Crowning the dragon: Chinese GDP PPP will exceed America's by year's end.

[The Brain]

Destroying the Chinese state seems plausible. Hit the center hard enough to make the rest descend into warlordism.

[Admiral Yi]

I have come around to Timmy's POV.

GDP is most useful as a proxy for state power, so plain vanilla GDP is better.

Per capita GPD is  more  about quality of life, so here PPP would make sense.

[Valmy]

How so?

And does it matter? Do people look at GDP PPP figures for military top trumps?

Shouldn't they?  I mean unless they plan on purchasing their military gear and personnel from abroad.

[grumbler]

GDP is most useful as a proxy for state power, so plain vanilla GDP is better.

Per capita GPD is  more  about quality of life, so here PPP would make sense.

Agreed.  PPP is oriented towards basic consumer goods (like food and shelter), not capital goods.  Since there is a basic level of PPP per-capita GDP below which a country or group cannot since and still remain alive, PPP GDP doesn't capture surplus very effectively.  Surplus, though, is what a nation can employ as "state power."

[CountDeMoney]

Britain could have conquered about as much of China as was within reach of their ship's cannons.

In short, the important parts.

[Jacob]

Color me skeptical.  This is the Eric Hobsbawm Marxist interpretation and it is not that they are necessarily incorrect, but in the past whenever I just go along with whatever they say I tend to find out later they were just making shit up.  Like 'how can we make this complicated and long process very simple and all about economics?'  So yeah perhaps the British Empire was this organized and systematic and focused that they were destroying massive industries.  Nehru certainly thought this was the case.  But I would be interested in a more modern approach to confirm this story, or at least give a more detailed account of how it came about.

Really?

Next you're going to suggest that the Brits didn't create famines in India by converting vast amounts of agricultural land to growing opium poppies?

The destruction of the Indian cloth manufacturing industry is, as far as I know, well established historical fact. I mean, do you expect that the hundreds of millions of Indians didn't wear much clothes until they started importing from the UK mills?

[Ideologue]

I have come around to Timmy's POV.

GDP is most useful as a proxy for state power, so plain vanilla GDP is better.

Per capita GPD is  more  about quality of life, so here PPP would make sense.

This has major ramifications for who should be nuked by whom.

[Valmy]

Really?

Next you're going to suggest that the Brits didn't create famines in India by converting vast amounts of agricultural land to growing opium poppies?

The destruction of the Indian cloth manufacturing industry is, as far as I know, well established historical fact. I mean, do you expect that the hundreds of millions of Indians didn't wear much clothes until they started importing from the UK mills?

Is it really that established?  There were hundreds of millions of Indians over a vast territory, and somehow the decentralized and chaotic British colonial administration was systematically able to impose a uniform policy that forced everybody to comply?  The Indian government has a hell of a time doing that today.  So I am just sort of curious how accurate these grand sweeping statements are.  Could I really walk into some village in the middle of nowhere in 1910 and nobody would be engaged in cloth spinning or anything?  That seems crazy.  But, as I said, Nehru certainly thought this was the case and maybe he is right.

It is like I get two different versions of the British Empire presented to me.  One that divides and rules and mostly goes through haphazard systems involving layers of local rulers and just sort of muddles along...and one that imposes draconian policies with ruthless efficiency that would amaze a modern government.  Maybe it depends on whether trade is involved.  These weird conflicting images make me...skeptical about my assumptions.  Once I am done with this degree I look forward to learning more about it.

[The Larch]

Many of Ghandi's initial demands concerned the forced cloth trade with Britain. Him spinning cloth to make his own clothing was a revindicative gesture. The spinning wheel is not in India's flag because it's a nice symbol.

[Barrister]

Many of Ghandi's initial demands concerned the forced cloth trade with Britain. Him spinning cloth to make his own clothing was a revindicative gesture. The spinning wheel is not in India's flag because it's a nice symbol.

Except it's not a spinning wheel, it's the Ashoka Chakra, a buddhist/hindu symbol.

[Valmy]

Many of Ghandi's initial demands concerned the forced cloth trade with Britain. Him spinning cloth to make his own clothing was a revindicative gesture. The spinning wheel is not in India's flag because it's a nice symbol.

Oh for Godsake.  I am well aware of this of course.  But attempting to refuse to buy British goods, a good way to hit them if you are looking for independence I hear, does not necessarily mean the complete destruction of Indian manufacturing to the level I had assumed.

[Valmy]

Except it's not a spinning wheel, it's the Ashoka Chakra, a buddhist/hindu symbol.

It is both of those things I think.  Ghandi liked his religious symbolism which, IIRC, Jinnah and the Muslims were not particularly happy about.

[Ideologue]

Except it's not a spinning wheel, it's the Ashoka Chakra, a buddhist/hindu symbol.

It is both of those things I think.  Ghandi liked his religious symbolism which, IIRC, Jinnah and the Muslims were not particularly happy about.

India: love it, or leave it.

Oh right.

[Jacob]

Is it really that established?  There were hundreds of millions of Indians over a vast territory, and somehow the decentralized and chaotic British colonial administration was systematically able to impose a uniform policy that forced everybody to comply?  The Indian government has a hell of a time doing that today.  So I am just sort of curious how accurate these grand sweeping statements are.  Could I really walk into some village in the middle of nowhere in 1910 and nobody would be engaged in cloth spinning or anything?  That seems crazy.  But, as I said, Nehru certainly thought this was the case and maybe he is right.

It is like I get two different versions of the British Empire presented to me.  One that divides and rules and mostly goes through haphazard systems involving layers of local rulers and just sort of muddles along...and one that imposes draconian policies with ruthless efficiency that would amaze a modern government.  Maybe it depends on whether trade is involved.  These weird conflicting images make me...skeptical about my assumptions.  Once I am done with this degree I look forward to learning more about it.

I think it's pretty well established, yes.

In 1897, British statesman Neville Chamberlain wrote a Colonial Office report: "During the present century ... you will find that every war, great or small, in which we have engaged, has had at bottom a colonial interest, that is to say, either of a colony or else of a great dependency like India." The impoverishment of India is a classic example of plunder-by-trade backed by military might. Before being subdued, colonized, and enforced to become dependent upon British industry:

India was relatively advanced economically. Its methods of production and its industrial and commercial organization could definitely be compared with those prevailing in Western Europe. In fact, India had been manufacturing and exporting the finest muslins and luxurious fabrics since the time when most western Europeans were backward primitive peoples.

Hand weaving was tedious and paid little, so at first the British purchased much of their cloth from India. India had no need or desire for British products, so imports had to be paid for with gold. However, Britain did not make the same mistake as Spain; Indian textiles were embargoed and British cloth was produced with the evolving technology of weaving machinery. After India was conquered, its import and export policies were controlled by Britain, which not only banned Indian textiles from British markets but also taxed them to a disadvantage within India so that British cloth dominated the Indian market. India's internal production of cloth was not only excluded from their own internal market so as to be undersold by Britain's inferior cloth, Britain excluded those beautiful and much higher quality fabrics from England while marketing them all over Europe. Controlling India and the seas "entitled" British merchants to buy for a pittance and sell at a high price. Friedrich List points out that the purpose of this control of trade was building Britain's "productive power":

...

Through the forced sales of British products and the simultaneous embargoing of, or high tariffs on, the cheaper yet higher quality Indian cloths, India's wealth started flowing toward Britain. "It was [only] by destroying [the] Indian textile industry that [the British textile industry of] Lancaster ever came up at all." Other Indian industries were similarly devastated. In the words of historian Lewis Mumford:

In the name of progress, the limited but balanced economy of the Hindu village, with its local potter, its local spinners and weavers, its local smith, was overthrown for the sake of providing a market for the potteries of the Five Towns and the textiles of Manchester and the superfluous hardware of Birmingham. The result was impoverished villages in India, hideous and destitute towns in England, and a great wastage in tonnage and man-power in plying the oceans between.

One exceptionally rich sector of India was East Bengal (Bangladesh). When the British first arrived,

[they] found a thriving industry and a prosperous agriculture. It was, in the optimistic words of one Englishman, 'a wonderful land, whose richness and abundance neither war, pestilence, nor oppression could destroy.' But by 1947, when the sun finally set on the British Empire in India, Eastern Bengal had been reduced to an agricultural hinterland. In the words of an English merchant, 'Various and innumerable are the methods of oppressing the poor weavers ... such as by fines, imprisonment, floggings, forcing bonds from them, etc.' By means of every conceivable form of roguery, the company's merchants acquired the weaver's cloth for a fraction of its value.

Later, still under British control and ignoring the fact that the East Bengalis were being impoverished through dispossession of the land which produced their food and cotton, Bengal produced raw materials (indigo and jute) for world commerce, and poppies for the large, externally-imposed, Chinese opium market. As Adam Smith commented, money was lent to farmers "at forty, fifty, and sixty percent" and this, and other profits of trade, would confiscate all wealth except that paid in wages. Of course, Bengali labor was paid almost nothing so Bengal's wealth was rapidly transferred to Britain. Foreign control enforcing dependency upon British industry and siphoning wealth away through unequal trades in everyday commerce devastated the balanced and prosperous Bengali economy and created the extreme poverty of Bangladesh today. "Once it was the center of the finest textile manufactures in the world ... [with] a third of its people ... employed in non-agricultural occupations.... Today 90 percent of its workers are in agriculture or unemployed." The destruction of the once thriving economy of East Bengal (Bangladesh) was so thorough that even the long-staple, finely textured local cotton became extinct.

http://www.ied.info/books/economic-democracy/british

Or if you prefer a more concise wikipedia summary:

High tariffs against Indian textile workshops, British power in India through the East India Company, and British restrictions on Indian cotton imports transformed India from the source of textiles to a source of raw cotton.

http://en.wikipedia.org/wiki/History_of_cotton
Both sources have footnotes in the original if you care to pursue them further.

What is your skepticism based on?

[The Minsky Moment]

GDP is a measure of final goods and services produced.  Nothing less, nothing more.
PPPs are just a logical adjustment in order to make rational like-to-like comparisons between non-tradable services.
I.e imagine two countries that just produce grain, steel, and manicures.  Grain and steel are globally traded so the quantitities produced and values as measured in dollars are going to be very close.  The same isn't true for manicures - Country A and Country B may both have "produced" 1000 manicures, but if Country A manicures cost $1 and Country B manicures cost $10, the services component of Country B will be 10 times larger even though production is the same.  It doesn't make sense to assign a much higher GDP to country B because its residents have to pay higher prices to get their nails done.

The objection that GDP (PPP adjusted) has some deficiency in measuring "state power" is kind of a non sequitur, because that isn't what it is measuring.  Domestic production of final goods and services may have ramifications for "state power" - whatever the hell is meant by that - but so do lots of other things.