Friday, May 11, 2012
China's Growth Rate is Slowing
There are stories in the newspapers today about China's growth rate is slowing down and some other concerns about their economy are discussed. When the U.S. and most of the West had the financial crisis in 2008, China tried to set itself up as a model of how to run a successful economy. Now some say that it may not be such a great model. I don't know why anyone thought it was. Yes, China has been growing at rapid rates for some time. But, it is easier to grow when you are catching up with the advanced economies. Japan did so in the 50s and 60s, South Korea more recently and now China. Like China, Japan used more government direction than we do in the U.S., and many here thought it would be better if we had an industrial policy. But, Japan has not been the economy we want to copy for a couple of decades now. China will not be in the future either.