Thomas Friedman provides a helpful snapshot of what China’s doing with its taxpayers’ money…versus what we’re doing with ours.
Here’s what China’s doing:
China is doing moon shots. Yes, that’s plural. When I say “moon shots” I mean big, multibillion-dollar, 25-year-horizon, game-changing investments. China has at least four going now: one is building a network of ultramodern airports; another is building a web of high-speed trains connecting major cities; a third is in bioscience, where the Beijing Genomics Institute this year ordered 128 DNA sequencers — from America — giving China the largest number in the world in one institute to launch its own stem cell/genetic engineering industry; and, finally, Beijing just announced that it was providing $15 billion in seed money for the country’s leading auto and battery companies to create an electric car industry, starting in 20 pilot cities. In essence, China Inc. just named its dream team of 16-state-owned enterprises to move China off oil and into the next industrial growth engine: electric cars.
And here’s what we’re doing:
Not to worry. America today also has its own multibillion-dollar, 25-year-horizon, game-changing moon shot: fixing Afghanistan.
And we’re also doing some other things: Growing our entitlement programs and borrowing money.
The chart below shows the breakdown of the projected growth in US federal spending for the next 10 years. The red bar, which accounts for ~60% of the increase, is the entitlement programs: Social Security, Medicare, and Medicaid. The blue bar, which accounts for ~37.5%, is the growth of the interest we’re paying on our debt. The green bar is the growth of everything else.
Photo: Northern Trust
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