Just one child doomed China’s hopes of overtaking the US.
The Middle Kingdom, once a surging economic growth engine expected to eclipse the US economy in just a few years, is not expected to outgrow the US until the 2040s now — if it does at all.
And it’s largely down to China’s 1979 One Child Policy, which is devastating growth, according to Yi Fuxian, a Chinese demographer at the University of Wisconsin-Madison.
Plummeting birth rates and economic problems have erased the 6+% per year growth that China reported before the COVID-19 pandemic.
Many economists in both China and the West were taken in by the Chinese Communist Party’s inflated official figures, which massively overestimated the country’s consumer power, Fuxian said.
It comes as a Goldman Sachs study found that China’s population began shrinking in 2022, just 13 years after that of neighboring Japan. And its decline is on track to be far steeper, dramatically damaging the country’s economic prospects, the Financial Times reported.
China has a GDP of $21.6 trillion — just two-thirds the size of the US economy.
Yi told The Post that official Chinese statistics have systematically inflated the country’s birthrates and total population figures going back decades.
While official reports claim China has a population of over 1.4 billion, Yi calculates that the true figure in 2020 was “under 1.28 billion,” at least 130 million lower than reported.
India actually surpassed China as the world’s most populous nation years earlier than officially recognized, according to Yi, author of the 2007 book, “Big Country with an Empty Nest,” which criticized China’s one-child policies.
The US, the third most populous country in the world, has 342 million people — about a quarter the population of China.
Yi argues that China’s population actually began shrinking in 2018, four years earlier than Goldman Sachs’ estimate, and more than a decade before the official projection of 2031 to 2034.
Most of this can be attributed to China’s notorious One Child Policy, instituted to limit Chinese families to one child per mother, over fears of spiraling population growth and widespread poverty.
While the policy was relaxed to two children per couple in 2016 and three children in 2021, China’s total fertility rate remains one of the lowest in the world.
China is no longer poor — officially 0% of the population is in extreme poverty, compared to 88% 40 years ago.
But it’s also not rich; the per capita GDP is about $13,800 per year, about 15% of that in the US.
Turkey, Russia and Kazakhstan are all richer than China by that measure.
The country’s total fertility rate fell below the 2.1 replacement level in 1991 and continued to plummet, dropping below 1.0 and now estimated to be just 0.8 births per woman, according to Yi.
Last year saw a record low of just 8 million live births in China. The much smaller US, by contrast, had 3.6 million births.
Yi also blames the economic reforms of China’s former Premier Zhu Rongji in the 1990s, for causing “many problems” that slowed down China’s economic growth and race to catch up with the US.
Decades of strict birth restrictions and fiscal centralization severely curtailed household disposable income in China, to roughly 42-44% of GDP.
In contrast, in the US, that figure is over 70% of GDP.
While this may have helped China’s economy in the short term, allowing it to flood the US with cheap imported goods, in the long run, it may have signed the CCP’s suicide note, according to Yi.
Children function as “super-consumers,” driving much of household spending, he explained.
With China missing several full generations worth of children, this severely crippled Chinese domestic consumption, he argued.
To offset weak domestic consumption, China became heavily dependent on manufacturing exports, an unsustainable real estate bubble, and state-subsidized industrial overcapacity, he explained.
Those policies, “killed China’s economy, the population and the economy — and also killed America’s manufacturing,” Yi said.
China is now one of the oldest countries in the world, with a rapidly shrinking labor pool and aging population. The median age is expected to reach 59 by 2050, compared to 44 in the US.
This means Beijing may never catch up with the US economically — and worse, could face a long-term economic deceleration, Yi argued.
Yi puts the over-optimistic predictions about China’s economic growth down to mainstream economists and Chinese government-aligned institutions relying on fabricated data — assuming China’s population would soon grow five times larger than the US.
This played into the popular narrative that “the East is rising while the West is declining,” he said, while the truth is very different.
“By 2029 to 2035, China will lag behind the US across all major demographic and growth metrics,” Yi said.
However, for pro-democracy activists who might hope that this demographic time bomb could topple the CCP, Yi has a warning.
Contrary to Western expectations that economic development would foster a pro-democracy middle class, China’s rapid aging has depleted it of the young population required to drive political activism.
Just 16% of China is aged 15 to 29, down from 31% at the time of China’s last mass-democracy movement in 1989, which culminated in the communists’ brutal crackdown in Tiananmen Square.
An aging, risk-averse China is far more likely to support a centralized strongman who will safeguard pensions and social stability, Yi explained.
