Arthur Kroeber

Yeah, it's a very good question.

It's a very good question.

There's a lot of criticism of China from the standpoint of, okay, you're trying to get rich.

That's fine.

Okay.

But you're basically trying to get rich on the backs of everyone else in the world by running this gigantic manufacturing export machine where it seems like the Chinese ambition is to produce –

all the manufactured goods in the world for everyone, run an enormous trade surplus, which means that they are depending on other people's buying power to support them, and that this is basically not fair, not sustainable, not a stable way to participate in the global economy.

So that's more of a question not of if China does get rich, but how does it get rich?

Does it get rich by essentially operating on the same rules as everyone else and having a market that other people can participate in?

Or does it grow rich by essentially making it impossible for anyone else in the world to have the kind of production structure that they want to have and relying entirely on these ever-growing trade surpluses?

In general, in principle, from a welfare standpoint, it would be great if China got to be as rich as everywhere else in the world, even as rich as America.

But that is likely to have some pretty difficult and destabilizing political consequences because of the vast differences between the Chinese political system and the U.S.

political system and the political systems of all the other major industrialized countries.

I think there are a couple of things beneath that.

One is the systemic difference politically is really important, right?

So the U.S.

self-identity is of the leader of democracies around the world, and we are very invested, at least for now, in our democratic system.

We'll see how that evolves over the next two or three years.

There's some question marks around that.

But historically, that's been a really huge part of the US identity.