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The Myth of America's Decline: Why the 'Declinists' Are Wrong (Again)
It has become conventional wisdom in recent years that America is in decline, perhaps terminally so.
Josef Joffe, a professor at Stanford and editor of the German weekly magazine Die Zeit, turns this mindset on its head in his new book: The Myth of America's Decline."
It's a cyclical phenomenon," Joffe says of the predictions of America's decline. But just as "declinists" were wrong about Russia in the 1950s and Japan in the 1980s, current forecasts about America playing second fiddle to China will also prove wrong, he says.
Related: U.S. Economy Will Trump China's in 2014
"All the Asian dragons and tigers started out at double-digit speed, then came down like Japan to nothing, or South Korea to 4%" growth, Joffe notes. "The [export-driven] model runs out of steam" because it's based on investment at the cost of consumption, and features too much state interference leading to over-investment in certain sectors, leading to declining marginal returns, he explains.
"That is already happening to China," he adds, noting that West Germany went through a similar experience after its initial post-war boom.
In addition to overstating the power of its rivals, Joffe says America's naysayers also underestimate our attributes, most notably:
Bring Us Your Tired and Poor: Immigration has been a hot-button issue throughout America's history, yet we continue to attract and absorb millions of people from around the world. The influx of immigrants helps keep America young -- certainly younger than rivals like Japan and Russia -- and provides "brute dynamism" to the U.S. economy that is unmatched globally, he says.
"The Europeans, Chinese and Japanese cannot handle immigration [which] yields the most precious natural resource in the 21st century economy," he says.
Johnny Can Read: Despite longstanding concerns about America's education system, the U.S. is home to 17 of the world's top 20 universities and 34 of the top 50, Joffe notes. This gives us a huge leg up in terms of attracting the world's best and brightest (see above). Joffe call the U.S. "the world's Ph.D. factory" -- as well as in R&D spending.
Related: America May Be #1 But Our Kids Are Below Average
In his book, Joffe says the biggest threat America faces is from within: If we were to "freeze up" and really limit immigration or severely restrict upward mobility, then America truly might be in decline.
As for President Obama's recent claim that America is suffering from "a dangerous and growing inequality and lack of upward mobility," Joffe is dubious.
"If it is true, then it's serious, that engine of self reinvention would slow down," he says. "But you
can parse [the numbers] either way. The president, of course, is playing politics."
And there's nothing new about that, as with much of what Joffe says is happening in today's debate about America's outlook.
The Myth of America's Decline: Why the 'Declinists' Are Wrong (Again) | Daily Ticker - Yahoo Finance
It has become conventional wisdom in recent years that America is in decline, perhaps terminally so.
Josef Joffe, a professor at Stanford and editor of the German weekly magazine Die Zeit, turns this mindset on its head in his new book: The Myth of America's Decline."
It's a cyclical phenomenon," Joffe says of the predictions of America's decline. But just as "declinists" were wrong about Russia in the 1950s and Japan in the 1980s, current forecasts about America playing second fiddle to China will also prove wrong, he says.
Related: U.S. Economy Will Trump China's in 2014
"All the Asian dragons and tigers started out at double-digit speed, then came down like Japan to nothing, or South Korea to 4%" growth, Joffe notes. "The [export-driven] model runs out of steam" because it's based on investment at the cost of consumption, and features too much state interference leading to over-investment in certain sectors, leading to declining marginal returns, he explains.
"That is already happening to China," he adds, noting that West Germany went through a similar experience after its initial post-war boom.
In addition to overstating the power of its rivals, Joffe says America's naysayers also underestimate our attributes, most notably:
Bring Us Your Tired and Poor: Immigration has been a hot-button issue throughout America's history, yet we continue to attract and absorb millions of people from around the world. The influx of immigrants helps keep America young -- certainly younger than rivals like Japan and Russia -- and provides "brute dynamism" to the U.S. economy that is unmatched globally, he says.
"The Europeans, Chinese and Japanese cannot handle immigration [which] yields the most precious natural resource in the 21st century economy," he says.
Johnny Can Read: Despite longstanding concerns about America's education system, the U.S. is home to 17 of the world's top 20 universities and 34 of the top 50, Joffe notes. This gives us a huge leg up in terms of attracting the world's best and brightest (see above). Joffe call the U.S. "the world's Ph.D. factory" -- as well as in R&D spending.
Related: America May Be #1 But Our Kids Are Below Average
In his book, Joffe says the biggest threat America faces is from within: If we were to "freeze up" and really limit immigration or severely restrict upward mobility, then America truly might be in decline.
As for President Obama's recent claim that America is suffering from "a dangerous and growing inequality and lack of upward mobility," Joffe is dubious.
"If it is true, then it's serious, that engine of self reinvention would slow down," he says. "But you
can parse [the numbers] either way. The president, of course, is playing politics."
And there's nothing new about that, as with much of what Joffe says is happening in today's debate about America's outlook.
The Myth of America's Decline: Why the 'Declinists' Are Wrong (Again) | Daily Ticker - Yahoo Finance
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