If Chinese and Indian workers create products and services that are competitive with the U.S., then their standard of living will rise.
In order for these nations to prosper, they will price their products and services below competing products from the U.S.
The result will be a contraction of markets for companies with workers in the U.S. and a lowering of wages. This process will continue until the differences between the standard of living in China or India and the U.S. has vanished.
Unfortunately, the people of the U.S. are not prepared to accept the only deal they are going to get. Instead, we see pie-in-the-sky ideas of how to implement more and more programs, accumulating more debt, and pushing the day of reckoning into the future.
The future is just about here. Zero interest rates have taxed savers and benefitted spenders. This has caused indebtedness to grow to such levels that the interest rates on such debt could not be paid if interest rates were returned to normal.
The government is already providing money as Earned Income Tax Credits for low wage earners. Before the music stops and everyone rushes for the chairs, we will see even more such direct transfers to make up for prior failed policies.
The reason the policies fail is due to the lack of recognition that the problem is that workers must accept a lower standard of living. Taxing "rich people" will not erase this reality, it will only put the government in the position of not solving the problem and cause the wealthy to stop creating jobs.
As an older Baby Boomer, I have witnessed rapid changes throughout my life which have caused people only ten or fifteen years younger than me to experience a dramatically different country than I did. With some luck my prudent habits will see me and my wife through the rest of our lives with some semblance of comfort.
For those who come after us, I see little hope.
Thanks for that excellent post on why the American standard of living is at best stagnate. I would also add that fiat money is working against us and that the only way to save for the future is through investing in tangible assets (i.e. real estate, precious metals, blue chip stocks/bonds or arms)to preserve family/generational wealth.