GDP is not the best measure of a nation’s wealth, since the nation that deliberately demolishes a building for no good reason then rebuilds it, will be assigned more points toward its GDP than a nation that simply builds a new building to meet economic demand.
GDP gives full credit to things we would rather not do such as spending money on wars and on disaster recovery. Let a major hurricane hit the USA, and GDP will go up as materials are bought and workforces are put into action to make repairs and restore utilities. Declarations of war also generate lots of economic activity.
GDP includes wasteful and foolish spending the same as wise and frugal spending.
GDP is supposed to exclude spending on illegal activities such as drugs, prostitution, and burglar tools, and some gambling is not counted, but spending on correcting the problems caused by those vices (legal and medical fees, courtroom costs, prison costs, etc.) is counted. __ Good GDP Bad GDP
We should also look at G20 per capita GDP by “PPP,” just to cover that base — although PPP GDP can be tweaked an infinite number of ways to get the numbers you want.
Looking toward the bottom of the rankings, we can see that Russia is doing marginally better than China on a per capita basis — by both simple GDP per capita and by the more byzantine (and thus less meaningful) PPP GDP per capita measurement.
And yet we know that Russia is determined to continue playing the “great power” game as if it were the USSR in the 1960s. Unfortunately for Russia, it is a nation in decline on virtually all possible measures.
Moscow’s intervention in Ukraine, its saber-rattling against NATO members, and its continued attempts to destabilize perceived adversaries throughout Europe and North America have had an effect opposite from the one it presumably hoped. Russia now faces a revitalized and more cohesive NATO, which has deployed forces to within 100 miles of St. Petersburg, and has taken a much greater interest in the security of Russia’s neighbors, Georgia and Ukraine…
All of these events have degraded Russia’s security and all of them were avoidable. Each was the result of Russia reacting to potential or theoretical threats as if they were actual threats, and in the process causing actual threats to materialize. The true tragedy of Russia’s great power politics is that this outcome was not determined by the structure of the international system but by the choices Russia itself has made. These choices turned theoretical threats into actual threats, making Russia less secure in the process.
China is a different story, and it is gaining technological expertise in many competitive areas. China’s economy on a gross level is much larger than Russia’s, and although it is currently stumbling, it is still better capable of supporting ambitious military goals than is Russia’s.
… China’s economic growth continues to slow and steadily worsens, and as its financial disruptions become more severe, Chinese leaders, concerned about staying in power, will likely turn abroad to quell their restive populations. Stoking nationalist sentiment at home through belligerence abroad—certainly in the South China Sea, perhaps elsewhere as well—is a powerful way to gin up otherwise waning domestic support. This path is obviously dangerous, paving the way for reckless and impulsive actions. Weiss’s article suggests that perhaps, in such a scenario, the Chinese people would not just take the bait, but also radically support it, because they already endorse a more militaristic foreign policy. That does not bode well for future peace and stability in East Asia. ___ https://freebeacon.com/blog/chinas-growing-hawkishness/
It would not be unlikely to wake to find either Russia or China engaged in a “hot war” on their own doorsteps due to their leaders’ need to ramp up national patriotism in order to cover up domestic problems.
Countries that Should Not be Ignored
China and Russia are the most expansionist of modern nations — expansionist in ways that are likely to lead to regional or world wars sooner or later. But there are a few other nations of potential power which could spoil the power plays of the bully-bear and the bully-dragon.
Japan, South Korea, and Taiwan are all well placed to put difficulties in the way of Chinese expansion in Asia. India is beginning to see that it cannot afford its traditional corruption-as-usual approach to politics and national defence. Malaysia, Vietnam, and Indonesia are sleepers that could wake up and give significant difficulties to the surly dragon that claims too much.
Russia’s Self-Induced Problems in the West
The arms manufacturing nation Ukraine has been thoroughly alienated by Putin, and Poland has been put on alert to strengthen its defences. All the Scandinavian nations are gearing up to rebuff any amphibious assault by Russian invaders. As a result of Russian posturing, NATO has moved into the Baltic region — training local resistance fighters and keeping a much closer eye on the belligerent bear.
The Real Conflict is Between Russia and China
This is the real conflict looming on the horizon. Sure, China would like to solidify East and Southeast Asia before seizing the Russian Far East and other resource-rich parts of Russia. But Japan, South Korea, Taiwan, Indonesia, Malaysia, Vietnam, and the US battle groups are not going to sit still for that. China can certainly not afford the level of escalation that a move in that direction would bring.
This leaves the Russian Far East. The US and Japan would not go to war to defend Russia — Putin has seen to that.
First, China will — using diplomacy, manufactured goods, and cash — regain the parts of Manchuria that were illegally seized by Russia at the end of WWII. Then using economic imperialism China will obtain de facto control of large parts of the Russian Far East.
Then as the demographic crisis leaves Russia without the manpower to defend its vast and porous borders, Russia will have to trade away larger and larger chunks of Siberian real estate.
… the “extinction” of Russia’s population is accelerating, as the adverse demographic trends that have long affected the country continue to rage unabated. __ https://www.themoscowtimes.com/2017/06/13/russias-leaders-need-to-address-its-demographic-crisis-op-ed-a58184
No overt invasion of a military nature should be necessary. Not at all.
Siberia – the Asian part of Russia, east of the Ural Mountains – is immense. It takes up three-quarters of Russia’s land mass, the equivalent of the entire U.S. and India put together. It’s hard to imagine such a vast area changing hands. But like love, a border is real only if both sides believe in it. And on both sides of the Sino-Russian border, that belief is wavering. __ https://www.nytimes.com/roomfordebate/2014/07/03/where-do-borders-need-to-be-redrawn/why-china-will-reclaim-siberia
I never understood why Putin wanted to stir up all that trouble in Ukraine, Georgia, Moldova, etc. etc. when Russia’s real problem lay on an altogether different point of the compass. China can watch Russia squandering its resources in the west — and even loan Russia cash in exchange for access to Russia’s most advanced military secrets. Putin must seem like such a chump in the eyes of Xi.
Russia and China are Adjacent in per capita GDP Rankings
But only because China’s population is so large and Russia’s population so small. The trajectories of the two nations are quite different — in part because Russia’s leader could not wait to trigger wars with his neighbors, whereas China’s leader is patient enough to try all other avenues of aggressive takeover short of full military invasion.
For Russia, all paths to survival require giving up the “Russian Imperial Idea.” Asia cannot support two great empires in the 21st century, and China’s claim appears far better supported than Russia’s — regardless of per capita GDP rank.
There are all sorts of problems with any measure of GDP, but PPP is plainly better than nominal, because it correlates better with the visible activities of a country. For example, in terms of PPP, Russia’s economy is about 10% or so larger than Germany’s, and when you list the things both countries make and do, that is obviously a correct measure. Nominal GDP, which lists Russia down with Spain yields obvious absurdities.
Right now, and for some decades to come, the US is China’s main problem. China needs a friendly Russia both for advanced technology and resources. It especially needs Russia to tie down American power in the West. If China were to move aggressively anywhere it would be south to the Philippines, Malaysia and Indonesia. Having control of those countries gives China control of all the choke points and control of the China Seas and neighboring waters. Any move against Russia is suicidal and would relegate China to permanent second power status, isolated and contained.
Clearly the Spanish enjoy a higher quality of life than most Russians. That is the reality that Putin has wrought.
There are countless ways of calculating PPP GDP with variable results. PPP is not a single number, just as TFR is not a single number for fertility rate. Both are models, subject to instantaneous and unpredictable shifts.
Economists try to make GDP into a useful concept for comparing economies of nations, but it is such a mess that they typically just make things worse when they attempt models and indexes with multiple adjustments.
As for China and Russia, I doubt you are planning to live in either country — particularly not along the borders between the two. ;0-) Try not to sound so much like a propaganda trumpet for the two murderous dictatorships.
China is suffering a demographic crisis itself. Moving the population from the countryside to the cities to become corporate wage slaves will likely send the birthrate lower despite repealing the 1 child policy. Christians have more children, but they’re trying to suppress Christianity.
China will be a flash in the pan unless its birthrates recover and no one knows how to make nihilistic urbanites have more kids.