Comparing India and China’s Potential for Economic Growth

December 30, 2011

The cover for The Economist of October 2 – 8, 2010, placed a bet on India in an economic race with China.

The Economist wants India to win this race, because India is a democracy as is the U.S., but what isn’t mentioned is that China is evolving into a republic closer to the original republic that the United States was in 1776 with a Chinese twist, which is what Dr. Sun Yat-sen wanted.

Some claim China is ruled be a dictator today but that is not true. China is a republic that is guided by the word of law, which is the essence of a Republic.  In 1982, China wrote a new Constitution that spelled out the law and China’s schoolchildren are taught what these laws mean and how to live with them. However, the Chinese Constitution is not the same as the one in the US, so the laws are different.

I opened The Economist magazine and read the two pieces the cover was about. One was India’s surprising economic miracle and the second piece was A bumpier but freer road.

On page 11, I read, “many observers think China has done a better job than India of curbing corruption…”

On page 77, a Western banker was quoted saying, “It’s much easier to deal with the well-understood ‘organization chart’ of China Inc than the freewheeling chaos of India.”

Corruption exists in every country and Transparency International attempts to define and identify what global corruption looks like. Comparing China and India, we discover that while India’s corruption appears to be getting worse, corruption in China is improving due to the evolution of its new legal system.

In fact, in the past 3 years, the perception of corruption in India was 74%, [in the United States that perception was 72%], while in China it was only 46%.

In addition, the BBC reported recently, “Widespread corruption in India costs billions of dollars and threatens to derail the country’s growth…”

After I read both pieces in The Economist comparing China with India, it was obvious that India would never beat China economically without controlling its corruption, shrinking severe poverty and increasing literacy. Overall, the latest World Bank data shows that India’s poverty rate is 27.5% [330 million people], based on India’s current poverty line of $1.03 per person per day and an illiteracy rate of almost 26% [312 million people].

In comparison, literacy in China is more than 94% and the World Bank says in 2004, people in China living in poverty represented 2.8% of the population.

There are more reasons The Economist is wrong about India winning this economic race just because it is a democracy. One reason is that America’s Founding Fathers hated democracy and had a good reason.

Live Journal goes into detail on this topic. Live Journal says, “It would be an understatement to say that the (U.S.) Founding Fathers hated democracy. They warned against it vehemently and relentlessly. They equated it–properly–with mob rule.”

 

The Founders of the US, who hated democracy, built a free country [a republic]. Our [meaning many Americans] ignorance of history, which has led to a love of democracy, is causing the US to surrender its freedoms at an alarming rate.

Dr. Sun Yat-sen (1866 – 1925), known as the father of modern China [by both China and Taiwan], said he wanted to model China’s government after America but by combining Western thought with Chinese tradition.

When he said this, it was 1910, and America, by definition, was still a republic. Once you read the two pieces in The Economist, you may understand why India’s democracy cannot beat China’s growing republic.

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Lloyd Lofthouse is the award-winning author of The Concubine Saga. When you love a Chinese woman, you marry her family and culture too. This is the love story Sir Robert Hart did not want the world to discover.

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 This revised and edited post first appeared October 13, 2010.


Everyone Cannot Be Rich – Even in China

October 18, 2010

I read an interesting piece from the Inter Press Service. Antonaneta Becker writes of growing resentment in China of the widening gap between the rich and poor.

She mentions talk of a revolution to redistribute the wealth.

What Becker fails to mention is that in India the poverty and corruption is worse. The Economist for October 2 says, “that China has done a better job than India of curbing corruption…”

China isn’t alone when it comes to bribes and corruption.

Earlier this year in Thailand, unrest over corruption turned deadly resulting in cancelled flights from 40 countries.


In fact, a report in the Asian Journal of Public Administration says, “Corruption is a serious problem in many countries. Indeed, in many parts of the world, corruption has become a way life…”

Becker may not be aware that in 1949 when the Communists came to power, about a million wealthy landowners were executed and land was distributed among the poor. 

With the landowners gone, agriculture broke down resulting in famines that led to the deaths of about 30 million poor Chinese.

Becker is right about China’s central government fearing an uprising among the poor. 

However, rebellions of this nature have happened in China before and most have failed.  During the 19th century, those failures cost more than 30 million lives when the Qing Dynasty showed the world that they still had the mandate to rule.

The best solution is to see that the poor have a house and earn enough to buy food since the price of challenging the mandate to rule is often chaos, anarchy and death.  No one wins.

See Global Censorship and Corruption

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Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too. 

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