Economic Futures of the West

Economic Futures of the West

New Thinking in Political Economy series

Jan Winiecki

Jan Winiecki explores the various problems that the West must deal with in order to remain an efficient competitor in the world economy. These, he argues, are primarily consequences of the ever-expanding welfare state; consequences that are not only economic but also socio-psychological and, therefore, political. The author also considers the evolution of Western Europe and the USA from a new perspective, noting the ‘Europeanization’ of US economic policies and regulation and the ‘Americanization’ of polices and regulation in some European countries. The book concludes that the main challengers to the West – Brazil, Russia, India and China (the so-called BRIC group of countries) – are unlikely to gain economic supremacy over the West any time soon, given that they have to contend with their own difficulties.

Chapter 5: China and India: competitors for future leadership in the global economy

Jan Winiecki

Subjects: economics and finance, austrian economics, political economy, politics and public policy, international relations, political economy

Extract

China has been the media and analysts’ favorite for quite some time. First, it has been ‘anointed’ as a global economic power and the next to surpass the USA as the No. 1 world economy. Since the turn of the twenty-first century, many writers have published their prophecies for the world economy, with China invariably playing the role of forthcoming No. 1. Quantitative projections have seemingly supported such expectations. Why? I see two reasons for such scenarios, one ideological and the other substantive. With respect to the former, a large, if not actually major, proportion of Western writers have been driven by their hostility to if not downright hatred of the capitalist West, the USA, Western multinationals, globalization – you name it. They are by and large the orphaned children of socialism. They understand (with the exception of some die-hards!) that socialism has been so thoroughly compromised that it will not become a serious proposition in the foreseeable future. Therefore, if it must be capitalism, let it be Chinese capitalism – despotic, intrusive, tinkering with the market, with a large state sector – rather than classical liberal, free market capitalism, based on private property (even fettered as it has been in the more recent period in the West!). Thus the reason is ideological and emotional – visceral, in fact.

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