GEORGE TOWN: A former Singaporean diplomat has pointed to the United States’ preoccupation with war as among the major reasons China may soon replace it as the world’s top economic power.
Kishore Mahbubani, who for a time served as president of the United Nations’ Security Council, said Washington chose to ignore China’s entry into the World Trade Organisation in 2001 because it was too busy fighting wars in Afghanistan and Iraq.
If Washington had paid enough attention to the rise of the Chinese work force and the ability of the Chinese to work, he added, it might have saved many Americans from losing their jobs.
“The US was busy with war while 800 million Chinese effectively joined the capitalist system, and their economy took off,” he said in a talk at the Penang Institute.
He said the US made another mistake in its neglect to make the “right adjustments” when the purchasing power of the Chinese shot up in 2014.
He noted that the US had a purchasing power parity (PPP) of 25% when China’s PPP was 2.2%. Today, the Chinese PPP is 25% and the US is trailing at 20.2%.
He said only 37% of American households currently had emergency cash of US$500 or more, adding that he believed a higher percentage of Malaysians had at least the same amount in savings.
“The income of the American worker has not gone up for 40 years. This might give you an idea of why Americans are angry and got Trump elected. It is simply because they have never seen their livelihoods improve.”
Mahbubani gave the talk to promote a book in which he outlines ways for western countries, especially the US, to bounce back.
He said the first thing the US and its western allies had to do was to stop policing the world.
He claimed that Asean had done a better job dealing with Myanmar than the western allies had done with Syria.
Whereas the west had turned Syria into a strife-torn country because it used sanctions and military action, he said, Asean had achieved a measure of success in making the Myanmar regime less militaristic through engagement to improve its economy.
He acknowledged, though, that some issues with Myanmar, such as its treatment of the Rohingya people, remained problematic.
He also said the west needed to give better recognition to the United Nations, the World Bank, the World Trade Organisation and other international bodies because “the world is shrinking” and “we need to strengthen the organisation of global governance.”
He said he found it amazing that some western countries were undermining the very organisations they created.