Is the American Dream Over? (NO! Decline does not have to be inevitable!)

American Thinker ^ | 11/09/2010 | Steve McCann

[SeekAndFind]

A major topic of conversation within the corridors of power in Europe and Asia is the decline and potential end of the United States as a major global economic power. This is in part a reaction to the desperate and foolhardy monetary policies of the Federal Reserve, trying as they are to mitigate the effect of enormous national debt and a restructured economy bequeathed to the American people by the "progressives" in the governing class over the past fifty years. But it is also a realization of what will happen to the global economic structure if the United States does not regain its previous world standing. 

Recently, Der Speigel in Germany ran a six-part article entitled "Is the American Dream Over?" As expected for a left-wing publication, there is the obligatory demonization of conservatives and the Tea Party movement and a lack of acknowledgment that the policies advocated by the social democrats in Europe and the United States are the root cause of the nation's financial problems. From the article:

The United States is a confused and fearful country in 2010.  American companies are still world-class, but today Apple and Coca-Cola, Google and Microsoft are investing in Asia, where labor is cheap and markets are growing and hardly at all in the United States.  Some 47% of Americans don't believe that the American Dream is realistic.

However, the essay does conclude that the American dream is over if the United States does not start producing products that are needed and become competitive in the world and domestic markets. Further, the U.S. must cease using the valuation of the dollar as a weapon to monetize its debt (which will ultimately bring down the global economy, with Europe and the America the hardest hit).

In an interview, Rolf Langhammer, Vice President of the Kiel Institute for the World Economy, when questioned on the issue of trade between China and the United States and the value of their respective currencies, said,

In many cases, companies that are based in the US can't survive on the global market because they don't have innovative products or the qualified workforce required to develop them.  When China allowed the yuan to gradually appreciate by some 20% between 2005 and 2008; there were no signs that this helped US businesses on a global market.  The crucial thing is that a country must be positioned with the range goods it wants to export.  The US is still lagging far behind in that respect.

Yet the current policymakers in Washington, D.C. are focused on a schizophrenic economic policy of printing more dollars -- which threatens not only domestic inflation, but also a global currency war -- while continuing government spending on an unsustainable basis and suffocating businesses with higher taxes and new mandates and regulations. 

The domestic and foreign consumption of goods and services produced in the United States is vital to reduce deficits, stabilize the dollar, and reset the U.S. economy. The overall structure of the economy must be addressed.

The service sector now accounts for over 81% of the U.S. Gross Domestic Product. An economy so dependent on services, which have no intrinsic uniqueness and comparatively low productivity, is highly susceptible to the vagaries of global and domestic economic factors. The rapid advancement in technology allows many of these services to be performed by fewer employees and, in some cases, in other countries with lower labor costs.

The statistics concerning the manufacturing sector of the U.S. economy are devastating. Per the Bureau of Labor Statistics, the percentage of workers employed in industry has declined from 21% of the workforce in 1980 to 9% in 2010. That represents a loss of nearly nine million jobs. The value of manufacturing shipments, inventories, and orders between the first nine months of 2010 and 2000 has declined 21.2% (adjusted for inflation).

Manufacturing's share of the U.S. economy stood at 11.9% in 2007. By comparison, manufacturing accounted for 16% of the economy in 1993 (a decline of over 25%). That trend is continuing. As a point of reference, the postwar peak was 28.3% in 1953. This same sector accounts for 23% of the German and 34% of the Chinese economy. Both countries are quickly recovering from the recent global financial crisis as compared to the stagnation the U.S. is experiencing.

This decline in the manufacturing base has also had a major impact on the massive trade deficit that has enriched other countries. Due to the lack of viable products produced in the United States and demanded by the American citizen, imports from other nations have taken up the slack. In 2008, U.S. manufacturers produced $912 billion worth of manufactured goods that were exported to other countries. These exports helped pay for somewhat more than half of the $1.5 trillion of manufactured imports U.S. consumers and producers consumed. This trend has been ongoing for over 25 years.

Unless and until there is a national policy established to re-industrialize the United States and reduce the size of government spending at all levels from the current 45% of the Gross Domestic Product back to the historical average of 34%, the naysayers from around the world will be justified in questioning the end of the American dream.

The steps necessary to restructure the economy and save the United States from the fate looming over the horizon are basic and achievable. 

First, the American public must become aware of the true and potentially devastating nature of the nation's problems. Politicians must be willing to tell the unvarnished truth and articulate potential solutions which will require sacrifice by all citizens in order to get government spending under control.

Second, energy independence is essential.  There is no viable "green" solution to our energy problem in the near future. Therefore, all geographic areas other than the extremely sensitive must immediately be open to exploration and development with suitable, albeit reasonable, environmental safeguards in place. Vast domestic natural gas and petroleum deposits are available to be exploited onshore and offshore, if regulatory and statutory hurdles are removed, and could generate huge numbers of good-paying jobs.

Third, the permitting process for industrial development, including a recognition that environmental protection has greatly improved over the past two decades, must be streamlined and given a strict timetable established by the federal government and the individual states.

Fourth, a reform of the product liability laws and the entire plaintiff/defendant relationship in court is a necessity.

Fifth, reduce or temporarily end the tax burden on corporate income derived from the production and sale of U.S. products. 

Sixth, "buy American" can no longer be just a slogan, but a goal together with reducing the trade deficit by 75% through expanded exports and reduced imports.

Seventh, encourage business investment in research and development through tax credits and grants.

Eighth, assure the health of small businesses through permanent tax reductions and access to capital.

The American worker is still the most productive worker in the world and can compete with anyone. China, with a ticking time bomb of the growing expectations, both economic and political, within a massive population, should not be viewed as an invincible industrial adversary. 

It is up to all Americans to continue the American dream. It can be done. It is in our DNA. We cannot allow those in Europe, whose own destiny may be that of becoming the world's largest outdoor museum celebrating its glorious past, to question our future.

[Frantzie]

Idiots elected a muslim a few years after 9/11 helped by TV, Hollywood and the media. As long as idiots watch TV - little will cheange. The elites/dems/left/islamists hold power over the moronic masses who watch TV. FACT.

[PetroniusMaximus]

The decline is related to the loss of morality.

As long as one continues to diminish, the other will also.

[mountainlion]

We are in the early rounds of a 12 round fight. We have won a couple of rounds but in the words of John Paul Jones “We have not yet begun to fight” The last rounds of the fight are when blood is shed like the American Revolution.

[warchild9]

The answer lies in individuals, not government policies.

1. Get to know your neighbors; isolated people have no power.
2. Stop wasting energy by getting all riled up with highly-paid strangers pandering to your prejudices and fears on talk radio. Turn that crap off and closely examine your own life.
3. Remember: sports is fantasy, not reality. It’s designed to reduce an adult’s thinking level to that of an adolescent.
4. I’m a believer that a connection with the Creator is crucial to each person, however they may pursue it. We’re not alone, and this big ol’ rock was created.
5. Politicians serve only those who bribe them. The system isn’t the answer. I’ve dealt with them, and I know.
6. Finally, and most important: keep your family and friends close. That’s where your true strength lies.

Decline is NOT inevitable, unless we surrender.

[bigbob]

A good article that affirms my own belief that the decline of US manufacturing can be turned-around.

Sorry but this won’t happen by faith or miracles - government-created problems require government-created solutions, including a sea-change in public policy and unprecedented levels of open and bi-partisan leadership.

Think of in in local terms - if a forest fire were raging on the outskirts of town or a rising river threatening to flood the city, we would be working hand in hand as neighbors without regard for political ideology. And our national economic situation is just that dire.

I hope the new Republican Congress can start laying out the plan to the American people in preparation for the 2012 elections. Now more than ever we need leaders who will speak with one voice and unite behind a plan to restore the US manufacturing strength

[Marty62]

The decline of the United States finacially is a planned economic attack. The election of the most inexperienced and I dare say intellectually challenged is not a simple blip in the grand scheme of things.

I submitt it was well planned.

My worry is that Soros is pulling another of his Gold Scams. He and his group of 100 investors ran the price of Gold up in 1983, and once they managed to get the suckers to buy, he and his group sold at enormous profits.
Does anyone know how to track WHO is buying Gold?

[Clock King]

People will have to experience real pain for them to change. Until reality literally bites them on the a--, people won't wake up. Ayn Rand's Franciso said it:"The rotter who simpers that he sees no difference between the power of the dollar and the power of the whip, ought to learn the difference on his own hide-- as, I think, he will."

[TexasRepublic]

The American Dream does not have to end, but it would take a revolution to reverse 50 years of Liberal-caused damage, because the LIbs will fight us to the bitter end. The only way to make wealth and create jobs is grow things, mine things, manufacture things and sell things abroad. To do those things will require removing 50 years of roadblocks.

[hosepipe]

American Dream............
http://www.youtube.com/watch?v=-AirhUmpNm0&feature=related