Refuting "China Is Better Because They're Building 100 Airports."Submitted by fightapathy on Wed, 09/14/2011 - 12:08
In the recent video of the Congressional Jobs Committee at http://www.youtube.com/watch?feature=player_embedded&v=Dgpq-... which features Peter Schiff providing excellent testimony, Congressman Cummings (D) remarked on China's intensive infrastructure building, some 9% of its GDP, and complained about America's less than 0.5% investment in new and repaired infrastructure growth.
Reflecting on Rep. Cumming's statements caused me to conclude that the United States and China cannot be compared in this regard. In fact, China cannot be compared to ANY country in the world.
Here are several points to refute the comparison, should you have this discussion with Democrats or Progressives:
1. China has the money to spend on infrastructure. This is the most important point. They have the cash on hand owing to cash in-flow from their export economy.
The United States is broke by contrast. We are an importing country and any money we spend on infrastructure automatically loses a great deal of investment return by the fact there is interest to pay on the total, and inflation makes future maintenance much more expensive.
2. China has no infrastructure, so they need to build from scratch to meet their new and changing needs. China is a third world country. Mr. Cummings noted they are building 100 new airports, but they have hardly any airports.
By contrast, the United States has a mature infrastructure dozens of times larger than China's and does not need to add hundreds of new facilities.
3. The United States does need to maintain existing infrastructre, that is certainly an inevitability. But that is part of the general liability of mature infrastructure and it is dishonest to include maintenance as part of a jobs creation program to stimulate the economy.
4. China has a communist government that is centrally planned and is making big mistakes in managing its economy. Just like the Soviet Union, it is overexpanding its infrastructure in bizarre ways, and may not have the money to maintain it in the future. The perfect example are ghost cities, some 100 of them, centrally planned, and lying idle or empty.
By contrast, the United States has traditionally built infrastructure to meet an existing need. Highways like I-95 were built to relieve traffic on Route 1, and this spurred existing business to expand, and new business to follow. Generally, when infrastructure is centrally planned, "bridges to nowhere" are sometimes built, and there is little economic advantage to offset the additional maintenance burden.
5. China does not have a regulatory problem holding back infrastructure development. A decree from the politburo overrides all restrictions.
By contrast, the United States has such a regulatory dictatorship that none of the 100 airports China's building could be built here. Some may argue that's a good thing, but it conflicts with the arguments for competing with China for infrastructure expansion.
By this list, one can conclude the two cases are impossible to compare. A mature infrastructure has different needs from a young and rising one. I share Rep. Cummings' jealousy of China's vibrance, but the concatonation of circumstances permitting them to do what they're doing is impossible here. It WAS possible in the 1900s until the 1970s. But our nation matured in that period.
Rep. Cummings used an example of his work at Bethlehem Steel when he was young, and how unhealthful it was. But that's the cost of rapid growth.
Safety and health is a luxury affordable for mature post-industrial economies, not for up-and-coming third world nations. If China adopted the regulatory regime of America and Europe, they will grind to a halt and remain a poverty-stricken, unhealthful third world backwater. This is the harsh reality of economies.
And its too bad Democrat progressives cannot understand it.