Rating: 
Summary: China's & America's GDP
Review: I think Mr. Lee is quite right. Right from the start of this book Thurow himself puts the 2000 Chinese per capita GDP at $3,700 in Purchasing Power Parity, which is about 10% of America's. Later in the book Thurow claims - probably correctly - that Japan's per capita income, only 10% of America's own in 1950, jumped to America's par in 1989......in LESS THAN FORTY YEARS! So the Japanese must have achieved some sort of miracle. But Thurow when discussing China now says that even by 2100 China's per capita income must still be far far behind America's, and that China will not be an economic powerhouse even then. By 2100! That's almost a century from now. (The truth is, today's Chinese economy is 4.5 times the size of Russia's - whether in PPP, OR nominal GDP. China is already the size of France in nominal GDP - the fifth largest economy in the world after the US, Japan, Germany, and Britain. In PPP, however, China is already the world's second largest economy - after only the US - worth $6 trillion. China is transforming into an economic powerhouse as we speak, whether Thurow can see that or not.) Clearly, Thurow's reasoning is ridiculous unless Thurow believes that the Japanese and the Chinese are fundamentally so different that we cannot expect the Chinese to accomplish what the Japanese managed to do even in the far distant future. But anyone acquainted with China's and Japan's histories knows that China was historically far more advanced than Japan - literally from time immemorial until the last two or three centuries. Moreover, the Japanese themselves describe the Chinese as "same race, same culture," - similar peoples, just like East and West Germans, or Finns and Swedes, or Saxons and English are. I for one cannot believe the mainland Chinese can't get rich like their ethnic brothers and sisters in Hong Kong, Taiwan, and Singapore, or like their racial relatives such as the Koreans and the Japanese. Thurow should remind himself how poor the South Koreans were in 1950 - literally poorer than the Egyptians. No one can say that now. That the Chinese may rely less on exports to develop their economy is irrelevant. After all, the United States did not rely entirely on exports to develop its economy (thanks to its own huge market). There is something really odd about Thurow's views of China's future. It's not that Thurow is too timid, as Mr. Lee claims, but rather that he doesn't seem to have thought everything through before making his statements.Institute for Advanced Study
Rating: 
Summary: Mindboggling statistics (3)
Review: If Thurow is right (that certain measures provide a better picture of GDP growth than pro forma GDP figures), then China's GDP is clearly growing at double digits. China's electricity consumption grew at 15% per year over the past two years (Business Week, Jan 19, 2004). China's steel production has been growing at 20% per year in recent years and is still having trouble meeting demands. (As of 2001, China, not including Hong Kong, was the world's second biggest net importer of steel even though China has been the world's number one steel producer for several years running.) China's industrial production rose something on the order of 13% this year. And China's oil consumption jumped by 30% over last year. The fact is, China is growing at over 10% per year in the aggregate, while Thurow is forecasting 5% at the most - way off the mark. China's official statistics may be unreliable, but not nearly as unreliable as Lester Thurow's own figures. He claims China to be one of his specialties (check his webpage), but all he can do is kibitzing about it like an amateur who doesn't like to bother doing the research for himself.
Rating:
Summary: Mindboggling statistics (3)
Review: If Thurow is right (that certain measures provide a better picture of GDP growth than pro forma GDP figures), then China's GDP is clearly growing at double digits. China's electricity consumption grew at 15% per year over the past two years (Business Week, Jan 19, 2004). China's steel production has been growing at 20% per year in recent years and is still having trouble meeting demands. (As of 2001, China, not including Hong Kong, was the world's second biggest net importer of steel even though China has been the world's number one steel producer for several years running.) China's industrial production rose something on the order of 13% this year. And China's oil consumption jumped by 30% over last year. The fact is, China is growing at over 10% per year in the aggregate, while Thurow is forecasting 5% at the most - way off the mark. China's official statistics may be unreliable, but not nearly as unreliable as Lester Thurow's own figures. He claims China to be one of his specialties (check his webpage), but all he can do is kibitzing about it like an amateur who doesn't like to bother doing the research for himself.
Rating:
Summary: How can one be wrong so much and still be called an expert?
Review: It is so sad how wrong someone can be proven over and over again and still, he/she is rewarded, called a genius and is allowed to teach our youth. Here is a quote from the author: "Can economic command significantly... accelerate the growth process? The remarkable performance of the Soviet Union suggests that it can... Today the Soviet Union is a country whose economic achievements bear comparison with those of the United States." This was in 1989, just shortly before the Societ Union collapsed. Unfortunately, being this wrong in economics gives one awards and allows you to teach college students while being described a genius. Sad. Mr. Thurow may be a 'genius', but geniuses can be wrong too.
Rating:
Summary: How can one be wrong so much and still be called an expert?
Review: It is so sad how wrong someone can be proven over and over again and still, he/she is rewarded, called a genius and is allowed to teach our youth. Here is a quote from the author: "Can economic command significantly... accelerate the growth process? The remarkable performance of the Soviet Union suggests that it can... Today the Soviet Union is a country whose economic achievements bear comparison with those of the United States." This was in 1989, just shortly before the Societ Union collapsed. Unfortunately, being this wrong in economics gives one awards and allows you to teach college students while being described a genius. Sad. Mr. Thurow may be a 'genius', but geniuses can be wrong too.
Rating:
Summary: Export strategy
Review: It wasn't too long ago that Gunnar Myrdal, the Nobel Laureate in Economics, concluded that it was not possible for Asia to export its way out of poverty. He wrote just when Japan was taking off as an exports giant. Lester Thurow faults China for its dependence on exports for economic growth, seeing it as a dead alley. He is wrong for two reasons. First, this strategy makes sense for China for now because of its vast cheap but hardworking (& fast-learning) labor force. What else could China be doing to grow? The Soviet model? China already tried that. Let's do what the Japanese and Taiwanese have been doing with success. Second, this strategy is only temporary. Once China has reached a certain stage in development, its labor force will begin to produce for its own consumers instead. The United States certainly did not rely on exports for economic growth in the 19th century. And I may add that China, the world's most successful economy for three thousand years (read Margaret Thatcher's "Statecraft" for those of you who dispute this), did very little trade with the outside world historically. Its famed silk trade added next to nothing to its domestic economy, even during its height in the 9th century AD. China stayed rich simply because its people worked hard. Thurow would learn more economics if he would only read more history - a typical problem when it comes to economists.
Rating: 
Summary: This book won't make your head hurt.
Review: ItÕs not very often that I read a book on economics that doesnÕt make my head hurt. This is one of those books. I found it eminently readable and interesting. Economics is a geeky affair, but this book teaches us that itÕs as much humanities as it is science. Although this book is a treatise on global markets--with China featured predominatelyÑitÕs something else, too. You will find it interesting to read about why countries steal technology from one and another. It was fascinating to learn about how patents can be used as weapons or strategic pawns in the race to innovate. ÒClusterÓ, ÒpicketÓ, and Òsubmarine patentsÓ are all strategies that can allow one to deny an innovator his innovation. During a recent Christmas season Amazon suddenly announced it had a patent on Òone clickÓ checkout and sought to stop other online retailers from using the Òone clickÓ checkout system. Now, Amazon expected to loose their case, but they gained tremendous advantage by disrupting others. Smart! You enjoy this book as much as I did.
Rating: 
Summary: Economic Enlightenment
Review: Lester Thurow does a great job at dispensing knowledge on current global economic realities. At times his writings smack of american arrogance, and he tends to be inflicted with self attribution bias. Yet again this is acceptable. The US is the most successful nation (like it or not), and Thurow is exceptionally knowledgeable on his subject (again deal with it). A tiny irritant is the large number of grammatical errors, but this should not sway you from purchasing the book. It is interesting to note previous reviews regarding the China dynamic, particulary from Mr Lee (one can assume from the surname that there is an ethnic bias). Thurow has not miscalculated when it comes to GDP figures. He is aware that exchange rates change over time. To assume that China's currency would strengthen thereby leading to a higher recorded GDP is correct (Mr Lee) except for one fundamental flaw. China is dependant on the US maintaining its high levels of consumption. Without this it is unlikely the Yuan will strengthen significantly. In fact a rapidly declining dollar will eliminate a large part of China's competitiveness. As for the suggestion that GDP is more important than per capita GDP (reviewer), this is just false. GDP would only be more important from a military perspective, and there is no reason to believe that China is seeking to economically dominate the world through military might, when capitalism is clearly the better option. Per capita GDP is what counts since high levels of consumption are dependant on the income levels per person. I strongly agree with Thurow's views on China. They currently provide cheap labour, but are not a great consumer nation of high value added goods, due to their low per capita GDP. This book can be considered moderate, and can be balanced by reading books by George Soros, Paul Krugman and John Gray. Finally, what to do about the pending Dollar decline? If the great decline comes, as suggested by Thurow, the solution would be to buy gold, not to seek other markets that may boom, as there won't be any.
Rating: 
Summary: Thurow's mistake
Review: Lester Thurow has some choice remarks to make about China in the new century. He is certainly right that if you extrapolate China's GDP, that country will still be small in 2100. But yes, he neglected to figure exchange rates fluctuations into the equation. China's GDP in 2001 was $1.159 trillion - a mere 28% of Japan's $4.141 trillion. (Let's ignore purchasing power parity for the moment.) After two decades of China growing at 7% per year and Japan at 2% per year, China's nominal GDP will still be a mere $4.486 trillion, versus Japan's $6.153 trillion, in 2021. By contrast the US will be $20 trillion (at 3.5% a year), which is almost twice as big as Japan and China combined. Although China will still be the fourth largest economy in the world, after the EU, US and Japan (and EU must be counted as a unit by then), China will clearly still be a small fry - less than a quarter the size of America's economy! In the meantime, however, it seems inconceivable that the Chinese currency will still be pegged to the dollar at 8.28 yuan. Most likely China's currency will rise gradually as the central government slowly loosens its grip on the trading band over the next 17 years. Should China's yuan be worth twice its present value by 2021, China's GDP, $4.486 trillion in 2001 dollars, should double to almost $9 trillion. While $9 trillion is still small compared to America's $20 trillion and EU's even larger economy, it is no chump change. To say therefore that China will still not be an economic powerhouse by 2200 - 79 years after 2021 - is a prognostication unworthy of a C+ student at Thurow's own MIT management school. After all, in 2003 Japan's economy is only 44% as big as America's, and though it's struggling to grow, it is nothing to sneeze at. China could grow to 45% America's size in less than two decades. In short, my calculations show that in 2021 America could be worth $20 trillion, China as much as $9 trillion, and Japan over $6 trillion. The EU may end up bigger than America - or may not. (EU's path to grow lies more in bigger membership than in economic growth.) That means China will likely be the second or third largest economy in the world less than two decades from now, measured in nominal GDP at 2001 dollars. For those of you who are surprised by this, consider that in 2005 China will surpass the UK in nominal GDP to be the fourth largest economy in the world after the US, Japan, and Germany. Jumping from 4th place to 3rd place from 2005 to 2021 (16 years!) is not exactly my idea of a spectacular improvement. (Some Africa states can leap - or in some cases tumble down - by ten places in a single year! There are 180 some countries, remember.) Can a CEO boast that his company's sales or market value miraculously went up by one Fortune 500 rank in 16 years? The vagaries of currency rates mean that the PPP remains the single best, if unperfect, measure of comparing economies' sizes. The best forecasts show that China's economy will be worth $20 trillion in 2020 or 2021 - exactly equal to America's - given 7% growth for China and 3.5% for America. By THIS measure China could be the largest economy in the world in our lifetime. In either case, China will be huge - like a hot air balloon blowing up before our eyes. How big China will get by 2100 is anyone's guesses. I won't hazard an estimate if only because anything can happen 96 years from now. Thurow should not have gone into this fortune-telling business. Leave that to other "professionals." I cannot believe a distinguished economist like Thurow could have made such an elementary error. British astronomer Martin Rees diffidently puts his money on the Big Bang Theory at "only" 98% chances of being correct, adding, "Astronomers are often in error but never in doubt." In fairness to Sir Martin, the record of economists is far worse. Mr. Thurow is over-confindent in his views, as this book shows.
Rating:
Summary: Recommending that bureacrats be bold .and save the world
Review: Let me begin by saying that I admire and like Dr. Lester Thurow. I would love to have had the opportunity to take a class or two from him. He writes well and he has had some impact on the public economic policy debate over the past couple of decades. I am willing to consider what he has to say not only out of respect, but because I believe one should seek to understand a range of opinions and not just those that endorse our own prejudices and even our own considered conclusions. Are you waiting for the "But"? Well, here it is. My problem with this book is that I can't find a structured argument for its proposals and even its proposals aren't all that specific. It seems to me that serious proposals also need to consider the expected best criticisms to their plan. Great chess players don't make moves hoping their opponents will not see their plan. They make their moves believing that their plan will defeat even the best moves of the opponent. Here, Dr. Thurow makes some anecdotal analysis of the economic problems of the United States, Europe, and Japan (which are not bad, as far as they go), and winds up with a call bold government action being needed to turn things around. Given all his public writing, wouldn't his desire for more government be predictable? He tackles a variety of issues, but comes back to the solution being some kind of government action. Given the mammoth bureaucracies we take for governments nowadays, is it really likely that they will even desire bold action let alone be able to overcome their massive inertia even if they desired act? The way he defines some terms frustrates me as well. I find his describing capitalism being based upon greed a biasing argument, glib, and unpersuasive. Certainly, socialist bureaucrats, tyrants, and anarchists can be greedy as well. Saying that Capitalism is based upon competing self-interests rather than using "greed" would have been a more useful term with a bit more subtlety in making the debate. Also, he lumps big corporation executives into the capitalist class. That could only be true if they actually believed in private enterprise. However, most mega corporations today work hard to use the government to protect them from competition or failure (both required under capitalism). They want to use the power of government to enhance their rewards and distort markets. That isn't capitalism, but it is human nature. While he does touch on this phenomenon on page 42 vis-?-vis the California electricity crisis, I think he sees it as a part of capitalism rather than a corrupting human tendency that needs to be managed and guarded against in any economic system. But this big-government big-business monstrosity is what we have now. However, this is another topic and a debate that is not really germane to this review. His notion of a Chief Knowledge Officer (chapter 9) is, I think, a pipe dream. I cannot conceive of a real world political way for such an office to exist successfully in a decision making process. What would make this person's view of the future any better than anyone else's? Who would anoint such a person as effective? And if they were, wouldn't they seek the CEO role? And if they weren't why would anyone listen to them? He or she would be marginalized quickly and ignored in practice. Dr. Thurow does cite Bill Gates, but Mr. Gates has a unique position as a founder and owner of a huge portion of the company's stock. Mao also ran China after stepping down as Chairman and resigning from the party. That is also not a typical way for a despot to wield power. Both are exceptions that serve to prove the rule rather than provide models for others. Only those on the extreme right would deny a role of the government in creating and enforcing property rights and in promoting competitive markets. And only a few would argue that government ownership of the means of production makes much sense. The debate we all really participate in is the proper role of government in this process and Dr. Thurow states his beliefs and his reasons for them with clarity and energy. However, I don't believe this book is going to persuade anyone on the right. It may be useful to those who agree with Dr. Thurow on the need for more International Government and want to have some more debate material. But I really would have liked to hear more debate on the horrors of the Terror, The Great Leap Forward, and the Cultural Revolution rather than simply saying Socialism is good on infrastructure investment, but poor on infrastructure maintenance. To me, that just seems to be an odd conclusion. Don't get me wrong. Just because I read the book and found myself disagreeing with Dr. Thurow doesn't mean I didn't find things of value in the book or that I don't think you should read it. There are things to think about that will force you to flesh out your position. I am willing to state that he may well be right and I might be wrong, but of course I don't think so. However, I do believe the book could have used a somewhat tighter focus and a more explicit structure to its argument and conclusions. There are footnotes citing reference materials for further reading.
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