Citigroup led the way into the massive marketing of toxic collateralized debt obligations that has brought the world’s economy to its knees, and China, which did nothing to create that problem, suffered mightily as a result. Yet instead of attacking the United States and its dubious dollar, the Chinese continued to buy our questionable paper. For that reason alone we should be happy that China recently managed to turn the corner on the adversity we created for it, thanks to a stimulus program that makes ours pale in comparison. As a result, not only did China’s exports rise 18 percent last month, as compared to the previous December, but imports rose an astounding 56 percent. China is now not only the world’s biggest exporter, having surpassed Germany, but it topped the United States as the world’s leader in auto sales last year.
All of this is good news, given the fact that hundreds of millions of people in China have witnessed a dramatic improvement in their lives. Instead of being a source of misery at home and undesired migration abroad, the once-feared Chinese population bomb is now a source of increasingly skilled labor and the most promising emerging market for the rest of the world’s products. Of course, with its vast population of more than 1.3 billion, China remains a very poor country, and if it doesn’t manage to spread the wealth to rural areas and solve major environmental problems the future may be dreary for the Chinese as well as for us.
That is precisely the reason we should welcome China’s success rather than bemoan it.