Obsessed with rankings, Americans are bound to see the Beijing
Olympics as a metaphor for a larger and more troubling question.
Will China overtake the United States as the world's biggest
economy? Well, stop worrying. It almost certainly will. China's
economy is now only a fourth the size of the $14-trillion U.S.
economy, but given plausible growth rates in both countries,
China's output will exceed America's in the 2020s, projects
Goldman Sachs. But this is the wrong worry. By itself, a richer
China does not make America poorer. Indeed, because there are so
many more Chinese than Americans, average Chinese living
standards may lag indefinitely. By Goldman's projections,
average American incomes will still be twice Chinese incomes in
2050. The real threat from China lies elsewhere. It is that
China will destabilize the world economy. It will distort trade,
foster huge financial imbalances and trigger a contentious
competition for scarce raw materials. Symptoms of instability
have already surfaced, and if the