I agree with you that Chinese education in grades 1-12 is vastly superior to the failed public schools in the West with the exception of Finland. However, the educational system starts breaking down in China at the university level. Furthermore it has been beneficial to be a child in China due to the one child policy enforced for so many years. Without other siblings distracting parents' time a child can be the little emporer or princess. The truth is that Chinese students are vastly superior academically than their Western counterparts upon entering the university. But by the second year the broken Chinese university system turns their bachelor degree into just a piece of paper since it is nearly impossible to fail. In many classes students do not even have to open a book to pass. It is a four year country club and the graduate degrees can be earned through copy and paste generally. It is for this reason that universities in Western countries have attracted so many Chinese students.
Thanks for the great post that raises this subject but I think you are looking very narrowly at this issue without considering the larger influences and dynamics involved. My experience with young Chinese is that they are not as health minded as the previous generation and they did not learn from struggle. If China has a crisis many young Chinese today do not have the endurance nor the developed expertise to compete effectively in a global environment where cheap labor is no longer a comparative advantage.
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Actually, i'm not really trying to say the educational system is at an advantage, i'm merely comparing the differences. In my opinion, your long term development is largely determined by what you are exposed to when you are young. And in the case of the Chinese educational system, if you are exposed to nothing but test passing and rigorous academia and nothing else, then it's not going to be beneficial once you come out of the system and enter society.
You are right, that the younger generation of Chinese are not as 'healthy minded' (i guess that's what you meant) in that they grew up in with much better circumstances than their parents did and so did not go through struggles. I think it has a lot to do with the disparity of treatment whilst in education and post education.
Once you are freed from the repressed education system, it is as though you are owed freedom and suddenly you lose all drive to achieve anything else.