[Sasa]

"Optimistic" experts always tell us the future would be better and we need to help people in poor countries so that one day they are able become rich as well.

But if you think more about it, even without the expertise of a economist, it's not hard to know, most countries on this planet MUST be "developing countries", there's no way to change.

The reason some countries, such as US/UK/Australia/Canada are thought rich countries simply because they take advantage of more poor countries (or more precisely more people living in poor countries), they squeeze the labor from them. Take Australia for example, which has a very high cost of living and also high income (very high minimum wage), thus more typical than the US (US is definitely an exception).

For instance a waiter in Australia earns $18 an hour. As a result everything is expensive (more so than in the US) due to the high labor cost. Nonetheless it's still a "rich country", which is interpreted as high purchase power - Australian people still afford to buy enough goods, in which way? Thanks to the existence of developing countries in Asia, they import cheap goods easily, just a waiter's hourly pay buys enough food for a family for the whole day in South East Asia. Apparently not because Australian workers are outstanding or hard-working but they enjoy such innate privilege to be able to squeeze the labor of Asians.

What happens if all the countries become as rich as Australia one day? That means as if Australian workers need to produce everything themselves - as foreign workers get the same pay rates. That'll be unimaginable if everything made in Australia, waiters may still receive $18 per hour but find they can buy nothing.

So the answer has been clear enough: to become a developed country, you should be able to squeeze labor outcome from poor countries, and the populations in these poor countries must be large enough to produce enough goods for your country.

That partly explains why the "economic giant" China may never become a developed country like Australia (few Chinese doubt this indeed). Today we know many super rich Chinese but what behind them are much much more squeezed Chinese workers, that's how this invariable system works.

If 1.4 billion Chinese want to enjoy the lifestyle of Australia/USA, regardless how powerful they can be (lets say China is the most technologically advanced nation in the world one day), where could they get enough squeezed people to sustain 1.4 billion people with luxury life standard?

It could never happen theoretically.

[Godstud]

You do not have to be rich to have a good standard of living. That's why this "theory" of yours is flawed, IMO.

US/UK/Australia/Canada are thought rich countries simply because they take advantage of more poor countries (or more precisely more people living in poor countries), they squeeze the labor from them.

Oh, do tell. You have a source for this silly claim?

Canada has vast natural resources, and that's why it's rich.

I know Australians who would laugh at what you are saying, as well. Who are they "exploiting"? They have natural resources as well, but both Canada and Australia have comparatively low populations compared to USA.

Canada has 35 million and Australia has 25 million. USA, by contrast, has 330 million. USA cannot just rely on it's natural resources, as a result.

You also missed out countries like Denmark, Germany, Japan, Norway, Sweden, France... These are DEVELOPED countries.

Countries like Thailand, Brazil, Mexio, etc. are developing. They're a long ways but have a bit to go.

Please note, Thailand has a far lower unemployment rate than the USA, and a lower poverty rate, as well. They've come a long ways in a decade, towards the goal of being "developed", which I think lends itself to countries that have extensive technology and infrastructure.

[Sasa]

You do not have to be rich to have a good standard of living. That's why this "theory" of yours is incorrect.

Oh, do tell. You have a source for this lie?

Canada has vast natural resources, and that's why it's rich.

I know Australians who would laugh at what you are saying, as well. Who are they "exploiting"? They have natural resources as well, but both Canada and Australia have comparatively low populations compared to USA.

Canada has 35 million and Australia has 25 million. USA, by contrast, has 330 million.

You also missed out countries like Denmark, Germany, Japan, Norway, Sweden, France...

Japan is as exceptional as the US. They became rich due to hard-working which led to the advancement in science/technology. Both Japan and the US, unlike Europe or Australia are not so expensive to live.

What you pointed out is true: Australia & have abundant resources along with relatively small population. But don't forget about the closed trading relations with Asia, especially so for Australia. The living standard of Australia would be halved if they stop trading with Asia tomorrow.

Even for Canadians, see how many goods you buy everyday are made in China. That's exactly the result of exploitation.

Back to the topic, what's your point then: can most countries become developed in a foreseeable future?

You said Thailand needs "a long way" to become developed, how do you think about Japan, how could they became a first world country within 20 years after been destroyed (stats shows that in 1946 the living condition in Japan lower than China).

[Godstud]

Even for Canadians, see how many goods you buy everyday are made in China. That's exactly the result of exploitation.

That's called TRADE. Are you new to economics?

Back to the topic, what's your point then: can most countries become developed in a foreseeable future?

Yes. Developing countries are making great strides in that direction,a s I pointed out.

You said Thailand needs "a long way" to become developed, how do you think about Japan, how could they became a first world country within 20 years after been destroyed

Japan was never "destroyed", as you put it. US spent the next 6 years rebuilding Japan, to what it was before, too.

Different culture. Different resources. Different geography. Different history. need I go on? There's reasons why all countries are not the same.

Thailand had a poverty rate of 25% a decade ago. Now that poverty rate is 12%(lower than the US - 13%). That's some good movement towards "development" and some argue that Thailand is already a first world country.

[Sasa]

:lol: That's called TRADE. Are you new to economics?

Yes. Developing countries are making great strides in that direction,a s I pointed out.

Japan was never "destroyed", as you put it. US spent the next 6 years rebuilding Japan, to what it was before, too.

Different culture. Different resources. Different geography. Different history. need I go on? There's reasons why all countries are not the same.

Thailand had a poverty rate of 25% a decade ago. Now that poverty rate is 12%(lower than the US - 13%). That's some good movement towards "development" and some argue that Thailand is already a first world country.

Frankly I never studied economics but clearly I'd tell you "Made in China" greatly increased your purchase power believe it or not. No country would use the term "exploitation" when trading with Asians but I just tell the truth.

Yes you pointed out countries like Thailand on a "long way", I wonder how long the way is. Would you say yes all countries would be as rich as the US in 1000 years.

"Different culture. Different resources. Different geography. Different history"
Well good progress! let's face the real question.
culture: Japanese have no ignorant culture/cult religions/anti-American sentiments, (yes they are lucky)
resource: Who has advantage you tell me.
geography: Japan is more isolated from the rest of world.
history: Only stupid people care about that.

I really don't mind if Thais consider their country "developed" to make them happy. The thing is, again, I just tell the truth.

[Crantag]

The initial theoretical objective underlying liberal trade theory was to transcend the zero-some game approach to international affairs basically, which was the theoretical underpinnings to the mercantilist system of international trade, which was based on the running of trade surpluses through protectionist trade and direct exploitation of colonies, through the importing of raw materials from the colonies and exporting to them of manufactured goods.

However, it could be argued that perhaps the previous systemic norms never genuinely faded.

[Sasa]

The initial theoretical objective underlying liberal trade theory was to transcend the zero-some game approach to international affairs basically, which was the theoretical underpinnings to the mercantilist system of international trade, which was based on the running of trade surpluses through protectionist trade and direct exploitation of colonies, through the importing of raw materials from the colonies and exporting to them of manufactured goods.

However, it could be argued that perhaps the previous systemic norms never genuinely faded.

Whatever terminologies you use to make your comments looks more professional (indeed I agree), it's undeniable why westerners trade with Asians today? simply for access to cheap labor thus low price. If the factories over there aren't exploiting Asian workers (one more reason is to set up pollutant plants there with little disposal), why do you like "made in China" instead of "Made in USA" or "Made in Canada"? Business runners in the west try to maximize profits/cut cost, while Asian partners offer low cost labor & pollutant factories, that's the whole story.

[Crantag]

Whatever terminologies you use to make your comments looks more professional (indeed I agree), it's undeniable why westerners trade with Asians today? simply for access to cheap labor thus low price. If the factories over there aren't exploiting Asian workers (one more reason is to set up pollutant plants there with little disposal), why do you like "made in China" instead of "Made in USA" or "Made in Canada"? Business runners in the west try to maximize profits/cut cost, while Asian partners offer low cost labor & pollutant factories, that's the whole story.

I would like to suppose I use the terminologies I use because of my economics education.

Or does that make me unworthy of posting here?

The opening of China for foreign factories has to be understood as the national project which it was, within the context of momentous world (and domestic Chinese, and American) events of the time.

[Sasa]

I would like to suppose I use the terminologies I use because of my economics education.

Or does that make me unworthy of posting here?

The opening of China for foreign factories has to be understood as the national project which it was, within the context of momentous world (and domestic Chinese, and American) events of the time.

You are definitely welcome to post here and I managed to understand it.

China needs its low cost labor to attract western businesses, meanwhile the westerners don't want it to become a rich country.
All of that tells us the necessity of the existence of poor countries.

[Crantag]

You are definitely welcome to post here and I managed to understand it.

China needs its low cost labor to attract western businesses, meanwhile the westerners don't want it to become a rich country.
All of that tells us the necessity of the existence of poor countries.

I expect China to gradually consume increasing levels of Chinese goods.

China will actually quietly start manufacturing in the US, probably, at some point as well.

As for the impetus for increasing Chinese domestic consumption, aside from the implications for standards of living, the 2008 economic crisis taught China about the danger of relying on Western export markets due to the risk of capitalist crisis.

China increased the pace of construction projects to counter unemployment in direct response to the shock.

[Sasa]

I expect China to gradually consume increasing levels of Chinese goods.

China will actually quietly start manufacturing in the US, probably, at some point as well.

As for the impetus for increasing Chinese domestic consumption, aside from the implications for standards of living, the 2008 economic crisis taught China about the danger of relying on Western export markets due to the risk of capitalist crisis.

China increased the pace of construction projects to counter unemployment in direct response to the shock.

I doubt your points.
Firstly would China expand manufacturing in the US? It's both unfeasible and undesirable. Having said China's advantage is large number of population which offers cheap labor. It'll be much more costly if they set up factories in the US and hire US workers. On the other hand they have to offer employment for domestic population. China may only achieve what you said if they only had the same population as the US's.

The domestic consumption faces a similar problem, in a country where majority people work as cheap labor, how much purchase power do they possess? Probably the only way to become rich is to largely reduce its population first.

[Crantag]

I doubt your points.
Firstly would China expand manufacturing in the US? It's both unfeasible and undesirable. Having said China's advantage is large number of population which offers cheap labor. It'll be much more costly if they set up factories in the US and hire US workers. On the other hand they have to offer employment for domestic population. China may only achieve what you said if they only had the same population as the US's.

The domestic consumption faces a similar problem, in a country where majority people work as cheap labor, how much purchase power do they possess? Probably the only way to become rich is to largely reduce its population first.

China merely needs to own businesses in foreign countries to employ foreign workers.

There have actually been calls recently from establishment economics voices lately for China to establish factories in the US, supposedly to ease the trade deficit.

China is trying to diversify away from US treasury securities. Germany recently blocked China from buying any more German companies, in response to a Chinese buying frenzy.

China's average income has quadrupled over the last 30 years, and continues to rise. If you go to a Chinese city, you are likely to walk past Ferrari dealerships, and you might happen upon high end department stores, with outlet stores for expensive suits, etc.

It is really no secret where the source of the growing wealth is, it's the Chinese economy.

[Rich]

Trade has made China and the West richer. Trade between the West and China, substantially raised the standard of living of the West and massively raised the standard of living in China. The key to initial development is light manufacturing, particularly clothing. There's some good video's about this but I can't find them at the moment. As the world's capital stock expands it allows greater productivty and therefore porsperity.

There are scarce resource limitations but they are not cured by mercantilism, of which Trumpism is just the latest version.

[Godstud]

Yes you pointed out countries like Thailand on a "long way", I wonder how long the way is. Would you say yes all countries would be as rich as the US in 1000 years.

A fraction of that time. Probably in the next 20 years. Also, it would depend on how far the US declines...

Different culture. Different resources. Different geography. Different history"
Well good progress! let's face the real question.
culture: Japanese have no ignorant culture/cult religions/anti-American sentiments, (yes they are lucky)
resource: Who has advantage you tell me.
geography: Japan is more isolated from the rest of world.
history: Only stupid people care about that.

Japan has a culture that values discipline, obedience and a strict work ethic. Not all countries do the same.

Japan has limited resources but has used what it has, very well.

Japan's geography lends itself to be easily defensible, and so they can be weaker and still resist any foreign incursions, which made them still quite secure after WW2.

History is always important. As Japan saw the folly of a militaristic nation, and changed, accordingly. Countries have cultures that are dependent on their history. Nothing forms in a vacuum. To suggest the history of a country has no influence on their identity, is simply foolish.

eg. See USA and Canada. Both were British colonies, but both are now independent, but through different means, and their identity is singificantly different because of this.

I really don't mind if Thais consider their country "developed" to make them happy. The thing is, again, I just tell the truth.

It's not Thais who are determining this, but objective economists. Being rich as the US is not a requirement to development. Your American arrogance is truly astonishing. Quality of life can be quite high without being "rich". Being "rich" is also subjective.

[Sasa]

China merely needs to own businesses in foreign countries to employ foreign workers.

There have actually been calls recently from establishment economics voices lately for China to establish factories in the US, supposedly to ease the trade deficit.

China is trying to diversify away from US treasury securities. Germany recently blocked China from buying any more German companies, in response to a Chinese buying frenzy.

China's average income has quadrupled over the last 30 years, and continues to rise. If you go to a Chinese city, you are likely to walk past Ferrari dealerships, and you might happen upon high end department stores, with outlet stores for expensive suits, etc.

It is really no secret where the source of the growing wealth is, it's the Chinese economy.

The prosperity you described in Chinese cities can equally applied to India I'm afraid. But don't forget the poor majority which sustained its economy and wealthy people.
"China's average income has quadrupled over the last 30 years, and continues to rise."
that's not a good news for a nation with large population heavily relying on cheap labor export.
"It is really no secret where the source of the growing wealth is"
Again cheap labor & pollutant factories. My company outsources its manufacturing in China, for what? cheap price. What if one day Chinese workers earn as much as Americans/Australians? Bye bye China, we'd choose factories in Vietnam/Malaysia instead. As a result Chinese leaders won't let it happen anyway.

[Sasa]

Trade has made China and the West richer. Trade between the West and China, substantially raised the standard of living of the West and massively raised the standard of living in China. The key to initial development is light manufacturing, particularly clothing. There's some good video's about this but I can't find them at the moment. As the world's capital stock expands it allows greater productivty and therefore porsperity.

There are scarce resource limitations but they are not cured by mercantilism, of which Trumpism is just the latest version.

That's right. Both westerners and Chinese benefit from the trade, westerners got cheaper products, and Chinese got jobs to do so that able to live, their Chinese bosses became super rich by exploiting them. sounds like a win-win result, huh.

But don't forget the premise: western countries were already rich enough before the trade, they just wanted to be richer by reducing product cost. Majority Chinese people just want to have enough to eat by working in the factories. There's no way here in this game that Chinese worker can become as rich as their western counterparts.

[Sasa]

A fraction of that time. Probably in the next 20 years. Also, it would depend on how far the US declines...

Japan has a culture that values discipline, obedience and a strict work ethic. Not all countries do the same.

Japan has limited resources but has used what it has, very well.

Japan's geography lends itself to be easily defensible, and so they can be weaker and still resist any foreign incursions, which made them still quite secure after WW2.

History is always important. As Japan saw the folly of a militaristic nation, and changed, accordingly. Countries have cultures that are dependent on their history. Nothing forms in a vacuum. To suggest the history of a country has no influence on their identity, is simply foolish.

eg. See USA and Canada. Both were British colonies, but both are now independent, but through different means, and their identity is singificantly different because of this.

It's not Thais who are determining this, but objective economists. Being rich as the US is not a requirement to development. Your American arrogance is truly astonishing. Quality of life can be quite high without being "rich". Being "rich" is also subjective.

You misinterpreted the "history" I said. I didn't say burn out our history books. The countries that stick with "history" are like North Korea/China/Muslim, whose dictators use "history" to mobilize the sentiment of hatred towards westerners. Japanese didn't hate America because of "history".

I really don't know the "arrogance" of pointing out Thailand not being a developed country:
https://en.wikipedia.org/wiki/Developed_country
If telling truth is called a kind of arrogance I don't mind.

I'm afraid Canadians differ from Americans not due to the history but different sense of value (welfare state), which shared by European countries as well. If you talk about "history", how many Canadians do you think are still loyal to British Queen?

[Crantag]

The prosperity you described in Chinese cities can equally applied to India I'm afraid. But don't forget the poor majority which sustained its economy and wealthy people.
"China's average income has quadrupled over the last 30 years, and continues to rise."
that's not a good news for a nation with large population heavily relying on cheap labor export.
"It is really no secret where the source of the growing wealth is"
Again cheap labor & pollutant factories. My company outsources its manufacturing in China, for what? cheap price. What if one day Chinese workers earn as much as Americans/Australians? Bye bye China, we'd choose factories in Vietnam/Malaysia instead. As a result Chinese leaders won't let it happen anyway.

It helps to actually look at China-specific data and analyses. Comparisons to other countries are useful only in so far as the enable the drawing of parallels, but these have to be specifically identified to be of value, broad and generalized comparisons (China and India) are not valid.

The Chinese urbanization has amounted to the largest internal migration of people in history. The urban population is already near level to the rural population, and may have even surpassed it by now. Chinese manufacturing is actually already relatively shrinking. This presents a big challenge in the way of economic policies and development strategies, to be sure. China is already making serious moves to drastically expand its service sector.

[Crantag]

That's right. Both westerners and Chinese benefit from the trade, westerners got cheaper products, and Chinese got jobs to do so that able to live, their Chinese bosses became super rich by exploiting them. sounds like a win-win result, huh.

But don't forget the premise: western countries were already rich enough before the trade, they just wanted to be richer by reducing product cost. Majority Chinese people just want to have enough to eat by working in the factories. There's no way here in this game that Chinese worker can become as rich as their western counterparts.

The Chinese have been subsidizing American consumption of Chinese goods, to the tune according to some, of around $1.5 trillion a year, by way of Chinese savings and through the exchange rate. It is very naive to think this is anything other than a tactical and strategic arrangement, or that it will be enabled to continue, even in the near-to-intermediate future.

The People's Republic of China turned 68 this year. The first 29 years were spent under the regime of Mao Zedong, and laymen seem trapped in this perception, or in a perception of China at the time of Deng Xiaoping's reforms.

However, we are living in the 21st century now. Conspicuously, China joined the WTO in 2001. China's progress over the past 4 decades has forced nothing less than a reevaluation of the naive orthodox theories of economic development and macroeconomics, broadly speaking.

[Sasa]

It helps to actually look at China-specific data and analyses. Comparisons to other countries are useful only in so far as the enable the drawing of parallels, but these have to be specifically identified to be of value, broad and generalized comparisons (China and India) are not valid.

The Chinese urbanization has amounted to the largest internal migration of people in history. The urban population is already near level to the rural population, and may have even surpassed it by now. Chinese manufacturing is actually already relatively shrinking. This presents a big challenge in the way of economic policies and development strategies, to be sure. China is already making serious moves to drastically expand its service sector.

I'm really curious to see how China, an authoritarian state with extreme large wealth gap and social tension, manages to switche to a rich service-led economy.