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Tuesday, July 30, 2013

Thomas Friedman, "Revenge of the Mistresses": Friedman's "Long March"

Over the course of an agonizingly long journey much akin to Mao's "Long March," Thomas Friedman continues to wake up to the fact that China is not only about bullet trains and ultramodern airports (see, for example: http://www.nytimes.com/2010/12/01/opinion/01friedman.html), but also about pervasive corruption and suppressed masses, deprived of basic human freedoms.

Concerned by "a stable diversification of [China's] low-wage, high-export, state-led command economy," Friedman writes in his latest New York Times op-ed entitled "Revenge of the Mistresses" (http://www.nytimes.com/2013/07/31/opinion/friedman-revenge-of-the-mistresses.html?_r=0):

"The world can ill afford a chaotic transition in China. With America stuck in slow growth, Europe mired in stagnation and the Arab world imploding, China has been a vital economic engine for the global economy. If China’s sagging growth and employment rates meet rising discontent with corruption by officials — trying to get their own while the getting is still good — we will not have a stable transition in China. And if one-sixth of humanity starts going through an unstable and uncertain political/economic transition, it will shake the world."

What doesn't Friedman say concerning China's woes?

Friedman doesn't tell us about China's demographic time bomb. As reported by The Economist in an article entitled "China’s Achilles heel" (http://www.economist.com/node/21553056):

"Between 2010 and 2050 China's workforce will shrink as a share of the population by 11 percentage points, from 72% to 61%—a huge contraction, even allowing for the fact that the workforce share is exceptionally large now. That means China's old-age dependency ratio (which compares the number of people over 65 with those aged 15 to 64) will soar. At the moment the ratio is 11—roughly half America's level of 20. But by 2050, China's old-age ratio will have risen fourfold to 42, surpassing America's. Even more strikingly, by 2050, the number of people coming towards the end of their working lives (ie, those in their 50s) will have risen by more than 10%. The number of those just setting out (those in their early 20s, who are usually the best educated and most productive members of society) will have halved.

The shift spells the end of China as the world's factory. The apparently endless stream of cheap labour is starting to run dry. Despite pools of underemployed country-dwellers, China already faces shortages of manual workers."


"Make your money and get out"? Those Chinese officials know far better than Friedman what they're talking about.

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