China’s Gloating, But There Are Big Problems


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Small wonder the Chinese news agency was on gloat mode during the week of Aug. 8. The U.S. stock market fell off a cliff, bounced briefly, and then fell again.The Federal Reserve admitted the economy is close to stalling.

And in China? Oh, just the usual. Exports surging to record heights, that sort of thing.

At first sight, recent events have exemplified the great shift from West to East that is the biggest story of our time.

Even before the odds of a “double-dip recession” shot upward, the International Monetary Fund was forecasting that China’s gross domestic product would overtake that of the United States by 2016. And as everyone knows, China is now America’s biggest foreign creditor.

And yet, in several weeks of travelling through China, I’ve found myself wondering if Beijing is tempting fate by so openly relishing America’s current misfortunes. Apart from a few days in Beijing, I’ve eschewed the favourite destinations of Western visitors. I’ve been to Yanan, where Mao established his grip on the Communist Party in the 1930s, and where people in outlying villages still literally live in caves.

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