It's a hard time to be an American. Everywhere you look, pundits delight in casting a blanket of misery over everything that is red, white and blue. Turn the oven off, grandma – there will be no more apple pie. “America is in decline,” they say, “and you better get used to it.”
Political scientists and social commentators who fancy themselves experts in the balance of power, both physical and economic, base their claims of American decline in a classic, zero-sum assumption of relative power. China is seen as a rising star in the East, and its increasing power and economic strength can only come at America’s loss. There can only be one left standing triumphant.
Who could blame them? Most of these academics grew up in a bipolar (and later a unipolar) world. Whole academic careers were focused solely on how the US could top the Soviets; later, how the United States could remain the only superpower.
The commonly accepted theory that the United States is in a slow decline isn't completely baseless, but it isn't concrete either. It’s easy to sulk at the conditions in America today: a stagnant economy, outsourcing of manufacturing, rising national debt, ineffective leadership at all levels and no real plan to fix its problems. However, when looking at the relative economic power of the United States around the world, only a "chicken little" who has not left the walls of the Ivory Tower would believe that the sky was falling.
When comparing China and the United States, it’s commonly stated that the Chinese economy will surpass America’s as the world standard-bearer by 2030. Sounds terrible, right? However, the claim is dubious at best. At face value, the numbers are impressive. Many years saw double-digit growth in overall Chinese GDP. From 1990 to 2011, China's nominal GDP increased from a scant $357 billion to a whopping $7.3 trillion. Indeed, the United States wishes that it could sustain growth numbers like that. Reality check: so does China.
Looking beyond the raw measure of GDP, consider the purchasing power parity (PPP) adjusted GDP per capita (fixed in 2011 dollars, per the World Bank). This is more indicative of an economy's real strength. While GDP is a good measure of total economic production, it does not describe the changes in quality of life that PPP does. China currently ranks number 91 in the world with an expected per capita income of $5,547. That is 16 times what it was in 1990, an incredible leap forward in its own right. However, it’s not good enough. Considering the population difference between China and the U.S. (1.3 Billion versus 300 million), the vast amount of individual poverty in China outweighs its coastal manufacturing and export strength. If China cannot solve domestic economic issues, should it be expected to lead the reorganization of the global economic order?
But let's look at the United States. The U.S. had a per capita income of $23,038 in 1990, which grew to over $48,442 by 2011. This increase in per capita income took place as the large Baby Boomer generation began to retire, and as the US shed over half of its manufacturing output. In contrast, the growth China has reported since 1990 has been produced by a glut of 18 to 40-year-old working aged citizens, which comprise well over half of the total population. However, China has one of the lowest population growth rates in the world due to its one child policy. So when this current oversupply of factory workers reaches retirement age, who will replace them? If the history of industrialization and outsourcing tells us anything, it won't be fellow Chinese workers.
China's rate of growth has far surpassed the America’s. Will the overall size of the Chinese economy pass the United States? Maybe. But will it become an economic titan that dominates the U.S. globally? Unlikely.
Perhaps China desires a regional hegemonic role in East Asia rather than replacing the United States as a sole superpower. Brazil seeks similar status in South America, as does India in South Asia. Can we expect the world of tomorrow be a multipolar one, or will the US survive flash-in-the-pan newcomers and hang on to the number one spot?