Trump Economist Backs Biden's Stimulus PlanPosted By Rod Kaufman |
"Foreign companies are turning their backs on the United States, taking advantage of China's booming economy and superior management of the Covid-19 pandemic.Originally Posted by Alfredo ViegasAll the Wall Street economists had China post very convincing rebound in economic activity starting in Q2 last year and this upcoming year they are on average expecting China will grow above trend as it continues to recover. Since China started on its economic expansion in the late 1990s the growth has been unbelievable and whether or not anyone wants to believe the “official GDP” the fact is that today coastal China and Beijing are very much first world in every aspect of the phrase. I go to China frequently and have been going for the past 20 years and the transformation is outstanding. More importantly the quality and capability of the Chinese workforce has also increased by many magnitudes.
While i despised Trump and found him wholly lacking as President, I do believe the subtext of his China fears — namely that China will eclipse the USA in the next 10 years if we don’t do something. However, I manifestly disagreed with his approach which was protectionist and trade restrictive. In 1959 the USA was shocked with the USSR Sputnik launch, rather than bemoan and isolate ourselves we funded NASA and marshaled much of our private sector resources to catch up and eventually we not only landed on the Moon but we also invented the modern CPU. I would prefer that the USA invest in the future and this means not just investment in technology but also even more importantly investment in our citizens and to improve education. Last year China graduated 37% of its college graduates in STEM, I think the equivalent number in the USA was like 4%. This is a huge deficit and as we consider the future GDP growth paths for China or the USA, we cannot divorce the fact that without a highly educated workforce the USA GDP will struggle to grow much above 2% following this bounce year... Unfortunately, I think the knee jerk response from Washington will be to create more safety nets and move the USA even more toward France\Europe like socialism. Well... maybe that’s not too bad, Europe is a nice place to live, and the British have mostly gotten over losing their empire and being relegated to minor world power...
Direct investment in the US by foreign companies plummeted 49% to $134 billion last year, according to a report released Sunday by the United Nations Conference on Trade and Development. By contrast, foreign direct investment in China grew by 4% to $163 billion in 2020."
"2020 marked the first year in history that foreign direct investment in China overtook that of the US, according to the UN. China is now the world's largest recipient of foreign companies' investments.
Although Covid-19 was a large factor in foreign direct investment tumbling in the US -- and most places around the world -- the drop-off in foreign companies' American investments began well before the pandemic."
https://www.cnn.com/2021/01/24/investing/us-china-foreign-direct-investment/index.html