I’m posting this quickie (sorry for the typos) as the stock market is busy plummeting so optimism may not be appropriate (my 401k is heavily in stocks and I’m hoddoring for dear life!), but that’s the point: We should have been optimistic, there was no need for a massive course shift, because America is in great shape!
Good quickie. This is a pet peeve of mine. People on both sides have convinced themselves that the US economy is awful, but it has actually been quite good, and we (even the poorer part of "we") are quite rich compared to any other time or place in history. It's not perfect, and there are obviously people living in poverty, but it's not like there's some other model that works better we can point to and say, "Why aren't we doing that?" Any proposed change is a guess at best, and implementing those guesses tends to go horribly wrong (see, e.g., Communism or Brexit).
The US is essentially a poker player about to trade in its full house in hopes it gets back a straight flush. Sure, it could happen, but it's not a great idea.
I could not possibly have a lower opinion of Trump. Yet I started wondering about fairness/ equity with our trade partners. Still haven't found out explicit comparisons of tariffs or other barriers (Or they were too complicated for me to follow.) The libertarian think tank Cato Institute has several articles going back to at least 2020 and note that 90% of economists (must be some kind of record) agree that historically they do not accomplish their purported goals. I'm no more expert than Trump but I would like if possible to identify nonpartisan expert opinion.
Whatever the arguments that a particular targeted tariff might be beneficial in a certain circumstance, what Trump is doing with his widespread and insane amounts actions aren't in the same universe (not ballpark). You might find some arguments that it's a good idea overall for a country to protect its main industries, even if that's not the most economically efficient in an abstract sense. I don't think you'll find any sane argument that it's a good idea to slap tariffs on everything everywhere.
If you normalize for hours worked most European countries do quite a bit better. Americans work an unusual amount for an industrialized country. In fact, many come out ahead of the United States.
Other factors work to Europe's advantage as well. For example, crime in the United States, which is extremely high, is estimated to cost ~15% of American GDP. This includes the direct costs of crime and crime prevention as well as the indirect costs on quality of life. Police cost a lot of money, people are pushed out to suburbs and avoid public places, and so on. Crime in Germany, for example, is ~1/6 as high in as in the United States, so it probably costs ~2.5% of GDP, or maybe more like 4-5% if you account for the fact that Germany has more police per capita than the United States. Accounting for this alone puts Germany ahead of the United States in GDP per hour worked.
Another factor is the fact that infrastructure is way more expensive to construct in the United States than in most European countries. These are the sorts of things people are thinking of when they say Europe has high "quality of life". Of course, the United States isn't poor, that's completely true, but you have to take everything into account.
Americans have more material goods, so we definitely aren’t “poor” but our quality of life is significantly degraded by having few choices about what kind of built environment to live in, being stuck in low quality health care systems, lack of mobility options, poor health in general due to all of the above and pessimism about the future. Our material standard of living is fine.
You can't reason with Trumpists they're halfwits.
Good quickie. This is a pet peeve of mine. People on both sides have convinced themselves that the US economy is awful, but it has actually been quite good, and we (even the poorer part of "we") are quite rich compared to any other time or place in history. It's not perfect, and there are obviously people living in poverty, but it's not like there's some other model that works better we can point to and say, "Why aren't we doing that?" Any proposed change is a guess at best, and implementing those guesses tends to go horribly wrong (see, e.g., Communism or Brexit).
The US is essentially a poker player about to trade in its full house in hopes it gets back a straight flush. Sure, it could happen, but it's not a great idea.
Nice metaphor.
I could not possibly have a lower opinion of Trump. Yet I started wondering about fairness/ equity with our trade partners. Still haven't found out explicit comparisons of tariffs or other barriers (Or they were too complicated for me to follow.) The libertarian think tank Cato Institute has several articles going back to at least 2020 and note that 90% of economists (must be some kind of record) agree that historically they do not accomplish their purported goals. I'm no more expert than Trump but I would like if possible to identify nonpartisan expert opinion.
Whatever the arguments that a particular targeted tariff might be beneficial in a certain circumstance, what Trump is doing with his widespread and insane amounts actions aren't in the same universe (not ballpark). You might find some arguments that it's a good idea overall for a country to protect its main industries, even if that's not the most economically efficient in an abstract sense. I don't think you'll find any sane argument that it's a good idea to slap tariffs on everything everywhere.
If you normalize for hours worked most European countries do quite a bit better. Americans work an unusual amount for an industrialized country. In fact, many come out ahead of the United States.
https://www.reddit.com/r/europe/comments/1g837y2/2023_gdp_per_hour_worked_in_ppp/#lightbox
Other factors work to Europe's advantage as well. For example, crime in the United States, which is extremely high, is estimated to cost ~15% of American GDP. This includes the direct costs of crime and crime prevention as well as the indirect costs on quality of life. Police cost a lot of money, people are pushed out to suburbs and avoid public places, and so on. Crime in Germany, for example, is ~1/6 as high in as in the United States, so it probably costs ~2.5% of GDP, or maybe more like 4-5% if you account for the fact that Germany has more police per capita than the United States. Accounting for this alone puts Germany ahead of the United States in GDP per hour worked.
Another factor is the fact that infrastructure is way more expensive to construct in the United States than in most European countries. These are the sorts of things people are thinking of when they say Europe has high "quality of life". Of course, the United States isn't poor, that's completely true, but you have to take everything into account.
Americans have more material goods, so we definitely aren’t “poor” but our quality of life is significantly degraded by having few choices about what kind of built environment to live in, being stuck in low quality health care systems, lack of mobility options, poor health in general due to all of the above and pessimism about the future. Our material standard of living is fine.