Come 21 Essay, Research Paper

COME 21

During the majority of the 20th century the United States has been able to maintain it’s position as the World economic leader without too much fear of losing the position. Recently however the threat of being dethroned as king of the hill has become a major issue. Japan, who’s economy grows constantly, is generally regarded as the country that will succeed the United States in this capacity, but recent studies have suggested that China is growing faster than any country in the industrialized world at the present time. Economist speculate that if future growth rates continue to rise just as dramatically as they have been, China will have surpassed Japan’s economy by the year 2005 and the United States by 2020 (Batterson).

Analyst Murry Weilbaum suggests a number of scenarios for China’s economic domination in the coming Century. In the first scenario Weilbaum sees China completing it’s move towards a market-based economy, and privately run businesses. Within the coming decade it overtakes Japan as the largest economy of Asia, and by the year 2020, surpasses The United States economy. Weilbaum further explains this scenario by suggesting that Hong Kong would be successfully incorporated into the People’s Republic of China and stronger economic and cultural ties are developed with Taiwan. China also reorganizes it has inefficient state owned firms, adopts a modern legal system, and establishes a commercial banking system (Batterson).

In Weilbaums second scenario China reverts to a fully communist country. In this he explains that “everything goes wrong.” After the death of Deng Xiaping the hard liners take control, the special economic zones established by Deng would remain with further restricted rights and privileges, and no new zones would be created. There would be an end to the foreign investment privileges, the rich and vibrant economy of Hong Kong would be squeezed, and the military power would increase, becoming a serious threat to Taiwan. Lastly, in this scenario New Western investment would virtually cease to exist, and China’s economy would likely nose-dive (Batterson).

Weilbaums third scenario for china seems to go from “bad to worse.” In this scenario the “Outer Empire” of China separates and fragments. China begins to suffer significant political and military instability in Asia, and quickly drops out of the race as a major economic competitor. Mongolia, Xinjiang, Tibet, and Manchuria are all likely candidates to split from China in this Scenario leaving Hong Kong in control of the industrialized Southeastern regions. Weibaums suggest that while none of these scenarios are likely to occur exactly as described, a combination of them is possible. China has the potential for major growth in the coming century and should not be underestimated.

The Backbone of the Chinese tradition in society has always been the philosophical theme of Harmony with Nature and Commitment to Family (Brown 13). This modern concept which incorporates another theme known as a sustained society is one that meets the needs of current generations without changing the ancestral ways of the past. However, now as the 20th century draws to a close China is looking towards one of it’s new leaders, Deng Xiaopeng, and his belief that “To get rich is glorious”, and have consequently abandoned old traditions conservation to further their economic advancement (Brown 113).

In T. W. Kang’s book “Is Korea the Next Japan” he describes how Korea has been making a name for itself in the world of global economy. While certainly not as advanced as Japan or even China, Korea is making some waves and proves to be a major player in the game of world economic leaders.

Comparatively Korea is still a relatively small economic producer. So, Korea is clearly not in the big leagues yet, however, Kang assures us that “yet” is the key word.

Kang explains that in any discussion of economics the participants must first look towards the GNP for comparisons. In 1987 for instance the Unites States GNP was around 4.5 trillion, Japan’s was about 2.7 trillion, while Korea’s was only 119 billion (Kang 43-44).

We can also take a look at the numbers for the companies in the private sector. Certainly the biggest of these In 1987 was IBM at $55 billion followed by Toyota’s $52 billion and then the Korean Hyundai at $38 billion (Kang 44). From this we can make a generalization about the kind of potential that Korea has, and that it is not unfounded to see Korea to be like Japan. Korea has been growing and growing but is in the shadows of Japan in its economic growth.

Korea’s phenomenal growth rate is further demonstrated by comparing its compounded annual growth rate of the GNP with that of Japan and the United States. While the United States had a growth rate of 3.2 for the years 1975 to 1979, and only 1.8 for the years between 1980 and 1984. Japan’s rate was a little better at 4.7 from 1975-1979, yet neither were as good as Korea’s rate of 9.9 and 5.3 respectively (Kang 63). So, it is fair to conclude from this that while Korea is still a relatively small and new economic power, there is no telling where they could be in a few decades. Rather than burning it’s bridges and turning its back on Korea as it seems to have done to Japan, The United States would benefit in my opinion from taking Korea as a political and economic power.

In a July 1993 article it was suggested that competition is not the key to success in the global economy, but rather cooperation in working with other leaders. In “Competition in the global economy”, the writer states in their opening paragraph that “The race is on to see which nation’s workers become poorest fastest. The solution is not retreating to protectionism, but advancing to international unionism.” The writer goes on to describe how the American people have always been told that they have to be able to compete in order to succeed in the global economy, they further go on to describe ways in which we can become more unionized as a global family.

Our President Mr. Clinton says that we have to be competitive if we want to keep high paying jobs in America. Then, the question is posed that if our ability to compete in the real world means that all of the American population has to work harder and longer for less, is this really worth it? Yet, in the real world, things seem to work just the opposite. Employers and big companies argue that the only way to stay competitive is to keep the pay for jobs low. If employers can not get cheap labor they will take their company to another country where they can. The whole idea of competition is to lower the cost of goods to the consumer and this is hard to do when the competition is spending less on labor. It is actually quite a vicious circle. Competition drives companies out of the United States because the cost of labor is too high. However, the newly out of work employees seek to gain work elsewhere and this competition for work also causes wages to go down. What the United States needs to do instead of focusing on competing with foreign markets is to work more toward dealing directly with them. This benefits both countries, and creates jobs, which in turn will increase wages, as more companies need to offer incentives to entice the dwindling number of the unemployed.

While it is true that the United States is in front as the “Global Economic Leader” at this present time. Will it stay on top, will China, or Korea come out and take the lead? Who knows what could happen as fast as the world’s markets are changing. Only time will tell what will happen. There are many doors to open, but who holds the keys of tomorrow?