There’s no need to focus on consumption. It’s pointless simply because our wants are unlimited.
The unlimited nature of our wants raises an obvious question about why some can consume more than others? The answer is that some produce more than others. Which to most is a statement of the obvious. The exception is economists and economic analysts.
Gordon Chang is one of those economic analysts mistakenly interested in consumption. He believes the alleged failure of people to buy things results in economic decline, or when it comes to China, much worse.
Consider Chang’s recent piece for The Hill titled “Spiraling domestic consumption is wrecking China’s economy.” This won’t age well. Chang is allowing his boundless disdain for China to blind him. And it’s not the first time.
In 2001, Chang published The Coming Collapse of China in 2001. It didn’t age well either.
While Chang predicted collapse, American businesses continued to expand in a nation that was happily shedding its collectivist past. To use but one example, there were 368 McDonald’s restaurants in China in 2001 when Chang published his book, but as of 2025 there were 5,500. Notable there is that the previous number is already dated. As you’re reading this there are 7,700 McDonald’s in China, and by 2028 the corporation projects 10,000.
Please remember this as Chang promises wreckage for China’s economy. If we gloss over his bias that calls into question his past predictions, they would be difficult to take seriously even if Chang lacked the track record that he has.
That’s because Chang’s problem yet again is his focus on consumption. He imagines an impossible scenario of production without consumption. No, there’s no such scenario. See McDonald’s. Would it really be so rapidly expanding in China if consumption in China were “spiraling downward”? Hopefully the question answers itself. And more.
All that matters is production, after which consumption mirrors the latter.
Chang would presumably say consumption doesn’t mirror production, that against all logic and empirical reality revealed in iPhone, movie ticket, and Quarter Pounder sales, China’s economy is “export led.” There's no such thing there either. To export is to import, by definition.
The above would be true even if what’s not true were in fact true, that the Chinese are producing without consuming. It wouldn’t matter one iota if so. Say it repeatedly that consumption mirrors production.
Assuming what’s not remotely true, that the Chinese people want nothing in return for their herculean production (something belied yet again by U.S. commercial expansion in China), China’s economy would still be powering soaring global demand. That’s because the act of saving in no way subtracts from consumption.
Lest the consumption focused forget, banks don’t rent savings so that they can stare lovingly at the money. They would be insolvent if so. Money saved is quickly loaned out to individuals and businesses that have near-term consumptive needs. To save the consumptive fruits of production is not to withdraw consumptive power from the economy, it’s to shift it to other hands. And it’s a bullish, pro-growth shift. Think about it.
Entrepreneurs can’t be entrepreneurs, and businesses cannot expand, without capital. Translated, they’re reliant on the very savings Chang believes foretell economic decline.
The savings that Chang believes will take China’s economy down foretell growth in the country. As opposed to shrinking consumption, savings expand it as the unspent wealth is used by producers to increase production, and by extension, wealth.
Needless to say, Chang’s latest prediction won’t age well. Bet the opposite. History says you’ll prosper.
