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Have We Already Seen Peak America? Actually, America Has Never Been So Awesome
A new Bloomberg survey presents the Trumpian finding that 72% of Americans say the USA isn’t as great as it once was. Which got me to thinking: When was Peak America? What was the last really great year? A good case can be made that is was 1999. The bull market was stampeding — the Nasdaq nearly doubled — as GDP grew by nearly 5%. And rivals … what rivals? Russia was only just recovering from its post-Soviet collapse, while Rising China had a long way to go before catching the American economy. Then came 2000. The tech bubble burst and Bush v. Gore. Then corporate scandals in 2002. The start of the long Iraq War in 2003. Katrina. Housing bust. Great Recession and Financial Crisis. Not-So-Great Recovery.
And consider this: The matrix in The Matrix was created by sentient machines to represent the peak of human civilization. And what year did film debut? 1999.
But all this assumes that America isn’t as great as it once was. I dunno about that. Let me stick just with economics, putting aside the huge expansion in civil rights and the ability for all Americans to lead flourishing lives. We’re looking a lot better today than stagnant Europe, stagnant Japan, and slowing, authoritarian China.
And it’s not just a “cleanest dirty shirt in the laundry” thing. Living standards may be rising more slowly in the past — maybe — but America and the American middle-class have never been richer. And I sure do love that magic hunk of glass that gives access to all the world’s accumulated knowledge. Also, so many unicorns. There is no time in which I would rather live. And no place.
Not that America doesn’t face huge challenges, from fiscal disaster to family breakdown to the Long War. But I don’t see why a nation of free, highly educated people acting within the greatest economic operating system ever cannot prosper as never before. And with that I give you Ronald Reagan in 1979:
Published in EconomicsTo me our country is a living, breathing presence, unimpressed by what others say is impossible, proud of its own success, generous, yes and naïve, sometimes wrong, never mean and always impatient to provide a better life for its people in a framework of a basic fairness and freedom.
Someone once said that the difference between an American and any other kind of person is that an American lives in anticipation of the future because he knows it will be a great place. Other people fear the future as just a repetition of past failures. There’s a lot of truth in that. If there is one thing we are sure of it is that history need not be relived; that nothing is impossible, and that man is capable of improving his circumstances beyond what we are told is fact.
There are those in our land today, however, who would have us believe that the United States, like other great civilizations of the past, has reached the zenith of its power; that we are weak and fearful, reduced to bickering with each other and no longer possessed of the will to cope with our problems.
Much of this talk has come from leaders who claim that our problems are too difficult to handle. We are supposed to meekly accept their failures as the most which humanly can be done. They tell us we must learn to live with less, and teach our children that their lives will be less full and prosperous than ours have been; that the America of the coming years will be a place where – because of our past excesses – it will be impossible to dream and make those dreams come true.
I don’t believe that. And, I don’t believe you do either. That is why I am seeking the presidency. I cannot and will not stand by and see this great country destroy itself. Our leaders attempt to blame their failures on circumstances beyond their control, on false estimates by unknown, unidentifiable experts who rewrite modern history in an attempt to convince us our high standard of living, the result of thrift and hard work, is somehow selfish extravagance which we must renounce as we join in sharing scarcity. I don’t agree that our nation must resign itself to inevitable decline, yielding its proud position to other hands. I am totally unwilling to see this country fail in its obligation to itself and to the other free peoples of the world.
No, Americans are not richer. Your link just shows income. It doesn’t reflect the staggering debt we’ve built up over the last 30 years: $18 trillion in federal debt, plus tens of trillions, at least, in unfunded liabilities, plus all the state and local debt. Americans see Detroit, California and Greece and see our not-so-distant collective future.
Reagan was a great President, but he didn’t have to deal with the debt we do. In fact, he (or Congress, take your pick) was able to avoid the tough choices by starting the debt party that has brought us to this point. The debt party, unfortunately, is about over, and all the tough choices we avoided over the last 30 years are going to come roaring back. At that point, the standard of living we’ve had over that time will be revealed for the illusion it was.
Fantastic post. There ARE significant world differences compared to 1999 (which economy and peace dividend was directly related to the economic and national security policies of Ronald Reagan). Among other issues, the incredible instability in the Middle East is now expanding into Europe, central banks now act as bottomless ATM’s, and a stagnant American working class is heading toward a retirement crisis. But 1979 certainly had some similar problems which were major hurdles for their time. Thank goodness Reagan was elected.
On another note: I was surprised to see the late date of Reagan’s campaign announcement. The above video was made in November of 1979. IOW, Biden still has a couple of months to decide.
I agree with some of this. Reagan was great but he also was lucky with a technology boom (which may continue now) and with a demographic boom (which is reversing now). The only good thing you can say about the debt is at least interest rates are super low. The biggest challenge now is how to deal with the aging boomers and entitlements. We can probably do it though.
I think that this statement is the root of the disagreement within the conservative side. What “huge expansion in civil rights” has occurred since 1999? SSM and the LGBT agenda generally.
From the wording of the OP, I take it that JP thinks this is a great thing. Many social conservatives, however, see it as something close to a sign of the apocalypse. To many, SSM is the elevation of sexual deviancy to the status of a sacrament, the debasement of the concept of equal protection as it is supposed to be understood, and a harbinger of a major attack on religious liberty in general, and on Christianity and traditional Judaism in particular.
This is not only a moral issue. SSM was forced upon the country by a series of dreadful SCOTUS decisions, against the will of the overwhelming majority of states and over a contrary Act of Congress (which was passed just 20-odd years ago with overwhelming bipartisan support and signed by President Clinton). The entire episode demonstrates a horrifying breakdown of our Constitutional system.
In my view, things have degenerated badly since 1999, both in terms of civil rights and in terms of faithfulness to our system of government.
The most troubling statistic for the U.S. is its fall in the index of world freedom. The U.S. was once in the top five most free countries, and has now fallen to 16th. The breakdown in rule of law and the rise in capriciousness of the regulatory state is going to be a serious challenge going forward.
Couple this with the rise in racial tensions, the ongoing but increasingly expensive retirement of the baby boom generation and the growth of another demographic bubble of under-qualified and over-entitled 20-somethings, plus the rapid immigration of people who may not share the classic American values, and the future isn’t looking very great if trends continue.
Of course, trends don’t always continue. The U.S. in the 60’s and 70’s was also spiralling pretty badly out of control, and things turned around.
I think 1999 is a good estimate for “Peak America”. Let’s hope there’s another peak to come.
Other things have gone dreadfully wrong since 1999. Our foreign policy is in a shambles, enabling and even supporting some of the worst dictatorships in the world. I don’t think that this needs elaboration.
The economy has grown overall, but the weakness of the labor market is concealed by a pretty good “top line” unemployment figure, while labor force participation has fallen badly.
Government finances have collapsed disastrously since 1999. In FY1999, the federal government ran a surplus of 1.3% of GDP, with receipts of 19.2% and outlays of 17.6%. Debt owed to the public was just 38.2% of GDP, and this fell further in the next few years to a 30-year low of 31.4% of GDP in 2001.
The federal debt (owed to the public) is up to 74.1% of GDP at the end of 2014. Federal outlays were 20.3% of GDP in 2014, and projected to grow to 21.7% of GDP by 2020. The 2014 deficit was 2.8% of GDP. Even these dreadful figures are vast improvements over the situation in 2009-2011, before the 2010 GOP takeover of the House.
Sorry to sound like Jeremiah, but I don’t think that things look rosy at all.
What specific freedom index are you referencing? I’ve looked at several of them, and while some are pretty good, others are misleading, from my perspective, for a variety of reasons. For example, I recall one index (I’m not sure which) that gave extraordinary weight to the LGBT issue.
In other words, from a conservative perspective, some of these indices should be taken with the same grain of salt as a Nobel Peace Prize.
I’m talking about the index of Economic Freedom in the world, produced jointly each year by the Fraser Institute and the Cato Institute.
Note that this does not include social or political freedom – just economic freedom. Gay marriage or other social issues are not in the mix.
https://www.fraserinstitute.org/sites/default/files/economic-freedom-of-the-world-2015.pdf
They look at these factors:
The top countries on this year’s list are:
The U.S. is 16th after Taiwan and before Romania.
Here’s what they say about the decline of freedom in the U.S.:
(Bolding mine)
I’m a skeptic of sweeping conclusions like “a one-point decline in the EFW rating is associated with a reduction in the long-term growth of GDP of between 1.0 and 1.5 percentage points annually”, but I don’t think there’s any doubt that lower economic freedom means lower long term economic growth.
Well, that’s the issue, isn’t it? We aren’t really a “nation of free people,” our freedom index under Bush-Obama has plummeted to 16th, globally. Under our system of higher education, our people aren’t so much “highly educated” as highly indoctrinated. They can spot a microaggression a mile off, but all they know of history is a mash of cultural grievances, and all they know of math and science is “Global Warming is going to kill us all and capitalism doesn’t work.” There are any where from 7 – 14 countries beating the USA in per capita GDP and economic freedom.
It can be fixed, but the longer we go down this path of socialism, the more difficult and unlikely a turnaround become.
As a rational optimist, I don’t see things getting worse. Given our national debt, however, I’m less inclined to see things getting much better until we impose some austerity with expenditures. Free markets, not crony capitalism, pro-business policies, lowering the corporate tax rate as an incentive to bring manufacturing jobs back to the US, and an unwavering commitment to innovation are the solutions to “Make America Great Again.” I hate to evoke He Who Must Not Be Named, but I agree with the author: America is, has been, and always will be, great.
I agree with AZ Patriot. There are a lot of things outside of economics that make people discouraged about America. Technologically and prosperity wise 2015 is better than 1999. However in terms of social cohesion, and prospectively the horizon in 2015 looks much darker than in 1999.
In 1999, we thought war was behind us and the national debt was going to be paid off. We thought that racial tensions were easing, crime was abating, and people were getting rich in the dot com boom. In 2015 war is likely, the national debt is going to sink us, the stock market is up but the spectre of a crash is always forward due to the last decade and a half of experience. Crime is increasing in the cities, racial tensions are at an all time high.
Momentum has a lot to do with people perspective on right-track wrong-track.
“We’re going to hell in a handbasket. But it’s a really fabulous handbasket…”
The Obama Recovery. h/t Zero Hedge
I hate to rain on JP’s parade too, but agree that things are horrible and getting worse. The divide between left and right has become an unbridgeable chasm that I cannot see being bridged short of civil war. The totalitarian instincts of the left are in full bloom and how can they be beaten back? They impinge on every aspect of our lives. I agree that right now, this minute, things don’t seem so terrible, but the trajectory is horrible. So much of what has been put in place, particularly during the Obama years, will destroy us in the near future if not seriously checked.
And this praise for civil rights? Wow, is that ever blind. Civil rights served a good purpose in beating Jim Crow, but since then it has been a destructive force. The push for “equality” is a destructive force. It is no such thing. People who talk about equality these days simply want privilege or other people’s money.
Still, history is surprising, I will grant you that. I used to put a lot of faith in good ol’ Yankee ingenuity. It has saved us many a time in the past. I just hope leftism has not defeated even that.