China’s Perfect Storm
by: Julie Clark, Author, Former Rancher, Lubbock, Texas
The industrialized world is growing old and nowhere is this happening faster than in China. Once both admired and disparaged for their strong but short sighted one child policy, China is now facing the results, an aging workforce that is accelerating faster than anywhere else in the world.
I am not criticizing China’s one child policy. They did what they had to in order to be able to feed their population, but limiting couples to one child in a male dominated society led to the death of a large percentage of female infants and that is now another contributing factor to China’s economic woes. Yes, some aspects of the one child policy should have been done differently, but hind sight is 20/20 and what is done is done.
Now the issue in question is what will the Dragon do when it discovers its name is Rip Van Winkle?
China faces many dilemmas and has limited options at this point. For years this massive nation has been forced to create an unbelievable number of jobs to sustain its growing workforce. Now it is seeing the age of that workforce growing older in relation to its size at an unsustainable rate and there is an insufficient number of women to give birth to future replacements. The Dragon finds itself still having to create jobs at a staggering pace, yet the young workers entering the workforce do not come near that of the growth of China’s elderly population who are ill prepared for retirement. Add that to a sluggish global economy and China faces a perfect storm.
For years China has known it must look outward and has. It has used its industrial might to fuel investments all over the world while secretly harboring ambitions for world domination. China knows it has two options to replenish its aging population in order to remain stable.
The first is to import a healthy young workforce just as other less isolated aging nations have opted to do. This is not without its own set of problems such as cultural and educational differences as well as expectations and more importantly loyalties. The youngest populations to draw workers from appears to be located in the world’s most volatile regions. We are all watching the young male populations of the Middle East and Africa with their violent jihadist attitudes being transplanted all over the world and now that the world is feeling the brunt of that violence, no one wants it, not even China. That leaves China only one region to import labor from, the Asian Subcontinent, better known as China’s ancient mortal enemy, India.
Watching these two nations interact is much like watching a dance between the dragon and the phoenix as it has played out through the ages. Each boldly facing off at the other inextricably linked in a primal codependent relationship that will not end anytime soon.
India with her vibrant young comparatively well behaved and educated population next door is an obvious prize to be won, especially by a nation hungry for new workers to fill an increasing void and India knows this. They will soon have a larger population than China. Only India’s growing population is in its young productive prime. India is in the same situation China was years ago. It is being forced to create jobs or export workers elsewhere. The Asian Subcontinent is throwing a coy look to the east even as she dances with the west. While China loudly bangs the war drum for India’s enemies to hear; in secret, the dragon is courting the phoenix and India is discretely responding.
China is silently investing money into India’s economy and making inroads into her good graces. While the two governments may drastically disagree on certain issues, economically it is increasingly difficult to view one nation as separate from the other with China holding the greater influence. At the same time China is militarily maneuvering its most prominent neighbor into a corner with hope that India will respond by deserting the safety net that the west has offered for years. India has not exactly been innocent in the sordid tryst, she has accepted all of China’s advances willingly and will soon have no economic or military option but to play the game by China’s rules.
China has not ignored its second option. It has busily fed its need for job creation by not just maintaining the world’s largest standing military but applying large proportions of its GDP into building an impressively dangerous blue water navy. One could argue that this is not so much out of fear of United States military might as much as its economic inroads into India and China’s other neighbors. After all China has recently cut the size of its military by what to any other country is a mind boggling 300,000 men. They might even argue China is simply seeking to shore its position with its neighbors and force those nations to be more amicable but other facts must be weighed.
China has long exhibited a desire to not only take a place as a respected global player but to replace the United States as the world’s elite nation and dominate the globe. It has in the past few years expanded its influence not only in India and the South China Sea, but in Africa, South and Central America as well as Europe and the Middle East. They are even actively courting such stanch allies a Britain seeking not just to pattern some of its economic regulatory systems after the Brits, but to get a closer view to how that economy functions. I would not be surprised if China did not in the near future open themselves up just a little to British investors to hide the inoculation of Britain by injecting Chinese money into the British economy to help neutralize its ties with America.
During these so called peaceful trade initiatives they have actively and aggressively modernized their military. All while managing to create an alternative fiat currency to the US dollar and launched the Asian Infrastructure Investment Bank aimed at replacing or at least rivaling the World Bank on the global market. All of these action are just as destabilizing to world peace as the Islamo-fascist running amok blowing up things. In many ways the Jihadists are concealing China’s global initiatives by drawing attention from them.
The most frightening part of the scenario is that China knows with a rapidly ageing populous that their time to act is running out. So what can an also aging United States do to peacefully prevent or at least slow this irritated Chinese Dragon from tearing the world apart? Ironically, the elderly in the USA and Europe, seem to have a better lifestyle, than in China. Perhaps it is because their numbers are not overwhelming. Even with these scenarios, the population in the USA appears to manageable.
And notice some images of elderly in the USA and Europe vs China. Is this because of planning, wealth and prosperity, in the USA and Europe vs the allocation of huge resources for new growth in China, holding the quality of life down, to achieve longer term growth and power.
The answer may be simpler than you think, for China to deal with it's aging problem, because the aging issue is a reflection of the economic policy and ambitions of the nation. Perhaps China needs to reconsider it priorities. Be better to it's people and cut back on military and expansionist policies. Perhaps the USA and other nations should be more competitive with China, and not "give" so much away.
To say that the United States is the most powerful nation on earth is not an understatement, but her real power does not reside as much in her military might as in her economic magnitude, and her ethic for social well being. The way Americans and Europeans handle the aging problem, may be different than we observe in China. For Americans and Europeans, it is a chance to live again. For the Chinese, it simply means for many, "Life is essentially over, stay out of the way".
No other nation comes close to rivaling the USA and the rest of the world is still reliant on America's good graces in spite of all the economic woes China and other less far sighted nations might impose. No doubt those "attacks by Islamic terrorists" or little more than mosquito bites in the large view of the American nation. Yet America when it comes to economics has and is her own worst enemy. The United States often timidly accepts self-destructive trade deals at her own expense and that of the global community. This is short sighted for a global power and bad for the rest of the world. It is time for the Eagle to flex her wings, when it comes to China, and when it comes to those who would attack or try to destroy our style of life.
For years I have watched American industry and environmentalists dance a dance of mutual destruction. It seemed if one prevailed the other must fail. On one side, if the environment was not protected the health of people would suffer. Yet the other can argue the cost of emission and environmental controls are such that industry is forced overseas to compete on the global market and jobs lost causing the American economy to crumble. Either way the world population suffers no matter which side prevails.
The United States has come a long way in implementing emission controls while wealthy investors responded to the rising production cost by racing to more cost effective regions of the world such as China leaving the American industries that are left to languish. Often with high wages, American's find it hard to compete cost effectively with cheaper produced foreign goods flooding the market. American's have done much to improve technical efficiency, and to reduce labor costs through smart innovations. But still, out of 1.4 billion Chinese, there are about 800 million who are willing to work for $2 or $3 per day. Some would make an argument for tariffs at this time, but that would only create an even more destructive global trade war.
America could easily address the issue of controlling China and other environmental offenders on a corporate level by simply allowing corporations the freedom of importing goods as they always have, but if those goods are produced in a plant that does not meet or exceed our own emissions standards then a fine should be imposed. Also those products, if tested and found to be toxic or dangerous, would be banned and the country of origin fined, or even blocked.
Call it a Destructive Environment Business Tax, DEBT for short, I like the sound of that.
The revenues from this fine could be earmarked to pay down the United States own deficit and shore up its fiscal standing with in the global community. Yes initially this would cause some inflation, but it would equalize the playing field making environmentally sound products more attractive to buyers. Recently a report concluded that China produced more toys and foods that are dangerous to health and safety than any nation on earth. Other nations such as Mexico, have been found to export foods treated with toxic chemicals. Clothing and furniture from South America often are fire hazards with flammable materials, and other nations send us infested wood products defective and below quality standards. Mechanical products from Asia often are cheap, poorly engineered and service and quality is sometimes substandard.
The result, of enforcing safety and environmental regulations would force corporations into scrambling to purchase goods from nations that already respect the environment and a rebirth of American jobs would come almost immediately. With those jobs the return of the American middle-class and its hungry purchasing power would be revitalized. The tax base would expand and provided our own corrupt power hungry politician didn’t dip into the cookie jar America would almost immediately bring stability back to the entire global economy.
The rest of the world would experience the benefits of America’s purchasing power, while China would find itself forced to divert funds marked for global dominance and military spending to pollution and emissions control. BootheGlobalPerspectives ran a research report several years ago concluding that some 20% of the farm land of China was polluted with metals and chemical residues, from industrial companies that had few or no emissions controls.
Inadvertently this one little step of tightly enforcing environmental controls and quality testing, before products could enter the USA would force China to redistribute its wealth in such a way as to improve the health of its own people and insure that they have a longer productive life.
Jobs would be created in China in the largely ignored environmental sector to get the nation back on a competitive scale. The rest of the world would catch a rest break from Chinese ambitions for at least a while.
The Truth is China can only seek global domination as long as American corporations and you, consumers fund it. Those same corporations and consumers should be more responsible toward the global community. It is only through the Eagle flexing her wings and expecting the same responsible industry from the rest of the world as herself that global stability can be achieved.