Stephen Roach Should Know Better, so should US policymakers...

I just read this paragraph inside of this article about China’s growth and challenges:

“The best way to measure how far China still has to go is to consider the development of its services sector — the infrastructure of consumer demand in an economy. The good news is that services are now growing faster than any other sector, having reached 48% of gross domestic product in 2014 (thus surpassing the end-2015 target of 47% well ahead of schedule). The tough news is that this remains significantly lower than the 60% to 65% share typical of a more “normal” economy.”

This is from Stephen Roach, a senior economist for some 30 years at Morgan Stanley Asia. Now to make a statement like this about a nation with as many people STILL living on $2.00 a day as there is in the entire population of the US is almost unconscionable and shows the level of disconnect between those who are supposed to know what is going on in places like China and those who actually know what is going on in places like China.

Really! Just because China has gone through a massive transition of manufacturing something like 25% of the global goods output followed and coincided with/by the largest government led “development” of everything from housing to roads to rail, power, telecom etc., all inside of one generation, does NOT in any stretch of the imagination mean “senior economists” anywhere in the world should start to compare China with mature developed economies that have been built over 4 times that long!! Yet there it is, in Black and White from someone who should know better.
Fair enough, there is mention of “at least another decade” to “complete” structural adjustment, but I would say a fair number in this category is 25 years+ to accomplish anything near what is insinuated in this article as “complete”.

In addition, the article goes on about America’s paranoia about China and the “Cold War” mentality in dealing with the “rise” of China. Yea, America will bury itself “worrying” about something that is complete nonsense. China is as fragile as any nation in history right now and all the US is doing is playing a card that supports massive additional deficit spending on pointless weapons production and support of the Military Industrial Complex. Nothing good will or can come of this ignorant policy mentality.

Meanwhile, you give me ONE example in history of a country that developed as rapidly as China has in the last 30 years with anywhere near the population they have managed to do this with. Then give me ONE example of any nation that comes anywhere close to comparison and tell me if some 60% of the wealthiest people in that nation have hedged their bets by transferring literally Billions of Dollars out of the country, buying foreign property, secondary visas, and sending their children out of the nation in mass at the same time!! Go ahead, show me! Then tell me what a “threat” China is anywhere in the world!

More and More Wealthy Chinese Want to Emigrate Percentages of Rich People Who Leave the Country: Source