A friend writes from India that the South Asian giant is anticipating a return to 7% economic growth this year, and that China forecasts the resumption of 10% growth rate. Europe and the U.S., in contrast, are hopeful their GDPs will drop less than 1%. The rest of the prognosis is that India and China will soon run the world politically and militarily, as leading world economic powers have been doing since the modern period began. These things are indeed possibilities, but countervailing trends also admit of other likelihoods too, particularly if one has been paying attention to recent history.
The spreading of manufacturing jobs to successive waves of low-wage countries has and will continue to lift millions of people in the world's poorest societies out of abject want. India and China will advance and increase their prosperity greatly in the few decades ahead, as Japan did in the 1960s and 1970s. That is, presuming environmental disaster does not overtake the biosphere as another couple of billion humans engaging in first world consumption patterns severely tax the ecological capacity of the planet.
But even if not, nations like China and India will probably suffer much of the same stagnation that has derailed Japan since the late 1980s. This will happen for two reasons. First, production will continue to get more automated, ruthlessly paring the factory jobs that have provided the bulk of working class employment there in the current boom.
Second, as their wages rise their labor forces will fall prey to industry's subsequent move to the next wave of rock-bottom wage countries, probably Latin America and then Africa, some 20 or 30 years hence. The process is inexorable given the reduction of trade barriers and the logic of business capital. The spotlight shines but briefly on a favored region. Like a line from All Quiet on the Western Front, "Forever isn't always a long time around here."
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