The U.S. has recently reached three major turning points, all of them worrisome.
The first is the news report that China has now officially overtaken the U.S. as the largest economy on Earth, and indeed in all of history. The International Monetary Fund now calculates that the Chinese national output of goods and services this year will be $17.6 trillion (measured in real purchasing power, or purchasing power parity), compared with ours of $17.4 trillion. In terms of share of the global economy, China is 16.5% of the world’s economy, compared to 16.3% for the U.S.
It is also worth noting that last year, China overtook the U.S. to become first in global trade.
This is a major and rapid change. Only fifteen years ago, we produced nearly triple what they did.
As the report’s author (Brett Arends) rightly notes, “[m]ake no mistake. This is a geopolitical earthquake with a high reading on the Richter scale.” Political power depends upon military power, and military power in turn depends upon economic power. We have been the dominant world power since the early twentieth century, and Britain was the dominant power from the early nineteenth century until the early twentieth. With all our faults, we were and are democracies. China isn’t, and it doesn’t show any sign of ever becoming one.
For those with that peculiar form of myopia called “isolationism,” let me sketch out some consequences of this change. China, through its explicit declarations, rapid military buildup, and extremely aggressive gestures toward its neighbors (Japan, South Korea, the Philippines, and Vietnam), has made it abundantly clear that it intends to have Asia as its very own empire...or “Co-Prosperity Sphere.”
Given our economic ties to that region, it would appear that we are in for a struggle. Look for China’s aggressive behavior to ramp up dramatically, as its ally Russia’s has. But where Russia’s aggression will be driven by its economic weakness, China’s will be driven by its economic strength.
The second disturbing milestone is related to the first. It is the unheralded news that our national debt has just hit a new high – of $18 trillion.
This is doubtlessly due to Obama’s spendaholic regime. When he took office – after bashing Bush for running up the deficit, even bluntly questioning Bush’s patriotism – the debt stood at $10.625 trillion. So in his six agonizingly long years in office, Obama has managed to increase our debt by $7.38 trillion, or nearly 70%! And he still has two years to go! This makes Bush look like a piker.
Put another way, if Bush’s record on the debt made him look unpatriotic, Obama must be – what? – traitorous?
Actually, an honest scoring would show that Obama has been even worse. For the TARP bailout was scored against Bush as spending, but it was completely repaid with interest during Obama’s administration, offsetting some of Obama’s spending.
Naturally, the MSM – i.e., the Democratic Party Ministry of Propaganda – has completely ignored the issue of national debt since its preferred hack won office. The debt will only become an issue again to them if a Republican wins the presidency in 2016.
The third problematic development was reported in a NYT piece. It is that the American birth rate has hit an historic low. The American fertility rate (meaning the mean number of children U.S. women have over their lives) now stands at 1.86 – far below the 2.1 necessary to keep the population stable. This is now the sixth straight year of dropping birth rates. We have a lower birth rate than countries such as France (2.01), Australia (1.92), Sweden (1.91), and the U.K. (1.90).
What to make of this, the NYT doesn’t directly say. It quotes one demographer (Andrew Cherlin) who puts a smiley face on the stat by noting that 1.86 still puts us ahead of much of Europe, and anyway, we can always increase immigration. But it is not of much comfort to be behind a country like Sweden. This drop in fertility is worrisome.
The reason why it is worrisome is mentioned but downplayed in the NYT piece – namely, the negative economic changes brought about by this administration’s policies. The piece quotes another demographer, who says chirpily, “On just about every demographic indicator involving young adults, whether it’s marriage, buying a home or delaying childbearing, it’s all been on hold since the beginning of the recession. ... I think it’ll come back up, and each time new numbers are coming out, I think maybe this will be the moment.”
But the moment hasn’t come yet, now has it?
Indeed, we have been recovering since the recession ended five full years ago now, but each year the birth rate keeps falling. I think it is obvious that Obamanomics is one of the main causes of the plummeting birth rate.
First, the ramping up of the student loan program (which was nationalized and dramatically expanded by Obama) has had the unintended negative consequence of raising tuition rates astronomically, and saddling many students with massive debt that cannot be discharged in bankruptcy. This is deterring students from getting married and starting families.
Second, Obamacare has clearly retarded the expansion of full-time work. We’ve seen this in the massive shift to part-time work, the swelling of the SSDI disability rolls, the huge number of people out of the workforce, and the painfully slow hiring of full-time workers.
Third, Obamanomics involved raising taxes on the people most able to start and expand businesses, and deliberately keeping corporate taxers the highest in the developed world, resulting in slower business growth and corporations moving abroad. This in turn has meant fewer high-paying career jobs for young people.
In fact, Obama’s policies are also the main causes for our slow growth (allowing China to surpass us) and the unprecedented massive national debt we now face.
It is simply amazing how much damage one corrupt ideologue can do.
Gary Jason is a senior editor of Liberty and author of the new book Disturbing Thoughts: Unorthodox Essays on Timely Issues (available through Amazon).