a quote from Andy Grove of Intel. With the ascension of China and Russia and the suppression of freedom at home, the new multipolar, illiberal world has some 3 billion "New Capitalists" that are outperforming the U.S. and threaten the pillar of our empire, supremacy on the free market.
Fareed Zakaria, editor of Newsweek International, widely-praised analyst of geopolitical trends and noted fiscal conservative (but as the son of an Indian politican, not a xenophobe) has a new article out for June 12th.
"How long will America lead the world?" he asks.
"America ... [is going] down the tubes," [Andy Grove] says, "and the worst part is nobody knows it. They're all in denial, patting themselves on the back, as the Titanic heads for the iceberg full speed ahead."
Zakaria himself is hopeful, but worried:
America's problem right now is that it is not really that scared. There is an intelligent debate about these issues among corporate executives, writers and the thin sliver of the public than is informed on these issues. But mainstream America is still unconcerned. Partly this is because these trends are operating at an early stage and somewhat under the surface. Americans do not really know how fast the rest of the world is catching up. We don't quite believe that most of the industrialized world--and a good part of the nonindustrialized world as well--has better cell-phone systems than we do. We would be horrified to learn that many have better and cheaper broadband--even France. We are told by our politicians that we have the best health-care system in the world, despite strong evidence to the contrary. We ignore the fact that a third of our public schools are totally dysfunctional because it doesn't affect our children. We boast that our capital markets are the world's finest even though of the 25 largest stock offerings (IPOs) made last year, only one was held in America. It is not an exaggeration to say that over the past five years, because of bad American policies, London is replacing New York as the world's financial capital.
Now, Zakaria is a (dynamic) conservative, and he likes Bush, (and Clinton) though not for any of the reasons you'll hear anyone else praising Bush on radio or tv. Zakaria notes that Bush is increasing most higher education science education funding, because:
Much of the concern centers on the erosion of science and technology in the U.S., particularly in education. Eight months ago, the national academies of sciences, engineering and medicine came together to put out a report that argued that the "scientific and technical building blocks of our economic leadership are eroding at a time when many nations are gathering strength."
...The national academies' report points out that China and India combined graduate 950,000 engineers every year, compared with 70,000 in America; that for the cost of one chemist or engineer in the U.S. a company could hire five chemists in China or 11 engineers in India; that of the 120 $1 billion-plus chemical plants being built around the world one is in the United States and 50 are in China.
There is a huge cultural problem making our economy less competitive, though Zakaria himself places more blame on government policy, while including the fact that more people will graduate this year with degrees in sports-exercise than electrical-engineering. Zakaria's silver lining:
What we can do is take the best features of the America system--openness, innovation, immigration and flexibility-- [he is against the guest worker program or the H.R. 4437] and enhance them, so that they can respond to new challenges by creating new industries, new technologies and new jobs, as we have in the past.
Our greatest danger is that when the American public does begin to get scared, they will try to shut down the very features of the country that have made it so successful. They will want to shut out foreign companies, be less welcoming to immigrants and close themselves off from competition and collaboration. Over the past year there have already been growing paranoia on all these fronts. If we go down this path, we will remain a rich country and a stable one. We will be less troubled by the jarring changes that the new world is pushing forward. But like Britain after Queen Victoria's reign, it will be a future of slow, steady national decline. History will happen to us after all.
Unfortunately, Zakaria places much credence in the optimist symbols of the economy's current health, like GDP. While his analysis is thoughtful, well-rounded, relevant and useful, the short term is far more disturbing than even presented. Ronald Reagan's Assistant Secretary of the Treasury, Paul Craig Roberts, a high priest of supply-side declares we are now a Nation of Waitresses and Bartenders. Yes, not only are Americans at negative savings and the country itself in the hands of foreign banks and China capable of offering more cheap labor and trained scientists than we could ever dare challenge, our republic's citizens are simply not making money! Yes, a waitress in Oakland makes far more than a Micronesian could ever dream of, but she is still probably poor, and our poor are suffering terribly amidst our "boom"; poverty is growing at something akin to the desertification of the world.
Our GDP is high and continues to grow because the nation considers a single one of its supercitizens, a CEO or boardman of a multinational, to be more the definition of our country than 50 middle-class workers. Our rich have amassed the greatest wealth in the history of the world, but even if that is so, that bottom 60% don't know what the hell economists are talking about.
The Bureau of Labor Statistics payroll jobs report released May 5 says the economy created 131,000 private sector jobs in April. Construction added 10,000 jobs, natural resources, mining and logging added 8,000 jobs, and manufacturing added 19,000. Despite this unusual gain, the economy has 10,000 fewer manufacturing jobs than a year ago.
Most of the April job gain --72%--is in domestic services, with education and health services (primarily health care and social assistance) and waitresses and bartenders accounting for 55,000 jobs or 42% of the total job gain. Financial activities added 26,000 jobs and professional and business services added 28,000. Retail trade lost 36,000 jobs.
During 2001 and 2002 the US economy lost 2,298,000 jobs. These lost jobs were not regained until early in February 2005. From February 2005 through April 2006, the economy has gained 2,584 jobs (mainly in domestic services).
The total job gain for the 64 month period from January 2001 through April 2006 is 7,000,000 jobs less than the 9,600,000 jobs necessary to stay even with population growth during that period. The unemployment rate is low because millions of discouraged workers have dropped out of the work force and are not counted as unemployed.
If the Republican Party were as aware of the surrounding world as Fareed Zakaria and Paul Craig Roberts, maybe we wouldn't be fearing the onslaught of nativism, reckless corporate welfare and class exagerration, but, to pull a tasteless quote from Joely Richardson, "it's not just out there, it's already here." What can be done?