Chapter 4 3. Starting from China surpassing Japan

In 2010, China's total GDP surpassed Japan's and attracted worldwide attention.Almost all Western media published the news and commented immediately.The British "Times" pointed out that China's jump to the second place in the world is important because it represents a shift in global economic and political power.The New York Times of the United States called this surpassing a "milestone" of China's national strength, "Although it has long been predicted, it still strongly proves that China is indeed in an advantageous position, and the rest of the world must reassess this new economy." superpower".The French "Le Figaro" believes that the long-awaited thing has become a reality, and this development trend has not yet ended.Most Western mainstream economists now predict that China's economic scale may surpass that of the United States in at least ten years or even twenty years.

In contrast, the relevant reports and comments of the Chinese media are low-key, most of which emphasize that China is still a developing country. At present, China's per capita GDP is only one-tenth of Japan's, so China's second place in the world does not have a high gold content.People who hold this point of view can be roughly divided into two categories. One category is those who uphold the spirit of modesty and prudence, keeping a low profile. They see more of the gap between China and developed countries, and they are also worried that an increase in GDP will lead to the burden on the country. disproportionate international responsibilities.The other category belongs to those who can’t see or are unwilling to see China’s rapid development. Not only do they think it’s no big deal that China’s GDP surpasses Japan’s, but they also think that China’s GDP was also the first in the world in 1840, so they still get beaten.

In fact, it is good to be modest and prudent, or to keep a low profile. The key is to be able to look at yourself realistically, and to be aware of the real scale of China's economy today.If keeping a low profile means belittling oneself at will, and finally make the people lose confidence in their own country and in China's development model, that is also dangerous.Those who don't want to see the success of the Chinese model often use this to mislead the public and bad-mouth China, which has caused the spread of the mentality of a big country and a small people among some Chinese people.In order to reverse this situation, we should truthfully tell the people the truth about China's rise.In the past two decades, I have visited more than 100 countries. China is undoubtedly the country with the fastest overall progress and the most improved people's lives in the world.All the problems that China encounters today have also been encountered by other major countries in the process of rising, and they can eventually be gradually resolved in the process of development.On the basis of such a new cognition, we can re-condense the consensus of the whole society on China's development path, and establish a kind of self-confidence, self-respect and self-improvement to hide our strengths and bide our time, rather than low-spirited ones, which will help us better. Respond to various challenges at home and abroad, and open up new prospects for China to move towards greater glory.

As for statistics and rankings related to China’s GDP per capita, I think that as long as two factors are introduced, everything will change: The first factor is to use the currency’s purchasing power parity (PPP) instead of the official exchange rate for calculation.For example, eating in Japanese restaurants is 10 times more expensive than in China.Calculated according to the official exchange rate, for the same meal, the GDP created by Japanese restaurants is 10 times larger than that of Chinese restaurants. By analogy, the error will naturally increase.It is generally believed that the results calculated by purchasing power parity are more reliable, so the international academic community is increasingly using this method for cross-country comparisons, the most famous of which is the famous British economic historian Angus Maddison (Angus Maddison) ) research done.After calculating with purchasing power parity, he concluded that China's economic aggregate surpassed that of Japan in 1992, surpassed the combined economies of 12 old European industrial countries including Germany, the United Kingdom, and France in 2009, and may surpass it in 2015. surpassed the United States (see "21st Century Business Herald" on August 1, 2009).I will talk more about purchasing power parity in the next chapter.

In fact, whether you use purchasing power parity or not, the CIA has always used purchasing power parity to predict China's strength.Americans' talk about G2 today is not groundless, nor is it to "praise China to death", but the general trend. They have to accept the fact of China's rise.It didn't say that to Russia, it didn't say that to India, it didn't say that even to its European allies, but it said that to China, because without China's cooperation, none of the problems facing the United States can be solved.Of course, China is unwilling to join the United States as the world's policeman. Doing so will only make enemies everywhere, and it does not conform to the Chinese people's thinking habits and behavior style.

The second factor is to count the real estate of the Chinese people.The Chinese have the strongest home ownership tradition in the world, and the home ownership rate is the world's leading.We may use household net assets for some comparisons, because household net assets can better reflect the real wealth of ordinary people in a country than per capita GDP.The so-called household net assets refer to the total value of assets owned by a family, that is, the household assets after deducting all debts from real estate, savings, stocks, etc.I don't have data for Japan at hand, only data for the United States, which is more developed than Japan. On March 23, 2010, "U.S. News & World Report" weekly magazine defined the net worth of a typical American household as $84,000 (the typical household has a net worth of worth of 84 000 dollars), and believed that this was the result of the shrinkage of real estate and stocks caused by the financial crisis.According to statistics released by the Federal Reserve in March 2010, due to the financial crisis, the total assets of American households have shrunk by an average of 25%, falling to the level of 2004.This year, the median net worth of American households was $93,000.Converted according to the exchange rate of 1 US dollar equals 6.7 yuan, then 84,000 US dollars is approximately equal to 560,000 yuan; 93,000 US dollars is approximately equal to 620,000 yuan.Even at the highest point in 2007, the median net worth of American households was about 150,000 U.S. dollars, which was about 1 million yuan. How many Chinese households have median net assets of 560,000 and 620,000 now?How many have reached 1 million yuan?I don't have authoritative data in this regard, but I estimate that there are tens of millions of Chinese households with net assets of 560,000 to 620,000, maybe hundreds of millions.Over the past 30 years of reform and opening up, the wealth of Chinese people has increased at a rate that no other country in the world can match.Of course, the Americans are used to large-scale borrowing and consumption. After decades of doing so, they have naturally become the world's largest consumer country, but this has also laid the root of today's financial tsunami.This also has enlightenment for us: we should not imitate the excessive borrowing of Americans, but I think that as long as the property and assets of Chinese people are properly revitalized, China can gradually become the largest consumer market in the world.

As for China’s GDP being the largest in the world in 1840, it was still beaten. That was because China was still a traditional big country in a state of disunity, while Britain already had the form of a "modern country", which enabled Britain to have modern productive forces and nationalities that China did not have at that time. Cohesion and war mobilization.Assume that in 1840, even one province in China could approach the level of the "modern country" at that time.For example, if Guangdong Province developed first and was close to the level of industry and trade in Britain at that time, then the whole war may not happen, because it means that at least your province already has a considerable degree of modern government capabilities, industry capabilities, foreign trade capabilities, defense capabilities, foreign-related negotiation capabilities, etc., all of which were sufficient to deter Britain at that time.The situation in China today is completely different.In terms of national defense strength, as early as the Korean War in the 1950s, the Chinese People's Volunteers wiped out the most elite British troops such as the "Royal Scottish Regiment" in one fell swoop.

There is one more thing to add here.When talking about the comparison between China and Japan, we must understand how the primitive accumulation of Japan's modernization was completed, otherwise it will be difficult to understand the significance of China's peaceful rise today.When China was one step behind in the starting point of modernization, China lost its first-mover advantage in modernization, and finally fell to the point where it was passively beaten everywhere.After the successful Meiji Restoration in the second half of the 19th century, Japan immediately joined the ranks of Western powers that preyed on the weak and the strong, and launched the Sino-Japanese War against China.After defeating China, Japan claimed 230 million taels of silver. What is the concept of 230 million taels of silver?It was equivalent to the fiscal revenue of the Chinese government for three years at that time.Japan used these huge Chinese compensations to invest in education, open factories, build cities, expand its military and prepare for war, and its overall economic and military strength quickly reached a very high level.How much blood, sweat, capital, and resources have been squeezed out of the Chinese people during the primitive accumulation and subsequent development of Japan's modernization?How many Chinese lives were hurt?It's too numerous to write down!In contrast, with the invasion of foreign enemies, the outflow of silver, and the empty treasury, China has declined.In 1900, when the Eight-Power Allied Forces invaded China, China was forced to pay 450 million taels of silver in war reparations, and China became the "sick man of East Asia" at the mercy of others.Looking at the modern history of China, before the Sino-Japanese War and before the "September 18th Incident", China's economy developed rapidly and its national power was on the rise. However, the two wars launched by Japan suddenly stopped China's modernization cause and its economy regressed by dozens of years. Over the years, countless lives have been devastated.In the end, China started from the starting point of being impoverished and impoverished. After decades of unremitting efforts, it took the road of peaceful rise and caught up step by step. Finally, on the basis of modern economy and modern national defense, China realized the economic scale. A true transcendence of Japan. On September 24, 2010, under strong pressure from China, Japan had to release the captain of a Chinese fishing boat it had illegally detained in waters off the Diaoyu Islands. This also reflects the changing power of China and Japan from another aspect.It is in this sense that China's economic scale surpasses that of Japan, which is a great milestone for the future of China and the future of the entire world.