In the Financial Times, investment strategist, Byron Wien argues that despite many assests, America’s decline will not easily be reversed.
America’s decline has been a long time in coming and will not be reversed quickly, if it can be reversed at all. To do so will require exceptional leadership from the next president, since some aspects of life in the US may get worse before they get better …Last year I gave a talk about America having reached its economic peak. I pointed out that England peaked in 1912 and life in the UK was still quite pleasant so I was not too worried about my own country having begun a gradual decline. At the end, a young man approached the podium. He told me he had been reading my work for two decades. I thanked him and then he said: “One thing you should probably know is that Holland peaked in 1617 and life over there is still pretty good also.â€
Tags: America's decline, Byron Wien, economic peak, investment strategist
August 19th, 2008 at 9:38 am
I wouldn’t count on it. The gap between the US and the world will continue to close because American leads the world and eagerly shares what’s made it great. But I would not bet that the most game-changing innovations across all sectors will not continue to be born in the US. Particularly as America continues to become more and more diverse.
America’s future in 2008 looks much brighter than it did in 1978. America always responds best to crisis. We’re slow to change even when we should in good times; but we turn on a dime when things reach a critical point. American remains the most dynamic, democratic and diverse country in the world; and those qualities will always lead it to new breakthroughs just as the doomsday crowd begins to pen its obituary. I would love to put all of the commentaries about the decline of the US in a time-capsule and open them up in just two or three years when everyone is celebrating the US again. Talk about being born under a lucky star, that Obama guy will be a mythical figure by then.
August 19th, 2008 at 7:53 pm
Here’s a fact I uncovered in an analysis of BLS statistics, and which I’ve since seen echoed by economists.
Adjusted for inflation, the weekly paycheck for U.S. workers peaked in 1975, and has been declining ever since. So how have families been able to stay afloat? The second spouse (usually the wife) has been increasingly been forced into the job market, to contribute to their household’s income.
It was once expected that a family would have a full-time stay-at-home parent. Now for most families, this is a unaffordable luxury.
This and other indicators make me feel that things are not getting better here in U.S.
b.
August 19th, 2008 at 8:41 pm
As long as we’re talking about relative decline rather than absolute decline, not only should life remain pretty good for us Americans, it should be better. We spend a huge amount of resources on defense and the other trappings of hegemony. Let someone else shoulder the cost; we can invest those resources more productively.
August 20th, 2008 at 12:35 am
Regarding the opportunity for women to work in the workplace, that opportunity should be viewed progress. And women in the workplace creates additional diversity, empowers women, and increases the overall number of people available to work in the workplace. Also, significantly, many of these women open hip and trendy boutique stores that value-add to the communities and neighborhoods that hose them. This is a very good thing.
And don’t forget that Southwest’s business model draws from female spouses that otherwise would have stayed at hone and unemployed.
August 21st, 2008 at 5:44 am
In some ways Britain peaked around 1840, but it had such momentum that it cruised along until WW1 put the brakes on.
The USA has been in the same situation since around 1960 or so. We are cruising on momentum. But something will put the brakes on ….
August 21st, 2008 at 2:24 pm
Hayden, there is a difference between having the ‘opportunity’ to work and ‘being forced into the job market’.
These two trends overlap in time (and, to a certain extent reinforce each other), but aren’t the same thing at all.
If the real story was restricted to ‘opportunity’, we would see increasing numbers of stay-at-home-dads in straight households, and of two-parent single-income gay and lesbian households. But both those trends are relatively negligible. Two income households are the norm (and most are still struggling to make ends meet).
August 25th, 2008 at 3:48 pm
On one hand, the US median wage is dropping and many, many people are struggling — no argument there.
But the idea that there was a historically a non-working parent in most families is only partly true. For many working class families of the 1940’s & 50’s, the wife working was the norm. My mother worked during most of my childhood.
Before WWII, the country was largely agricultural and staying at home on a 19th century farm definitely wasn’t non-working. One of my grandmothers cooked for the dozen or so lumberjacks of my grandfather’s lumber mill — on a wood stove. She wouldn’t show up in employment statistics, but she had a full time job. The other grandmother was widowed three times, so she often worked but not as part of a couple. When she was married, see farm reference above.
August 26th, 2008 at 10:42 am
The stay-home mom today also is a working mom - she just doesn’t get paid for her work. Some add to family net worth through investing their time and creativity into frugal living (anyone remember the Tightwad Gazette?). A wide variety of service organizations now are in trouble because the volunteer corps they used to count on now chooses to (or has to) work for pay. Apparently, early retirees aren’t numerous enough to replace the housewives. The value these folks add to the GDP is not measured, but it is substantial. Alvin Toffler has called it “prosuming”, and argues that it will be of increasing importance in an information-based economy.