A World of Optimism
Board: Macro Economics
The issue is not that America is in decline.
I don't see that as an issue. Typically issues are in doubt. Yes the American century is over.
However, we are seeing the end of the world as we knew it when Reagan told Gorby to tear down a wall.
We were running out of energy, and Cray built super computers. 300 dollars would get you a digital watch that you had to push a button to turn the LED display on.
There was no cheap long distance, Russians were bad guys who might invade our nation, and the Chinese were all wishing they had some of our left over broccoli.
I say adios to that time and don't let the door hit you in rear on the way out. Today we have a low and dropping need for capital. Partially because of demographics, and partially because we (the world) are so rich compared to a quarter century ago.
The imbalance of trade from Asia to the west is subsiding, energy production is less centralized and advances in alternate energy and material science is moving along at an amazing clip.
Additionally false ideas about the evils of government, and false ideals about the infallibility of democracy and capitalism have been proved false.
More and more quality human capital is being brought online and not wasted every day. While we see failings in the U.S. School system, the U.S. is small compared to the rest of the world and the rest of the world is bringing human capital on line at an amazing rate.
The U.S. and world has endured baby booms. The U.S. in the 1950's and the rest of the world in the 1970's. These are over and the excess labor in the U.S. is washing out of the system. The rest of the world will follow. But not before it sees a real golden age like our period from 1980 to 1999. (People like to say the policies made that happen; I believe that demographics made the policies not the other way around.)
Remember back in the late 1970's, the end of the age of youth. The "Urban Cowboy" put on film for all to remember, the excesses of the baby boomers. The excesses where young men would work all day, get paid a fair wage and then spend the night at Gilly's turning wages into urine.
The same sort of thing is happening in the "developing world"; first they have their 1960's, flower power, upheavals, demonstrations, then their 1970's, then once all the hormones and excess energy is washed out of the system, wealth creation like crazy.
Austerity? Yes if you hide under a rock and attempt to keep the old world.