2 things we Americans believe that aren't true:
1. Japan was able to produce affordable (cheap) manufactured goods because they could pay their workers less than American companies.
2. China and other 3rd world Asian countries can produce affordable manufactured goods because they could pay their workers less than American companies.
The Japanese were able to become a manufacturing giant by developing more efficient processes and factories. They were able to produce more affordable products despite their lack of natural resources and limited land usage. The Chinese (and other Asian 3rd world countries) will be stuck producing inferior products unless they can revolutionize some aspect of the manufacturing process like the Japanese did in the 1950s.
Is China a 3rd World country? Based on their standard of living of the average person, kind of. They have abundant natural resources and many of the advantages that the US, Great Britain, and Germany did in the early industrial age. The problem is that we are 150 years past the early industrial age. China may have the same fate as Russia: abundant natural resources, large population but little to no industrial base and the industrial products that are produced are of low quality. China seems like the boogie man to many but they have problems that limit their power and growth. They have little intellectual property. The new technologies of the information age were invented by Western countries (Japan included). New products and technologies are still mostly invented by Western countries. China has a huge army in terms of people but they have a limited nuclear arsenal and limited technology. Time will tell.
Scott
