Crippled by systemic problems, China won’t overtake the US any time soon

Fifteen years from now, China will have more citizens over the age of 65 than the entire population of the United States, and that aging of the Chinese people, severely accelerated by cruel and stupid social policies in the 1950s and 1960s, has already plummeted by a steep decline and unmanageable. Furthermore, China lacks the financial resources to cushion this labor shock. When Japan and the United States faced population aging, these nations had a GDP per capita of just over $15,000. China’s GDP per capita is currently about $4,000.

Things are not rosy in China, and it’s time for a serious look at China’s problems.

Timothy Beardsson is a legend among expatriate financial entrepreneurs in Hong Kong. A permanent resident of Hong Kong for many decades, he is the founder of Crosby Financial Holdings, which he incorporated in 1984. Beardson’s vast investment banking empire once employed 700 employees in seventeen cities in 14 countries, with operations stretching from Beijing to New York. transactions of about $20 billion annual business.

Having amassed dynastic wealth for himself and his heirs, Timothy Beardson cashed in on Crosby in the late 1990s. He has now turned to writing, and Yale University Press has just published his The giant that stumbles, the threats to the future of China. This is a book that no one interested in China can afford to ignore, as Beardson speaks with the kind of authority rarely found in this part of the world: the authority of someone who has worked within the system rather than of simply observing it from the corridors of a university or city newspaper room.

Beardson’s thesis is easy to sum up in a single sentence: It is simply that, contrary to much of the hype, China will almost certainly not overtake the United States as the world’s number one power in the 21st century because it is riddled with problems. insurmountable.

Although Beardson’s ideas appear to have set off a firestorm in Europe and the United States, where popular media have promulgated unfounded myths about China’s growth and power, they are unlikely to surprise any serious observer in Beijing or Hong Kong. Indeed, it is clear to us here in Hong Kong that China is not suffering from any secret or mysterious disease. China’s problems are there for anyone to see, and perhaps Beardson’s real point is that no one is looking hard enough to see them.

Here are the main obstacles China faces in the coming decades: The disastrous one-child policy of the Mao period has created a shrinking workforce and an aging population, along with a vicious gender gap that devalues ​​women. to an almost unimaginable degree. Combine this with catastrophic environmental degradation, a dangerous environment of radical Islam lurking around your borders, a dwindling supply of clean water, an academic and business culture that seems culturally incapable of true innovation, a social safety net totally inadequate, a system of government that seems antiquated and stagnant, and an efficient low-tech economy, and you will quickly appreciate that China is far from becoming a serious economic, military, or cultural rival to Europe or America. On the contrary. China is falling behind.

Yet in the midst of cataloging these shocking weaknesses, Timothy Beardson also manages to paint a realistic and personal picture of China’s magnificent history, integrity as a nation, and significant achievements over the millennia. Having learned his lessons the hard way (by losing money when he was wrong), Beardson is more interested in hard-nosed analytical assessments than the kind of pabulum one gets too often from magazines and newspapers.

Perhaps even more devastating than the historical roots of China’s problems is the sheer inadequacy of current policy responses. China is famous for its five-year plans, but in Beardson’s opinion, no one on top of the Forbidden City is seriously charting a path out of this forest of trouble.

This book is much needed. So many recent articles have heralded China’s rise to global supremacy that many casual observers have begun to believe the myth. Beardson breaks these wildly erroneous predictions. China will have to come to terms with its daunting challenges, its sheer weight and numbers, before it can achieve anything close to its supposed ambition of becoming “Number One.”

Immodest visions of China’s imminent and spectacular success were perhaps abetted by the 2008 financial crash, leading many pundits to suggest that Europe and the United States had peaked and perhaps even reached a downward tipping point, and that China was rising to not only catch up with but surpass the West. That is not going to happen, not today, not tomorrow, not at any time in the foreseeable future.