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A GDP growth of 3% with a 2% inflation rate is much worse than a GDP growth of 10% with a 5% inflation rate Er, I wouldn't say that at all. It's far more complex than that. In a developed economy with broader wealth distribution (I'm not talking about peaks and valleys, I'm talking about a wider spread in the middle) and decent growth, a few points of inflation annually are the norm and pass by relatively unnoticed for the majority. (Save for spikes in something like, oh, gas.) 5% is not better than 3% simply because GDP is growing more rapidly, most especially when the majority of your population is not benefitting proportionately from that GDP increase _and_ is starting from a very low point in the first place. (Versus a mature economy where inflation outpacing rises in income can more readily be absorbed for an extended period of time by average consumers.)

In China right now, it’s the bottom of the income scale that’s heavily gaining in income. Minimum wage requirements in Guangdong province (where 20% of China’s exports are made) are up - again. Up 20% over the last year. That’s one of the reasons a small shortage in pork creates such a spike now, unlike 6-8 years ago; so many of the working class can now afford pork on a daily basis that demand has greatly grown.

And these labor laws are strictly enforced; one factory I work with over here was audited, forced to pay back wages, and fined double the total of back wages. It’s not the US or the EU, but it’s a lot better than it was 10 years ago, and better than Mexico, India, South America (save for Chile), and other places with heavy exports.

The richest in China are doing fabulously, and you can still live like a king of $3000/month. But the lower rungs are quickly climbing, evidenced by sudden jumps in food prices and housing costs, because they can afford these items. In fact, labor costs have increased so much that some companies are pulling out and moving operations to Vietnam and Cambodia, with even lower labor costs.