An Approaching Power Shift

In January 2009, more autos were sold in China than the United States. 

This is significant. It is yet another indication of the gradual power transition to which we all are witness. 

Of course, China surpassed the US in car sales last month due, in part, to the grinding recession in America. Furthermore, China has an annual boost in sales during the Spring Festival at the end of January. So for 2009, expect to see the US with more sales altogether.

But this news is important not because of the auto numbers themself; rather, it is important because it means that China is within "striking distance" now. A decade ago, the same slowdown still would have left the US far ahead of other countries in auto sales. But today, after a decade of 10% annual growth, China will periodically begin to surpass the US in some raw economic measures.

Before long, the US will enter a neck-and-neck horse race with the Middle Kingdom. With 1.4 billion souls, China can not help but to enter this competition as it develops. Its consumer market will continue to grow. And as this happens, producers the world over will begin to tailor products and services toward China's growing middle class with an abundance of household savings.

This trend should not seem alarmist. Even with the US economy sputtering, China likely will not surpass the US in total GDP for 15-20 years. Furthermore, once it does happen, it does not necessarily portend negative consequences for Americans. There is plenty of room for both nations -- as well as the rest of the world -- to prosper. 

But the effects should also be confronted realistically. Business competition will only get more fierce. With the Chinese market becoming more attractive by the day, the US will lose more business to that country than ever before. Quality of life in America will not increase as quickly as it has in the past as more capital goes elsewhere in the world. People will have to be more willing to move to find opportunities -- possibly even overseas.

However, the most urgent effect of the shift is neither risks to Americans nor benefits to Chinese. It is the risk to the human race. China's selling more cars than the US also signifies the risk to our climate. China cannot develop in the same way as the US has. It must be far less carbon-intensive. And a Chinese society heavily dependent auto transportation -- in its current gas-combustion form -- will magnify climate change severely.

Hopefully this issue tops all others on Secretary Clinton's packed agenda when she arrives in Beijing next week.