center of LLM "AI". A huge invention.
California has added roughly 17GW of grid-scale batteries in the last five years. Modern GPU (NVIDIA). Modern electric car (Tesla). Reusable Rockets (SpaceX).
I agree that the US has an "Only Elon-led companies can get things done outside of computers" problem.
Comparative GDP based on more current methods (well, decades too at this point) rather than the graphs you are probably seeing show a stable co-trend over the past quarter century.
As an European, yeah, we probably are doing really good with basic science, but what about innovation when it comes to productivity? Why there is no AI lab (apart from Mistral) in EU? Why there is no European model (and hasn't been probably ever) in the pareto fronteer? Or any other really innovative company in the last while (I believe Spotify was the last European unicorn that transformed the landscape in the market they operate into).
Don't get me wrong, I rather lose the superpower race but enjoy my privacy and work benefits that folks in the US dream of. But the topic was superpower competition and I don't see the EU going anywhere in that front.
We are fragmented, among the top 4 EU economies 2 are struggling with debt (France & Italy), Germany economy is stagnating and the amount of bureaucracy hinders any attempt at innovation, ... .
Fragmentation isn't really there in science and development, fragmented financing (basically the main point I'll cede) is being worked on, and markets will always have to deal with European diversity; we're not all going to speak English tomorrow and eat the same, dress the same, etc.
And kill the savings of what remains of the middle class. Probably they will do it though, as it is a slow thing and is not felt by the average Joe like a tax hike or loss of benefits. So the policians won't trigger an outrage by doing so.
hyperinflation is very fast, but I think they'll do it, by accident because they don't know how anything works, but I think it's impossible to accurately predict when.
Oh hey, a good faith argument. I thought about going and googling for more studies supporting my position, but I'm not sure if that actually has much of a point?
Maybe I can come up with a stronger/more defensible argument: creating a just and equitable society is valuable on multiple levels including moral and economic.
Societies without "lower classes" are good for a variety of reasons.
Researching into why we have lower classes and, hopefully fixing that, is a good thing for a bunch of reasons.
Something something how many potential new einsteins aren't pushing boundaries because they had to drop out of highschool and work 3 jobs?
> "real" diversity of thought isn't allowed under globohomo. The goal, of course, is handouts for race communists and to further solidify communist control of political
For a Chinese century you'd need there to be anyone in China in a century. With the one child policy they have run out of young women and are running out of middle aged men. The Chinese, and Asian, population pyramids make Europe look young and vibrant.
Seems to be playing out.