Letting China join the WTO was the worst decision the West ever made

It’s not often that you come across a book that completely transforms your understanding of the world. Just recently I’ve read two. One, Tom Holland’s Dominion concerns the debt we all owe — not just vicars and popes but atheists and social justice warriors — to Christianity’s revolutionary (and frankly still shocking) message that the last shall be first and the first shall be last. The other, China, Trade and Power by Stewart Paterson, is about a seismic event in 2001, three months to the day after 9/11, which shook the world to a degree few remotely comprehend.

Almost none of us is familiar with that epochal moment, yet it changed everything and explains everything: the Blair/Brown spending bubble; Australia’s prosperity; Mexico’s gangland hell; the 2008 crash; the rise of Donald Trump; Momentum, Antifa and the only problem with communism being that it hasn’t been tried properly yet; Brexit; your smart phone; protectionism; the price of houses; the crowds at Bicester Village; the riots in Hong Kong…

All these happened partly or mainly because on 11 December 2001 China was admitted to the World Trade Organisation. The consequences have been mostly great for the Chinese, with millions lifted out of abject poverty. But they have been little short of catastrophic for the West, where, for the small gain of cheaper white goods and toys, we have endured 18 years of industrial stagnation, falling real household incomes, wealth inequality, asset bubbles and political instability.

Consider how different the global economy looked at the beginning of this century. Its core comprised the US, the EU and Japan (the G3), with 900 million people and an income of around $30,000 for every man, woman and child. This bloc — roughly 20 per cent of the world’s population when you add places like Australia, Canada, New Zealand — was responsible for 80 per cent of its economic activity.