The decline of America

A few weeks ago, in response to ex Fed chairman Paul Volcker's comments about the rise of China and a resulting decline of the U.S., I wrote:

I'm usually a glass half empty guy, so Volcker's comments are unsettling.  But to somehow believe that things will never change and the U.S. will stay dominant and all powerful throughout time is naive or, more likely, ignorant.  Things are what they are.  We're gonna just have to "accommodate ourselves to it".

Along the same lines, Rick Newman's U.S. News story on the "9 Signs of America in Decline", is sobering stuff.  Newman uses widely available metrics and paints a disturbing image of a nation on the precipice.  A few highlights:

  -  The U.S. slipped four places in a year and is now 9th on the Legatum Institutes "prosperity scale".  Newman notes "The drop might seem inconsequential, especially in the midst of a grueling recession—except that most of the world has endured the same recession, and other countries are bouncing back faster."

  -  While the IMF projects the U.S. economy will grow 1.9% next year, ten other nations will be experiencing more growth.

  -  At 17%, the U.S. poverty rate is the third worst among advanced nations.

  -  The U.S. ranks 27th for the health of its citizenry and we spend more on health care than any other country in the world.

There's more, including education, competitiveness, employment, prosperity and, even happiness.  While the U.S. is still number one in terms of innovation and entrepreneurship, the other metrics are in decline.

This slip backwards didn't happen overnight.  Federal governmental policies over the last thirty years that have pushed supply side and trickle down economics have had a devastating effect on what was once a middle class in America.  Wages that haven't kept up with inflation, policies that have favored corporations over citizens, a distrust of the government, and an infantile consensus that we can have anything we want and not have to pay for it has gotten us where we are now.

Things change slowly.  But nothing lasts forever.

Comments

[Wes]

This is no doubt more "walden zero" than "swimming freestyle," but I'm interested in your opinion of why we have developed the "infantile consensus that we can have anything we want and not have to pay..."

Also, you counted down primarily government policies leading to the decline and then included "distrust of government." Are you suggesting we trust government to create bad policy?

[Jay McDonough]

Honestly? I think it began during the Reagan years. Hate the government, push for lower and lower taxes. But no one wanted to compromise on the services. Now it seems to be a mindset, a way of life.

While I meant the above when writing "distrust of government", I agree we have every reason to feel we can "trust government to create bad policy"

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Wages that haven't kept up with inflation, policies that have favored corporations over citizens, a distrust of the government, and an infantile consensus that we can have anything we want and not have to pay for it has gotten us where we are now.

[Jay McDonough]

I think that's exactly right.