Economy
US Outpaces China in Economic Growth
The US economic growth will outpace China’s rate for the next few quarters. This promises to be the first time America will have a sustained period since 1990 where its economy grew faster than China’s.
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US Economic Growth Outpaces China’s Rate
US gross domestic product rose 12.2% during the second quarter of 2021. In contrast, China only managed to post a 7.9% gain during the same period. As a result, many economists believe that the US can sustain this faster economic growth rate at least for a few more quarters.
The difference lies in how each nation dealt with the COVID-19 pandemic. When the coronavirus outbreak hit China, the country’s officials quickly shut down entire provinces. As a result, the Chinese GDP fell by 6.7% during the first quarter of 2020. In contrast, the US gained a little.
However, China’s aggressive response initially gave it an advantage over the US. Its economic growth rate zoomed more than America’s for a short while. The US took longer to start its recovery period, but when it did, they zoomed out of the gate.
US Economic Growth Fueled By Stimulus And Near-Zero Interest Rates
The US unrolled a combination of measures to prop up its economy. Vaccination drives helped restore confidence in essential workers to go back to their jobs.
Massive fiscal stimulus paired with near-zero interest rates increased the money available to spend. These measures have helped propel the US economic growth ahead of China since last year.
Government stimulus checks sent to Americans helped households save $2.6 trillion in excess savings. This is nearly seven times as much as household savings in China. Now, the world awaits how the two countries will respond to the Delta variant, and how a resistant virus strain can affect their economic reboots.
US To Outpace China For Five Consecutive Quarters
Moody’s forecasts that US economic growth will outpace China’s for the next five consecutive quarters, beginning the 2nd quarter in 2021. Capital Economics and Oxford Economics agree but gave their prediction a shorter time span of three quarters instead of five.
Note that China does not issue quarterly reports for its economic growth. Economist estimates of Chinese quarter-vs.-quarter results vary widely. However, they all point to US economic growth far bigger for the US than China.
China Will Still Emerge As World’s Largest Economy
Despite the gains made by the US in terms of economic growth rate, China’s march to the top economic spot remains undeniable. Andy Rothman, a China specialist at Matthews Asia, views the growth reversal as a temporary delay.
News on the US’s faster growth rate is “like getting so excited about the Washington Nationals winning five in a row but they’re still five games below .500,” he said.
China holds long-term advantages. They have four times as many people versus the US. Meanwhile, the government also spent decades encouraging growth through savings and investment. In terms of population, China already had it made. However, many other industrialized nations with increased productivity per person managed to slip past it.
China Will Get There
China holds all the cards and it’s a matter of time before it claims the title of having the world’s biggest economy. Oxford Economics estimates that China will claim the top spot in 2030. Moody gave it a few more years and predicted 2038. Once they get the #1 rank, they can set business and consumer trends globally.
Watch the CGTN video report on a US Economist's Views on the Chinese Economy:
Loading ...Do you agree that the Chinese economy will overtake the US soon? How can the US prevent its slide to #2? Or, do you think there’s nothing the US can do about losing its spot as the #1 economy in the world?
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7 Comments
US has turned the corner towards communism and as long as elites run and control the money supply we a free people will lose.
David hale you are a idiot
Brandon, David is expressing his opinion. You are only name calling.
I am hoping this doesn’t come true. So sad. China should stay as China and leave us alone regardless of the situation. The feds need to be replaced by younger minds. Our government needs an overhaul, or restructure! The feds are crazy!!!
As long as this administration is in control, we don’t have much of a chance to become the super power we once were. They are dismantling our form of constitutional republic. The leaders are weak and no one in that administration seem to know what to do about anything EXCEPT to attack whites, the rich, companies, police, laws, and others. They allow open borders and don’t test for Covid or other diseases, bussing and flying them all over the country, which explains the surge. They don’t care about all the money they’re printing to pay for the uneducated to thing “the government will take care of me,” (to get their vote) as if it grows on trees and no one will have to pay it back. Sad. I’m watching America being destroyed in less than a year.
well if the communists we have in the shite house and in Congress speaker pelosi , Bernie sanders they are going off of the communists play book first ruin the economy close down everything businesses go bankrupt (check) put people on social programs (check) then yank their services yank everything then these traitors will start implementing communists programs and before you know it hey comrades we are doomed and the vaccine will help them control the people take away or second amendment rights they are evil bastards but there is a God and they will pay for their evil sons against humanity !
well if the communists we have in the shite house and in Congress speaker pelosi , Bernie sanders they are going off of the communists play book first ruin the economy close down everything businesses go bankrupt (check) put people on social programs (check) then yank their services yank everything then these traitors will start implementing communists programs and before you know it hey comrades we are doomed and the vaccine will help them control the people take away or second amendment rights they are evil bastards but there is a God and they will pay for their evil sons against humanity !fuck you democrat commies