Eduard Fischer

China Becoming a 'Middle-Class' Nation

Although I generally enjoy this author’s articles here are a few reasons why China’s future may not be quite as rosy as he suggests:

1. China is relatively, for the size of its population, resource poor; it must, like Japan, manufacture and trade in order to sustain growth, or even simply not to starve. This holds true for most of South East Asia. The idea that this region could be economically
self sufficient could only come from America, where the blessings of an abundance of resources and a relatively sparse population are so taken for granted that the reality of other nations’ true circumstances are apparently seldom imagined. The domestic energy resources that China does have, chiefly coal, are very dirty, which brings us to the next point.
2. As the US continues to increase its fiscal debt, China continues to incur its enormous environmental one. The US may default on its government debt some day but China’s degradation of the environment will be impossible to walk away from. Hundreds of thousands of Chinese are already dying every year as a direct result of pollution. Anyone who doubts that China is paying an unsustainable price for its vaunted economic expansion should go there and look around and just take a deep breath.
3. The fossil aquifer under northern China that is supplying much of the irrigation water to feed China’s 1.33 billion people is already showing signs of running dry. Then what? Well maybe they will own enough US treasuries and gold by then to buy Alaska or something. One can only hope that they take Sarah Palin with it.