Is there a malaise in America?
No. This is not a reprise of Jimmy Carter's 1979 "Crisis of Confidence" speech. Although in some ways, much of the melancholy that America is experiencing now feels much like that despondency running rampant back in those days of another dark American economy. And part of today's melancholy, that which hangs over us like a single-minded old man predisposed to discuss nothing but his ailments, is expressed in an American poll about Chinese economic ascendancy.
Amid endless reminders of a stubbornly high unemployment rate, continuous images of gas prices going up at the pump, and the constant political drumbeat of American income inequality, comes the uninterrupted and ad nauseous jeremiad that China is more of an economic power than the United States. This national grumble is evidenced in a February 2012 Gallup Poll in which 53 percent of Americans said that China was the leading economy on the planet today.
Poppycock, America. You are wrong.
How so? Let me show you.
Most everyone realizes that national economies are measured by gross domestic product (GDP) which is represented by the total output of goods and services in a given country.
Are 53 percent of Americans correct about the Chinese economy? That's easy to find out. Let's check the GDP statistics.
Per the CIA (Central Intelligence Agency) World Factbook which reports GDPs, among other things, the 2011 GDP for China is $11.3 trillion (in 2011 US dollars). The CIA reports that this number represents China's GDP as shown on a purchasing power parity (PPP) basis, rather than on a national currency basis. Briefly explained, PPP calculates the comparative buying power of money based on how much of it is needed to purchase the same product or service in different countries. The CIA uses a PPP number as a more accurate representation of total Chinese output because China's exchange rate does not float on global markets but rather is determined by governmental fiat, a situation which would make GDP comparisons on a currency basis inaccurate. Thus, a Chinese GDP shown on a PPP basis represents a more accurate picture.
How does this compare to the United States GDP?
The CIA World Factbook shows that for 2011, also in 2011 US dollars and on a PPP basis, the GDP for the United States is $15.04 trillion.
US GDP in 2011 was 33 percent greater than Chinese GDP. The two figures are not even close.
Now, this is not to say that China's GDP won't surpass that of the United States someday. Some economic thinking out there puts this as a distinct possibility. Yet, the supplantation of the American for the Chinese economy as the world's leader does not need to be a foregone conclusion.
Time to buck up, America. Get the lead out of your britches. No more Jimmy Carter-esque malaise.
It's time to stop the economic self-flagellation; it's time to stop complaining that the government is holding back American capitalism. You are still free, over the age of consent, and able to sit up and take nourishment.
Negative attitudes don't help capitalism, and in the long-run those lousy attitudes may help China lap us on the economic racetrack of life.
Let's not make it easier for them.