[Hank Rearden]

Yeah, and 15 years ago Japan was destined to rule the world, according to the same forecasters.

We'll see.

[Mr. Mulliner]

Good point!

[djr]

Somehow there is always this temptation to believe that some magic mix of centralization + free market exceeds free market alone, and as you recall, this idea seemed to permeate fears of the Japanese juggernaut in the 80's. In the West, the central goverment types seem to be trying to practice a principle of maximum sustained yield - i.e. how can the they farm the free market to grow the biggest government possible.

I happen to think that any economy that undergoes the transition from underdeveloped to developed will - during that period - reap maximum rewards. Growth then slows once "catch-up" occurs. The fear I have about China is that its got a lot of undeveloped human resources, so that catch-up will occur over a very long period as different segments get recruited into the economy providing cheap labor over an extended period.

On the hand, having observed the ways of Mainland Chinese quite closely, I have found that they actually have some enormous Achilles heels - but that's another story and I certainly would not wish to imply that Mainland China is not a serious threat to the U.S.

[AIG]

Unlike Japan, China's GDP potential is not limited by population size.