FP: Ian, what's the biggest winner of the coming year?Daniel Drezer excerpts the following from this study:
IB: United States.
IB: Oh, absolutely. First of all, it's all a relative game. If you're concerned about the euro, the dollar looks really good, and that gives us a lot more flexibility in this country. I'm a believer in American entrepreneurship. I'm also a believer in quality of life, and when things start falling apart, people look to the U.S. more.
The widespread misperception that China is catching up to the United States stems from a number of analytical flaws, the most common of which is the tendency to draw conclusions about the U.S.-China power balance from data that compare China only to its former self. For example, many studies note that the growth rates of China’s per capita income, value added in hightechnology industries, and military spending exceed those of the United States and then conclude that China is catching up. This focus on growth rates, however, obscures China’s decline relative to the United States in all of these categories. China’s growth rates are high because its starting point was low. China is rising, but it is not catching up.The challenge will be to figure out how to make the US' economic might more inclusive than it is now.