China has no great unemployment problems; the U.S. has lost millions of jobs. China manufactures and exports products all over the world while the U.S. is outsourcing more and more manufacturing jobs to other nations. This entire situation is getting very bizarre indeed; we import massive amounts of products from China and then borrow the money to pay for them from China and other nations, a very dangerous vicious circle.
America now faces dire economic issues. Consider our current massive rate of borrowing from other nations, together with a $1 trillion annual defense budget, and a GDP plunging due to our continuing economic crisis. Could it be that at some point in the future the U.S. may be forced to default on its debts? This is not a doomsday prediction or scare tactic, but it could very well happen if we continue on our present course; on-going wars, outsourcing more manufacturing and growing deficits.
That word default (on debt) has been taboo, unthinkable in the American economic community but here is what Greg Ip said in a Washington Post article Jan. 11, 09. "We're borrowing like mad. Can the U.S. pay it back? And, "Yes, default is unlikely. But it is no longer unthinkable. He concludes, "The chances of default remain pretty remote. But remote does not mean impossible.
Assuming that China and the U.S. continue to follow their current strategies and directions, and there is no reason to think that they won't, China seems to be heading into the position of dominance. Right now China is making domestic and foreign policy moves that are based on growth and solidifying its economic foundation. On the other hand, the U.S. is pursuing strategies that have no clear formulas designed to spur growth, but, rather, strategies that are severely eroding our economic base.
There is a point in the future where these two strategies will meet head on and then we will see which will prevail; economic power or military power.
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