American Economics Thread

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Serb

Junior Member
Registered Member
proelite said:
Are software products and brands not tangible assets?
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Yeah, but they are too redundant in their economy. Physical production is abysmally scarce. You should never put all your eggs in one basket. Everything is about harmony. Also, you should probably avoid attempting to provoke a rival industrial hyperpower into a hot war then idk. Better accept who you are nowadays and stop being so arrogant as you are still WW2 lever industrial powerhouse, to not embarrass yourself.
 
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styx

Junior Member
Registered Member
A fanatic pro-American Italian commentator wrote this article, which I have translated into English. What do you think?

Another fantastic figure, confirming the excellent health of the American economy: 256,000 new jobs in December (net of layoffs) and a further decline in the unemployment rate (at 4.1%, one of the lowest in the world). Over the past year, 2.2 million new jobs were created. Another positive signal comes from a less expected area: health. The longevity of Americans (which had seen a decline) has started to increase again. In 2024, the average life expectancy rose by almost a year, and mortality fell by 6%. When these figures are aligned with others and observed in a global context, one conclusion is clear: America remains number one, even stronger in some respects, and its model triumphs over all alternatives.
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It wouldn't seem so. If America is thriving, someone forgot to tell its citizens. The majority of Americans are dissatisfied, pessimistic, and disillusioned. We’ll see how Donald Trump addresses this widespread negative sentiment in his January 20 Inauguration Day speech. But public opinion is clear: two-thirds believe America is on the wrong track, and 70% think the economic situation is bad. Trust in institutions has hit historic lows, with only 20% of Americans trusting their government (these are pre-Trump victory figures, indicating a long-term trend). Even love for the country is waning. A quarter-century ago, in 2000, 70% considered patriotism important; today, only 38% do. As for divisions, we know how polarized American society and politics are. The last election slightly eased this polarization—since the rightward shift affected all categories, including ethnic minorities, women, young people, and traditionally progressive states—but the country remains a population of "housemates separated" by strong ideological, moral, and political differences.
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Now, a scholar offers an intriguing thesis to reconcile these two sides of the coin. American superiority and internal disorder are interconnected, feeding into each other. They are not contradictions but rather compose the modus operandi of this society and nation. This argument is put forward by Michael Beckley, a professor and researcher at Tufts University, City College of New York, and the American Enterprise Institute. He details it in an essay published in the latest issue of Foreign Affairs, the most authoritative geopolitical journal. The title is striking: "The Strange Triumph of Broken America." Or shattered, depending on your preference. In short, his thesis is this: we should stop talking about American decline based on superficial symptoms of internal malaise. America is the strongest because it is divided, in a sense; and it is divided internally because it is the strongest.
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To begin, some data on American superiority. Beckley's figures echo analyses we recently encountered in the Draghi Report. The United States not only maintains the world’s strongest economy but also holds the same 26% share of global GDP it did in the early 1990s, during the so-called "unipolar phase" (when the Soviet Union had collapsed, and China was just beginning its development). In 2008, the U.S. and Eurozone economies were equal in size; today, the U.S. economy is twice as large. It is also 30% larger than the entire Global South combined (emerging countries from Asia to Africa to South America, excluding China). Even China is shrinking relative to the U.S., a gap underscored by Chinese behavior: they are transferring hundreds of billions of dollars abroad and increasingly emigrating to the United States. In Japan, Germany, France, England, and Italy, wages for workers are much lower than those in the poorest U.S. state, Mississippi.
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The stereotypical image of America as a paradise for the rich, the Wild West of unbridled capitalism, a land of extreme inequality, reassures Europeans who wish to cling to an illusory sense of superiority. But it’s pure denial. Over the last 30 years, the U.S. has increased the incomes of its lowest earners more than the average. The poorest 20% of Americans saw a 74% rise in incomes (compared to 55% for the average). This trend has accelerated in recent years. Since 2019, the wages of the least qualified workers have seen the most dynamic growth: ten times greater than the highest earners. These figures are astonishing to European "denialists" but explain why America continues to exert an irresistible attraction, with immigrants from all over the world (including Europeans).
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The American economy has its issues, even significant ones. Total debt—combining public and private—is 255% of GDP. But China’s is 300%. And China doesn’t have a currency everyone else wants. On this note: talk of the dollar’s decline has persisted since the 1960s, reaching a crescendo after the 2008 financial crisis. Yet the dollar still accounts for 60% of global foreign exchange reserves, the same level as in 1995. It’s used in 90% of global trade transactions and 70% of financial operations worldwide. Monetary supremacy is matched by energy supremacy. During Jimmy Carter’s presidency, the U.S. was the world’s largest energy importer (vulnerable to the 1970s oil shocks). Today, it has achieved energy independence, surpassing Russia and Saudi Arabia in oil and gas production. At the same time, it has heavily invested in renewables, and its per capita carbon emissions have fallen to levels seen 110 years ago. Another visible superiority lies in innovation: American companies generate 50% of global tech profits, compared to 6% for Chinese firms.
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Yet, yet… Xi Jinping and Vladimir Putin often speak of American decline. It might be propaganda to distract their people from the failures of autocracies. But many Europeans also believe this America is ailing. Within the U.S., as we’ve seen, public opinion is gripped by negativity. Do they care about being the best in the world if they believe their country is in crisis? Knowing it’s much richer and more dynamic than Europe or China doesn’t comfort them.
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America’s internal crises, however, have been far worse in the past, always followed by resurgence: after the Civil War, Reconstruction; after the Great Depression, victory in World War II and a period of hegemony; after setbacks in Vietnam and Iran, the Cold War triumph over the USSR and a series of technological booms.
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Beckley explores the connection between America’s strengths and its cyclical internal instability. First, the nation is shaped by structural factors—geographic isolation and protection; a positive demographic trend in a shrinking world—that foster security and self-sufficiency but can lead to political missteps.
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Then there’s the peculiarity of its political and institutional history. "Other democracies developed strong states first, then democratized," Beckley observes. In the U.S., it was the opposite. "It began as a democracy and only started building a bureaucracy in the late 19th century." Hence, the U.S. constitutional system "maximizes freedom and limits state power, curbing public administration while facilitating private enterprise." While these traits seem historical, they’re still visible today. For instance, "building a society or enforcing a contract in the U.S. takes half the time and bureaucracy compared to Europe. As a result, Americans create two or three times as many businesses as in France, Germany, Italy, Japan, or Russia." The U.S. system is also the best at turning scientific discoveries into industrial applications, more critical than pure science for long-term economic development. Additionally, its internal federalism drives fierce competition, forcing states to correct errors to avoid losing residents and tax revenue.
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These forces—geographic vastness, natural resource wealth, positive demographics, decentralized institutions—define the American exception but can also become sources of instability or fragility. "They accentuate disparities between dynamic and lagging areas," which Beckley associates with the urban-rural divide. "Foreign trade and immigration enrich the nation but tear its social fabric, devastating entire working-class communities." This likely explains the rise of protectionism—against imports and illegal immigrants—that appeals to both left and right.
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Finally, there’s self-sufficiency. America is almost unique in this regard: exports account for just a tenth of its GDP, compared to an average of 30% globally. Since the U.S. is largely self-sufficient in essentials like food, energy, and technology, isolationism is a tempting strategy. Historically, this has led to strategic costs, such as inadequate deterrence investments against adversarial powers. Currently, the U.S. spends relatively little on defense (more than Europe, but the comparison should be with China and Russia). It faces a recruitment crisis in its armed forces. Like in previous eras—between the World Wars or before Korea’s invasion—the U.S. "is sending an ambiguous signal to the world, akin to a yellow light; and yellow lights often prompt aggressive drivers to accelerate."
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T

tokenanalyst

Brigadier
Registered Member
styx said:
A fanatic pro-American Italian commentator wrote this article, which I have translated into English. What do you think?
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The total debt of the US already passed the 350% with 120% public and 245% private I guess. i would give him the US dollar but I think with so many sanctions and the threat of global tariffs looming is looking a bit grim.
 
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