I have an idea (and this is really the raison d’être of http://FutureofUSChinaTrade.com): instead of blaming China for the U.S.’ economic woes, let’s all sit down at the table and talk about a way to engage with each other that is mutually beneficial. Some have said that trade is not a zero-sum game, but politics can make it one. So let’s agree that a mutually beneficial solution is best for everyone involved and then let’s work toward a trade framework that truly is win-win.

Correct me if I’m wrong but this seems somewhat uncomplicated. (Point-prediction is overly complicated, maybe impossible; but the trend seems clear.)

China’s population is 4x the US pop.

So as soon as they reach 25% of our per capita GDP, our total economies will be of equal size.

But it’s not really clear why anything other than per-capita GDP is what matters. This is not a zero-sum contest.

The issue is not whether China, India and the other emerging economies will match US per capita productivity (they cannot, unless they make their economies much freer), but rather, whether the modest supply side liberalizations they have already introduced are enough to get them to a level of even just 1/3 of US per capita income. A China and India alone that have reached just 1/3 of US per capita income, will be economies larger than the US and Europe combined.

In other words, the West either retakes the lead in supply side liberalization of their economies (i.e. incentives to produce) or it fades away into worldwide economic averagedom. While the rest of the world has embarked in, albeit modest, economic liberalization (ironically after finally realizing how far behind the US they had fallen) American economic liberalization has stalled and perhaps even reversed course in the last decade or so. The average American cannot maintain his unique enviable prosperity in this world, under these dynamics.