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David Mahon says politically they may be polarised, but the US and Chinese economies are intertwined through the global trading and financial system making Washington’s ‘decoupling’ aim a fantasy

David Mahon says politically they may be polarised, but the US and Chinese economies are intertwined through the global trading and financial system making Washington’s ‘decoupling’ aim a fantasy

By David Mahon*

The Chinese economy will continue to expand into next year, and social confidence will remain strong, even as the Chinese Government faces mounting economic and political pressure from abroad.

As the Chinese economy continues to recover from a sharp, first-quarter COVID slump, losses in the catering, tourism, hospitality, and entertainment sectors have been partly recovered elsewhere through growth in e-commerce, a surprisingly resilient property sector, robust health insurance market, and year-on-year increases in auto sales. But as many smaller enterprises in catering, retail, transportation and general services may never reopen, a significant minority of the labour force are unemployed. These sectors employ around 200 million people, many of whom are migrant workers from small towns and villages in central and northern China.

In a total workforce of 800 million, approximately 30 to 40 million are presently unemployed across all sectors. Not yet unmanageable social crises, un- and underemployment, and increased income disparity have the potential to erode the government’s credibility in the long term, just as it undermines so much Western social confidence now.

International observers often decry China’s heavy focus on stability and employment as socialist recalcitrance and a ploy to increase the power of the state-owned industries over the private sector. But China’s financial and fiscal policies are generally cautious and measured. The banks have increased credit to the private sector, while total social funding which rose in the first quarter, appears to be decreasing. Demand in China’s domestic market is such that, given present investment and consumption trends, China may achieve over 2% GDP growth in 2020, while stimulating its economy less than many Western countries.

China also enjoys the hard-won advantage of having implemented a strict, science-based COVID management regime, sacrificing some personal privacy for the sake of individual and community safety, and accepting deep, short-term economic losses to ensure longer-term economic stability.

The role of ideology

In crises, the West is often trapped by assumptions derived from laissez-faire capitalist ideology, leaving markets to correct anomalies that government interventions are often better able to repair. In contrast, the former Marxist-Leninist, People’s Republic of China now eschews communist economic orthodoxy, preferring to foster market forces while implementing strict regulatory tools. Quick to learn from their own and others’ mistakes, Beijing is presently stimulating the economy to sustain growth, employment, and consumption, while freeing capital markets, fintech initiatives, encouraging the issuance of corporate bonds, and opening its financial sector to greater foreign competition. 

The Great Recession of 2008 to 2009 occurred because Western investment banks worked outside the constraints of already-weak regulations to generate higher profits. In the last four years, many Chinese banks also strove to circumvent banking regulations, but were checked by regulators, who did not just issue decrees from Beijing, but criss-crossed the country assessing balance sheets and the quality of assets. Regulators threatened severe penalties for non-compliance, thereby averting an explosion of unsustainable bank debt and shadow-banking liabilities. As compliance with financial sector regulation and governance (much of which has been adopted from the global system) has weakened in the West, it is strengthening in China.

The evolution of the Chinese banking and financial sector provides Western firms with increased opportunities stemming from domestic demand for high technology, imported components, raw materials, food, and agricultural products, creating the potential to lift the global economy out of the COVID recession, just as it did the Great Recession of 2008. But the world must allow China to do so.  

Coalition of the anxious

The bloc the United States is struggling to build against China will become little more than an ineffectual coalition of anxious allies, but it will still cause significant global economic and political damage, and may weaken China’s ability to help reignite the global economy. Washington’s actions will neither weaken the Chinese economy nor stem China’s inexorable rise. At no time since the Second World War has there been such a need for unity among the major powers to ensure the integrity of international public health, free trade, common wealth and stability. Seldom have the major Western powers been so darkly introspective and so poorly led.

China’s leadership is steady but needs to find better ways of communicating why it undertakes certain domestic measures, not in order to seek the approval of other countries, but to mitigate their frequent poorly-informed reactions. After a year of increasingly violent protests, Hong Kong needed to promulgate a security law. Beijing could have done more to allay the fears of the Hong Kong people and attracted less international condemnation by outlining limits to the law’s implementation.

The ‘wolf-warrior diplomacy’ of recent years reflects a strong nationalist vein in Chinese society, but it does not characterise all Chinese diplomacy. Within most populations there are nationalists, and the more powerful a country becomes, the more intense their nationalistic instincts. When empires falter, as the American empire is now, their inherent nationalism becomes desperate and aggressive.

Despite Beijing’s testy lapses of diplomacy, its general lack of reaction to Western barbs shows an attempt to abide by a principle of ‘action through non-action’, the power of sentient passivity (‘wu wei’ in Daoist and internal martial arts teachings). 

China will need considerable patience and courage to face the blunt, petulant coercions of Washington and the wavering commitments of its trading partners, especially over the next three months. US Secretary of State Mike Pompeo stated in July that the aim of trade sanctions and prohibitions on Chinese tech companies was to bring about regime change in Beijing, but that they were not attacks on the Chinese people. This is the same point George W Bush made to the Iraqi people in 2003, before waging a war that led to the slaughter of hundreds of thousands of Iraqis.

Under present circumstances outright war is unlikely. In the face of growing domestic condemnation for the manner in which they have mismanaged the COVID-19 crisis, the Republican Party is groping for causes to distract its constituents from its own failings. Exaggerating the China security threat and emphasising that China is the architect of America’s domestic ills are crude tactics, but will resonate in an anxious, increasingly Sino-phobic society.

It would be naive to expect that the trust and respect between the United States and China built over decades, and now lying in ruins, may be rebuilt soon. One thing that Chinese people are unlikely to forget is that at their peak of suffering and dying of COVID-19, Washington tried exploit their vulnerability to extract strategic advantages.

Regardless of how polarised they may remain politically, the US and Chinese economies are intertwined directly and indirectly throughout the global trading and financial system in a way that makes Washington’s aim of ‘decoupling’ a fantasy. For all the sound and fury emanating from Washington in the form of threats to sanction China and block Chinese companies, American businesses are unlikely to allow their politicians to cut them out of the Chinese market that will be a key factor in their success for decades. China constituted 40% of global growth in 2019 and will be the strongest and one of the few growing markets in the world in 2020. Even though a Biden presidency will be no less anti-Chinese than the current administration, there are enough people with strategic common sense and humanity in Washington and Beijing for rapprochement to be possible, no matter how slow and painful.

*David Mahon is the Executive Chairman of Beijing-based Mahon China Investment Management Limited, which was founded in 1985. 

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How 'bout those Uighurs, then? How 'bout Hong Kong? How 'bout Taiwan? How 'bout the Sprattley's

The new Taiwan Defence Act which has strong bi-partisan support across both houses doesn't seem very "phoney" to me.

The recent US State visit from Alex Azar (highest ranking state visit in decades) to Taiwan is also clearly not considered "phoney" by the CCP either. In their State controlled media they have described it as illegal. Although clearly, if the USA brings the new Taiwan Defense Act into law then that undermines the CCP's claims of moral high ground (as claimed in this article).

If you are heavily financially invested in China, it must be really hard to face the possibility that political changes could interfere with your efforts. "De-coupling" would be undoubtedly be a painful and costly process. A lot of people would lose a lot of money. If human history is anything to go by though, geopolitics dominates overall. If geopolitics is supporting a globalised trading world then sure, this is just hard ball negotiations between America and China, but given other events (CCP hacking state websites, CCP spies discovered having infiltrated the CIA and FBI, tensions in Hong Kong, tensions in the South China Sea, western sympathy for Tibet) I would not be so quick to dismiss the deterioration of relationships.

Everyone thought that the British wouldn't vote for Brexit because it would be a painful and costly process and yet here we are.

"Everyone thought that the British wouldn't vote for Brexit because it would be a painful and costly process and yet here we are."
Everyone believed the ludicrously inaccurate pollsters. Remember the Brexit vote was almost 50/50, including within political parties - hence the pantomime and shenanigans the negotiations became. It seems few voters knew what they were actually voting for - a salutory lesson for our upcoming policyless (so far) election

As has been repeated ad nauseam, when China is weak, all the territories mentioned, and probably a few more, are independent. When China is strong, they are part of China. That's it. As China's Hong Kong deal showed, it was honoured as long as China felt too weak to dishonour it. Same with Sprattley Islands. Same with Taiwan. Tibet etc. Great fun.
I haven't decided yet if Dave is just trying to protect his position and investment in China, or is giving us his honest opinion about the unstopppableness of China's intentions. Time will tell. Maybe Xing has an opinion on the topic.

He did - it was deleted.


The British were better informed than they had been in 1973 when they voted to join the Common Market and Ted Heath told them it was only going to be a simple free trade union. He knew all along that it would lead to a political union but that the British would never agree to it if they were told so.

Hook; UKIP was still a minority political party for most of the noughties and the Cameron led Tory party who called the referendum were very confident that the referendum would return a Remain Vote. The Tory leadership thought the referendum would silence the dissenting Euroskeptics within their own party. Most Brits didn't spend much time thinking about membership to the EU. No one bothered to attend EU elections etc. Dissatisfaction grew slowly after the GFC, during the austerity programme, when wages and employment rights failed to improved and there was increased competition from migrants. That was when support for UKIP started to grow. But then leaving the EU didn't really reach wider public consciousness until 2015 as the issue of the referendum became mainstream. Public opinion went from ambivalence to intense engagement on the matter of the EU very quickly. I have never known the Brits be so widely passionate about anything. You can say that they didn't know what they were voting for, but it doesn't change the fact that it shocked a great many people, as big and sudden swings in political opinion sometimes do. People take for granted that the business, employment and trading relationships that they have built their life on will endure. They never expect Brexit's. Many, many businesses in the EU and the UK did not have a contingency plan for Brexit. The British government appeared to not even have one!!!!! Hardly anyone saw it coming.

All my comment is stating, is that geopolitics can change quickly and unexpectedly. In democracies, it happens in one way. In communist regimes, it would happen in another way. But it can and does happen. There is clearly souring sentiment around globalisation in many countries and I wouldn't be so bold as Mahon is, to dismiss it as "phoney" because it will lead to financial losses.

I am also not (at this time), making any value statements about Brexit or the choice the British people made.

"Everyone thought that the British wouldn't vote for Brexit because it would be a painful and costly process and yet here we are." It was because the media were too busy sucking up to those in power and the pollsters who were also doing a fair bit of sucking themselves, and had lost sight of just who any Government in a democracy really serves, and of the real level of angst that existed in the community as to the consequences of the capitalist free market and the impacts of being in the EU.

Unless US scraps the Taiwan Relation Act and prepares to take on the PLA in Taiwan straight, everything else is more of political smoke grenades. They are to disrupt China's effort to reunify with Taiwan and slow it down, but won't be able to stop it. The fact is the balance of power has long changed in the straight. Clinton was able to send in the Navy and aircraft carrier to stop PLA's aggression decisively in 1996; you don't see that anymore.

NZChinese, respectfully, I think you are missing my point. Political sentiment leads **first** in Western democracies. Since the 90s, most Americans have not given much thought to the trade relationship with China. Most were just happy to buy at the cheaper prices that an industrialised, trading China could provide. Over the recent decades, China has become much wealthier and has had money to spend on their military. They have massively caught up since 1996 and I agree that the American power is not currently as dominant as it was.

But that does not mean, that won't change. The Cold War shows that if countries want to compete in an arms, or space exploration race, they will escalate and direct resources to that **IF** the political sentiment supports it. This is my point. If public sentiment becomes very anti-CCP, if the current generation of politicians in America decide the CCP is a risk, they will just spend more on their military and the balance of power can change. Other countries may support the CCP, or they may support the USA. There are many factors that can effect the balance of global power. I'm just saying that I think Mahon is mistaken to be so confident that the situation won't escalate just because people will lose money.

Right, I now get what you meant. Yes, I believe the situation will keep escalating. And I also think the face-off between the United States and the People's Republic is inevitable. The US has missed the boat to contain the rise of Authoritarianism in China and influence her to become a constitutional democracy - thanks to the greed of Corporate America and the focus on the global war on terror. Mike Pompeo's recent separation between CCP and "Chinese people" might be too late as well.

I don't welcome deteriorating diplomacy. I am not Pro-America, or Pro-British (although i am British originally), I am pro-humanitarian. I want the global population to live as freely and peacefully as possible, which means action and collaboration on climate change, global resources and environmental issues too. Every country in the world has had authoritarian leaders or regimes at some point and all countries have at some point behaved aggressively or imperially. There are no good guys, only flawed human beings. Sadly, we seem doomed to keep repeating old mistakes and yes, further tensions between People's Republic and America seem likely. It won't just be those countries either. Others countries are already taking sides.

On a personal level, there is much more that fascinates me about the rich history of Chinese culture than America's (which is not hugely dissimilar to my own). I would love to spend time traveling China when my kids are a bit older.

History is fascinating, isn't it? The People's Republic once stood next to the USA to oppose the aggression of the Soviet Union. China joined America to boycott the 1980 Moscow Olympics to protest the Soviet's invasion of Afghanistan. It only took a few wrong turns to get where we are today. One thing is clear, though, Xi still lives in Mao's era. He believes in authoritarian rules so much even his father was a victim of the Cultural Revolution. He wants to be the Emporer. To unify all under Heaven is the ultimate goal for all Emporers through Chinese history.

History is fascinating yes, but also depressing and demoralising.

天命 The mandate of Heaven sounds noble. Just as it has in every culture that has tried to force it on others (under many different names and religions). We all foolishly hoped that authoritarian rule was on the decline globally but increasingly it looks like we are sleep walking back under its shadow. Authoritarian leaders are appearing in many countries.

China and the US have never been allies. Russia and China joined to combat Japanese aggression in '37, and the PRC has never had an aggressive or overtly anti Russian stance, quite the opposite. US was very worried about Chinese intervention in the Korean War (they were lucky China didn't step in on the Korean side).

Ah... China not only helped supply North Korea but they also fought in it.


"After a year of increasingly violent protests, Hong Kong needed to promulgate a security law. Beijing could have done more to allay the fears of the Hong Kong people and attracted less international condemnation by outlining limits to the law’s implementation." Is this guy serious?! They didn't 'need' to do anything of the sort. Hong Kong maintained as per the agreement with the UK would have continued to be a significant money spinner for the Chinese, effectively in perpetuity. No it is the CCP's need for absolute control that has caused the problems in Hong Kong, and will ultimately be the biggest threat the the CCP itself. Article 38 of those security laws reach far beyond the borders of Hong Kong and effectively means that anyone speaking against the CCP, in reality or perceived, anywhere in the world is in breach.


It would not be in Mahon's best interests-his ability to continue to do business-to be seen as anti China. That said, we have little choice but to ride the tiger as best we can, or run the risk of incurring massive economic damage.
I would much prefer that we were not as beholden to China as we are, but particularly now, we must tread warily.

The problems in HK were caused by increasingly violent and destructive riots. They started peacefully enough as protests and were tolerated but when they escalated to out and out riots and violence Beijing's hand was forced. Many in the protest movement should take a look in the mirror regarding their actions. They made some good gains but overreached subsequently IMO

Hook those protests were because of the CCPs increasing crack downs in HK, not the stimulus for them.

The protests started as that and achieved their objective but later morphed into riots for unrealistic demands - full democracy. In about 21/2 decades HK will revert to full CCP governance, no way the CCP would allow an enclave of separate systems to exist in 2050

No they did not achieve their objectives. At best the implementation of those laws was just delayed. By the time they were dropped, the other security laws were on the horizon for Hong Kongers and they saw and understood what they meant. Again the protests were driven by the actions of the CCP.

I don't support what the CCP is doing to HK but I find it interesting that any agreement the UK had with HK is still even mentioned. It was never Britain's to 'own' or dictate, they just leased it for a while. Lease up, get over it.

As to general economics this article contains a little gem of a statement that is very true of our own Government as well as others; "In crises, the West is often trapped by assumptions derived from laissez-faire capitalist ideology, leaving markets to correct anomalies that government interventions are often better able to repair."

An insightful and prescient article from Mr Mahon. Makes some interesting points regarding the need for a functioning world trade situation including China. Also makes a good observation re: nationalism - certainly apparent in the US. As usual the US and it's constant warmongering and sabre rattling to hasten or support "regime change" is hubris, only aimed at furthering american economic interests.
Let's face it - a lot of what the US is deriding China for now, are merely similar actions taken by the US historically

Yes some reasonable points.
The USA has been guilty of many crimes indeed, which some of us have been highly critical of in the past (which is why it is frustrating being labelled 'anti Chinese')
But that doesn't mean we should turn a blind eye to some of China's current actions.
I really like Chinese people but the current CCP leadership is detestable. Stories are emerging of dissent in the CCP ranks, people are seeing that his approach is backfiring,hopefully they get rid of Xi. Although I can't see it.
We really need to see some intense diplomacy and compromise, from both sides...

Neither Authoritarian China nor Corporate America is good

Gee what a China apologist!

Haha Fritz, given Mahon is "boots on ground" and he operates an advisory agency, it's possible he's more of a realist (and a fairly well informed one)

Good one! He's heavily invested in China and is biased.
And as you probably know he may not be popular there if he's critical.
So I give this article almost no weight. But it's interesting in terms of psychology.

It's a shame you seem to discount his opinions as propaganda. He's been there for over 30 years so he's better informed than most, and certainly any on this forum. Mr Mahon has been very helpful with facilitating NZs efforts to increase trade with China.. you may not like it but it's an unavoidable necessity for NZ to trade our way out of the current downturn and China is our best hope. Certainly the US won't help, the EU doesn't like us, UK is a basketcase and Aussie has it's own problems and is too small. So that only leaves Russia, India, Asia and China. China is the only one we have an FTA with

I'm certainly not saying he isn't well informed on Chinese business matters. He obviously is.
But being informed and offering insightful, objective and unbiased advice on broader economic, political and geo-political matters are very different things.

Is Hook actually Xings replacement ?

haha Glitzy.. no, just acting as a foil to the constant anti-china rhetoric here. I'm more interested in paying the bills than virtue signalling tbh
As you may have noticed, I also have a strong dislike for US hypocrisy and double standards

It would appear so. Going so far as to blame the HK protestors for forcing Beijing's hand.

It was the protestors more recent actions not the protests per se. When they devolved into riots was the tipping point.

Maybe, just maybe, the riots might be justified.
Rather than 'a bunch of young, idealistic unemployed students getting up to havoc'

I disagree the riots were justified, protests yes (and they resulted in the repealment of the extradition policy). To then riot in support of full democracy was a step too far and was both unjustified and unrealistic. As I said, the protestors overreached. They'd had good gains made in their local Council elections and many pro democracy candidates had been installed. They should have been more tactical and strategic.

"To then riot in support of full democracy was a step too far and was both unjustified and unrealistic."

... in what circumstances then, would you consider it justified and realistic for people to riot in support of full democracy?

NONE!! Peacefully protest and exercise your right to free speech is fine. Destructive rioting and anarchy is most definitely not fine

How does that work when the right to free speech is non-existent and those peacefully protesting are escorted off into obscurity? I'm for and vastly prefer civil disobedience when necessary, I see it as vital to democracy. But there are clearly situations throughout history in which rioting is an understandable response that desperate people resort to in an attempt to throw off unbearable oppression.

When was the last time you joined a protest movement physically as opposed to just jawboning the virtues of one ?

Can you actually respond to the question, instead of ignoring it and then trying to attack me personally? I have physically participated in many protest movements. As I've said, I believe civil disobedience is necessary at times for a functioning democracy.

There is no excuse for civil disobedience.. protests .yes, riots no. Participating in a protest is not civil disobedience.. engaging in and promulgating a riot is most definitely civil disobedience which when coupled with destruction of public and private property should be stamped out hard and fast and those who encourage those acts need to be held accountable

You do not understand what civil disobedience actually means at all. It's worth looking up and learning the vital role it has played in history, though I'm sure you'll find it just as disagreeable. I've already stated that I greatly prefer civil disobedience, but I understand the level of oppression that would force desperate people to resort to rioting. I don't agree with the destruction of property and other serious consequences of this, but people enduring such oppression are in a place that you don't care to understand or empathize with.

If there hadn't been several moments of civil disobedience in the past we wouldn't have our current freedoms

Hooks comment Mahon's is boots on the ground is right. Everyone is forgetting basic history,europeans have dominated world history as we know it. Except where "our' interpretation of how it went is not the given. Maybe it is for us to step back and except that there are other players on this globe who have just as much right as us. Inclusion of all states and opinions including China,Iran,Russia,and every other state on this planet. Untill everyone can except the global situation we are in there will never be peace.

Ah yeah, Russua, where Putin's main opponent has been poisoned.
Thanks but no thanks.

Where is Xing?
I miss his/her commentary!

Xing made a sexist and derogatory comment about America. I replied, as did others. They have been deleted.

I am torn between wanting him gone for good and wanting him here - for entertainment value.

I am inclined to take his (could be her) comments as trolling..

There are a few more I'd lump in that category.....


As long as people stick to respectful, civil debate I am more than happy to share the space with even extreme views. People disagree but IMO disagreements are better off aired. Spreading misinformation/gossip (as some did on here about the South Auckland family) or making sexist, racist comments etc I don't think that furthers anything constructively.

Just for the record Xingmowang has not been blocked or banned. Their absence is entirely their own choice.

No. I am not blocked or banned. I very much enjoy in commenting on this site from time to time.

Some of my and following comments did get deleted for unknown reason.

I do not believe describing the current status that the US is at as a woman experiencing her menopause period is inappropriate.

However, the editor has the final say on this and I respect his judgement.

I think most people on this site found that comment inappropriate Xing. I'm actually quite bemused you can't see why. Just for the record, why do you think the comment was appropriate?

I don't get why Westerns are so hot on China taking control of Hong Kong. Appreciate that it was British administered when we were all born, but it was more or less stolen by the British empire as part of the opium wars. The original takeover by the British being a textbook definition of the term 'gunboat diplomacy' And not all that long ago.

Its like if we had a brief war with China, lost, and as part of the settlement agreed to give up administrative and financial control of waiheke Island and its native population. Sure some/most people of Hong kong may see themselves as an independent state, but you can at least understand the claim by China.

Just like the South C Sea. Its just China tidying up its back yard. The US are still the ones with most of the carriers, nukes and military bases all around the world.

Best thing about NZ? No one cares enough about anything we do/have/are close to, to justify projecting military presence here. The less people can find us on a map the better...

Best we keep quite and hope they don't end up trading nukes.

Hear, hear.

[ Personal insults removed. Final warning. Ed. ]

Bwaahaha, priceless Glitzy, some new opinions ruffling your feathers?? Questioning the established order - haha, can't have that.

What's your position on the concentration camps in Xinjiang ?

Watch what you type, someone is watching you and your family.

Here's the thing Glitzy, They are no doubt in existence, however I don't see many world leaders stepping up to condemn them or, more tellingly, to sanction China over their existence. Tbh I actually don't give them much thought on a day to day basis, as I expect most people focussed on their own lives don't either. There are, and have been, many distasteful actions taken by Govts the world over but it's out of my hands and there's nothing I can do about it. I prefer to focus on issues that are closer to home that I might be able to influence.

Keep up with the news! Many world leaders have been condemning it in recent times. And like any issue (apartheid etc) it takes collective efforts form many countries to counter it. So every country, including little ole NZ, counts.
Keep gong with your 'turn a blind eye to atrocities' world view Hook... nice one

See the thing is Fritz.. I don't actually care. A significant proportion of NZrs don't even know who or what the Uighurs are. As for "world leaders".. not much concrete action coming from them. Words are cheap, especially when they are couched in diplomatically obscure language. Not a single country has said "free the Uighurs or we stop trading or apply tarifs and sanctions". Says it all

'I don't actually care .
Of course you are entitled to your opinion.

That's the problem. If more people cared and kicked up a fuss about it, in both words and in action, there might be some actual pressure on our governments to do more than politely and rather quietly condemn this. The apathy we collectively show towards such atrocities, does matter.

Too right. Can't make an omelette without breaking a few hundred thousand Uighur eggs. There's is just a sacrifice we have to make. Appeasing dictators with race based policies has never gone wrong in the past. Generally pretending they're not imperialistically inclined for as long as we can works the best.

Heaven forbid we should asked to take a stance on ethnic cleansing.

Didn't see too much of an international stance in Rwanda or Zimbabwe. Czechoslovakia was a mismanaged debacle by the UN. Iraq was a US led disaster that destroyed a functional country. Syria is still a war zone. Yemen is nearly as bad.
Just because some in the western world (mostly led by the US) disagree with some regimes doesn't give them the right to force change.

"Two wrongs make a right"

The international response to the Rwandan genocide was called out as a terrible failure of the international community. Don't see any validity in your argument that such a failure makes it reasonable to look away from other genocide.

Fluffybunny, realistically though... do you really think that the world can be different? Throughout all of known history, it has never been so. There isn't an inhabited part of this planet that hasn't been fought over or where when one tribe hasn't dominated another. We are perpetually in a state of global domination by one culture or another. The dominating forces have not always been "Western". Mongolian, Carthaginian, Egyptian, Babylonian, Muslim all massively influential, enduring imperial forces.

The question is... does the majority of the world want to stand back and let the People's Republic become the dominant world power or do they prefer their American Overlords and want to block the CCP from gaining any more power? Because, let's not pretend that either of them are "fluffy bunnies" who have no imperial intentions.

is presently stimulating the economy to sustain growth, employment, and consumption,

There's the kicker. Not enough to go around anymore. The US couldn't continue consuming and China come to the table as well, let alone India.

PDK I am of the opinion that human demographics is one of the biggest contributing factors to GDP anyway. Not sure if you have read the book "The Human Tide" by Paul Morland but it's about population expansion (especially since the Industrial Revolution). Britain began the Industrial Revolution and was the first country to experience a hugely increased population growth rate (others quickly followed). Industrialisation enabled greater resource extraction, wealth, advances in science and medicine that could sustain greater numbers of people yadda yadda. Simples.

But as you track GDP around the world, it slows down the further they are from peak industrialisation (and as their population growth slows down or goes into decline). There are other factors obviously and immigration often helps to boost the GDP for the same reasons but "growth" as we have come to expect it, at anything like 2%+ just might not exist at all as human population declines.

Obviously, if countries with huge populations consume at the levels that the Western world does then this is only going to hasten the speed at which resource scarcity becomes more acute, potentially forcing human fertility and population growth down even further.

You often mention the unsustainability of "growth" and I agree... but are we already seeing the effects of it all around the "developed" world in anemic GDP? There are also interesting links between fertility rates and recessions (they decline *before* the recession happen). Do you think it is possible that human fertility is still linked to the global ecosystem enough for us to subconsciously sense resource scarcity and therefore hypothesise that human population growth might slow more than is predicted if economic growth is in terminal decline? The general consensus is that human population growth is slowing because of female education and rights but perhaps this is a factor too?

Quite an interesting bunch of questions you pose ninja, all of which are pertinent. I do focus on your last sentence. Women have an education, careers and ambition which is an excellent result of changing societal values. Women now are no longer subjected to being "stay at home mums" if they prefer to actively partake in the economy if they choose to. Of course the flip side is women are no longer quite so willing to put their careers on hold merely to be the enablers of population increase. This is, of itself, a good thing. Unfortunately this means the population increase is often being provided by less than ideal parents

It has become extremely clear to me that women having control of their own lives and fertility, do indeed choose to have fewer children, start later and even eschew the whole thing altogether, preferring career to motherhood, which on the other hand suggests to me that high birth rates occur where women do not have such control of their lives. Just look around the world, even where women receive lots of support, if they are educated and have choice, the birthrate is much reduced.

Sorry. To clarify, there is undoubtedly a strong correlation between female education/equality and declining birth rates. But I am asking whether there is another factor to declining birth rates and whether economic growth, being tied to population growth, might create a negative feedback loop to population growth.
I often hear parents talking about how many children they can afford. Post-peak-industrial developed countries have achieved an expectation of a certain standard of life. We often choose to have less children in order to main that standard of living. Even in areas where there is still extreme poverty and lower levels of education, there are much lower levels of population growth than there were even a few decades ago.

Another factor is that child mortality has greatly decreased. The expectation that your child will probably survive beyond 5 years of age is something that only modern post-industralised countries have enjoyed for maybe 80-90 years? All these issues overlap.

Great posts GN - thanks.

I think it's a matter of timing; lag-times and such; both GDP and births.

As resource consumption grows exponentially, a nation (traditionally, there's a corporate question latterly) overruns it's local base. It takes more and more effort per return, the further away they then cast their nets. Britain, for instance, had to be in the Middle East to secure oil supply - effort in for effort out (EROEI) and as ever, the output has to outweight the input. In percentage terms, I doubt foreign-resource acquisition ever matches the initial local draw-down, thus GDP will trend down. The other point to note is that it now takes more than a dollar of debt to account a dollar of GDP. Is that really a plus?

The problem with relying on education of women to reduce birth rates, is that we are currently 5-6 billion overshot and there are more pre-parents coming through yet; the graphs cross at a fairly acute angle. Expect longevity ("Despite the incredible strides we’re seeing in science and technology, life expectancies are stalling or even falling in much of the developed world. Recent statistics from the Centers for Disease Control show life expectancy has fallen for the third year in a row in the U.S. There are ominous signs the U.K is heading in the same direction with growth in life expectancy stalling—according to the New York Times—after years on the upward trajectory.") to keep dropping from its peak.

One of the drivers to the less-children trend has been the change from human and animal labour, to fossil energy. Lots of children meant lots on the end of a hoe or an axe, or mangling washing. Now you flick a switch. Now a female can use a digger equally as effort-fully as a male, fossil energy nullifying the strength of muscles (which evolved because we specialised; males out spearing protien-on-the-hoof hunting, women nurturing and maybe gathering). Given that fossil energy so outranks human, you try and earn to buy it, not raise a child. You get more energy return for your energy input.

For once - as far as I recall - I agree with Hook; the lesser-cogitating will keep procreating, the more thoughtful will be less likely to reproduce their trait. Thus the average lowers; a reversal of Survival of the Fittest.

Lots of neoliberal environmentalism clap trap from you as usual PDK.. If you were a true believer in the destructive results of modern society and its resource hungry consumerism you'd be sitting in a thatched hut with no internet connection and saving us all from your ridiculous diatribe. Modern society has rejected your outmoded and discredited theories about 300 years ago. That's why it's called a modern society

Insults don't do your "arguments" any favours

They're clearly an easier resort than a cogent argument given the absence of the latter.


What I do, is demonstrate a very comfortable, low-impact lifestyle. It's not perfect, but it's better than shafting future generations (of resource chances, while giving them a polluted, entropy-doomed collection of closed-off options).

Actually, your 'modern society' decided to at least fool itself, and at most lie to itself. As most 'modern societies did in the past, prior to their own collapses (there were folk like you in Rome, I bet). The problem is when you measure progress in terms of consumption, while assiduously avoiding 'how much is left to consume'. Folk like you (whether out of fear, selfishness, denial or a combo being an aside q) are the kind who call folk like me Malthusian - gibbering on that he was 'disproved' (usually with a misrepresentation of the Limits to Growth projections thrown in).

Some of us are more dispassionate in our quest for first-principle knowledge. Here's a quote from one of my favourite historical intellects:

"No man can say that he has seen the largest ear of wheat or the largest oak that could ever grow; but he might easily, and with perfect certainty, name a point of magnitude at which they would not arrive. In all these cases therefore, a careful distinction should be made between an unlimited progress, and a progress where the limit is merely undefined”

If you try really hard, you might understand. The intellect, of course, was Malthus. Makes 'discredited' and 'modern' sound a little silly, no? Your whole stack of cards is built of, and fuelled by, finite resources, dug from a finite planet. It doesn't give a rodent's behind what you choose to discredit, its physics is what it is, and its is, is being altered by us. And it could tell you the obvious; that your collection of activities is a temporary arrangement. I challenge you: download, and read end-to-end, Catton's Overshoot. Then come back and make the same statements. Perhaps follow up with Emmott's 10 Billion - a real cheapie download and a one-hour read. The 3rd last page (from memory - it's the one with about 3 sentences on it) is worth the download on its own.

BTW - you're a bit late. I first heard that diatribe from an angry drinker in an Aussie pub, the week Charles and Di got hitched. He was envious two of us had built a small yacht and were off on an open-ended adventure. Told us we should be using flax and dugouts. We argued we'd worked to earn the materials, our account was square with society and we had chosen a lower-consumption lifestyle for a while. He wasn't listening, and I realised he was excusing his own fears. I ended up feeling sorry for him.

Haha... love it

Gingerninja,regarding "The human tide" which I have never read, but I am an avid reader and am with you on the philosophy on the problems of humanity on this small planet. I would say intensive agriculture, starting say 10000 yrs ago is really the begining and nothing changed until people got sick of tending crops. That's when religion took over,intimidation with unseen deities forced the people to produce. Back then there were the haves and the have not's, peasants and elites, the latter mainly religious or military. Fast forward nothing has changed in the human psychology except we have amazing technology and religion has been replaced with science(for the better) but unfortunately many inhabitants are regressing. Hopefully a new future is dawning as people realise that we have to move on to clean energy, whatever that may be, to survive as a species.

What if the global corporations imitated the surveillance and control of the CCP?
Maybe China is showing the techniques on how to rule the world.

Including the universal cashless credit card-less way of life with Alipay, Weichat pay, etc