The financial crisis revealed some of the problems in the U.S. financial sector, and that was just the tip of the iceberg. There are more serious problems that exist in the country’s economic structure, of which the biggest problem is that the defense industry’s proportion is too large. A huge amount of expense on defense is required to support the country’s war industry, while its civil use industry is shrinking rapidly. It is a problem left over by history, beginning in the Cold War. The U.S. and the Soviet Union had been contending for hegemony for 40 years since the end of the World War II. The Americans concentrated their strength on developing their military, science and technology industries. The country was seemingly flourishing with its rapid development in science and technology. However, since the development of their war industry was the top priority, other sectors lagged behind in comparison. Manufacturing industries were to bear the brunt of development in the military industry. Both sides suffered from the cut-throat competition, with the Soviet Union stepping down from the stage of history and the U.S. hiding its own losses from the Cold War with the glory of victory.
Being a massive importer, the U.S. can only rank third or fourth in terms of exports. Over the years, the country has suffered from huge deficits, which is still a problem waiting to be solved. The reason for this is very simple — most of its imports are essentials for daily life. Most of the daily necessities found in the U.S. are made in other countries, while high-tech and military products make up most of U.S. exports. But who needs military products when they are not involved in wars? Besides, there are export restrictions on some of the high-tech products. These are the root causes of the huge deficits.
America owes its success to a cluster of talents from all over the world. A large number of Europeans came to the U.S. around World War II. Combined with a great number of domestic talents, they became highly qualified professionals that contributed to the technological boom of America and helped the country build up a good lead over other countries. By the 21st century, the number of European talents was reduced dramatically: Talent came from Asian countries like China, and India became the think tank of America. Meanwhile, the basic education of the country, especially its education in mathematics and science, fell behind many Asian and European counties. Young Americans have a passion for business but not science — this, in a way, is a hidden trouble for the country.
The power of America is a reflection of its strength. There is a kind of interdependence amongst the capacities of economy, military and science, with the economic capacity serving as a foundation, military capacity as a demonstration of power and scientific capacity as a commander. The development of these three aspects depends on qualified professionals. What contributes to the weakening of the power of this country is that it might face a shortage of science and technology professionals in the near future.
The world has witnessed the Cold War, and the rise and decline of a superpower. We should take a warning from history: First, we should never contend for hegemony like the Soviet Union did, which will only lead to a lose-lose situation. Second, the training of qualified personnel should be given top priority in education.
The problem with the U.S. economy is simply greed. We placed restrictions on industry in the U.S. that, although logical and reasonable, like not dumping your chemical effluence directly into the rivers, still cost a company money…it is also very expensive to live in the U.S., and so companies had to pay higher prices for labor. This caused a loss of profits to investors in these companies, and made it very difficult to compete on a worldwide basis. Those we have dubbed “neo-cons” sought to override these non-profitable factors, and so infested our government, placing those that would “play ball” in power, by utilizing media propaganda & political donations. They were successful. We now have virtually no tariffs on goods coming into the country, and our companies have moved to locations around the world where labor is much cheaper, and polluting the countryside is acceptable, to the properly bribed officials.
You contend we have not kept up with our science & mathematics training in our schools, and lag behind other countries in our colleges. This is true, but you are confusing cause & effect. There is no reason to go into half a lifetime of debt to become an engineer, if there are no engineering jobs available…even our military industrial complex uses components built overseas, so the pool of available jobs in these fields is very small. It is much more logical to go into business, as it at least gives you a chance “network” your way into a half-decent career, using a lot of “ego-stroking” & insincere platitudes to the higher-ups.
Yes, the U.S. finds itself in a situation that is not sustainable, and has resulted in the downfall of every country in history that has tried to survive by being a nation of “shopkeepers”, instead of a nation that creates & builds. But it was not the disparity in consumer production vs. military production that did this to us…it was the rot from within our own government, and those that sold out the country’s best interests, in favor of uncountable dollars in their own bank accounts…this is what has crippled us, just as these types of people have brought down strong countries throughout history.