I really do hate the current economic climate. No doubt, it's causing pain for a lot of us. For some, it's been an absolute disaster. Even those who have been relatively unscathed are afraid for their financial well-being like never before.
It's tempting, at a time like this, to want to throw the baby out with the bath water, declare that the United States is broken, and that we need to change everything from the ground up.
Unfortunately, the numbers don't bear that out. Don't get me wrong: we really do need to do some tinkering with the model, especially in regards to banking, insurance and health care reform.
Underneath it all, though, the greatness of America is still evident. So, let's not be too eager to tear down the things that could continue to keep us great through the 21st century and beyond.
Let's not lose track of the fact that China may have an astounding growth rate, but that in absolute terms, the US economy has grown more in the 21st century than the Chinese economy has grown in the last 3,000 years.
Literally, we created an entirely new economy, the size of China's entire economy, in less than 10 years right here in the US.
By this I mean, that the entire Chinese GDP is roughly 5 or 6 trillion dollars. (Depending on a lot of factors, and how you measure GDP and against what standard.)
Our economy has grown by about 5 or 6 trillion dollars since the turn of the century.
Literally, it took 3,000 years for the Chinese to grow as much as we've grown in the past 8 or 9 years.
Yes, their growth RATE is impressive, but the reality is that it's only impressive because their economy is transitioning from a medieval agrarian soceity to a modern industrial one. They're literally transitioning from beating the ground with sticks to stealing US intellectual property to build with CNC machines.
In the mean time, they have an abysmal record on human rights, and if not for the fact that they steal all the intellectual property they lay their eyes on, they wouldn't have an economy at all.
The US definition of "poverty" is such that, frankly, only a statistically insignificant number of Chinese people are not living in abject poverty by US standards.
Don't envy them. They can't enjoy double-digit growth rates forever. Once they're industrialized, they'll be subject to the same laws of economics that we are.
We had double-digit growth rates, too, when we transitioned to an industrially based economy, 100 years ago. Difference is, we pioneered that technology. China hasn't pioneered anything in a thousand years.
I wouldn't advise you to put too much of your betting money on China to dominate the US anytime soon. They have to prove they can do something other than steal US innovation and produce it with sweatshop labor ignoring all environmental impacts before I'll consider them a threat to the US.
Our unemployment rate is approaching 10%. Some of you who have travelled to Europe know what I'm going to say next. At our worst... as in "worst since the 1930s", our unemployment rate is basically approaching European unemployment during the best of all possible conditions.
France always has an unemployment rate of about 9.5%. Always. Germany and the UK do a little better with historical unemployment rates of about 7%. The US? Those types of unemployment rates are scandalous and indicative of an economy that's badly off-track.
Those, by the way, are comparisons against pretty much the best and brightest the world has to offer.
So, before we declare that the era of US exceptionalism is over, let's take a deep breath and remember that by almost all measures, the US is still an economic engine that's the envy of the world.
If we can avoid changing things too much, we can lead the world out of this recession and beyond.
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