From: Lee Corbin (lcorbin@tsoft.com)
Date: Tue Jan 21 2003 - 23:18:08 MST
Steve Davies responds to the inquiry
> > I have read and heard from several different sources
> > that China will have a devastating effect on American
> > and many other nation's economy in the next
> > ten years or so. How much of this is true?
> This is nonsense is the simple answer, for two reasons...
> The more serious reason is that arguments like this
> fundamentally misunderstand the nature of exchange
> relations/economics. The underlying assumption is
> the mercantilist one that economics is a zero sum
> game so that growth in China will have a "devastating
> effect" on other parts of the world.
Ah, thanks for reminding me what the zero-sum-mentality
in economics is called: mercantilism.
> In fact the opposite is true, as economics is a positive
> sum game, the richer China becomes (or to be more accurate
> the richer people living in the part of the world called
> China become) the richer we become due to greater opportunities
> for exchange.
It's incredibly hard to root out all the old mercantilist
memes and instincts. This applies also to the class envy
propaganda, where any benefit to the rich is seen as bad
for the poorer.
> So it's fantastically good news for everyone.
Yes indeed! I can't find my copy of C. Owen Paepke's "The
Evolution of Progress". Here is what an Amazon review says:
As mankind meets the future, the author informs us that
the victory of material progress is nearly complete;
it has already accomplished most of what it can in the
United States and other advanced nations. In some areas
of technology, performance has approached limits that no
amount of future ingenuity will circumvent.
Paepke had listed four sources of economic progress: (1) trade,
(2) technical innovation, and I can't remember the other two.
But he pointed out that trade has almost been fully exploited:
worldwide communication and trade routes have almost maxed out.
But as you say, this "good news" shows a very large potential
in the third world yet unexploited.
Lee
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