BRIC Summit Nonsense

This week’s BRIC* summit has been in the news. Breathlessly. Because … you know … America sucks.

I’ll be the first to tell you that China is going to be the # 1 economy in your lifetime.

I’ll also be the first to tell you that it will be back to # 2 in your lifetime.

I’m about the only one that will tell you that India will be # 1 by the time you retire.

But … let’s not get premature about this: growing is not the same as big.

And Russia shouldn’t even be included in any prestigious international groups. It’s reason for being there is missiles.

Brazil is a somewhat different case … it may end up as big as the U.S., but it’s going to take centuries — they have to grow both their economy and their population to catch up.

Here’s a chloropleth of the sizes of these newcomers:

This is using World Bank data, evaluated at current exchange rates. World Bank is probably a bit biased towards the U.S. Because this uses exchange rates, it is probably an underestimate of the size of each economy.

Here’s another:

This paints a different picture. This uses IMF data (which tends to be biased against the U.S.). It also uses purchasing power parity, which tends to overstate the GDP of poorer countries. And … this isn’t even complete: each countries GDP is understated by 10-25% here (maybes I should have added some Canadian provinces or Mexican states).

The truth is probably somewhere in between these two.

* BRIC stands for Brazil, Russia, India, and China.