The horizon is not so far as we can see, but as far as we can imagine

How Big Is The Chinese Economy Compared to The West?

I recently came across these charts, of the biggest trade partner of each country, from 1990 and 2020.

To simplify: China is now more dominant in trade than the US at the height of its recent power. (Also of interest is the change in the UK and Japan’s position, though the collapse of Japan is overstated: it’s not , but it’s still a big trade power.

Let’s put the 2020 chart in numbers, bearing in mind that doing it in US dollars will overstate the relative size of the US.

For imports (from Wikipedia):

So, China is the primary trade partner of far more countries than the US. It exports more than the US, and imports less. These numbers understate the situation, though, since they are “goods and services.”

French Economist Jacques Sapir recently did an economic comparison by adjusting GDP numbers (not trade) as follows. First, change them for purchasing power parity (PPP), which is to say you can buy more with the same amount of money in China or Russia than in the US or Germany. Then adjust for the service sector being overvalued, so you’re left with manufacturing and the primary sector (digging things up and refining them) as the primary drivers.

Do this and Russia’s economy is 5% to 6% of the world economy, and much larger than Germany’s. China is about 30%, and the EU + US are about 30%.

Now I don’t entirely endorse this, there are some useful things in “services” like parts of the tech industry (much is worthless though, serving ads better does not increase a country’s actual economic strength. It might sap it.)

But it puts the situation in better perspective than using raw GDP.

Really there are three primary drivers of actual economic power: manufacuturing, resources and technology. Everything else either exists to service those 3 areas, or is nice and maybe even important to social stability (law, entertainment) but not primary.

China is the world’s primary manufacturing power. Russia is a powerhouse for resource exctraction. Russia is a leader in some types of military technology and not far behind in many others, and China is rapidly closing on the West in terms of tech and is even ahead in many areas (5G, for example, or hi speed trains, civilian use of drones, and so on.)

China also has something the US doesn’t have: a belief in technology. Robots and drones are common, technology is viewed as good, not bad and a threat. The Chinese believe in the future in a way that the west hasn’t since the 50s.

On top of all of this China is the world’s largest developer of nations: if you want ports, roads, train stations, hospitals, schools, smart cities or anything else, China will build them for you. They’ll finance them, and some exceptions aside they offer good loan rates because usually they’re more interested in good trade relations and getting your food/oil/minerals than they are about making a profit off building the infrastructure. In addition, Chinese construction companies building overseas infrastructure means those industries don’t have to downsize: they build China, now there isn’t enough work, so they’re off in Africa and South America.

To summarize then: China is:

  1. the number 1 trade partner of more nations than anyone else, and more than the US had in 1990.
  2. the world’s largest manufacturing nation
  3. Technologically near even with the West, and in some places ahead.
  4. The nation that helps the most other nations develop.
  5. When you adjust for PPP and service sector crap, a larger economy than the US. With Russia, a larger economy than the US and the EU combined.

And this is the nation we want to enter into a Cold War with? We shipped them so much of our industry that they now have more than we do, and after doing that we decide it’s time to pick a fight?

One thing is true of post-industrialization great politics: industry, access to resources and tech are what determine power. Since there is no longer a situation where the West has technology that is vastly ahead of everyone else’s, it really comes down to industry + resources.

And with Russia locked in and South America and Africa tending to prefer it, China is ahead or secure in both of those those categories.

If we wanted to keep our supremacy, we had to not ship China our industry and our tech so we could make some of our elites even richer. The Chinese accurately sized up our elite’s weaknesses and exploited them to the hilt. They thought they were “international” elites and it didn’t matter where the manufacturing was done, or who had the technology. The Chinese, however, were a national elite, and they knew it did.

I’m not sure this was exactly a bad thing. The West, in the unipolar moment (and heck, before) vastly misused its power, over and over again. Maybe a two-polar world will be better, if it isn’t, at least all power won’t be centralized in America with a few satrapies getting a voice and maybe that will be better for many countries and billions of people.




The Petrochemical Age In Context


Open Thread


  1. Willy

    Seems like yesterday when I opened my 9th grade world history book to find pictures of Chinese labor building a dam almost entirely by hand, carrying buckets of rocks atop their heads wearing the only clothes they owned, the green one with the red star cap.
    The text claimed that Mao had just killed millions.

    Today their descendants are developing high tech everything.

    For some it may be amazing how one unchecked concentration of power can fail so disastrously, while another produces miraculous success. But for me, not so much. Power amplifies quality.

    I’d happily discuss this, but I’m wondering where some of the good commenters have gone. I’m not talking about those who I agreed with or them me, but the ones who if asked for credible backup for some unusual or unpopular opinion, usually obliged without much fuss or bother.

    Here’s a parting quote from one of the more reasonable ones:
    …wall to wall trolls, all of them peddling various delusions and conspiracy theories. No attempt to understand anything. The few progressives or radicals or what you will who did show up here could always expect lots of yelling and name calling. But real discussion?

    I’m betting that the Chinese leadership of old was intolerant of contrary opinion. I’m betting that the current Chinese leadership is open to anything as long as it provides credible backup.

  2. Feral Finster

    Short-termism may well be the death of us all.

    I am not joking, especially if you compare the present international situation to the runup to WWI.

  3. Ian Welsh

    Nobody gets moderated if they aren’t rude or use ad-homs or say obvious lies.

    People couldn’t control themselves when I didn’t moderate, the consequence is that y’all must now put up with my judgment calls.

    I assure you I really didn’t want to moderate, but since I tried twice to go without moderation, it’s unlikely the blog will ever return to non-moderation.

  4. Astrid


    Since you agree with Hugh that this blog as full of trolls and all the “good commenters” are gone, maybe you will be happier finding a place more amenable to your views and no longer suffer the not good commenters here. There are plenty of places online where Putin is an unspeakable evil, everything China does is dystopian/authoritarian, Zelensky is a hero, and exploration of Ukrainian history before February 2022 will get people banned immediately. You will have no problem finding the “good commenters” you’re evidently seeking.

    Speaking for myself, I am so grateful for Ian and Yves (lots I don’t agree with her on, but thank goodness for NakedCapitalism in the last 28 months) for giving a safe space for people with non-mainstream views and even on the ground experience in Russia/Ukraine. I’ve learned so much. Or at least enough to know I’m not going completely crazy. It is amazing to me that you read the same comments and came to your conclusion, but hopefully this realization will help you move onto something you find more congenial.

  5. Trinity

    One major thing we lost when we shipped manufacturing overseas was our ability to innovate. Sure, they innovate new financial products, they keep dreaming up ways to “innovate” regulations, they dream up new ways to steal money/avoid taxes, they’ve innovated how to purchase policy and politicians, how to lie with facts, and how to amplify their persuasion techniques, but little else. All they’ve really done is the same thing over and over and then called it “innovation”, like building a really cheap (for the owners) taxi company that uses an app on your phone instead of a phone call.

    All the innovation is occurring in China, and that was true in 2000 as it is today.

  6. bruce wilder

    There was a time when I would pour over statistical facts. I was especially fond of the kind of superlative lists that have proliferated thru Wikipedia: longest rivers, tallest buildings, steel production, et cetera. And history, too, where I collected red letter dates in my head: when wars started, inventions were recognized, companies or countries founded.

    We seem to be in an historical moment when facts and history are in low repute. I read an essay on the causes of the French Revolution recently that focused on the theatrical dramas the played out from the struggle of the finance ministers of the Crown against reactionary parlements, especially in Paris. The historian was making a very good point about how the passions and division of opinion made very little objective sense, nor did they align well with the divisions of interest and ideology that emerged half a year before or after. Epic Whiggish or Marxist analysis a century or two later still cannot make much sense of it, but it was story that drove public opinion, the mob and events.

    Historical revision of all kinds finds in history a distant mirror and I suppose the political dominance of The Narrative in our times makes it easier to make a case for the theatrical rhetoric and paranoia of 18th Century France as a dominant force in the dynamics of the Revolution. The essayist was not wrong about the ancien regime.

    It may be that our time is particularly resistant to fact and embroiled in paranoia, contempt for elite institutions and confusion for some similar reasons: decline of empire, pervasive but ineffective censorship, confused and shifting ideologies and class antagonisms.

    I think China’s dominance economically is an accomplished fact (as those diagrams show) and the mindless refusal of teh Blob and the neoliberals to cotton to this new state of affairs is accountable only as an elite high on its own supply. The political dominance of the Intelligence Community, billionaire-owned media, and a handful of tech monopolies in control of information and censorship has created a dearth of factual knowledge in the population at large. America does not realize what a catastrophe Obama was and Europe does not know what a disaster the Euro has been and promises to be. Britain has Boris and Brexit.

    I am watching the Ukraine war unfold in the New York Times and Naked Capitalism and a few other places and the narratives are so tendentitious! Was “he said, she said” so long ago? Narrative constrain the facts, not the other way around.

    Counterfactual speculation and confident assertions of expertise to make sweeping statements about war, strategy and tactics abound.

    Reality may set in shortly, both about the progress of Russian arms and shortly after, the effects of a partial global collapse in economic systems. What will the spinmeisters tell us?

    Reality bites.

  7. Joan

    Don’t go Willy! I enjoy your comments though I don’t always reply, and sometimes I go weeks without much internet use and then catch up.

  8. Ian Welsh

    I like Willy and am fine with his presence here. Hugh, on the other hand, could not restrain his anger and his insults.

    Stats: I used to get every single BLS release and I’d study them. I had my own spreadsheets, did my own seasonal adjustments and so on.

    But over time I grew to realize that a lot of stats couldn’t be trusted, and I turned from very detailed use of them.

    Not to say numbers don’t matter, they do, but I’ve become wary of a lot of them, because they’ve become so manipulated.

  9. Blueberry Hill

    This is all the proof you need the Great Voluntary Contraction will never happen and thus the world as we’ve known it will be no more because contraction is coming — it’s just a matter of getting out in front of it and managing it before it manages you.

    Bragging rights for who has the largest economy is not in keeping with what needs to be done. I will submit that neither the West nor Asia nor Russia nor any other region is truly future-oriented in this respect. All economies of the world, or the world economy if you will, have/has stolen the future and despoiled the planet so even a return to hunter-gatherer or some perversion thereof will be nay impossible (all those nuclear power plants for example). So, I guess I’ll say, enjoy the top spot China while it lasts which won’t be long. It’s a dubious designation. A pyrrhic victory. Certainly not something to gloat about.

  10. Mary Bennett

    Bruce Wilder, As for your point, ” We seem to be in an historical moment when facts and history are in low repute.” if you read some contemporary history (from renowned scholars with popular You Tube channels no less) you can see why that is. I gave up on the highly reviewed SPQR, which I found as superficial as an average HS textbook. Miles’ Carthage Must Be Destroyed is an impudent piece of opinionated polemic, IMHO. So, OK, we all have opinions and polemic is a perfectly respectable form of literary production, but must we call it history?

    Furthermore, good writing about history is simply no longer available to non specialist readers. Libraries are culling with abandon, calling librarians book Nazis is not far from the truth, and scholarly articles hide behind paywalls. Those of us who assembled libraries from public library cull piles are now contemplating rising food, rent and utility prices with panic, wondering how ever can we save our treasures.

  11. Willy

    Ian, moderation is a sign of the times, not you. I too, can remember a time when the overall culture of commenting (at least mostly on the left) preferred a strong(er) respect for the rules of debate, when it was more about limiting logical fallacies instead of gaslighting commenters who couldn’t view everything in black and white terms, out of respect for the (sadly and ofttimes) complexities of reality, without also getting lost in stupid nuance for the sake of some FUD fetish. Comment sections were still imperfect as most humans are, but it seemed to be a better kind of imperfection.
    Common goals seemed possible back then.

    Enter the desperate cognitive closure crowd. Enter the black and white thinkers. The magical thinkers. The paid trolls.

    I remember the only thread that I’ve ever seen get shut down around here. Maybe I was part of the cause. Maybe I spoke of a certain influencer (whose name I’ll never mention again) in such disparaging terms that some of his enraged flying monkeys arrived to try and de-straw me. Sadly for them, those confused idiots couldn’t see that I’m actually the tin man. And they were armed with the floppy pool noodles of ad hominem. Ever been viciously attacked by an enraged somebody armed with a pool noodle? I have. It was so excruciating that I peed my pants. From laughing so hard.

    Sorry, I got sidetracked. Would it be considered impolite if I asked for extraordinary evidence whenever somebody makes an extraordinary claim?

  12. Astrid

    You have to win (or least survive) the present to be in contention for the future. China almost certainly won’t win against the oncoming ecological collapse, if winning is defined as perpetual Western level consumption. But they have no chance of survival at all if they have to submit to the US the way that Europe is currently doing. And they are problem solving oriented as opposed to financialization oriented, so at least there’s a slightly better chance they can solve the problem.

    Whatever Russia and China may believe about the future, they do have a better shot of survival together than apart. And it’s not the Chinese or the Russians who brought about the confrontation in the Ukraine and likely soon in the Taiwan Straits. The US expressly went back on it’s words and backed racist historical revisionists specifically to weaken Russia. Russia and China has been putting up with the West’s sanctimonious bullshit for 30 years and was willing to let it go on for a while longer, if only Minsk II was respected and the US maintained the formal one China position it agreed to in the 1970s.

  13. Willy

    I always wanted to be an architect, and finally made it to my local universities “Intro To Architecture” (weeding out) class. Our lead instructor was an odd sort. She was a pale-skinned buzz-cut artsy-fart, whose fashions mostly consisted of what looked like dyed burlap sacks and uncomfortably large ethnic jewelry. And yes, she wore sandals with socks a lot, especially in winter.

    When she told the class that studies had shown that most successful architects had “just fallen into the field”, and that less successful were those who’d always wanted to be architects, I lost interest in architecture. Her style of teaching didn’t help much either.

    In engineering school we learned about Mimar Sinan. He rose from being a poor Greek civil laborer/technician to Ottoman Empire chief public works engineer and eventually became one of the world’s top architects. The general style of Istanbul’s mosques, with their distinctive pendentive domes and rocket ship minarets, are his.

    WTF does this have to do with China, you say?

    Well, Sinan knew how fortunate he was. The Sultans at the time were practical doers, more ethical than corrupt, demanding results on time, on budget, and built to last, and they rewarded the result doers. He had Hagia Sophia to learn from and improve upon. The ongoing Renaissance wasn’t just an Italian thing but influenced everything from Spain to India and beyond, and he had access to knowledge of practically everything being built in those lands. He’s said to have known Leonardo da Vinci and Michelangelo and was familiar with the plans for St. Peters. His many apprentices and worldly contacts could be relied upon to bring back good information from which they could together, build upon.

    In short, he was a practical ethical achiever living in a practical ethical achieving age.
    Like China today methinks. And unlike todays America. I don’t think one needs to be a rocket scientist to believe that if Sinan been born in todays America instead of today’s China, that he’d be just another disgruntled misanthropic schmuck pitifully emoting on blogs.

    Still, I do sometimes wonder how an oddball grifter upstart like Elon Musk can find and get people to collectively outperform established giants like Boeing. On second thought… maybe I don’t.

  14. Feral Finster

    @ Astrid, Comment #1: no lie.

  15. Willy

    @Feral Finster

    Feelings aren’t strategy. Just saying. There are people reading here who’re tired of worrying about their futures, who may not be lucky enough to live in large suburban homes with a double income and a garden designed to provide through the coming apocalypse. I think they might be hoping for actual results, someday.

  16. Frogger

    Have you checked out the Atlas of Economic Complexity ( It’s a comprehensive site with lots of stats to compare and the user interface is decent too. Worth checking out if you haven’t already.

  17. different clue

    “American” policy about China is being fought over by two elite mafia groups with their two sets of hands on the one same steering wheel.

    The “diplomats” and “geo-strategic power politicians” view history as a story of empire-follows-empire. They are psychomentally invested in the success of ” American Empire Hegemony” and want to prevent China from becoming the next World Imperial Hegemonist. They want a Cold War with China to prevent that or at least delay that. They also want a Cold War with China so as to be able to control and manipulate mass social sentiment and political activity by the non-elite masses within America itself. They want to re-impose the top-down social discipline and control which their predecessors achieved through the Cold War against Communism. They want to manage and contain the American masses through the Revolution of Falling Expectations as it plays out over the next few decades.

    The Global Plantationist Free Traders want to impose Free Trade everywhere against everyone not in their own class. They want continuing Free Trade between China and America because America still has some industry which has not been all the way destroyed yet, and they want to make the money they can still make by working the differential costs-and-conditions arbitrage rackets between China and America all the way down till all of China is at least Middle Income rich and all of America is one great big Youngstown , Ohio. Then they hope to continue making money by working the differential conditions arbitrage rackets in the other direction, by mediating and toll-skimming Chinese Colonial Investment in New Poverty America. They fear a runaway Cold War could interfere with their profitable Free Trade Arbitrage Rackets and their undisturbed management of the Corporate Globalonial Plantation.

    In a perfect world, we-the-American-masses could shoot all the members of both policy mafias in the back of their heads and bury them all in pits and trenches. Then we could abolish Free Trade between America and the Outside World and we could begin restoring a social survivalist remnant of America’s former industry within our own borders so that we could keep eachother employed making and selling to eachother all the basic survival necessities we need to stay alive with. I suppose we could keep the Trade Fetishists happy by making absolutely frivolous luxuries to sell TO China in order to raise the money to buy other absolutely frivolous luxuries FROM China in return. But for basic survival necessities there would be zero contact of any kind between China and America, so both countries could be free from eachother.
    But we would need a Protectionist Movement to conquer America society from within and amass so much social and monopoly-violence power within American society that we actually could round up and physically exterminate every single Free Trade supporter living within America’s boundaries-on-the-map. If we could kill them all, thoroughly and in detail, down to the very last one, then we would be free to establish the United States of Autarkamerica to become the Hermit Republic we need to become in order to survive the Free Trade Aggression of an Evil Free Trade Outside World.

    Naturally every member of the Clinton, the Bush, and the Obama families would be among the very first to be shot in the back of the head and buried in the pits and trenches to be filled with all the Free Trade Traitors against America’s existence and survival.

    About surviving the coming onslaught of Global Heating . . . if any organized societies at all can survive it, they will be some East Asian societies. Korea and Japan will have the inner cultural cohesion needed to adapt and absorb all the bumps on the way down with minimal violence and hysteria. China has the milleniums-long tradition of Imperial Command and Control directed towards huge survival projects needed to try surviving that way. If anyone can build a Great Seawall of China, it will be China.

    But if the goal is still wealth and comfort for the National Masses of any one nation or another? That garbage barge has sailed and sunk. If the ChinaGov Elites think their masses will have a rich future, they will find that China is all dressed up with no place to go and no way to get there. And they’ll find that everybody else is in the same shape along with themselves . . . . except for a few Hermit Countries who will be able to seal themselves off within their own borders and exterminate anyone who tries to force trade, immigration, or any other form of survival-destroying contact.

    The next few decades will reveal if my vision of the future is reality-based or fantasy-based.

  18. Astrid

    Our homes will be burning soon enough. Maybe then we can stop obsessing about whatever Putin or Xi ate for breakfast.

    There’s no guarantee in a world wrecked by climate chaos, resource depletion, and delusional elites oscillating between transhumanism and Mad Max. I can’t save the world, I’ve given up doing anything more than the occasional acts of kindness for people in my life. Suburban vegetable garden will not provide salvation. A Portuguese passport won’t either if 60 million hungry and desperate Africans make their way to an energy and food starved Europe. We might not even live to 2023. I am spending as much of 2022 as possible seeing bands I like and growing primroses that may never have a chances to bloom.

  19. Joan

    @Astrid, apocalypses are only ever local, so I wouldn’t bank on us all not living to see 2023. Hurricane Katrina, the March 11 disaster in northern Japan, tornadoes, all of those are apocalypses, but elsewhere in the world people were having a regular day.

    You’re right that Europe has a rough future ahead of it and the rather idyllic post-war days of peace in much of Europe are surely over. We live next to a center (in an empty parking garage) where Ukrainian women and children line up to receive blankets and warm clothes, so I’ve been thinking about this on the daily.

    There is plenty that you can do to help the genuine, actual peasants in America. There are people in your city who have to walk because they cannot afford a car, and who have to sit on poorly designed public transit because they have no choice. If there is a rat-infested ghetto in your city, they could use someone writing the city council and asking for more affordable housing to be built, or for the ghetto to receive an upgrade, even if it means your suburban home goes down in price. Your own life experience shows that you have to make wheelbarrows of cash, if not truckloads of cash, in order to achieve any kind of human decency in the US. Half the population or more doesn’t make it.

    I’m not saying the poor should be elevated to a suburban car-dependent lifestyle in the US. That design is terrible for the environment. What I am saying is that there are a lot of peasants in the US, and there will be many more in the future, so it makes sense for there to be options for living with a lot less but still with dignity. Decent apartments to live in, decent sidewalks, building things closer together to be reachable, mixed use buildings, etc.

    There’s a lot you could do to help, and in “teaching a man to fish” kinds of ways. Where things are currently headed is more along the lines of looting the suburbs by organized crime or other disenfranchised young men. You might own a gun, but you have to get in your SUV and leave that house sometime. Can you afford the upgrade to a gated community with an armed guard? That’ll prolong the prosperity lifestyle by a few years, but what would genuinely make life better in the US is if people had ways of living humbly but still with decency.

  20. GlassHammer

    It’s interesting that the hub of capitalism moves from one nation to another every few decades. The time between moves was much longer in the past but protectionism was much more common then.

    Time will tell if China manages to hold onto the hub of capitalism longer than most or if they create an elite with no loyalty to the nation. (I think they will because protectionism and nationalism is socially enforced among their elites.)

  21. Blueberry Hill

    Elites of all stripes are the enemy, not JUST Western elites. Russia has its elites, China has its elites and all the various regions of the planet have their elites. Say no to the elites. Say no to elites and elitism, full stop.

    The media recently is underscoring the suspicious deaths of various Russian oligarchs. Curiously, or maybe not, the media doesn’t see this as a positive outcome. I do. I think it’s incredibly positive. Not because it’s the RUSSIAN elite but because it’s the elite. I celebrate their death by whatever means. Let the recent suspicious deaths of these abhorrent Russian oligarchs serve as a catalyst and precedent for the fate of ALL elite everywhere.

  22. anon y'mouse

    my many apologies to Ian for being the one to cry out for comment moderation, even if i do think it is for the better.

    as soon as any conversation space turns into a personal insult zone, it has no more use and then why even have a comments section at all? ideas aren’t being exchanged just because you can craft a zinger that stings enough to get a rise out of some stranger on the internet. and there are places where you can do that with abandon, just to get it out of your system. the web is full of primal scream rooms.

    sorry to create much more work for you, Ian but it is appreciated. i wish i could show my appreciation with money, but that’s always in short supply.

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