As Americans, we put pride in our strong military, forward-looking educational systems, and most of all, our world-class economy. Though we maintain certain privileges, such as the U.S. dollar being the global reserve currency, others may be slowly eroding under global economic pressure. However, our status as the number one global economy in the world may be soon overtaken by China’s much more rapidly growing economy.
Compared to America’s capitalist economy, China has a mixed economy of socialist and capitalist features. A couple of years ago, many experts were concerned with China’s economy model, and a majority suggested political change to reform it to match the global free-market system. China’s economy has constantly grown, with a reported domestic product growth of 6.8 percent last year. If this continues, China could very well pass the U.S. as the country with the world’s largest economy within a decade, according to Bloomberg News.
However, China has certain political advantages that the U.S. does not. It has annual control of individual businesses and can choose to bail out an industry without legislation or introduce new policies in order to fine tune the economy. China provides political support for companies that they believe will benefit them. China can also quickly create laws as they see fit to help industries grow. According to BBC, the National People’s Congress in China can arbitrarily lower or raise taxes for industries or even the country as a whole. In addition, Time Magazine claims that China defends its industries from charges of stealing intellectual property and also carries out cyber-attacks against competitors to gain security.
Aside from fifth generation mobile infrastructure, China may also be able to focus government funds on key industries such as artificial intelligence, dubbed the space race of our age. With authoritarian control China will have a better chance at cracking artificial intelligence than the United States, which has moved much of its innovation into private corporations. At the moment, the U.S. does not have the political unity for such a heavy investment in technology.
China has made it a national priority to hold economy growth as a priority above everything else. However, this increased control over economy and steady growth may come at a hefty price. Though the capacity to allocate resources where they are needed is powerful, China’s ability to fund companies is not unlimited. According to the New York Times, China bails out many of its companies by using an extensive connection of banks, like the People’s Bank of China. In addition, many of the laws that they have to benefit corporations also take away from personal liberties. According to Christopher Stevenson, author of “The Quest for Freedom of Expression in a Connected World,” many liberties, such as the right to surf certain internet sites in the country, have been banned to reduce China’s corporate competition with foreign social networking companies.
Growth in China has come at the expense of many things, most notably changes to its environment. It is no wonder, as China currently burns forty-seven percent of the world’s coal according to a New York Times report. Air pollution, just one of the major problems in China, surpasses the Environmental Protection Agency’s pollution rating limit of 300. According to the Washington Post, Beijing now experiences ratings of 500 regularly, clearly a result of air pollutants from fossil fuels fueling the economy. Water pollution, desertification, and a phenomena coined “cancer villages,” villages next to heavy industrial sites, still exist.
For the time being, China is next in line to become the biggest contender for the global economy in the foreseeable future.