Back in the 1960s, economists were confident that the Soviet economy could overtake the economy of the United States by the year 2000. This chart — projecting huge Soviet growth — originally appeared in the 1961 edition of Nobel-winning economist Paul Samuelson’s textbook.
Of course, the Soviet Union never achieved such high growth levels. When the Soviet Union fell apart in 1991, its economy was barely half the size of America’s. Why did projections of huge Soviet growth turn out to be so wrong? Renegade Soviet economist Girsh Itsykovich Khanin argued that the growth rates reported by Soviet authorities were hugely overestimated. While official estimates put the Soviet economy of 1985 at 84.4 times the output of 1928, Khanin estimated that in reality it was only 6.6 times the 1928 output. Bad data from the Soviet authorities led economists like Paul Samuelson to make bad projections.
While there are no projections that today’s Russian economy will overtake that of the United States, many economists are projecting that China, which has experienced three decades of 9.8 percent average annual GDP growth, is poised to trump America.
Here’s why they’re wrong.