Ron
I am not sure that we should be talking about "Freakonomics" in the Miss Universe thread....but WTF...
At work, we have been doing serious economic modelling for some high power Government Agencies, where we want to take a detailed look at some future scenarios vis-a-vis the shifting economic dynamics in the World as China continues to grow at a very fast pace. As your article rightly points out, Australia has shifted it old alliance with England and , to an extent , the West and re-aligned its Busines and Social model on Asia, We have massive resources and very little second and third tier manufacturing, in essence we are a giant quarry...shifting dirt all over the World...especially China these days.
In that is a strength and also a weakness. Recent history proved that it is a robust model for our times..but this may not hold good for the long term.
Central to our economic modelling is the relativity of demand from the awakening economies...China, India, Indonesia - wherein some 70%+ of the World population is located...thus even though "per-capita" these folks have a lot less than developed countries...there is a heck of a lot of them !!!!...and they slowly will increase their individual demands towards the "life of material pefection" so well advocated by developed countries, led by USA.
If, over the next few decades, even a small percentage of these people have small increments in income, lifestyle, possessions, the scale of it all has huge implications for the changing patterns of demand for Australian resources...could be all good news, or could be a disaster.
Hence we must seriously look at the consequences of China (or somebody??) soon becoming the "largest" economy.
Our research suggests that China WILL achieve this, and we also dont think that USA has seen the last of the bad news about its own economy...not by a long way, sadly.
It is not for me or my team to coment on what USA should do...we are only small fish in THAT pond...but for the research we are doing inside our own sphere of influence, what we are finding is very important for our future here, stuck at the end of the planet...a Western Country (by background and tradition) being inescapably grafted into Asia .
