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A new paper suggests that countries start to experience growth slowdowns when their per capita incomes reach $17,000, a level that China will reach in about five years. Ryan Avent:

The story this suggests is one that’s quite at odds with the prevailing view in much of the world—that China’s relentless growth will continue until it dominates the global economy. Another possibility arises. Within a few years, we may be reading “What’s the matter with China?” stories. A growth slowdown and demographic difficulties will challenge the policy status quo and could potentially expose serious weaknesses in the growth model (as Warren Buffet says, when the tide goes out, one sees who’s been swimming naked). India, on the other hand, will be ascendent. And that could make for a very different set of policy challenges and priorities within the rich world.

I agree, and I’m surprised this isn’t a more common narrative. Demographic problems alone put serious limits on China’s future growth path, and the slowdown in productivity once they hit the $17,000 income level will make things even worse. China will plainly be a big player on the global stage for the rest of this century, but they’re not going to take over the world quite as quickly as folk punditry often has it. This is something to keep in mind the next time some hawkish outfit releases yet another study trying to scare everyone into big Pentagon budget increases in order to stave off the future red menace.

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Fact:

In-depth journalism that investigates the powerful takes real money and is so damn important right now.But it doesn’t take a Mother Jones investigation to know that billionaires and corporations will never fund the type of reporting (like they do politicians) we do that exists to help bring about change. Instead, our mission-driven journalism is made possible by people power, and has been for 46 years now since our founding as a non-profit.

In “TITLE TK” Monica Bauerlein writes about the perilous moment we’re in, and why it’s so important that we raise $325,000 by the time November’s midterms are decided so we can be ready to throw everything we have at the big issues facing the nation no matter what happens. Please help MoJo’s people-powered journalism with a donation today.

$400,000 to go!

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