America nearly defaults, London is burning and Europe is broke. Meanwhile, China launches its first aircraft carrier and the Indian economy is surging. Are we witnessing the transfer of global power to the East? “The I.M.F. forecasts that, adjusted for purchasing power, China’s economy will be bigger than America’s by the end of 2016.” Public opinion confirms this trend with a majority of Chinese and nearly half of all Americans believing China has already replaced the U.S. as the world’s preeminent power. But not so fast, says The Economist.
What’s the Big Idea?
We should not take the imminent rise of the east for granted. The west’s economic woes, thanks to globalization, also belong to China and India. “Asia, too, is addicted to American debt, in so far as this finances imports from Asia, which then invests some of the proceeds back in America.” Domestic instability also plagues China, Indonesia and India. Recent protests over the failure of China’s high speed trains and long-standing charges of Indian corruption are challenging regional and national governments. And given America’s defense spending, the rise of the east is premature at best.