China is well behind us

[bokamba]

People who talk incessantly about China's development as some kind of zero-sum game that the US is losing are foolish ninnies. Tom Friedman is one of the best-known and most obnoxious examples, but there are millions of people who think like him. Yes, China's growth is faster (because it's a poor country--duh!) and yes, its trains are better (

Comments

Re: Chickens and eggs

[writer1985]

But if gas were extremely expensive, the only people who could afford it would be the rich, not the truck drivers. As a matter of fact, rationing gave priority to trucks and other commercial vehicles. I agree that unregulated prices would have curtailed demand, but ultimately supply was controlled by OPEC, using oil as a bargaining chip to achieve international economic and political goals. It's like Lysistrata!

The crisis ended because of a voluntary decrease in demand (e.g. extremely ugly but fuel-efficient cars), the development of alternative fuel sources (which I know you hate, except for nuclear power), and increased production from other, non-OPEC nations and apparently some OPEC member nations. All of which led to the oil surplus in the 1980s.

I don't know anything at all about China's economic plan or Thomas Friedman's ideas about it, other than this article from over a year ago. His argument here makes sense: if China is investing in the future, and we are wringing our hands over manufacturing job losses in Detroit, China's going to get ahead. If he's written anything else on the subject, I'd be glad to read and possibly revise my opinion.

Re: Chickens and eggs

[bokamba]

Despite the best efforts of the people in charge of rationing systems to distribute the rationed goods such that they will be put to their best use, they cannot do so with the agility or precision of a free market setting prices. Economies are far too complex to manage well, and some people always find a way to cheat (e.g. bribery or loopholes). But you can't cheat a price.

I don't have anything against alternative fuel sources; I'm against subsidies (in general, not just related to energy). People can build all the solar and wind farms they want, but I don't want to be taxed to pay for those inefficient boondoggles.

I think Friedman's view of Chinese investments in "green" technology is naïve. He seems to think that government-directed investment is the path to economic and environmental salvation. Government "guidance" of the economy is better than comprehensive control of the economy, as China had before, but it is still hugely wasteful. Bureaucrats and politicians don't make choices about whom to subsidize or favor based solely on objective analysis of what's best for the public they serve. Businesses will produce better innovation when they're competing for customers, rather than competing to see who can schmooze with officials most effectively.

Re: Chickens and eggs

[writer1985]

On the first point, regarding rationing, it sounds like you're arguing from a principle of justice and I from compassion. Fair enough. I would only add that a free market is itself a form of rationing, in that it distributes scarce goods on the basis of income rather than need.

I have mixed feelings about subsidies, but for the sake of argument, it's very difficult to develop a new technology without funding. The government also subsidizes medical research, remember, and the one positive thing you CAN say about medicine in this country is that it's extremely innovative. I am with you on wasteful; I just don't think innovative and wasteful are mutually exclusive. (In fact, innovation is 99% failure and waste.)

Also, the government non-interference policy you suggest sounds close to the laissez-faire model of the Gilded Age, which is great if you're a Vanderbilt or a Rockefeller, but not so much if you're a sweatshop worker in the Triangle Shirtwaist Factory.