Why don't you blame the American people who demand cheap products?

At the same time, we have enjoyed lower prices for goods, so we have also been on the receiving end, albeit at the cost of some manufacturing jobs.

Economists will tell you that countries should do what they do best due to comparative advantage. If China manufactures things better than the U.S., they should do it and the U.S. should shift to something it does better like R&D. The problem is we ALL can't be in R&D and this is where the whole theory of comparative advantage breaks down.

It surely doesn't look good for the global economy but this is what happens when you run on a debt based society. Interesting times are a coming!

People should hang? Which people? The ones who buy cheap Chinese imports? Manufacturing has moved to China because CONSUMERS demand low prices that can only be offered when labor is cheap.

That makes for an interesting point. What happens when China wants to cash in on their investment in the US?

Tiggle,

The economic philosophpy of advantage never really breaks down. It's more like a wave circling the globe. Advantages change, and the thought is that the develpment of advantages always mean greater properity. You develop advantages in undeveloped areas to fulfill market needs and exploit resources. The misconception is that advantages continually mean higher development, but this is only true if an area can successfully develop an advantage that drive higher economic growth. It is also possible that an area cannot maintain an advantage in one area and must try to develop another area of advantage. The trick is to stay on top of the wave. If you can't you fall to the bottom. For example, if the US woul lose it's technological advantage to say, China, the US would have to try to develop another advantage to employ all of those out a job because of this loss, perhaps manufacturing.

It is big business and the government that drive competitive advantages, most others are merely pawns in the scheme of things.

China's $US700million stimulus injection into their economy is peanuts when compared to America's nearly $3trillion "Stimulus" programs. China has a huge trade surplus and nearly $2trillion of US Treasury it can unload to financial any domestic debt. USA, on the other hand, owes China and Japan nearly $3trillions, not counting other foreign lenders and has a trade deficit of nearly $500million. While China is America's greatest creditor, America is the world's greatest debtor. Uable to pay off its debt despite raising the national debt ceiling for the umpteen times, America borrows from the new creditors to pay off the old creditor. Essentially, America is running the biggest Ponzi Scheme in the world, one that Bernie Maddoff would be proud of. If adjudicated in a World Court, the American government would have been convicted as a criminal.

America's ghost towns are dispersed into millions of empty forclosed homes, while China's are newly constructed subdivisions. Another difference is that America's housing boom was financed with government money borrowed from China and Japan or the Federal Reserve's printing press whereas China's housing boom is financed by trade surplus, a huge domestic savings rate, and government purchases of American Treasury bonds.

America stimulates its economy with war machine production, stock and housing bubbles and massive government spending of borrowed money. As the US ARmy is the employer of last resort, the America Army has been waging 4 wars for nearly 11 years to reduce America's unemployment. Essentially, it is cheaper for the US government to bury America's unemployed than to feed and house them. While China uses its people to build ghost towns, America uses its military machines to create ghost towns in Iraq, Afghanistan and Pakistan, demolishing buildings and infrastructures, and killing civilians.

While China has steadily moved away from its socialist/communist roots and embrace more of capitalism, the American government has embraced socialism for the past 70 years. The result has been predictable: American business, industry, and manufacturing have abandoned USA for Asia where taxes and government regulation are much lower for both workers and employers. Several hundred years ago, Europeans abandoned their oppressive homeland for the New World in search of wealth, opportunity, and liberty. Today, many American citizens have abandoned USA for in Asia for the same reasons.

In USA too many American workers are jobless or underemployed, and those who have jobs are desperately clinging onto them. As domestic jobs are scarce, rights of workers are at the mercy of employers and government. The rise of American socialism corresponds with the lost of American economic might which translate into the decline of standard of living and wealth for the middleclass. The lost of employment opportunity and wealth will usher in the lost of liberty as America's socialist government attempts to redistribute wealth uniformally through higher taxes and mandatory participation in social programs.

Despite suffering the erosion of their Constitutional rights, purchasing power and job opportunity, the ignorant American people can't admit they have been brainwashed by socialist propaganda issued by their socialist government.

Wow wall...

Could you please use your theories to comment on Germany, Holland, Switzerland and the Scandinavian states?

Given your rant with its dubious analysis of socialism in the US, I would conclude that you are a member of the tea party. Could you please comment on the fact that the red states are the net recipients of federal largesse and the blue states the benefactors of such largesse?

Truth hit you in the face there?

i am an independent conservative, and not a reich winger. what I do detest is the reich wingers who post nothing but trash on these sites. Why don't you guys comment on the FOX site - you can feel at home with your fellow bsers? Right now it seems that the left wingers and the independents are taking the high road with the truth. Bet you are going to vote for Romney.

Nice attention to detail. I believe China's largest stimulus was $586 billion (USD), not $700 million (USD). wikipedia.org/wiki/Chinese_economic_stimulus_program

Back to the MSNBC article, the question of why China might ever start building these white elephants? their ghost cities? empty and vacant?

google.com/webhp?source=search_app#hl=en&q=China+ghost+cities&fp=1

"But when and how did 8 percent become sacrosanct?

In all questions of faith, look first to ones creator. In this case, that means Deng Xiaoping. At the 12th Party Congress in September 1982, Deng determined that the national economic goal would be to quadruple the annual industrial and agricultural output of the entire country by the end of the century. Prior to the big meeting, Deng asked then General Secretary Hu Yaobang how the country could quadruple its economy from 710 billion yuan in 1980 to 2,800 billion yuan in 2000, and Hu responded that 8 percent annual growth would do the trick. Thats it. Theres no complicated secret formula, no hallowed equation precisely linking growth to employment, no connection to the revered words of Confucius, Mencius, or Lao-tzu. Back in 1982, it was determined that it would take 8 percent annual growth to quadruple the economy by 2000.

The end of the century has come and gone, but the target has remained the same. Subsequent five-year plans have all set an annual growth target between 7.5 and 8.5 percent. This national objective has since become the obsession of officials at each level of the governments vast bureaucracy."

globalpost.com/dispatches/globalpost-blogs/macro/china-economy-whats-the-big-deal-about-8-percent-gdp

Even Chinese style capitalism is a fraud and shell game. How long must we suffer under this regime. We lambasted socialism for its failures in Russia and Eastern Europe, and yet we excuse capitalism as just some market failure from an ideal system which exists only in economics textbooks and the minds of capitalism's apologists. This is capitalism. Shattered lives, a polluted world, and dead end jobs for the majority of people. A joke, a fraud, and dangerous.

InfoTechnology:

Just because some high level government official set a national growth rate does not mean it is achievable. There's so many factors and variables that can throw-off projected growth rates. Every nation, including USA, set a growth rate; it is the except rather than the rule that they reach them. Prior to dramatic liberalization of its economy during the 80s, China's leaders repeated had their 5 year Great Leap Forward plans going backward.

Warren:

Capitalism rally isn't one of the 'ism.' The early Egyptians, Phoenicians, and Chinese traded in open markets with gold and silver thousands of years before Karl Marx's put a lable on it. It wasn't a sin then and it's not one, today.

@ Real life man-

Why don't you blame the American people who demand cheap products?

Because the American people require cheap products. If our standard of living wasn't on the decline people wouldn't be forced to purchase less expensive goods. Treason was committed by the corporate power houses that modernized the factories of these 3rd world nations at an attempt at lowering the cost of production through cheep unprotected labor. That in-turn makes it very hard for a "legitimate US based business" to compete. By American companies modernizing these factories we are basically giving them the ability to mass produce what ever they feel fit. To some extent factories are no different than bombs, tanks, and guns, as you have to have a factory to make all of those goodies. Ask yourself... If we gave them the power to mass produce TVs, cell phones, computers, refrigerators, and what ever else faster, cheaper, and at a comparable quality, why cant they do the same with, Tanks, guns, bombs, and air planes? People forget the only reason we won WWII was our factories. We could build faster than then the enemy could destroy. And now we moved that same industrial beast overseas. Production methods should be protected like military secrets. The traitors who made this possible should hang. Whats the difference if you give them the bomb, or the factory to make it?

@Real life man-

Why don't you blame the American people who demand cheap products?

The more i think about your comment, the more I get upset. It's all about corporate profit. CHEAP LABOR! They lower the prices to compete. Then they take over the whole manufacturing complex. The average Americans income fails to keep up with inflation, causing them to shop for cheaper products. Eventually leaving us bankrupt.

Don't be a tool.

Too many Americans are willing to sacrifice quality for quantity. Face it, we're a greedy, gluttonous nation of lazy slobs. Here's a simple concept, quit buying piles of cheap Chinese crap, 3/4 which is not needed, & instead focus on less but superior quality American products. There are Plenty of American made goods & yes they usually cost more, but they exist if you look past frickin' Walmart's garbage heap.

And this too shall pass.

with an estimated sixty four million empty homes

when the Chinese government injected into the economy a stimulus worth nearly US$700m. Much of that money went straight to those ghost towns.

It's not that the stimulus in China didn't work, it's that it was poorly used.

Who's to say with certainty, that we wouldn't have a 25% unemployment rate and buying all of our cars from Kia and Hyundia without our use of our stimulus.

When an airplane is going straight down, it does have to level off before it can climb. We are not going down, we are climbing. If you try to climb to fast, like China, you stall.

Kip360-You have to draw your own conclusions but do it on facts. We are not the first generation to live on earth. Thousands upon thousands have come before us and they constantly readjusted. We too, will re-negotiated and readjust to modern ways. :ple seriously 2101, we are climbing.

kip360, I'm no economist but I do know that you can't improve an economy by reducing spending, just as you can't stimulate the economy by enriching corporate coffers while hourly workers don't make enough money to pay their utility and medical bills, much less having any money left to purchase goods.

Capitalism must be a two way street for it to be a viable economic model. It's been a one way street in the U.S. for way too long.

Instead China has invested in other countries infrastructure/schools and is receiving access to their natural/labor resources...

Afghanistan, Africa, Central/South America, Pakistan, and many Asian Countries have seen these investments...

While China is building their Military capabilities, their direct invasions have slowed after Vietnam has kicked their A$$ in both Vietnam and Cambodia. They rely more on ECONOMIC control now...

Though the South China Sea - territorial and access to ENERGY resources, may cause this to change rapidly...

These cities are based on concrete/steel construction that can last almost a century before rebuilding. Unlike the USA with relies on sticks and glue, most requiring major repairs within a decade...

China's problems are environmental; the south and coastal areas experience MAJOR earthquakes regularly and in the north the Yellow River over-flows its banks about every 50+years. The last natural floods killed hundreds of thousands; 1887- 900+thousand, 1931 - between 1 to 2 million. The intentional flood during the Second Sino-Japanese War(1938) An official Nationalist post-war commission estimated that 800,000 were drowned, which may be an underestimate.^[2]..

The ethnic divisions are another problem that are and have been a MAJOR problem for China during their entire 5+thousand year history...

IMO - Preparing the needed infrastructure prior to expanding into the areas, in the long-run is much cheaper, that after-the-fact...

I have a better idea. Build more of such frontier towns in sparsely populated Tibet and move more millions of Chinese in over crowded cities into these fancy homes? This way Tibetan will have more jobs, more income, less trouble making.