Daniella Portal Blog Post #4

Daniella Portal

GVPT200

Mark Shirk

11/12/13

The Financial Crisis of 2008 and International Relations

            When the Financial Crisis of 2008 hit, many critics were shocked as to why regulators, markets, and financial exports failed to see it coming.  The fall should be been obviously foreseen, as using the previous US economic crises as support that rising economies must see their fall. Now that it has been a few years after the major damage done in 2008, it is time to address the increasing concern whether the US is loosing is dominant economic position throughout the world, and if China is the emerging superpower. I do not believe that this is the case, and that the United States still has a strong hold on their economic position.

The US currently remained that largest national economy in the world, with an estimated GDP of more than $15.8 trillion, just $2 trillion behind the European Union. Yes, that is a significant difference, but remember that the European Union is a combination of many countries, where the GDP of the US reflects just one country. According to IMF, China’s GDP is expected to exceed that of the US in the next few years and so is the GDPs of small countries like Norway, Finland, and Qatar. However, these smaller developed countries are in no way to compete with the US, showing the GDP alone cannot determine the fate of the global economy.

Another way to assess this issue would be to analyze the rankings of such countries based on the Human Development Index, which assess the national income per capita, life expectancy, education, and other indicators of development. As of 2011, these rating put the US tied at third place with the Netherlands, following Norway and Australia as the top 2. Among global competitors, Japan was the only country who made the top 20. Ironically enough, China was ranked 101, showing the China as a whole is in no way ready to become a global superpower.

Additionally, the US occupies the leading position in the division of labor and production of technology, other indicators of developmental success. Though there is a significant sector of high-tech industries in China, the US is still 20% ahead of them. Also, China lacks the knowledge required for the high-tech manufacturing industry, which puts them at a disadvantage.

The advantage that China has over the US is in regards to the traditional manufacture of intensive labor products, which will eventually put China at the center of this economic sector, however it will be a while until such profit will outweigh the high-tech industry of the US.

There are many more indicators that assess from different angles a country’s position in the world economy. From the brief synapsis above, it is evident that the Financial Crisis did not affect US hegemony. At the time of the crisis, the US was seen as the superpower of the world, and its position has been questionable throughout the past few years. Though the crisis did shake different parts of the financial system, which decreased the productivity in some aspects of the economy, the US currently retains its position as the leader of the global economy.

Works Cited

Supyan, V. "The US in World Ranking: Economic Indicators." International Affairs 59.5

(2013): 130-41. Print.