All the signs of American decline on the world stage are there. Not that we will not remain viable, but our position as the leading economic and military power decline is almost a sure thing unless something changes, and in the present atmosphere, I don't see that happening.
What will happen then, with two large and hostile countries on the same planet? Especially China that wants to replace the USA as the worlds leader in the two big categories of economics and military. Not only those two but, two others that don't like us very much, Iran and North Korea. Not too mention most of the Muslim countries are not our friends, we're the great Satin. India, the largest nation on earth, by population, seems to be siding with China and Russia. It is not a friendly world out there.
It has been said that in any form of government lies the seeds of it's destruction. For a democracy, or a democratic republic as we are, the seed sprouts when the populace realizes that it can vote itself the contents of the nations treasury. We begin to spend more than we take in as revenue. A trend that was started by FDR during the Great Depression escalated. New entitlements were created and older ones expanded to include more of the population, although the treasury couldn't really afford a lot them over the long haul. Money was essentially printed and just handed out every time there was down tick in the economy.
That produced an appearance of wealth for awhile among the population; but what happens when the treasury finally runs dry? The population loves the social programs that government funds, and the left want even more than they are getting now, so the government borrows and continues borrowing in order to fund those programs. The populace are not happy with anything less and so they back the political party the promises to give them more. They want a high standard of living and even more social programs, free medical care, free college education, forgiveness of all past student debt, more welfare programs, among other things, but don't want to pay for it through the exorbitant taxes that would be required. If the government had to borrow money to pay, that was fine.
The last time
the budget was balanced was under Bill Clinton, even then the debt wasn't paid down, just not increased. The government started to step in every time there was a
hiccup in the economy and poured money into the system to weather the
storm. What really put the icing on the cake was the arrival of the Covid-19 virus from China. The government, in it's infinite wisdom proceeded to shut down the economy in order to prevent the spread of the virus, or so they preached. The economy went into a tailspin. To shore it up the government, first under Trump and the under Biden, in his case with spades, pumped trillions of dollars into the economy by just handing out money to workers that were told to stay home. That had a predictable effect. Inflation took off. There was to much money chasing to little goods. As a side effect, the workers don't want to return to work when the lock-down was lifted.
The debt continues to grow as the government, through their elected officials spent more and more. Neither party seems to be willing to take on the problem, although the Republicans were able to slow down the massive increase desired by Biden and Dems during the last budget raising game. Maybe there is some hope for the future if the GOP can capture the legislature for any period of time, long enough to make a difference. And, if they have the guts to start making inroads in reducing the ever increasing debt or at least stop increasing it.
A look at the public debt reveals that we are now in a position where we owe more, with respect to the GDP, than anytime since WWII.
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| Public Debt over time as Percent of GDP |
Our spending is really out of control over the last 8 years, especially since the Dems took the White House and both houses of congress in 2020. In 2022 we spent more than a trillion dollars more than we took in. We have locked ourselves into entitlement programs that leave little room to maneuver. So the Government printed money, lots of money. The result is high inflation. Wages are creeping up but inflation is raising faster. To make matters worse, Biden and the Democrat congress passed a measure called the inflation recovery act, which dumped even more trillions of dollars in the already over heated economy. That's Trillion with T. An ungodly amount of money, considering that the United States has less than 350 million people to pay it.
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| The 2022 Spending and revenue |
All the borrowing is fine until you have to pay the interest on the debt. When you have to borrow more in order pay the interest on the current debt, you are headed for a big problem. After all the interest keeps compounding. Only Medicare and Social Security will grow to to remain larger than the money we have to pay in interest in the near future, but in the long term the interest will become the largest single item in the budget. And growing by the day, unless something is done, and soon.
The left believes that the way out is tax the rich and the corporations, with high capital gains and corporate taxes, not to cut back on spending, especially their pet social programs.
But, a bit of insight into the way the economy works would show that that is not a good idea. History has shown that it doesn't work. It would not produce enough revenue and the liberal forgets that money walks. The rich and their money will find other places for their investments.
Sometime, in the not to distant future, the chicken will come home to roost. We will have to do something to meet our obligations to pay our bills, or declare bankruptcy. Most of the options range from unpleasant to catastrophic. The one the politicians will choose is probably just to print even more money. The result will be massive inflation on a scale this country has never seen. The Federal Reserve will keep increasing interest rates trying to battle the inflationary spiral which might, and probably will, throw the economy into a recession.
What should be attacked is the large entitlement programs, and it should be attacked soon. Social Security, Medicare and Medical are the biggest items in the budget, dwarfing the defense budget. You would not have to take a hatchet to the two entitlement programs, just put some common sense into them. After all, when Social Security was enacted the average life span was about 68 years. It has not risen to around 72. People who reach Social Security retirement age will probably be on Social Security longer than they worked. What will be attacked is defense spending. Especially, if the Dems are in charge. They will not give up their entitlements without a fight. We will shave our military drastically. The politicians don't have the nerve to modify Social Security or the other entitlements. Ron DeSantis and others have tried to offer some solutions but, got no where, and is the subject of the Trump advertisements against him in the current Republican race for the White House.
There will be no one left who can challenge the Russians, the Chinese, the Iranians, and the North Koreans, if they choose unleash their forces into areas they want. I suspect they will. Eastern Europe, all of Indochina, the middle east and most of the Pacific could very well be ruled by the communist governments or the Iranians. So far those areas are protected under the umbrella of the United States military power. That could well disappear in the future as we struggle with the public debt.
How else have we shot ourselves in the foot?
We, you and me, along with help from the rest of the Western World, have pulled the Chinese from a third world country into the second largest economy in the world. How and why did we do that?
The United States emerged from WWII as the leading industrial power in the world. Our industries were intact, not having been bombed into to rubble as had many other of the worlds industries. We turned out products for the US market and for exports at a phenomenal rate as the world woke up from the war and started to want the goods that were only being produced in numbers by the United States. This produced the highest standard of living in all of history for the vast majority of the American public. An explosion of the middle class emerged. The average worker could buy a house, a car, appliances for the home and could live a life that would have been the envy of older generations.
That generation suffered through the great depression and WWII. They remembered the past and showered their children with everything they never had. The Baby Boomers grew up having all the necessities of life and many of the luxuries. And, they liked it. Their children liked it even better and the later generations began to think of it as their right, their due.
American manufacturers looking to capitalize on the abundant market rushed to get products out the door and shipped. The products they were producing were still at pre-war standards. In their rush, they began making many poor products. The machine tools were still being made as they had been in the pre-war days. Large tolerances were the norm so the the mass production methods developed the US would keep running.
But then, the other nations started to recover and rebuild their manufacturing. Their factories were newer and more efficient than the older American ones and in the Asian countries especially, they had an abundance of cheap labor.
Japan decided that the future that MacArthur wanted them to go, wasn't in their best interest and they set upon a goal of achieving high levels of reliability and quality in their products. Their machine tools were the latest technology and far surpassed those of the American manufacturers. Consequently after a few false starts and a national commitment, the Japanese started turning out products noted for their high quality and reliability and because of cheaper labor and more efficient machines they were turning them out cheaper and better than the American manufacturers. This was especially noticeable in the auto market with the rise of Toyota and Nissan and the impact on the American market. Today Toyota is the worlds largest selling auto brand.
After a few missteps by the Chinese, they abandoned their experiment in socialism as unworkable and took a big step toward capitalism. Not exactly free market capitalism as we know it, but a form with the government heavily involved in over all direction of the economy. Even those large companies owned outright by the state are run as businesses under capitalist rules. They were run for profit. Those companies had to compete in the global market so the old Soviet Model wouldn't work. The Chinese created as many billionaires as the western world. A strong one party system can do that. The Chinese had a very cheap and very abundant labor pool and could turn out any manufactured product far cheaper than the American manufacturers.
Manufacturing of goods and raw materials started moving to China. Pretty soon virtually everything that was for sale in American stores or online was made in China. The great American factories that had out produced the world during WWII were closed down. Americans were unwilling to pay the higher prices that local products would cost. They liked using cheaper foreign made products. The factory jobs that once were the backbone of American economy disappeared.
American Companies, like Nike, Adidas, Coca Cola, Disney, the NBA to name a few, saw that huge market of a billion people or a huge amount of cheap labor to produce their product and couldn't resist the urge to capitalize. Your Michael Jordan's shoes are made by cheap child labor in China. Most American based companies that wanted to do business on a global scale sucked up to China.
We did not produce enough goods of all kinds to export to China and other foreign countries to balance the scales, so we borrowed money to pay for those goods coming into the United States. Other countries were also exporting goods to the US but not anything like China. So, a growing trade deficit emerged over time.
Where did the Chinese spend all that American cash they reaped from sales to the US markets? They begin to buy up America. They invested in real estate and other items. That GE refrigerator you bought was money that went into the bank in China. The appliance division of GE is owned by a Chinese Company. The holdings of Chinese in American is extensive and just too many to list, but a few may surprise you.
AMC, Smithfield Foods, The Waldorf Astoria, Strategic Hotels Resorts, Legendary Pictures, Sheraton Universal Hotel in LA, Motorola Mobility, Terex Corporations, Marriott Hotel in LA, Ingram Micro, are wholly owned by Chinese companies to name a few. In addition the have a stake in Morgan Stanley, VISA, Ford, Reddit, Blackstone, GM and many more. Enough of a stake they have a seat on the board. Of course everyone knows that the social media TicTok is owned and run by a Chinese company.
If you want to do business in China you have to have a Chinese partner and transfer the technology you use to do that business to the Chinese partner. The same as giving it to the Communist party.
The Chinese have infiltrated American business at many levels and influenced the politics of America for years. They give liberally to the Democrats and a little to the Republicans. They have a huge influence on the World Health Organization which went to great lengths to cover up Chinese involvement in the Covid-19 virus.
They want and have a seat at the table for almost any discussion about China. Look at the Covid-19 episode. They did everything they could to muddy the waters about the origins of the virus. They have so much influence that the government went right along with them and worked to mislead the American people.
The main government funded medical organizations, the NIH and the CDC were afraid to point the finger at China research, probably because they funded that research. The social media platforms worked, along with the Chinese, to misdirect the discussion of the virus origins. No posting on Facebook or Twitter that questioned the governments position was allowed. Serious researchers and doctors in the specialty of infectious diseases were banned from the social media platforms.
Mainstream media, ABC, NBC, NY Times, Washington Post, CNN and others pretty much toed the government line. Only Fox seemed to point the finger at the Chinese Wuhan lab as the culprit.
They are engaged in a massive and intensive cyber war against the United States. They are after military and state secrets as well as personal data on American citizens. They are infiltrating every level of our society and mining information at a horrific pace. They are using social media to plant their ideology into the minds of the American youth. And we are helping them. Every posting on Tiktok is available to the Chinese. American youth seem to be in love with that platform and uses it constantly.
I don't see how we get out of this mess until we hit bottom and the electorate wakes up and stop electing left wing politicians that advocate a global reach, even at the expense of the American citizen. Perhaps I'm too pessimistic. I hope so. If I'm not, then our grandchildren will have a tougher time of it than the current generation had. For the first time the next generation will have less than their parents. That seems to be happening already is some ways.
