A relative recently asked me why China (and for that matter the old USSR) does so well at the Olympics? The same relative pointed out just how fast China rose through the ranks over the past five Summer Olympics yet India hasn’t done anything like it, so it is not necessarily attributable to population size.
And even if the US comes out on top in nominal terms this year, if you take the Medal / Athlete average (ratio), I suspect that even if doping accusations prove true (or false), China will probably do a bit better on this ratio (e.g., there are 380 athletes from China and 530 from the US yet as of this writing the two teams are equal with 23 medals a piece).
There are multiple reasons, including the fact that this kind of public event becomes a “face project” (mian zi gong chen) in which Chinese policy makers love to project the “success” of their system and hence spend oodles of money funding them (in contrast, in Canada and the US nearly all of the leagues/teams are supported financially through private companies/donations/sponsorships).
In responding, I also noted that this wiki blurb regarding the East German basketball team which explains another aspect:
In 1969 the Socialist Unity Party of Germany decided to focus its support primarily towards those sports that were most likely to win medals and earn points at international competitions. Since basketball is a teamsport where, in contrast to individual sports, the whole team can only win a single olympic medal, it lost considerable government support. Eventually, the SED banned its basketball players from traveling to non-socialist countries and immensely limited the sponsorship and promotion of talents. Soon, this meant the end of East German international basketball success, which ceded completely after 1973. 
Here in China the state planners (yes it is a ministry level agency called the Ministry of Community Development, Youth and Sports) pick and choose athletes at a young age. Thus there is arguably not a whole lot of internal motivation that a kid that young has to perform at the highest level all the time.
But can’t state planners effectively rationalize objectively who will or will not be a good athlete later on?
No. In fact, this is one of the reasons that the Chinese team sports utterly, for lack of a better word, suck. Which is ironic considering how proponents of socialism (and yes, China is very much a socialist state) contend that its system promotes better coordination and team work.
In basketball for instance, for many years nearly all of the Chinese players were over 7′ tall because the planners pick the tallest kids at a young age to develop, believing that height is the best variable for success. Yet despite this vertical advantage, the players were developmentally stunted in part because they do not have develop creative play-making skills that a mixture of heights arguably affords (as a reference, the average player on Team USA is 6’8″).
In fact, despite Xinhua (one of many state-owned Chinese papers) asking Jeremy Lin to play for the Chinese National team (you know, the former Knick who sparked Linsanity earlier this year), the truth of the matter if Jeremy Lin had attempted to go through the Chinese system as an adolescent, he would not have been able to make the Chinese team… because he would have been deemed too short (he is now 6’3″).
Similarly in soccer, the kids are picked at a young age based on a variety of factors — including penis size! Yet year after year the domestic soccer league and national team are scandalized (scandalized I tell you!) through indictments of fraud, corruption, match-fixing and bribery. Just two months ago the heads of the domestic soccer league, the most famous national referee and the national team captain are either in jail or are being charged with a bevy of abuses.
Li Na actually ranted a bit last year about all of this. She is the first Chinese woman to ever win a major tennis championship and she did so after leaving the state sport system and going “private.” There was a huge uproar because she said that she couldn’t succeed under the current regime (and she didn’t).
And while China may not come out on top in nominal terms this year, I suspect that the Chinese athletes will continue to dominate near the top of the Olympics for many more years to come because the policy makers want to create a powerful public image and will throw immense resources like their Soviet counterparts.
In fact, if you look back during the cold war the Soviet Union was almost always the top dog.
Heck, even after the USSR legally “disintegrated” at the end of 1991, basically the same group of athletes-formerly-known-as-communists participated in the ’92 Barcelona Olympics and won big time. The Unified Team won 112 medals compared to 108 from the US.
Here is how the Soviets did back before it ran out of other peoples money:
Medals by Summer Games
|1952 Helsinki||295 (40)||22||30||19||71||2|
|1956 Melbourne||283 (39)||37||29||32||98||1|
|1960 Rome||284 (50)||43||29||31||103||1|
|1964 Tokyo||319 (63)||30||31||35||96||2|
|1968 Mexico City||313 (67)||29||32||30||91||2|
|1972 Munich||373 (71)||50||27||22||99||1|
|1980 Moscow (host nation)||80||69||46||195||1|
|1984 Los Angeles||did not compete|
Medals by Winter Games
|1956 Cortina d’Ampezzo||55 (7)||7||3||6||16||1|
|1960 Squaw Valley||62 (13)||7||5||9||21||1|
|1964 Innsbruck||69 (17)||11||8||6||25||1|
|1968 Grenoble||74 (21)||5||5||3||13||2|
|1972 Sapporo||78 (20)||8||5||3||16||1|
|1980 Lake Placid||10||6||6||22||1|
So to answer the question, no, the US does not need a ministry of sport. Or any ministry for that matter. Like their Soviet cousins, at some point the Chinese socialist state will run out of other peoples money too and then the athletes that are subsidized will no longer have the advantages afforded to them by the state. In the event that US and Western sport programs are still decentralized and private, they will rise once again to the top.
[Special thanks to: Brian Martinez, Stephan Kinsella and Severin]