Rumors of America's Decline are Greatly Exaggerated
We're Better Off Than We Like to Pretend
In 2021 and 2022, I spent some time traveling around America, mostly by car. I saw plenty of America’s troubles – poverty, homelessness, inflation, the lingering effects of the COVID-19 pandemic. But one thing that impressed me was just how well America was doing. I saw a lot of happy people, living great lives, in nice homes, in beautiful parts of our diverse country. And despite all the doom and gloom, I saw a lot of Americans who managed to weather the pandemic just fine and made the most of an unfortunate situation. To be sure, I saw ravaged Rust Belt towns, unused storefronts left over from shuttered businesses that hadn’t survived the pandemic, and neighborhoods and localities that weren’t thriving. But having traveled in Europe some, I’ve been impressed by how much better off the average American appears to be than the average citizen in other counties, even in other wealthy countries like the U.K.
And the data bears this out. Mississippi, the poorest state in America, has a higher per capita income than France. California’s GDP is larger than Italy’s and Russia’s (including before the Russia’s elementary incompetence was exposed by their disastrous invasion of Ukraine). And America’s economy – for all that inflation, and bank failures, and recession fears have been plaguing us – remains the strongest economy in the world. Even wage stagnation was a myth.
In college, I worked on the floor of a factory. This was in 2015, and we were already hearing about the decline of American manufacturing (another myth). But I noticed that all of my coworkers had smartphones, most of their children were going to college and were already on track to have a better economic future, and they seemed to like working at the factory (which paid for an ice cream party for the workers, among other things).1
Recently, we’ve heard a lot about how trade (especially with China) over the last thirty years has ravaged the American economy. Thirty years ago, as China was first entering the global marketplace, the United States contributed 24% of the entire world’s output. Today, after China’s impressive rise and our 2008 recession, the United States contributes 24% of the world’s output.2 Other than maybe Tencent and Alibaba, all of the most important companies in the world are American companies.
Why, then, are we so pessimistic about our place in the world?