The United States of America
President Ronald Reagan said it best: we should strive to be the shining city on the hill. Let's do the best that we can, and lead by example -- as the Good Book says, do unto others as you would be done by.At a societal level, I am very concerned about how impolite we are becoming. Good manners are the essence of civilization, and if we cannot practice them ourselves, we will never be able to instill them in our children.
Economy
At an economic level, I am very concerned about our economy; I believe that all of the economic evidence of the last 20 years shows that "free trade" is anything but -- it seems to be unsustainably expensive. Even Gramlich at the Federal Reserve is having reservations about the level of foreign debt (see Figure 2 from that paper a bit on down this page, it shows a very unhealthy upswing in our foreign debt to GDP ratio) though Gramlich is still firmly in the free trade camp. Robert Rubin puts his concerns about the debt level in general even more strongly in this paper. Another paper on debt concerns by Michael O'Hanlon is here.
Our external debt is growing rapidly:
This is a serious matter. The World Bank has objective criteria for moderately indebted and severely indebted nations:
Indebtedness : Standard World Bank definitions of severe and moderate indebtedness are used to classify economies in this table. Severely indebted means either of the two key ratios is above critical levels: present value of debt service to GNI (80 percent) and present value of debt service to exports (220 percent). Moderately indebted means either of the two key ratios exceeds 60 percent of, but does not reach, the critical levels. For economies that do not report detailed debt statistics to the World Bank Debtor Reporting System (DRS), present-value calculation is not possible. Instead, the following methodology is used to classify the non-DRS economies. Severely indebted means three of four key ratios (averaged over 2000-2002) are above critical levels: debt to GNI (50 percent); debt to exports (275 percent); debt service to exports (30 percent); and interest to exports (20 percent). Moderately indebted means three of the four key ratios exceed 60 percent of, but do not reach, the critical levels. All other classified low- and middle-income economies are listed as less indebted.
Looking at the non-DRS criteria, our national debt to GNI (GNI for 2003 was $10.9 trillion) is certainly over 50% at around 60-70% (our external debt alone is 25% of GNI); our national debt to exports is around 600%-700% (we exported $1.02 trillion in goods and services in 2003) which exceeds the 275% criterion; our national debt service to exports is well above 30%; our interest on our national debt to exports is over the 20% criterion.
Notice that I am using public debt figures; our debt positions as a country are worse, not better, since we are a large debtor nation.
So on all 4 non-DRS criteria, we are already in the "worrisome" category:
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I imagine that the first effect will be that day when Moody's or S-and-P decides to put our sovereign debt "on review" of its AAA status. Moody's has not hesitated to lower Japan, which if you know anything about the Japanese economy in comparison to our own should give you pause, since Japan has arguably a far more robust economy than we do.
For reference, Moody's rating for Japan is based mostly on Japan's large and increasing public debt -- about 170% of GDP while we are still in the 70% range -- but there are some significant differences, including the fact that Japan, despite its lowered rating, is paying far less interest than we are due to accommodative measures from the Bank of Japan and the fact that Japan is wealthy -- Japan has strong positive income from not only its strong exports but also its overseas investments such as the Japanese government's $700+ billion dollars worth of U.S. Treasury debt. Amusingly, Japan is issuing lower rated debt at anywhere for 0% for short term money to 2.4% for long-term money to buy AAA debt (ours), and is benefiting from the spread since we pay over 5% for long-term money.
Strong Defense
A strong defense is as necessary now as it ever has been; the lessons of history have not been repealed, and we must remain strong and vigilant. We cannot ship all of our industry to China and remain a viable military power, much less a superpower. We cannot ship all of our research to India or China, and remain a military leader.
Politics
At a political level, the people have spoken and for the first time since 1984 have had an incumbent capture more than 50% of the popular vote. President Bush has done exceedingly well in the 2004 election, and his coattails have brought in many new Republicans in the House and the Senate.
The previous Republican Congress has been disappointingly spendthrift; not that running a deficit is the worst thing to do in a downturn -- a small fiscal deficit during a recession is usually a good strategy to pickup the economy, but programs such as the new prescription drug "benefit" are far too expensive, and seem to be poorly designed. Like the War on Poverty, this spending simply balloons over the years; and part of what will drive this is the inevitable graying of our population.
I have great hopes that the next Congress will do better at constraining the red ink -- and a great start would be the abolition of the Department of Education.
The Net
One of the great blessings of the Internet is the easy access to fundamental knowledge, as well as current news, and the ability to comment that wonderful sites like Free Republic afford.
In no particular order except roughly geographical, here are some sites that I think are worth knowing about:
China: Good resource for studying Chinese characters
http://www.zhongwen.com/
Germany: An easy way to get Debian
http://www.knoppix.org
Japan: Robb Satterwhite's Tokyo Food Page is the guide to Tokyo's restaurants
http://www.bento.com/tf-rest.html
Japan: A good source of information about Japan sponsored by the Foreign Ministry
http://web-japan.org/
Japan: Japan Journal, general Japanese interest website
http://www.japan-journal.com
Japan: JAXA is Japan's Space Exploration Agency
http://www.jaxa.jp/index_e.html
Japan: Nifty's Translation Service, itself translated
(Long URL)
Japan (Australia): Jim Breen's Japanese webpage
http://www.csse.monash.edu.au/~jwb/japanese.html
U.S.: John Pike's Global Security website has good information, the picture of the week can be particularly interesting
http://www.globalsecurity.org/
U.S.: Linux Distribution Watch
http://www.distrowatch.org/
U.S.: Our Constitution
http://www.house.gov/Constitution/Constitution.html
U.S.: The Amendments to the Constitution
http://www.house.gov/Constitution/Amend.html
U.S.: The main way to get Debian
http://www.debian.org