Image by Beverly & Pack via FlickrAmericans everywhere continue to espouse the view that they live in "the greatest country on earth". This is so ingrained in the American psyche that the words are spoken as a matter of fact, without question. It makes me wonder how the rest of the world views Americans who continue to believe this in the face of a creeping, almost overwhelming sense, that the American century has officially ended.
I wonder how the people of Sweden, Norway and Finland think of the average American who truly believes those words. With an almost complete lack of poverty, free education (including university), an abundance of natural resources and societies where violence, while not absent, is not an every day fact of life as it is in most American cities, citizens of these countries must be puzzled by it. I know I am.
As a Canadian, I am always rooting for our friends in America to get their act together, and arise once again to take the lead in world business, finance, and politics. However, the "facts on the ground" so to speak do not bode well for America holding it's current place as the lone super power in the world. I think that, within the next 20 years, America will be relegated to a regional power, sharing the worlds attention with China, India, Russia, Brazil and other rising powers. Not only politically, but financially and militarily.
Currently there are 41 million Americans on food stamps. The great recession already ranks as the longest period of weakness since 1932. Millions have lost or are losing their homes. The country has debts that absolutely dwarf other world powers (and are growing continously at this writing) 26 million healthy adults, including the very well educated, are out of work and as middle class jobs keep slipping away to China, India et al, the outlook is not a bright one for America in the 21st century. Certainly not like it was in the 20th century. The American century.
Globalization has been very good for "big" American businesses. Multi-national businesses. However it has not been very good for American small business and it is devastating the American middle class. The unions, who made such huge gains for their members (and subsequently all working Americans) over the past 60 years, are being decimated by big busines's assault on the middle class. Yes, some unions went way beyond their initial mandates of supporting the workers, but that does not take away from the valuable service they provided to the greatest generation and the boomer generation. Gen X and Gen Y will not be so lucky.
Some of the biggest problems will take a decade to work out, such as: the lack of jobs, the hangover of debt, the banking collapse, the depression in real estate, the contraction of the massive defense industry, runaway costs in health care and the gargantuan federal deficit.
From an investment point of view, Americans, at least the smart ones, are finally getting the message that other markets are growing, and will grow much faster than their own in the immediate years to come. A good investor today, is an international investor, not bound by political borders, flags, religion, or politics.
After all, the multi nationals that led us into this mess are a case in point. If you want to prosper through globalization, you must invest in growing economies. With the exception of niche markets and businesses, that does not include America over the next decade.