high time to invade cuba, page-36

Hi Tou,

I'm not certain who is the slave to whose ideology, but I do question some of your observations.

In particular:
"We have a strong trade surplus with China even though they are sending us shiploads of their manufactured and consumer goods. Unlike the US where we will always have a trade deficit".

Strange, but in October 2004, I thought that the ABS figures demonstrated that we had an $800M trade deficit with China, with exports of $1.0B, and imports of $1.8B.

The October deficit with China was almost as large as the October deficit with the USA (~$900M).

As for the upcoming ageing problem in China, I disagree with your views and the naivety of your observations.

The one-child enforced policy in China is fast creating a reverse 4-2-1 population pyramid.

This issue was commented upon by the Financial Times in a major story just prior to Christmas.

Earlier, the Economist (20th May 2004) had written at length on the looming Chinese pension crisis, the lead-in comments of which went like this:
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"THE pension system is a mess, and the government only has a few years to sort it out before a fast ageing population turns the problem into a full-blown crisis. Seven years ago, aware of the problem, China began trying to set up a new system. Unfortunately, it isn't working..."

I have the print copy of that story (but not the electronic copy).

On 7th May 2004, the Australian Financial Review in a major opinion article, titled: The Empty Cradle, noted the following in regard to China (the USA, Europe and Jpan were not immune from adverse comment in this article):
".....To close that gap, the IMF warns, "would require an immediate and permanent 60 per cent hike in the federal income tax yield, or a 50 per cent cut in Social Security and Medicare benefits"....Neither is likely. Accordingly, in another 20 years, the US will be no more able to afford the role of world policeman than Europe or Japan can today. Nor will China be able to assume the job, since it will soon suffer from the kind of hyper-ageing that Japan is already experiencing".

The Sydney Morning Herald also wrote about the issue on 28th April 2004, in the following terms:
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China may grow old before it gets rich, new study warns
By Hamish McDonald, Herald Correspondent in Beijing
April 28, 2004

Faced with a population ageing at an unprecedented rate, China has been warned it may grow old before it has a chance of reaching widespread prosperity.

"Today's great powers became affluent before they became ageing societies," say the US demographers Richard Jackson and Neil Howe in a new study. "China may be the first major country to grow old before it grows rich."

The proportion of over-60s in the population will rise from the current 11 per cent to 28 per cent - and possibly even as high as 32 per cent - by 2040, the year when communist leaders are confident that fast growth will have brought China close to challenging the economic power and strategic size of the United States.

"In Europe, the elder share of the population passed 10 per cent in the 1930s and will not reach 30 per cent until the 2030s, a century later," say Jackson and Howe in their paper for Washington's Centre for Strategic and International Studies. "China will traverse the same distance in a single generation."

By then the country will have almost 400 million elderly people who, unless broad pension schemes are started soon, will have no support. Although China has a healthy national savings rate of 40 per cent, households provide only a tiny proportion of savings and most are invested in dwellings.

Few people qualify for social security and attempts at setting up new pension funds have led to an "empty account" syndrome, where contributions are siphoned away by official institutions to meet the unfunded obligations of state-owned enterprises.

Most rely on traditional old-age insurance in the form of children. But the one-child policy enforced since 1978 has led to the so-called "4-2-1 problem" where one child will be expected to support two aged parents and four grandparents.

The emerging gender imbalance, resulting from selective abortion of females, also means that daughters-in-law, who do the actual caring for the elderly, will be in short supply.

Those healthy enough to continue work will find job-hunting tough. Many Chinese heading into retirement would have missed out on secondary and college education during the 1966-76 Cultural Revolution.

"As elders, they may find themselves competing with teenagers for sweatshop jobs," the authors say.

The warning in the paper titled The Graying of the Middle Kingdom is partly a job application by its funders, the huge US funds manager Prudential Financial Inc. Like insurers worldwide it seems to be eyeing a role in helping China set up a universal pension scheme in time to avert the crisis.

But it adds to warnings by Chinese demographers that looming population imbalances could bring social turmoil.

It also comes as the Chinese Government published details of unemployment, showing that despite recent 9 per cent economic growth, job creation was still far from soaking up the country's pool of surplus workers.

This story was found at: http://www.smh.com.au/articles/2004/04/27/1082831569621.html

As for the joint military exercises, that's news to me (just as it is likely to be news to the Russians and the Chinese).

By the way, have the military garrisons on the Sino-Chinese frontier been de-commissioned or are they still on station?