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Ron Paul: "Why We’re No Longer Number One"

Tyler Durden's picture




 

By Ron Paul via the Ron Paul Institute

Why We’re No Longer Number One

Last week World Bank economists predicted that China would soon displace the United States as the world’s largest economy. The fact that this one-time economic basket case is now positioned to surpass the US is one more sign of the damage done to American prosperity by welfare, warfare, corporatism, and fiat money.  

Some commentators have predicted that China’s reign as the world’s largest economy would not last long. This may be true. While China has made great strides since adopting free-market reforms in the 1970s, China is still run by an authoritarian government whose economic policies distort the market in order to benefit state-favored industries. These state-favored businesses are often controlled by politically-powerful individuals.  
 
What many of these commentators fail to notice is that the American government pursues many of the same flawed policies as the Chinese. For example, because of the increase in regulations, subsidies, and bailouts, many American businesses are putting more resources into manipulating the political process than producing goods and services desired by consumers. Many big businesses even lobby Congress and the federal bureaucracy for new regulations on their industries. They do this because big business can more easily absorb the costs of complying with the new regulations that force their smaller competitors out of business.
 
China is regularly criticized by American protectionists for subsidizing its export industries. However, the US government does the same thing via programs such as the Export-Import Bank. China is also criticized for manipulating the value of its currency to make its exports more attractive to foreign consumers. This may well be true, but China is hardly unique in this respect. Throughout its history, the Federal Reserve has manipulated both the domestic and international economy, often working in partnership with foreign central banks.
 
The Federal Reserve’s inflationary policies benefit big banks, politically-connected businesses, and big-spending politicians at the expense of the American people. Anyone interested in helping improve the American people’s economic situation should focus on changing America’s monetary policy, not China’s.
 
Ironically, many of the same politicians who denounce China’s monetary policy benefit from Chinese purchases of America’s debt. If China stopped making large purchases of US debt, the Federal Reserve would be forced to monetize even more debt, thus risking hyperinflation. So the best thing Congress could do to make it more difficult for China to manipulate the global economy is cut federal spending.
 
One advantage China has over the US is that the Chinese government does not waste money on a hyper-interventionist foreign policy. The United States government spent approximately $752 billion on the military in fiscal year 2013. In contrast, China spent approximately $188 billion. While China may be increasing its military spending, it has a long way to go to catch up to the United States.
 
It is difficult to see how the American people, other than those who run or work for the military-industrial complex, benefit from this spending. Military spending, like all government spending, hampers private sector growth by taking resources away from investors, entrepreneurs, and consumers while contributing significantly to the national debt. In contrast, a return to the policy of peace and free trade would allow those resources to be used by entrepreneurs to create new businesses and new jobs.
 
News that China is soon to surpass the United States as the largest economy in the world is a stark reminder of how the American people are harmed by the welfare-warfare state, crony capitalism, and fiat currency. The only way to avoid continuing collapse is to finally reject an interventionist foreign policy, stop bailing out and subsidizing politically powerful industries, and restore a free market in money.

 

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Mon, 05/05/2014 - 21:19 | 4730478 TeamDepends
TeamDepends's picture

All your ranchers are belong to us.

Mon, 05/05/2014 - 21:35 | 4730521 Buckaroo Banzai
Buckaroo Banzai's picture

The US may no longer be number one, but the beltway surrounds a big steaming pile of number two.

Mon, 05/05/2014 - 21:57 | 4730589 james.connolly
james.connolly's picture

Funny pre WW2 the USA was a failed penal colony and nation of hair-lips at best,

Post WW2 with NAZI ( operation paperclip ) support, and the fact that the rest of the worlds MANUFACTURING was destroyed the USA looked good for about 20 fucking years, then in the 1970's the JAP's kicked the USA ass in AUTO;

By 1980's the USA was bankrupt,

#1 my fucking ass, ... Ron Paul is talking 1950's revisionism, .. happy days my fucking ass.

Happy Day's are never coming back,

Mon, 05/05/2014 - 22:03 | 4730600 chumbawamba
chumbawamba's picture

Look, I'm no nationalist, but your version of American history is like Rachel Maddow's telling of heterosexual sex.

I am Chumbawamba.

Mon, 05/05/2014 - 22:09 | 4730629 xtop23
xtop23's picture

Nice

Tue, 05/06/2014 - 00:44 | 4730933 James_Cole
James_Cole's picture

News that China is soon to surpass the United States as the largest economy in the world is a stark reminder of how the American people are harmed by the welfare-warfare state, crony capitalism, and fiat currency. 

Er.... Other than the warfare bit, how's the Chinese economy function again?? RP trying to walk a tightrope and failing. So what if the Chinese 'economy' has allegedly passed Americas in size? If anything this would demonstrate that cronyism works

Tue, 05/06/2014 - 00:56 | 4730947 A Nanny Moose
A Nanny Moose's picture

Amen Chumblez.

Mon, 05/05/2014 - 22:07 | 4730621 i_call_you_my_base
i_call_you_my_base's picture

Right, in the 1920s America resembled a failed penal colony. You seem to forget the industrial revolution entirely.

Tue, 05/06/2014 - 01:42 | 4730990 thamnosma
thamnosma's picture

I'm afraid he's forgotten a lot more than that.

Tue, 05/06/2014 - 02:11 | 4731011 crazyjsmith
crazyjsmith's picture

Mr Connolly,

I love the Hair-lip remark.  Everytime I see it in a comment, it just makes me kind of chuckle - because it is meant to be derogatory in some weird way, but ends up sounding more funny than anything, and just gives a very good sense of where the comment is coming from.  And especially now, where hair-lips are totally hip, and embraced here in the states.  

So sorry little Chicom friend - your overly aggressive, yet very scripted nonsense is boring and just plain ackward.  And I bet I got hairs on this lip that are longer than that little 2 inch angry yella fella you are probably carrying around. All pretending to be a man.  So I dispose of you like I would some creepy Mormon Pamphlet I found stuck to my windshield - 

Good Day, and May the Force Not Be with You

Tue, 05/06/2014 - 08:31 | 4731331 bigbucksr
bigbucksr's picture

I agree with your point that the US's post WW2 economic dominance was due in large part due to the destruction of the manufacturing base of 4 of the 5 largest economies of that time. Think about it, Germany, England, France and Japan were effectively destroyed. Perhaps we are poised for a repeat scenario. The money printing of the the last 40 years has created such world wide global mal investment that the only way out of this economic mess is to destroy worldwide capacity...both manufacturing and labor capacity....too many manufacturing plants, too many car factories, too many empty apartment cities in china....keyseyism (more aggregate demand) is not the answer just like we discovered in the 1940s

Tue, 05/06/2014 - 08:34 | 4731336 bigbucksr
bigbucksr's picture

The question is which countries will be destroyed....

Mon, 05/05/2014 - 21:59 | 4730595 chumbawamba
chumbawamba's picture

I must admit to being out of touch with "reality" for a while now, having eschewed any interest in public or world affairs in favor of study of more pertinent matters.

But I read this and I wonder, is this really something that even needs to be written?  I mean, I like Ron Paul and all, though I'm still not sure what that whole botched election bid was all about.  But isn't this just basic common sense?  I mean, to me it's like ZH running an article that says, "once in a while you should make sure to catch up on your lost sleep or else it'll catch up to you".

Anyway, just wondering if I'm losing touch with reality or if the world has.

I am Chumbawamba.

Mon, 05/05/2014 - 22:47 | 4730725 Cathartes Aura
Cathartes Aura's picture

whose reality Chumba?

which One?

Mon, 05/05/2014 - 23:29 | 4730829 Greenskeeper_Carl
Greenskeeper_Carl's picture

Yes, it is something that needs to be written, and it needs to be read by as many people as possible. What RP said may seem so obvious to us that it seems unnecessary to even write, but to most people it would be completely out of left field. Articles like this need to be written and spread so that others may learn the truth about the fed. That's what all of this really comes down to, IMO. There is no issue more important, and most people don't even know what the fed is, or, at least in my case, the people who I have encountered that had even heard of the federal reserve thought it was some kind of part of the treasury or something. As long as that institution exists, the rest of these issues are pointless. The fed enables them all.

Tue, 05/06/2014 - 00:48 | 4730941 James_Cole
James_Cole's picture

But I read this and I wonder, is this really something that even needs to be written? 

The funny bit is Ron Paul creating his own institute named after himself, the clown show goes on!

Tue, 05/06/2014 - 03:24 | 4731066 Squid-puppets a...
Squid-puppets a-go-go's picture

ron paul is part of the solution

james_cole is part of the problem

and the problem goes beyond dumb and annoying, its downright evil

Tue, 05/06/2014 - 06:16 | 4731144 James_Cole
James_Cole's picture

and the problem goes beyond dumb and annoying, its downright evil

the american taliban - fightin' dem libtards, one downright evil bastard at a time. for freedom an' shit. 

Mon, 05/05/2014 - 22:30 | 4730684 Dr. Engali
Dr. Engali's picture

+2 Good one.

Tue, 05/06/2014 - 18:40 | 4730986 prains
prains's picture

never really understood the metric behind the concept of being number 1. how is an economy number 1 ? number 1 at what? graft, cronyism, quiet lobbyized corruption, black ops overthrowing of other sovereign gov't, killing brown people, killing innocent people in tall buildings, starting proxy woars that are meant to start full blown global woars. I guess these are all GDP metrics that can be applied to 70% of the american economic GDP in some form or another. The money to produce all this killing has to trickle down somewhere. Not sure how this historically means an economy is number 1 or why that's something to be proud of? Help me out here......so the rest of us from 2 to 7 billion can try and understand how we can get better so one day maybe we can be number 1 too !

 

or is nobody else allowed to be number 1 ?

Mon, 05/05/2014 - 21:19 | 4730481 dexter_morgan
dexter_morgan's picture

So, my question is, Why did Rand get dropped on his head so many times? Something has to account for him becoming the anti-Ron Paul as time goes by.

Mon, 05/05/2014 - 21:21 | 4730488 1stepcloser
1stepcloser's picture

He kept fucking with Ron's stack! Ronny don't play that!

Mon, 05/05/2014 - 21:50 | 4730571 SilverIsMoney
SilverIsMoney's picture

Lol... as much as I love Ron Paul, this is hilarious...

 

Mon, 05/05/2014 - 21:38 | 4730534 Buckaroo Banzai
Buckaroo Banzai's picture

Rand Paul really lost me when he stabbed Cliven Bundy in the back.

Mon, 05/05/2014 - 21:43 | 4730547 Charles Nelson ...
Charles Nelson Reilly's picture

It's better just to move on from Rand at this point. There is zero chance that one individual is capable of fixing any of this mess.

Mon, 05/05/2014 - 23:51 | 4730861 g'kar
g'kar's picture

These layers of crap were built up over a period of time. In geology I think they call it sedimentary layering. But eventually you get an extinction level event.

Mon, 05/05/2014 - 21:54 | 4730582 Dexter Morgan
Dexter Morgan's picture

Dexter Morgan agrees.

Mon, 05/05/2014 - 22:01 | 4730598 james.connolly
james.connolly's picture

Daddy was just a US Congressman, in Texas, where his cheap rhetoric got him elected 20 terms.

Randy Paul wanted to be a US Senator,

US Senate seat requires eating AIPAC shit, and being fucked ( mouth, ass, ear, ... every orifice ) by every alpha male in TEL-AVIV.

Randy is now just a bitch, not unlike OBAMA.

What happened to RANDY PAUL?

In a quest for power the God's make you mad.

Clive Bundy is a real man, Randy Paul is NOT.

Mon, 05/05/2014 - 22:11 | 4730631 Dr. Engali
Dr. Engali's picture

I think Rand tries to play the political game, which he is not very good at, instead of being true to himself. Hopefully as he ages more of his father's characteristics come out.

Tue, 05/06/2014 - 01:50 | 4730996 DollarMenu
DollarMenu's picture

You've got to be carefull with that 'hope' stuff.

Too much can get you down a dead end road.

Mon, 05/05/2014 - 21:35 | 4730524 The Gooch
The Gooch's picture

For the punk rock Tylers, China #1.

"888"

http://hellkite.bandcamp.com/track/eight-eight-eight

Recorded by The Gooch.

HELLKITE, r.i.p.

Mon, 05/05/2014 - 21:45 | 4730552 TeamDepends
TeamDepends's picture

This one time, at band camp, Barry stuck Marx' flute up his....

Mon, 05/05/2014 - 21:35 | 4730527 i_call_you_my_base
i_call_you_my_base's picture

I find any article about "what's wrong with america" that does not include rampant corruption as a cause suspect. The fed may excacerbate corruption, but to me it's a biproduct, not the cause of the downfall. Cronyism, graft, nepotism, etc, is the true cause. The complete rejection of ethical conduct and a merit-based society are the systemic maladies of the US. With those, nothing works.

Mon, 05/05/2014 - 21:38 | 4730532 The Gooch
The Gooch's picture

The "fed" births corruption.

Breach, even.

Tue, 05/06/2014 - 03:34 | 4731075 Squid-puppets a...
Squid-puppets a-go-go's picture

chicken+egg

Mon, 05/05/2014 - 22:07 | 4730622 Dr. Engali
Dr. Engali's picture

The fed is synonymous with corruption.

Mon, 05/05/2014 - 22:39 | 4730708 JR
JR's picture

No. It is the Federal Reserve that has stolen America’s greatest; it is the Federal Reserve that has sapped America’s energy and transferred it to its own accounts.

The Federal Reserve is the single most important reason for what’s wrong with America. Because of this monster operating for 100 years against the public interest, the corruption from political officials has been accelerated.

The country, its politicians and political parties, its institutions, all have been purchased because they are totally addicted to Fed money – created out of nothing – enabling Congress to spend money like crazy with money it doesn’t have, transferring control of all power centers to the bankers.

[W]hen the money is created out of nothing for the government it is spent by the government. On the banking side, however, when it's created out of nothing it's not spent by the banks it is loaned by the banks to you and to me and we spend it. Notice that when they loan it to us we have to pay them interest on it. Think about this for a minute. This money was created out of nothing and yet they collect interest on it which means that they collect interest on nothing. Not too shabby!”

For instance, 2 1/2 times as much money on an 80% home loan will be paid to the banks in interest created out of nothing than will be paid to those who provide all the labor and all the materials to construct the home. The Federal Reserve gets rich all right but they get it by taking it from us.

G. Edward Griffin, author of The Creature from Jekyll Island: A Second Look at the Fed, explains further:

A strong nation is not a candidate to surrender its sovereignty but a weak nation is. If America can be brought to her knees where she is struggling for survival, if people are hungry, if we have riots in our streets, then Americans could possibly be grateful for…those wonderful blue-helmeted peace-keeping forces…or international money, a new world money with purchasing power... That is what we're dealing with.

“What I'm trying to say is that the name of the game out there is not wealth, it is power.”

Griffin continues:

“You are led to the question of where is this river flowing? Where's it going? … They're not accumulating it at all. What are they spending it for? The answer may surprise you. They're not buying more yachts and mansions with this money; they've already got all of those they possibly want. … That's not it. When a person has all the wealth that you could possibly want for the material pleasures of life, what is left? Power. They are using this river of wealth to acquire power over you and me and our children.

They are spending it to acquire control over the power centers of society. The power centers are those groups and institutions through which individuals live and act and rely on for their information. They are literally buying up the world but not the real estate and the hardware, they're buying control over the organizations, the groups and institutions that control people. In other words, to be specific, they are buying control over politicians, political parties, television networks, cable networks, newspapers, magazines, publishing houses, wire services, motion picture studios, universities, labor unions, church organizations, trade associations, tax-exempt foundations, multi-national corporations, boy scouts, girl scouts, you name it…this is where those people have been for many decades spending this river of wealth to acquire operational control particularly over those institutions and individuals, those organizations that represent opposition to themselves….”

http://www.bigeye.com/griffin.htm

And, thus, America has lost not only her institutions, but her government, her freedom and her prowess.

Tue, 05/06/2014 - 00:09 | 4730894 g'kar
g'kar's picture

JR, you and Dewey Cheatum and Howe put out really good well thought out info. Thanks.

Mon, 05/05/2014 - 21:39 | 4730535 Yes_Questions
Yes_Questions's picture

 

 

WTF is #1 supposed to fucking mean anymore anyway.

Mon, 05/05/2014 - 21:45 | 4730554 Major Major Major
Major Major Major's picture

piss

Mon, 05/05/2014 - 21:41 | 4730541 Charles Nelson ...
Charles Nelson Reilly's picture

Saw some a-hole today walking around with a "back to back world war champs" t-shirt on. I'm sure my grandpa who fought at Guadacanal & had years and years of nightmares & flashbacks after he fought would be proud?!?

What a total fucking disgrace we've become in allowing these bloodthirsty warmongers to repeatedly lie to us and distort history.

Mon, 05/05/2014 - 22:06 | 4730616 Dr. Engali
Dr. Engali's picture

That asshole wearing the t-shirt would probably cry like a baby at the thought of having to face some of the horrors your grandfather faced too.

Tue, 05/06/2014 - 01:04 | 4730958 rockface
rockface's picture

Even the 49ers couldn't Threepeat.

Mon, 05/05/2014 - 21:41 | 4730542 buzzsaw99
buzzsaw99's picture

china wins the kewpie doll. big whoop.

Mon, 05/05/2014 - 22:38 | 4730704 Leraconteur
Leraconteur's picture

It's a worthy laurel when the USA has it, but as soon as it slips a notch 'so what' is the response.

Classic. Pathetic. A nation and culture in decline.

Mon, 05/05/2014 - 21:41 | 4730543 q99x2
Mon, 05/05/2014 - 21:45 | 4730555 Robot Traders Mom
Robot Traders Mom's picture

I still think it was a blessing in disguise he wasn't elected. He would have been scapegoated for the inevitable collapse. Now, our society will be remembered for the stupidity of ignoring him to fight for Obama and Romney...

www.TopTheNews.com

Mon, 05/05/2014 - 21:49 | 4730566 SilverIsMoney
SilverIsMoney's picture

Unforunately, he's right, and because of that they will start a big giant war to show the whole world they're still no. 1!

Mon, 05/05/2014 - 21:53 | 4730578 james.connolly
james.connolly's picture

We're NO LONGER #1 because we never were #1,

Just because the USA for a short while was ahead of the pack with NAZI t( Operation Paperclip ), doesn't make the USA #1, rockets, moon landing, NASA all that made USA great was stolen from NAZI's.

Yes, the USD is #1, but that is thanks to LONDON/TEL-AVIV, and not fuck to do with USA.

USA is a 3rd world penal colony with nukes, study the CIA factbook, and see that's it citizens have the same IQ, and read/write as zimbabwe.

#1 my fucking ass, only in your mind.

Mon, 05/05/2014 - 22:36 | 4730701 Leraconteur
Leraconteur's picture

More 20th C historical blindness.

The USA was the #1 economy in the world from 1872-1914 and had no military or foreign policy to speak of. The USA simply wished to be left alone to grow, industrialise, and make money.

None of that was done with Nazi tech - most Nazi's were born in the 1880's and 1890's.

Nice thesis, but 100% wrong.

Mon, 05/05/2014 - 23:24 | 4730818 yrbmegr
yrbmegr's picture

We were, actually, number 1 for awhile.  What made us number 1 was the combination of cheap labor and competitive technology, stolen at first and then home-grown.  China's success is built on the same two assets.  They are hitting a wall because labor costs are rising quickly to parity with the developed world.  Next, Africa.  That will be a 30 year project.  Then, South America?

Thu, 05/08/2014 - 03:56 | 4738872 Leraconteur
Leraconteur's picture

South America? They all have a middle class, on a global scale, lifestyle. 8,000 to 20,000 per capita PPP. I suppose we could just keep leveling the field until everyone in Luxembourg is earning what everyone in Congo is earning, but clearly many nations are not buying into it now let alone in 30 years time.

Tue, 05/06/2014 - 00:53 | 4730945 buyingsterling
buyingsterling's picture

Toilet, infantile materialism.

The US was #1 from 1789 until at least 1860, probably until 1913, and arguably until 1965. That's because for all of those years (at least until 1913) this was the freest country in history.

That's the macro view, on the micro level we're #1 in a list of things longer than your mama's skidmarks (laid end to end).

If you mention slavery you'll give away your status as a high-school, tramp-stamped, pump and dump floozie with an *sshole that can blow out a candle.

Mon, 05/05/2014 - 21:58 | 4730590 A Lunatic
A Lunatic's picture

America = sloppy seconds. sloppy anal seconds......

Mon, 05/05/2014 - 22:04 | 4730611 james.connolly
james.connolly's picture

Want to know a nation? Look at who they elect to be their leaders.

Mon, 05/05/2014 - 22:01 | 4730602 nah
nah's picture

NUMBER 2! NUMBER 2! NUMBER 2! NUMBER 2!

Mon, 05/05/2014 - 22:14 | 4730642 kchrisc
kchrisc's picture

Based on my reading and research, the DC US is probably actually down at about #67. I will know for sure when the Petro$ goes poof and the Walmarts, etc. go empty of product.

#67 economically, #1 in hypocrisy and delusion.

Mon, 05/05/2014 - 22:53 | 4730619 MedicalQuack
MedicalQuack's picture

He's right in the fact that even the White House is just virtual anymore and I voted for him but in the last year things have changed.  It's like the whole White House and everything they attempt is one big template...augh...

Even their big data and privacy report...a total dud and meanwhile bot run wild scoring you and keeping you as a consumer of having access to something, money, school, medical care. 

http://ducknetweb.blogspot.com/2014/05/white-house-privacy-report-privac...

Look at the virtual numbers we see on job reports, why do they still bother?  Everyone knows they are flawed...but oh yes the stock bots need those numbers to trade.  This is bad as it scares me to wonder how a Virtual sort of White House would act when the "real world" makes a call.  They used to do it well, but now they are all in "The Grays".  I couldn't even watch the annual correspondent dinner Saturday as it represented just too much of what is wrong and things are too serious to see so much of that tossed in our face if you will.   Here's what I call the grays..

http://ducknetweb.blogspot.com/2014/03/virtual-worlds-real-world-we-have...

The US is so wrapped up in "data" we forget the real world is out there.  Here's another example being that Target is in the news with the CEO leaving, did he ok scanning driver's licenses too when you buy alcohol?  It ticked me off as it happened to me a couple years ago in a manner that did not please me at all.  She asked me to take my license out, so I did, she grabbed it and scanned it.  So who does Target sell this information too and what do they query it with in house with other data bases?  

http://ducknetweb.blogspot.com/2011/09/are-target-stores-now-selling-dat...

We are getting to the point to where we can't hardly move and corporations are profiting from it. 

Mon, 05/05/2014 - 22:21 | 4730643 Cathartes Aura
Cathartes Aura's picture

.

.

.

Mon, 05/05/2014 - 20:13 | 4730299 JR
Vote up!

5
Vote down!

0

Let’s hope this sinks Rand Paul…

Rand Paul’s Terrible Position on Ukraine | LewRockwell.com | May 5, 2014

Michael S. Rozeff

Rand Paul’s position on Ukraine is like that of the Senate warmongers who have signed on to that terrible “Russian Aggression Prevention Act of 2014? in being anti-Russian and pro-intervention. It’s not precisely the same but its premises, tone, goals, thrust, blame-placing, call for sanctions and childish treatment of Russia all add up to his brand of interventionism in Ukraine and in Ukraine-Russian relations. If the U.S. political process produces a Hillary Clinton vs. Rand Paul race in 2016, voters who now favor a much greater non-interventionist position will have no place to go in the two major parties.

Rand Paul’s op-ed on Ukraine is filled with a lot of rubbish.

http://www.lewrockwell.com/lrc-blog/rand-pauls-terrible-position-on-ukraine/

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

aaahh voters, where to turn to now? 

guess its another vote for the bush-leagues. . .

Mon, 05/05/2014 - 22:28 | 4730679 kchrisc
kchrisc's picture

"Let’s hope this sinks Rand Paul…"

With respect, but the powers to be will just buy another "Rand Paul."

 

On election day, I will be treating the wood on my guillotine. Not as much fun as George Carlin's recommendation, but much more contemplative."

Mon, 05/05/2014 - 22:45 | 4730718 Cathartes Aura
Cathartes Aura's picture

oh, you don't have to convince ME of that truth - I've never voted, nor will I, it's an obvious dog whistle for the pack.

but I cannot help but notice how some others are slowly pulling back from the machine - particularly here at ZH, where the fan club was rabid last go 'round.

not that it matters a tiny bit in the overall outcomes, no, not a tiny bit - it's just my Nature to seek a wider Truth, shared.

Mon, 05/05/2014 - 23:19 | 4730811 yrbmegr
yrbmegr's picture

So, China is surpassing America because of bad American policies, many of which are also pursued by China.  But, apparently China is better, or worse, at bad policies than the US, because they're about to surpass us as the biggest economy in the world, despite being an authoritarian state that favors state-run industries, unlike the US.  Welfare, warfare, corporatism, fiat currency...China doesn't have these?  What incoherent claptrap! 

Tue, 05/06/2014 - 00:19 | 4730907 JR
JR's picture

One thing China does have, she has our offshored manufacturing base, recipient of nearly 50,000 factories that have left America, plus the US patents and technologies that go with them -- all gratis of the globalists. While at home, jobless Americans are loading up on debt to make ends meet, but meet they don't.

That's what happens when a people no longer have a representative government.

Tue, 05/06/2014 - 01:23 | 4730974 prains
prains's picture

there never was a representative gov't but at least the Oligarchs knew to keep the sheep happy and well fed with cash in the 50's and 60's. Once the realization in the 70's that energy demands would out strip the capacity to produce it, the oligarchs have slow bled the plebes to avoid full on rioting too early in their preps. 40 years later it's almost time to suck on the donkey balls that have been filling with the pus of their designs.....and then we'll all get to witness representative gov't.....bovine on the hook style.....bolt's almost ready

Tue, 05/06/2014 - 08:21 | 4731303 yrbmegr
yrbmegr's picture

Cheap labor and competitive technology.  That's how we did it.  That's how they did it.  And that's how it will be done in Africa.

Tue, 05/06/2014 - 01:45 | 4730991 icanhasbailout
icanhasbailout's picture

China stopped making large net purchases of US debt four years ago, so that particular ship has already sailed. Sometimes I think even the financial analyst types who can see the bullshit still can't, in general, wrap their heads around the full picture of just how bad things have gotten already. The rot may be 90% through the bucket, but they only see a few drips so they're not taking the situation as seriously as it deserves.

Tue, 05/06/2014 - 02:48 | 4731037 Rising Sun
Rising Sun's picture

When your society's key industries are education, healthcare and social services, the system bogs down.

 

All three of these are necessary, but have become make-work schemes and "meme fodder" for the left - it's right up there with the "what about the children" meme - just another catch phrase to bitch slap your opponent and really means sweet fuck all.

 

And so we ride the slow painful ride to the bottom of the lake and then someone does something.

Tue, 05/06/2014 - 03:27 | 4731057 fencejumper
fencejumper's picture

OT: Where else do I post that I was the first caller on 'Coast to Coast' tonight interviewing Nomi Prins who is pushing her new book: All the President's Bankers? I challenged her earlier assertion (during interview) that the Rothschilds played a minor role in the creation of the Fed (I said that JP Morgan was in fact an agent of the R's) and that American bankers have asserted their own presence without the Rothschilds. She danced around that and they didn't allow me to challenge her answer. Then the second caller basically came through with the same assertion: that the Fed is largely a construct, and continues to be owned by, the R's. Tired...g'night!

Tue, 05/06/2014 - 06:27 | 4731073 TheRideNeverEnds
TheRideNeverEnds's picture

Throw a graph of the Shanghai comp up next to the Nasdaq comp then tell me who is and is not #1.

 

[spoiler] in the past year the US is up over 20% and the Shanghai is down almost 10% [spoiler] 

 

Oh and check the futures, the S&P is breaking out of its range and starting the next leg up to the year end target of 2000+ on USD weakness as the dollar falls out of bed with the next leg down in DX targeting the 2010 lows around the 75 level where we can expect a bounce before the dollar continues its journey to zero.  Loook oout belooooow!

 

USA! USA! USA! USA!

Tue, 05/06/2014 - 04:56 | 4731115 AnAnonymous
AnAnonymous's picture

China is an integrated element in the US world order. It is a captive economy that does not operate on its own needs but to serve the 'american' middle class worldwide.

The bigger it gets, the better for the 'american' middle class worldwide.

The chinese economy has no other existence in an 'american' world.

The chinese troubles that they are experiencing now show they are unable to switch from being an integrated feature in an 'american' world to a self serving economy (the famous 'american' fable of the chinese domestic driven economy)

Once again, Paul tries to cover for 'americanism'.

What is going on is nothing different than an 'american' middle class starting a business, working his fair share at start then delegating work to an increasing number of employees.

By Paul's measure, the personal economy of the middle classer goes down while the personal economy of the employees goes up.

This is an 'american' world though, face must be saved.

Tue, 05/06/2014 - 06:22 | 4731147 marklind
marklind's picture

 

Just some logic should inspire everyone that China must surpass the US in GDP one day:

There are much more Chinese on the planet than American. So sooner or later they will produce more goods and services than the Americans.

In real terms they are close to the US, in nominal terms still far away. But the eclipse is anaviodable unless something terrible happens to the chinese economy. (war?)

The US accounts for about a quarter of nominal world GDP. This will decline further. May be the planned Freetrade area with the EU should enlarge the US centered economic universe to prevent the BRICS to eclipse the US dominated area.

By the way. Who cares about size? That`s only useful in conflicts. In military and economic wars.

I hope this not the true end game  the world is heading for.

 

Tue, 05/06/2014 - 06:39 | 4731160 sudzee
sudzee's picture

A bit OT:

http://mobile.reuters.com/article/idUSBREA440R220140505?irpc=932

US openly supporting terrorists.

Tue, 05/06/2014 - 07:19 | 4731214 22winmag
22winmag's picture

If a congressman preaches about government overreach and corruption for decades in a forest and everybody hears him, does it still make a sound?

Tue, 05/06/2014 - 08:17 | 4731297 d edwards
d edwards's picture

Is it any wonder the DC establishment always put him down, called him "crazy"?

Tue, 05/06/2014 - 08:17 | 4731296 Hayabusa
Hayabusa's picture

"While China has made great strides since adopting free-market reforms in the 1970s, China is still run by an authoritarian government whose economic policies distort the market in order to benefit state-favored industries. These state-favored businesses are often controlled by politically-powerful individuals."

 

I'm confused, is the preceding statement from the article talking about China or the U.S.??

Tue, 05/06/2014 - 09:02 | 4731430 Pickleton
Pickleton's picture

That look on your mother's face when she sees you is disappointment and disgust.

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