From American Affairs Journal, Winter 2022 / Volume VI, Number 4:
Since the start of the war in Ukraine, the question of the size of the Russian and Chinese economies—relative to Western economies—has become highly significant. Early on, policymakers compared the Russian GDP to that of Spain or Italy, for example, as a way of minimizing its global importance. Now that these geopolitical tensions have resurrected Cold War blocs, it is crucial to clarify our understanding of the real size and importance of these economies.
Simple GDP statistics have arguably lulled the West into a false sense of security. By GDP, Western economies appear dominant and their capacity to impose sanctions decisive. But the West’s reliance on service sectors—and the relative weakness of directly productive sectors like manufacturing, mining, and agriculture—introduces critical vulnerabilities in goods production and supply chains. In times of peace and unimpeded trade, such vulnerabilities may seem insignificant. In periods of deglobalization, geopolitical competition, and state-versus-state conflict, however, these weaknesses can have profound impacts, while basic productive sectors take on greater importance. A clearer view of these realities implies a reassessment of the West’s strategic position.....*****
....The Importance of the Productive Sector
When calculated from the point of view of production, GDP is typically broken down into different sectors: agriculture (including forestry and fishing), industry, construction, and services. Strong growth in the service economy has been the trend in the last fifty years across Western countries; service sectors have grown more rapidly than goods production and form an increasing share of Western economies. The “productive” nature of some services is certainly debatable. For example, some studies have sought to include the “services” of drug trafficking and prostitution into the computation of GDP. The question of the real contribution of some services arises even if the development of the service economy in peacetime is perfectly legitimate. But the reasoning changes in times of war or quasi war. During wartime, services lose their importance relative to agriculture, industry, and construction. It then becomes necessary to calculate the share of the goods-producing sectors across different economies in order to have an accurate understanding of how they really compare....
....MUCH MORE
So, you're saying the number of real estate agents in California doesn't really count for much in the geostrategic world?
