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The global economy isn't zero-sum

chinaandindia.JPG

Matt Miller's got a very good column on education today that allows me to make an almost entirely unrelated point about the way China (and, for that matter, India) gets used in the domestic political conversation. Miller's column argues that we need to do more to improve America's schools than we're already doing. Most people, I think, would agree with that. But in order to arm his point with more urgency, he writes that "the real race we're in is not a 'race to the top' within the United States but a race to maintain middle-class living standards in a world where rising, hungry powers such as China and India now threaten them."

You see this rhetorical move a lot. Barack Obama's State of the Union pitch for clean energy used the same tactic. "We know the country that harnesses the power of clean, renewable energy will lead the 21st century," he warned. "And yet, it is China that has launched the largest effort in history to make their economy energy efficient."

Polls and focus groups show that people go nuts for this sort of rhetoric. If you want the country to get behind your policy initiative, just tell them that China is beating us to the punch. But global economic growth is not a zero-sum game. Quite the opposite, in fact. If China and America both develop large and innovative clean-energy sectors, the result will be cleaner energy. If India graduates more engineers than we do, that means the world will have more engineers. If China gets a serious medical-research sector going, it will develop cures that will work on diseases that afflict Americans, too.

Competitive language is used in service of worthy goals, but it's also dangerous stuff. We're telling Americans to fear the economic development of other countries, when what they should actually fear is the reverse. If China or India stagnate, that means they won't become huge markets for our exports, it means they won't develop new technologies that can better our lives, it means that they won't be geopolitical anchors in the way that only rich, stable countries can be. The global economy isn't a race so much as it's a relay.

Photo credit: By Liu Jin/Agence France-Presse via Getty Images

By Ezra Klein  |  June 3, 2010; 11:40 AM ET
Categories:  Economic Policy  | Tags: clean energy, ezra klein, global economy, renewable energy  
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Comments

"Competitive language is used in service of worthy goals, but it's also dangerous stuff. We're telling Americans to fear the economic development of other countries, when what they should actually fear is the reverse."

Its a fine line, isn't it. Sure, we don't want India & China to stagnate, but we also don't want them to develop technologies ahead of or instead of us doing so - or we won't get a piece of the action. The best outcome is that we're all viable & the pie grows.

While you're correct to note that its not a zero-sum game, it would be foolish to discount the value of this country's competitive instincts as a motivating factor. The real challenge may be in stimulating those instincts without resorting to a jingoistic, xenophobic, us vs them mentality.

Posted by: bsimon1 | June 3, 2010 12:09 PM | Report abuse

I don't see the conflict in that type of rhetoric and what you're saying. No one is saying, "We need to create more clean energy and STOP China and India from doing so." They're just spurring a competitive spirit: "We need to do it faster than China and India so we can be the best."

Posted by: roquelaure_79 | June 3, 2010 12:21 PM | Report abuse

What makes you think we will benefit from India having more engineers, or China producing clean energy?

Doesn't India and China suck less because they have engineering and manufacturing jobs.

Another thing about producing talent. Talk to anyone that is an Engineer or Software Developer and they will tell you that most of what they learned is on the job.

We are basically depriving citizens of this nation opportunity here and shipping it overseas, and we are not suppose to thing that zero-sum?

I don't think people in India or China really cares of the US is doing well or not. And we shouldn't either.

What world do you live in?

Posted by: nabiber | June 3, 2010 12:40 PM | Report abuse

Pathetic, naive, free market drivel, Ezra.

China is stealing jobs, capital, manufacturing and intellectual synergy, tax base, and future opportunities from us by undervaluing their currency. If you can't recognize that, you are incapable of being a credible blogger on policy.

You are part of the elite that just doesn't see that there are elements of globalization that are partly and wholly zero sum.

You also seem to selectively read Krugman.

Join the real world, sir, where 15% of people without education are unemployed, and where state and local governments - and education systems - are near collapse from the collapse of their tax income, from precisely those workers.

Posted by: Dollared | June 3, 2010 2:27 PM | Report abuse

I see a lot of people complaining that education, tech, and job growth in China & India is bad because we are outsourcing our jobs to them.

Exactly the opposite is true however. The lack of local opportunities depresses wages for china's and India's workers which makes it irresistible on a strict finance rule to resist outsourcing.

While I agree that we need to counter that wage discrepancy with penalties for moving jobs overseas in the short term. The only long term fix is for people in china and India to be making a similar wage as US workers. Then the grief involved with outsourcing will out-way the cost benefits and more jobs will stay here in the US.

Again, letting that transition happen naturally is killing the middle class in the US so we need to use artificial controls in the short term.

Posted by: chrynoble | June 3, 2010 3:43 PM | Report abuse

Self editing fail:
"The lack of local opportunities depresses wages for china's and India's workers which makes it irresistible on a strict finance rule to resist outsourcing."

Should have been: The lack of local opportunities depresses wages for china's and India's workers which makes it irresistible on a strict finance rule to USE outsourcing.

Posted by: chrynoble | June 3, 2010 3:45 PM | Report abuse

I'm with bsimon1 on this one. But I don't think the marathon is the right analogy since it presumes an eventual end and an overall winner.

If our goal is to crush all other countries so that we can be on top when the rapture comes, then I agree, that is a silly and self-defeating goal.

But if our goal is to engage in an endless series of sprints to push each other into becoming better and more innovative global citizens, then I see nothing wrong with invoking competition rhetoric.

It's the fearful rhetoric I could do without. I've heard Obama use the competition rhetoric before, but it's always had optimistic overtones. He characterizes being first on innovation as an inspiring challenge for America. Miller's column, on the other hand, invokes the rhetoric of fear by talking about "hungry powers" that "threaten". That's not useful. Fear does not inspire innovation but rather retrenchment.

Posted by: slag | June 3, 2010 3:52 PM | Report abuse

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