AMERICA SOON TO BE A HAS BEEN NATION

I have, on this blog and forums I have visited over the last couple of years, warned of the impending decline of the American economy. Of course, my theories and warnings were met with dissent from those who practice the belief in American cultural and economic supremacy. Others simply have a hard time digesting negative reality and stick their heads in the sand in the hope that if they can’t see reality, reality can’t see them.


The most common dissent from detractors, to my proposition on economics, is that it is invalid to assume a “Zero sum” in economics. For those who may not know, zero sums in the context of economics, is when one or more entities cannot experience a gain unless one or more entities experience a correlated loss. The opposite of "zero sum" in economics is the theory or belief of infinite wealth for all, meaning that simultaneously, it is possible for everyone to hold tremendous wealth.

I have never argued that an absolute zero sum exists in economics. What I have argued is that the economics of a planet of over 6 billion people is much closer to the extreme of absolute zero sum, than it is the opposite extreme of infinite wealth and opportunity. One thing that discredits the infinite wealth theory, in practice, is our dependence on finite resources to generate real wealth. There is finite supply of “prime” real estate or productive land and there is a finite and depleting supply of oil reserves, which fuels all modern economies. Meanwhile, the earth’s human population continues to grow, increasing demand for finite wealth producing assets and resources, while supplies remain stagnant or decrease. It does not take a mathematician to figure out the consequence of supply not keeping pace with demand.

On another note, there are many people, primarily black conservatives, who talk about the decline of “black America” as if black America is a vessel that sails in the global sea independent of white America. The fact that black people decks are flooded more than others is not an indication of black failures, because we are not navigating the running the ship. The water flooding the lower deck is not an indication of the navigational failures or faulty construction of black people, but rather, white America. You see, black people are aboard the vessel America and as the vessel sinks, the groups disproportionately on the lower deck will get the most water. This is what is happening in America and hence what appears to be black failures is really an indication of much greater failure of the navigation and structural integrity of the vessel America, run by white America.

The truth of the matter is that while America is feeling good about itself by juxtaposing itself with other Americans and the relative problems they have, many other nations are starting to surpass America in future economic indicators like educational attainment and so forth. Asia is experiencing a renaissance that is promoting its rise and Americas fall. The rise of China and India and its resultant effect on America should be a glaring indicator that yes….economics is much closer to zero sum than people want to believe. If it was not true, the rise of China, India or any other previously undeveloped nation should have no negative consequence upon any other countries, but it does.

I won’t go on further, but will provide this link to a FORTUNE magazine recent article concerning America’s economic future.

http://www.fortune.com/fortune/articles/0,15114,1081269,00.html

We’re not building human capital the way we used to. Our primary and secondary schools are falling behind the rest of the world’s. Our universities are still excellent, but the foreign students who come to them are increasingly taking their educations back home. As other nations multiply their science and engineering graduates—building the foundation for economic progress—ours are declining, in part because those fields are seen as nerdish and simply uncool. And our culture prizes cool.

Many iconic U.S. firms—Coca-Cola, Procter & Gamble, Texas Instruments—already do most of their business and employ most of their workers outside the U.S. Conversely, some of the most American brands you can think of—Hellmann’s mayonnaise, Jeeps, BV California wines—are owned by non-U.S. companies (Unilever, DaimlerChrysler, and Diageo, respectively). To complicate matters further, many products of U.S. companies are made outside the U.S.—Maytag refrigerators are no longer made in Galesburg, Ill., but in Mexico—while many non-U.S. companies make products here—your new Toyota may have come from Kentucky. Now add a few more twists: Your Dell laptop may have been assembled in Malaysia from parts made by American companies in Thailand.

All those university graduates in China and India threaten U.S. living standards in another way. Paradoxically, it’s not because they’ll end up working for U.S. employers, but because some of them won’t, finding jobs instead with domestic companies in their own countries. That’s a problem for America if many of those graduates are top students in science and engineering.

For the U.S. the loss of technology leadership could be historic. Without that advantage, there would be little to prevent living standards in the world’s interconnected economies from equilibrating. The rest of the world’s living standards would rise, and—at least in the near term—America’s would decline.