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Why America's economy is soaring ahead of its rivals

• pfooti 2y ago
  https://archive.is/vt7sY https://archive.is/vt7sY
• jrodrigo33 2y ago
  [dead]
• WalterBright 2y ago
  > the improvement was largely down to reconstruction efforts partly funded by the US via the Marshall Plan Most of the improvement was in Germany, which received far less MP money than Britain and France. Postwar prosperity correlates with the level of free markets. Germany embraced free markets up until 1970, Britain and France did not.
  • WhereIsTheTruth 2y ago
    They served as bases to spread the American culture through music and cinema and later with the industry through the coal and steel community, to create a single and unified market The US did not want to create competition, but to break monopolies and to create a unified market for its industrial complex The remnants of that goal are visible today with Big Tech
    • ashoeafoot 2y ago
      That manchester capitalism with different decorations rhetoric does not hold up to scrutiny. In particular when you hold it against current examples of economic colonialism like the chines lend & own campaign in Africa .
      • almaight 2y ago
        Without an army or control over territory, it cannot reach the level of colonization. African countries often default on their debts.
        • ashoeafoot 2y ago
          The army is provided by the local dictator or by playing different ethnic groups against one another.Britain never had enough soldiers to conquer India , but india had. Same for Russia .
    • WalterBright 2y ago
      My dad was part of the occupation of postwar Germany. The bases were there to protect Germany against the Soviets. I remember once on the autobahn around 1970, and a fighter came by hedgehopping at high speed. He was a few feet off the ground, and looked like just under Mach 1. The citizens didn't particularly like the noise and disruption, but they understood the need for the Air Force to train hard. I also remember touring East Berlin (yes, East Berlin) in 1969. Going through Checkpoint Charlie and seeing the Wall is plenty convincing of the need for the US military being there. France, on the other hand, didn't much care for the US military bases and wound up pushing them out. BTW, the US Military was pretty thorough in making sure US personnel and military families behaved like guests in Germany, as they were invited guests. Ever since the Berlin Airlift, the US was friends with Germany. The Americanization of Germany came later. I recall visiting a shopping mall in Germany in the 2000's, and you could not tell you were in Germany rather than in any suburb in America. Shopping malls did not exist there in 1970.
      • Dalewyn 2y ago
        >BTW, the US Military was pretty thorough in making sure US personnel and military families behaved like guests in Germany, as they were invited guests. Ever since the Berlin Airlift, the US was friends with Germany. All the more sad that the chief component of Japanese animosity towards Japan-stationed US forces are sexual crimes, particularly in Okinawa where the Marines especially don't seem to know how to keep their dicks in their pants. There have been at least two incidents just this year if I recall, and that's just of the ones we know. I really can't blame the locals wanting Americans to get the fuck out, security be damned.
        • WalterBright 2y ago
          That is indeed sad. Such crimes against the locals should be severely punished. I found out many years later that if I had committed a crime like shoplifting in Germany, my father would have been cashiered. The military took their guest status very seriously. An officer who could not control his family was not fit to be an officer.
        • adamc 2y ago
  • danielbln 2y ago
    Saying Germany embraced the free market is not correct. Germany under Erhard had a social market economy (even during the "Wirtschaftswunder*, the economic miracle). While some free market principles were followed (price liberation, free trade) and it was certainly more market liberal than France at the time, it still came with substantial protection (universal healthcare, strong labor protections and unions, anti monopoly regulations etc.) The situation back then was decidedly _not_ what the term "free market" (of the libertarian variety) would imply today.
    • WalterBright 2y ago
      Nobody claimed it was a 100% free market. But it was quite a bit more free than the other MP recipients. And the results showed.
      • danielbln 2y ago
        Definitely, just wanted to make sure that no one who's passing by your comment thinks that post-war Germany had some gung ho modern definition style free market.
  • nitwit005 2y ago
    East Germany did better than its peers in the Soviet block, and West Germany did better than its peers outside of it. People love to point at policy, because it's a thing we can control, but the most important factors are often cultural issues we both don't control, and don't entirely understand.
  • nativeit 2y ago
    I assume you’re referring to West Germany? Can such comparisons even be drawn for only half of an otherwise largely occupied nation?
• shiroiushi 2y ago
  The US is a great place to make a lot of money if you're lucky and successful, but a terrible place to retire.
  • CalRobert 2y ago
    How so? Healthcare? FIRE seems much more attainable in the US
    • sameoldtune 2y ago
      Healthcare is just a word until you get into your sixties, then it is a lifestyle
    • shiroiushi 2y ago
      Housing and healthcare costs are insane. When you're older, you need a lot more healthcare (and you won't have that nice insurance plan you had at your big company job when you were working), and housing keeps getting more expensive, which is a problem if you're on a fixed income. You could move to much cheaper locales (i.e. rural areas), but those are "healthcare deserts" where there's no competent doctors left and hospitals are all closing left and right, plus when you're infirm how exactly do you drive yourself? Living in a walkable city (or any city really) is much more doable when you're older for these practical reasons (less need to drive, healthcare providers close by), but then you can't afford the housing there.
      • anovikov 2y ago
        Housing in US is in fact one of the cheapest... everywhere, measured as price per square foot as percentage of income. Several times cheaper than in many countries and at least somewhat cheaper than almost every single one, rich or poor, democratic or authoritarian. It's just that "normal" housing in the US is what's only attainable to the very rich and only because they inherited it, in most of Europe let's say: even 1% won't be able to buy an equivalent of median new US single family house, in EU - that 1% probably owns a similar or somewhat better house but simply because they bought or built it generations before.
• mytailorisrich 2y ago
  This has been the case for decades now. The US economy is much more dynamic than Europe's and the US government is actually more willing to intervene (and can afford it because of US dollar). In Europe it is austerity and general less support for economy-boosting policies.
  • croes 2y ago
    So the US economy is built on debt
    • mytailorisrich 2y ago
      Europe has massive debts, too, and growing. But this is a downward spiral. Edit: Average government debt-to-GDP ratio in the EU was around 60% from 2000 to 2008. It is 88% now and worse in many major countries. No lie here...
      • Jensson 2y ago
        > Europe has massive debts, too, and growing This is a lie, take Sweden's debt for example it has been going down the past 20 years. Most of Europe doesn't see increasing debt, USA is an outlier. https://tradingeconomics.com/sweden/government-debt-to-gdp#:~:text=Government%20Debt%20to%20GDP%20in,source%3A%20EUROSTAT https://tradingeconomics.com/sweden/government-debt-to-gdp#:...
        • 0xBDB 2y ago
          Sweden is an outlier. US debt to GDP is 110%. France and the UK 99%. Italy 138%. Greece 203%. Japan 263%. China depends on who you believe, but probably somewhere around 100%.
    • stephen_g 2y ago
      All economies are built on debt... It's basically how money works...
• oldpersonintx 2y ago
  [dead]
• almaight 2y ago
  Because people have been liberated from the quagmire of handicrafts
• grecy 2y ago
  Make no mistake, the US is a fantastic business. It makes a lot of money, and some people get fantastically rich while others toil for life and hover at the poverty line. With a vastly higher percentage of its citizens in jail than any other developed country, much higher crime and violence than developed countries and many other very bad indicators it is, however, not a good country. It does not provide for or look after its citizens in the ways other developed countries do, and does not appear to be a healthy society.
  • throwaway8754aw 2y ago
    There's 365 million Americans vs. Europeans countries none have more then about 85 million.
    • stephen_g 2y ago
      No US state has more than 40 million people...
      • throwaway8754aw 2y ago
        State is not a country and European countries are not states...their federal governments handle their healthcare and etc. That's my point the US's federal government would be handling free healthcare directly or indirectly thru the states. As well the amount of money Americans would have in their pockets would be a lot less and that's not after over 300 years are what we are use to. Recent election shows the majority does not want change in many regards.
        • davisr 2y ago
          Recent elections show that capital interests are able to spend unlimited amounts of money buying political influence to prevent a pro-working-class candidate from ever touching any true levers of power.
          • throwaway8754aw 2y ago
• roenxi 2y ago
  This is an interesting take, because it contrasts with GDP PPP [0] which is suggesting that America is in fact being overtaken by its rivals although it has managed to outpace the EU. China is claiming to already be ahead and India is well on track to gain absolute economic ascendancy relative to the US. And I expect that Asia is going to start developing some serious military muscle on the back of that because they have access to the history books and have a pretty good view into how Western leadership thinks. If the US is benchmarked against Europe then all is well. The problem is that Europe is now a distant 3rd in terms of economic power - it can't face up to China. Arguably, if we put China in its own category and India into "Asia" then the EU might be pushing towards 4th. Everyone is still ahead of Africa I suppose. [0] https://ourworldindata.org/grapher/national-gdp-wb?tab=chart&country=CHN~USA~BRA~IND~OWID_EU27 https://ourworldindata.org/grapher/national-gdp-wb?tab=chart...
  • OfficeChad 2y ago
    [dead]
  • spiderfarmer 2y ago
    The EU is number one in quality of life and that’s all that matters to me. If we work just hard enough to maintain and maybe even improve it, other countries can do their pissing contest.
    • ragebol 2y ago
      Quality of life costs money, and if we're not competitive, sooner or later that money will run out.
      • Cumpiler69 2y ago
        It's crazy how so many people don't get this basic economic fact and think public welfare in EU just rains from the sky for free. No, EU welfare state is not some magical hack nobody else thought of, it's just paid from the working class' wages and then redistributed to those in need. Without innovations and highly profitable industries generating well paying working class jobs, with what will you pay for that welfare and quality of life? Billionaires and corporations certainly aren't gonna pay for it out if their profits, so the working class has to. But if the working class has no more high paying wages anymore due to stagnating growth , then your welfare budget also goes bye-bye. You can't just vote yourself more welfare and higher public sector salaries and pensions out of thin air without an economic growth to back that up. I mean, you technically can, but it doesn't end well as was proven every single time this was tried.
• didibus 2y ago
  I'm never able to get to the "so what?" with these. Productivity growth sounds nice, but then it mentions that there's more inequality, higher cost of living, and more workers struggle in the US than other developed countries. How do I reconcile this? They make a point that eventually the other countries' economies would shrink and won't be able to afford those benefits, but also the US doesn't have those benefits even now. Anyone can elucidate me?
  • WalterBright 2y ago
    > How do I reconcile this? I'm curious why you care that some people have more money than you do? If you want mo' moolah: 1. upgrade your job skills 2. minimize spending (like get a roommate, eschew restaurant food, buy a used car) 3. invest the money you save If you really want to make big money: 1. start your own business
    • didibus 2y ago
      Not sure I understand how you're reconciliating it? Maybe I'm missing the link you are making with caring or not about other people being richer than oneself, how is that relevant here? What I'm asking is more, what conclusion should I take from the article?
      • WalterBright 2y ago
        Isn't caring about inequality mean complaining about people having more money than oneself?
        • Jensson 2y ago
          The issue is when others money means high costs for you, such as in healthcare or education or construction. A lot of stuff is really expensive in USA due to the high wages/profits and those workers not being any more productive, that directly hurts your quality of life unless you got an equivalent raise.
• thomassmith65 2y ago
  That's an excellent summary of the economic state of the world. This excerpt is depressing... The challenge for other advanced economies is not just replicating America’s dynamism. It is to do so while retaining their cherished social safeguards. For all its economic power, the US has the largest income inequality in the G7, coupled with the lowest life expectancy and the highest housing costs, according to the OECD. Market competition is limited and millions of workers endure unstable employment conditions. The pessimistic take is that American FA*NG 'enshittification' and cheap Chinese plastic junk will continue to eat the world, while other nations abandon consumer- and labor-friendly policies.
  • WalterBright 2y ago
    > endure unstable employment conditions It's also correspondingly easier to get another job. In Europe, making it hard to fire people means it becomes equivalently harder to get a job in the first place.
    • dachworker 2y ago
      Yep, and crucially, getting a first job from which you can build a career is relatively (to the US) hard in places like Germany because companies are super risk averse.
      • deleted 2y ago
        [deleted]
    • tossandthrow 2y ago
      While it sounds great to add some zero-sum game to it, it is not entirely precise. > For all its economic power, the US has the largest income inequality in the G7. Had the job market been a zero-sum game like you propose, then the income inequality would not have been so dire in the US.
      • nickpp 2y ago
        But said income would've been much lower - like in Europe. Europe "solved" inequality by effectively limiting the upper range. Meanwhile the lower tier is just as low (or lower) than in the US. People would still rather emigrate to the poorest state of the USA than Bulgaria or Romania.
• fxtentacle 2y ago
  It's thanks to innovative business models, of course! Increasing you investment efficiency with FTX. Reducing farmer idle time with Deere. Sharing your otherwise unused car with Uber. Revolutionising office productivity with technology, like those beer taps that WeWork had. Spending less time on your savings with Yotta. Not reading long emails with AI. I wonder how high productivity actually turns out if you remove every scam that inflated GDP or earnings numbers.
  • spiderfarmer 2y ago
    Also, ask the poor how satisfied they are with the GDP.
    • fxtentacle 2y ago
      Or ask farmers about the DRM technology that locks them out of their tools ...
    • mrguyorama 2y ago
      [flagged]
      • 65 2y ago
        Yes, I agree. However the "economy bad" thing was blamed on Biden for signing another stimulus bill which created worse inflation. In reality both Biden and Trump are to blame, but the thinking among the lower class is that Biden made inflation worse.
      • ImJamal 2y ago
        It is clear why they voted for Trump. They didn't like the way things were going and Kamala said she wouldn't change anything from Biden. Why would you vote for the status quo if you don't like the status quo?
        • mrguyorama 2y ago
          Is America's economy soaring ahead of it's rivals as this article is about or does something need to be drastically changed by voting a bull into a China shop? As I said before, if you look at charts of public sentiment on the economy by political party, democratic leaning voters will see a slightly better economy when a democrat is in the oval office, but republican voters swing wildly from one extreme to the other completely matching election day, not even inauguration. They can complain about "the statistics aren't showing the truth" all they want but the data objectively shows that what they mean by "the economy isn't good" is "my team isn't in the oval office"
• croes 2y ago
  Simple answer. The US don’t fear high debts like for instance Germany does.
  • dachworker 2y ago
    Germany suffers from bad leadership in industry and government above all else. The lack of investment is downstream of that. And I guess upstream is their conservative mindset on how and who to appoint as leaders. Lots of nepotism and corruption and not a lot of competence.
  • Cumpiler69 2y ago
    Germany can't print the world reserve currency. They did for a bit towards the end of WW2 though but that time is passed.
• rich_sasha 2y ago
  One thing this article doesn't touch on is the soaring government debt, which is now really quite big: 120%, and IIRC if you add municipal debt, it's more like 140%. That is high. It also seems like much of the recent growth has been fueled by this debt. It's unclear how this is going to unwind. America can afford, apparently, to run their deficit hot, but not forever and without limit. So at some point they have to start cutting expenditure and paying that debt off. What happens then? Or will they somehow default on it? Or, will they manage to deflate it via growth. But it is a bit of a sword of Damocles hanging over the economy, like ZIRP over VC successes of the 2010s. The crazy thing is just how much the debt increases in living memory. Under Clinton, it was as low as 60%, which is considered a really low level.
  • dlcarrier 2y ago
    My theory is that other countries' trade is so closely tied to the US Dollar that when the Federal Reserve prints money it's not just diluting the US Dollar but all currencies. The US is effectively taxing the world, to pay for its own spending. As evidence that the US Dollar plays a large enough role for this to be the case, half of the banks bailed out in the TARP program were foreign to the US (https://www.europeaninstitute.org/index.php/ei-blog/106-august-2010/1119-us-bailout-funds-saved-european-banks-without-much-transatlantic-reciprocity https://www.europeaninstitute.org/index.php/ei-blog/106-augu...) and trading is US Dollars.
    • tossandthrow 2y ago
      It seems like other people also buy into this. Eg. Trump. I also think that the USD is currently under attack as the reserve currency and running these deficits is a way to protect its position. We will see in a couple of years how things play out.
    • matheusmoreira 2y ago
      > My theory is that other countries' trade is so closely tied to the US Dollar that when the Federal Reserve prints money it's not just diluting the US Dollar but all currencies. The US is effectively taxing the world, to pay for its own spending. Yes. The BRICs economic group has been trying to launch their own currency for a while now. This is one of the reasons for it. Trump has threatened to impose 100% tax on them and on anyone else who ever tries. https://www.msn.com/en-us/money/markets/trump-threatens-100-tariffs-on-china-and-russia-if-brics-group-of-nations-issues-new-currency/ar-AA1v5omC https://www.msn.com/en-us/money/markets/trump-threatens-100-... https://www.bloomberg.com/news/articles/2024-12-02/south-africa-rejects-trump-s-claims-over-brics-currency-plans https://www.bloomberg.com/news/articles/2024-12-02/south-afr...
• drukenemo 2y ago
  [flagged]
  • Gud 2y ago
    The only one provoking a war in Europe is Putin. And the Germans destroyed their energy sector themselves.
    • pfdietz 2y ago
      Are you under the illusion that nuclear would have helped, or are you complaining they didn't keep burning coal?
      • kbelder 2y ago
        >Are you under the illusion that nuclear would have helped I am.
        • simoncion 2y ago
          Yeah, there's no illusion here at all. Look at France, its electricity cost per KWh, and its carbon intensity per KWh generated. In recent years, all are much, much better than Germany's. (And their carbon intensity numbers have probably been consistently better since like the 1990s.) It's almost as if making your economy that requires a lot of electricity dependent on electricity generation methods that require fuels supplied by potentially-hostile foreign countries is a bad, bad idea.
          • kazen44 2y ago
            to be fair, this energy dependence was created in a time when the soviet block collapsed, and has worked for many many countries that where part of that block except for russia and belarus. Economic integration has finally put the lid on the enourmous destruction of nationalism for the past 60 years. The mistake which was made by (mostly) american and european economists was convincing everyone that applying shock therapy to the socialist economy and liberalising it in that way was the best way forward. This resulted in the rise of putin and the aversion of the russian goverment to the "west".
• DataDaemon 2y ago
  You are so lucky to be born in the USA: - Easy to do business - Great economy, high salaries, and funding - English native speaker, so you can speak with everyone and everyone can speak with you The EU is in a deep hole, with socialism and green communism next.
  • tokioyoyo 2y ago
    I swear, I’ve been hearing that since 2010. That and big Chinese collapse. It’s like the US just wants everyone else to fail just because they don’t share the same attitude towards life. It’s been almost 15 years. That’s a lot of time! I’m mostly annoyed by the recent “Canada should just become an American state” talks, otherwise I would ignore such takes. Apologies for that.
    • indoordin0saur 2y ago
      > Canada should just become an American state Canada is a really interesting take that I ctrl-f'd hoping I'd find a discussion on. It was doing a great job keeping pace with the US but seems to have really stagnated since the last 8 years or so.
      • mmmBacon 2y ago
        Trudeau has been PM for the last 9 of those 8 years. Do you think his policies are at least partly responsible?
        • tokioyoyo 2y ago
          I actually don't think much would've changed. Our core problems - low birthrate, and extreme dependence on RE wouldn't be affected one way or another. Things will probably get worse before it gets better, and it looks like we have to be more strategic when it comes to partnerships. Being a service industry with very low manufacturing doesn't help either. Decent amount of natural resources, but not enough people, nor cultural (yes, it's hard to find workers for the mines for good reasons, despite its high pays, and I'm very familiar with the issue due to relationships with people who are in the industry) and political willingness to go full-China style on them either. We could try to push for innovation, but brain drain is real, because if you want money, it's really not that hard to find a job across the border especially if you're talented. And 10x market down there, so what's the point.
• amelius 2y ago
  Meanwhile US infrastructure is crumbling down.
• bookofjoe 2y ago
  https://news.ycombinator.com/item?id=42311318 https://news.ycombinator.com/item?id=42311318
• wslh 2y ago
  My two cents: the U.S. owes much of its economic strength to its robust legal framework. It provides a system where complex business disputes can be handled and enforced effectively, creating trust and predictability for investors and entrepreneurs. This institutional strength is often overlooked but is critical for fostering innovation and long-term economic growth. Incidentally, recent Nobel laureates in economic sciences have focused on the role of institutions in shaping economic outcomes, underscoring how pivotal they are to success.
  • deleted 2y ago
    [deleted]
  • alephnerd 2y ago
    > the U.S. owes much of its economic strength to its robust legal framework Pretty much. This is the mainstream institutionalist view which won AJR a Nobel Prize. This is also the reason why China began the Guiding Case Project with Stanford Law before it got shut down due to Xi 2's crackdown.
    • deleted 2y ago
      [deleted]
  • ein0p 2y ago
    The US owes its "economic strength" to the ability to print $2T/yr in perpetuity and buy stuff with that money. Once that tap ceases to function (which eventually it will, though not anytime soon), the US is going to be fucked beyond any recognition.
    • georgeecollins 2y ago
      That's irrational and alarmist. Any time I hear someone talk about "printing money" I figure I am hearing from someone who doesn't have a great grasp of finance. For those that are interested, the supply of US currency or purchasing power of the government is not controlled by printing. A steelman of this argument is the USA has too much debt and can't keep issuing this much. Maybe true. But the world holds that debt and it's denominated in USD. Also, just the simple wealth of US households grows a lot faster than the debt so its still pretty clear that if the US wanted to pay all its debts it easily could. (https://fred.stlouisfed.org/series/BOGZ1FL192090005Q https://fred.stlouisfed.org/series/BOGZ1FL192090005Q) We could be heading for inflation like in the late 70's early 80's. Not good but you don't have to doomsday prep.
• ginko 2y ago
  The headline is about America's rivals but then talks mainly about EU and other G7 economies. Do Americans consider Europeans their rivals? Occasional competitors sure, but rivals?
  • monetus 2y ago
    Rival in the same way two American football teams are rivals maybe.
  • cjs_ac 2y ago
    The Economist is a British magazine, originally marketed at devotees of classical liberalism, which was also called economism at the time. Its readership is largely British, and therefore seeks comparisons between the British economy, European economies and the US economies, because they are seen as peers of the UK.
    • losvedir 2y ago
      This is Financial Times, not the Economist, but is also British.
• ysofunny 2y ago
  when you control the measuring stick (USA dollar) you'll always be the tallest of them all
• anon291 2y ago
  > Globally, the top R&D spenders are increasingly concentrated in software and computer services I always find these sorts of statements strange because most software is not intended to be software but rather something else. For example, Adobe's suite should be classified under 'art supplies' or 'video production'. While true that it's software, in my mind, it's like classifying a car builder as a metal fabricator. The truth is software and computers are pervasive today. There's rarely any software (other than development tools) that are truly aimed at computers themselves. Almost all software today is used for other industries and ought to be classified under that. Under this taxonomy, I think things would seem much more diverse.
  • doctorpangloss 2y ago
    > Adobe's suite should be classified under 'art supplies' or 'video production'... Under this taxonomy, I think things would seem much more diverse. Will someone who has shopped at Blick for 20 years be able to develop a Photoshop plugin? It would be a stretch.
    • anon291 2y ago
      It's clearly not just software etiher though
    • bluGill 2y ago
      Most people who shop at Blick don't make their own canvas, clay. Many of them wouldn't know how. They could learn and some do, but many never will. Likewise they could learn to write software but most won't.
  • bluGill 2y ago
    Software is a tool, so it should have some count toward that economy. Same as any other tool is a hammer part of real estate or iron?
  • deleted 2y ago
    [deleted]
• forth_throwaway 2y ago
  > Anecdote of shitty AI company raising a fuckton of money > Mention of GDP with no other metrics > No mention of inflation > No mention of QE > No mention of interest rates This is propaganda. When your central banks control the world's reserve currency it's pretty easy to make sure that the line goes up every year. The British Empire didn't have their wealth because of their superior system, they got it from imperialism. Before you downvote please just reflect on what I'm saying a little bit. Do the changes you see on the ground reflect this narrative of economic growth? I see a little bit locally, mostly from the CHIPS act and infrastructure acts, but it doesn't correlate with an improvement in QOL and certainly infrastructure projects are not unique to American capitalism.
• anon291 2y ago
  Thomas Sowell says that equality of opportunity leads to inequality of outcome. And this is the main difference between America and the rest of the world. The articles cites innovation-growth v cost-cutting as sources of increased productivity, and this parallels this dichotomy. People interested in equality of outcome and a level playing field have to compete on cost. There's a social stigma against sticking out and achieving more, lest you become unequal, and the governments are well aware of that. Meanwhile, innovation literally desires to reward disproportionately he who comes up with the new product. The entire purpose of the American economic system is to produce inequality. This, combined with America's relative freedom from prejudice, is an unstoppable juggernaut. It is absolutely insane how easy it is in the United States to be handed money with limited liability to go and do whatever you want with it. This is a true blessing, and we see it not just in venture capital, but in the plethora of small businesses, as well as the plethora of credit (for better or worse). Yes, there are problems, but I think history will show that this model is ultimately more sustainable. While true that America's productivity growth has only really taken off over the last century or so, even before then, it represented a formidable economic player.
  • hmmm-i-wonder 2y ago
    >This, combined with America's relative freedom from prejudice, is an unstoppable juggernaut. It is absolutely insane how easy it is in the United States to be handed money with limited liability to go and do whatever you want with it. This is a true blessing, and we see it not just in venture capital, but in the plethora of small businesses, as well as the plethora of credit (for better or worse). I was with you until then. America was build on prejudice and inequality as much as any other country has been and suffers from it today. That translates to how the last half of that paragraph doesn't apply to a significant amount of American's who struggle to access the resources they need to survive let alone innovate and thrive..
    • anon291 2y ago
      As the child of non-white immigrants to this country... I simply disagree. We faced more discrimination in the country my parents left than we did here. My father was unable to be employed due to his skin color and social status in his native country, and became successful mid-level exec here in America, was given a mortgage, etc. Capital is available for people here without reference to social standing. Is it perfect? Of course not. I literally said that. However, if you want capital and aren't whatever platonic ideal your country has decided you ought to be to access that, America is literally your best bet. > That translates to how the last half of that paragraph doesn't apply to a significant amount of American's who struggle to access the resources they need to survive let alone innovate and thrive.. I'm not going to claim every american is able to thrive, because obviously that's not the case. But even the poor American is able to access credit, which is what my entire post was about. You are changing the goal posts a lot.
• badpun 2y ago
  Not a single word about shale oil and gas revolution, that started around 15 years ago? The US now has the one of the cheapest energy on earth, and probably the cheapest among the countries that matter. Pour all that cheap gas and oil onto an economy that was already a leader and you get lots of impressive growth.
  • paganel 2y ago
    That's the gist of it, especially since the "IT revoluion" (for lack of a better word) seems to have cooled off in the early 2010-ish, i.e. exactly when the shale revolution started doing its thing (and, no, I don't count the recent AI hype as being worthy of getting called as "revolutionary"). That shale revolution has also come with big opportunity costs reductions, because the US didn't have to geo-strategically care about the Middle East and the oil there all that much, at least not as much as to send real feet on the ground there, with all the associated costs. With that said, there's also the danger of the US following on Britain's steps from the 1980s up until the 2000s, i.e. to rely on this shale/oil bonanza and not care about (internal) structural reforms that are in dire need of being enacted. At some point the shale money will not be there anymore (the shale gas will have run out, the world's car-fleet turns to electric en masse etc), and if the Americans don't carry out the necessary reforms sooner rather than later then that future "no more shale-gas money" moment will come at a very, very bad time for them. I said it's similar to Britain's situation because things started going downhill there as soon as the North Sea oil&gas money started thinning out.
  • greenthrow 2y ago
    It's not brought up because this is not the source of the growth whatsoever. It has only served to keep our gasoline and methane costs low compared to the rest of the world. That's nice for people but does not create massive economic growth in the 21st century of the kind being discussed. That is all coming from the tech sector. If you want to talk energy to power the server farms, the growth in energy is happening with renewables which are and far cheaper than any fossil fuels.
    • badpun 2y ago
• lifeisstillgood 2y ago
  Tech is the problem. The internet is global (or perhaps two or three regions), and winner takes all - so global value creation is being experienced everywhere, but being monetised in the US stock market. Take tech out of the equation and the US is pretty much on par with EU, and China and India are just burning the coal for everyone else.
  • jebarker 2y ago
    Can you expand on this? What do you mean by "monetized in the US stock market"?
    • tiffanyh 2y ago
      I'm not GP, but they probably meant "realized" (not "monetized")
      • jebarker 2y ago
        I guess I still don't understand though. Is the claim that tech innovation in the rest of the world is being turned into money in the US only? If so, why is that happening?
        • roflc0ptic 2y ago
          The claim here is that the tech innovation is occurring in the US. It adds value globally, but most of the profits from that value are being realized in the US b/c the innovation is by US companies. There’s no natural law that says technical innovation must occur in NA, but due to contingent historical conditions, it is occurring here. Thus, the gains are being realized in the US stock market b/c it’s the one capitalizing the winners.
          • jebarker 2y ago
            I see, thank-you for clarifying.
          • 2y ago
• DrBazza 2y ago
  These articles also gloss over the US market is 400m English speakers with one set of legislation, more or less. Europe is 20+ languages and 20+ sets of legislation. That’s a colossal advantage. And any clicks and mortar business gets the benefit of absurdly cheap shipping costs compared to Europe.
  • ifwinterco 2y ago
    There are counterexamples in Asia though like South Korea, Taiwan etc. that have massively outperformed Europe over recent decades despite not having those advantages. Having said that, not sure the SK model is something to emulate given the social problems it seems to have caused
    • treis 2y ago
      In growth, yes but GDP per capita in South Korea is still 3/4s of France.
      • echoangle 2y ago
        That’s an important point, people always compare growth as if growing from the bottom is as hard as growing from (close to) the top. People love to do this with India and china.
        • ifwinterco 2y ago
          That's true - the counter-counterexample is Singapore where GDP/capita shot straight past western European countries and just kept going. They do have the significant advantage of being English speaking though
          • echoangle 2y ago
            Singapore also has the advantage of being a significant financial hub. But that only works when being small, it doesn’t scale to something like the EU.
• jaco6 2y ago
  [flagged]
  • greenthrow 2y ago
    Wowwwww. This is the most blatant white supremacist rhetoric I have seen on HN.
• athrowaway3z 2y ago
  It is frankly absurd to make a case with only one line mentioning > owing to its abundant domestic energy supplies, Energy is wealth. In so far as I can tell we have better data, going back further, and being more strongly correlated to outcomes of interests, than the data we have on monetary systems. I have my doubt the FT will ever dare to entertain that position. Energy has an enormous cascading effect. But it pops up directly as well. ChatGPT could not run at 5x the base energy costs and no suppliers able to scale to more demand. If you're looking to explain the US upward trends always include their shale output in your graph as well. You'll find you rarely need more explanations. It has been blessed by their resources, an enormous size granting a low population density, and a functioning liberal state to use those well. The rest is pandering and ideological pleas for less tax and less regulations. And i mean... if you're going to pander, you're going to pander to the people with the cheapest energy.
• mesk 2y ago
  I'm thinking a lot lately about which country would be best for my future, and somehow US is never there. Maybe for me without family yes, but otherwise I see it like there, I would be one illness away from bankrupcy, one crazy kid with a gun away from family tragedy, one <what if> away from <unsolvable problems>. Sure, being in top 10% is cool, but will my kids be also so lucky? And the middle class in the US already thinks they are struggling (hence the last vote) - as someone said numbers can't feed you. But, hey, I'm maybe too old ;)
  • sirbutters 2y ago
    "hence the last vote". You are implying that logic fits the results. It doesn't.
  • aftbit 2y ago
    Anywhere in the world, you might be "one <what if> away from <unsolvable problems>." That's not a US-specific thing. The US is better at some things and worse at others. Obviously we all make these choices on different merits, but IMO don't live in fear. Being in the group of people who has a choice of countries to live in _and_ being in the top 10% in the US puts you in the top 0.1 to 1% globally. Enjoy it while you can!
  • eitally 2y ago
    This is the kind of comment written by someone who only knows a country from its headlines. The US, as a resident, skews wildly from the popular narrative in many ways much of the time -- regardless who is in charge.
    • mesk 2y ago
      > The US, as a resident, skews wildly from the popular narrative in many ways much of the time Much of the time, thats it, you named it. To me the worst case scenario (I work in IT, so I often think in the worst case scenarios) in few relatively common situations, _seems_ to be much worse in the US. Common, like being ill, visiting hospital, going to school, being stopped by the police.... (headlines again).
  • 2y ago
• luizfzs 2y ago
  But is the majority of the population thriving? It is very misleading (at best) to say the economy is strong when a good chunk of the population live paycheck to paycheck. A handful of companies are thriving, but barely any of its employees.
  • deleted 2y ago
    [deleted]
  • nightski 2y ago
    We need to differentiate living paycheck to paycheck out of necessity vs. choice. It might be surprising but there are a lot of people who choose to do so because why save when you could die tomorrow.
    • codr7 2y ago
      Judge much? It's more like, how save when you need the money right now.
      • tombert 2y ago
        Not the OP but I don't think that is who they are talking about. People who don't have money to save obviously are going have trouble saving it. There is a certain subset of people, though, that do make money and actively choose to not save it. Kind of a perpetual "YOLO" attitude. I don't think the OP was judging.
        • codr7 2y ago
          How do you know? Have you walked in their shoes?
          • tombert 2y ago
            I mean, I don't have access to anyone's internal brain-state other than my own, obviously, but I have had at least one coworker outright tell me that this was their mentality. This coworker made roughly the same yuppie engineer salary I did, and didn't have any familial responsibility, and flatout told me that he didn't have much interest in saving money, he likes to spend it and live for the now. Granted, I think that this is mostly a product of the fact that he was pretty young (22 at the time), and I haven't really talked to him in 11 years, so it's very likely that he doesn't do this anymore.
• tjahsg 2y ago
  These opinion pieces are so tiring. Talking points: - The sanctions induced energy crisis exists, but is not the reason. - The lazy Europeans are the problem. - We need more tech. - Trump will ruin everything. All of this is false. There is no mention of the dollar status as the reserve currency, which enables the reckless U.S. deficit spending while shielding it from the consequences. There is no mention of German industries, which had been productive, closing or moving abroad after the Nord Stream sabotage by one of Germany's "allies". There is no mention that tech is overvalued and not a panacea. Russia does have Yandex as a Google replacement and it does not help. China has Baidu. So tech in the U.S. has been inflated by printing money, which the EU and China cannot do. I expect more from a European newspaper than just telling Europeans to work harder.
  • lotsofpulp 2y ago
    >There is no mention of the dollar status as the reserve currency, which enables the reckless U.S. deficit spending while shielding it from the consequences. This isn’t a given. People around the world like to use USD because they trust USD to buy the things they want in the future.
    • tossandthrow 2y ago
      Oh boy, you should pick up a history book.
      • lotsofpulp 2y ago
        Care to provide any examples? If the US were to fall into disarray, the demand for USD would fall. People are free to choose GBP, Euro, Yen, Yuan, but apparently a lot of people choose USD.
        • tossandthrow 2y ago
          Bretton woods et Al. The usd was historically designed to be the reserve currency with support of major economies. This was terminated with Bretton woods, but things have the tendency to not move so fast. But it is definitely not just a happy coincident that the usd is the reserve currency.
• gigel82 2y ago
  All these statements about the "booming economy" are triggering for a lot of people because this "economy" they're talking about is just an abstract notion that has absolutely nothing to do with people's financial situation. I don't know if we need a different term entirely to make this distinction.
• HellDunkel 2y ago
  When younger, i often thought about moving to the US because it offered so many amazing and creative places to work. Most of these places seem to have gone completely or are in a somewhat unhealthy state (hollywood, video games). Boring tech companies took over and often times they stared with just a website - for gods sake- this is so lame! I‘m so happy i didnt go back then- I think it would have depressed me to experience this first hand but who knows.
  • deaddodo 2y ago
    What do you mean by "unhealthy state"? Hollywood (the location) has always been skeazy/decrepit location (at least, after the 60s). Hollywood (the idea) is still going fine...other places have just developed their own media output too. One thing getting stronger doesn't mean the other is now sick, unless your only mental model is "defeatism". If anything, the US not being the only media producer in the world has made it easier for smaller/more indie/more culturally significant media to thrive in the US again. As to Video Games, I don't even know how to tackle that. The US and Japan still dominate the video game market and have since the 80s (with the US solely dominating it before). And the American-led Independent/art games scene has been in it's golden age for about a decade now. It's impossible to defend/explain something without a comparison point; but just your vague abstract comments are falsifiable on their face.
    • pests 2y ago
      I think you are debating whereas OP was just sharing a memory.
      • deaddodo 2y ago
        I'm not debating, I'm explaining the inaccuracies of their perspective.
        • pests 2y ago
          OP was just giving their opinions and telling their memories ("when i was younger") People can remember incorrectly or wrongly, and things can change. You don't have to explain the inaccuracies all the time. Sometimes its okay to tell a story or a moment from memory and be wrong or incorrect. It would be like correcting your grandfather who told stories of walking up hill both ways in 4ft of snow. "But grampa, this area has _never_ received 4ft of snow." That's not the point, per se. Or at least my $0.02.
• wg0 2y ago
  It is basically soaring because there's a drive to pull things from China. That is posting lots of economic activity for sure. Others in contrast aren't in that race to cordon off from China.
• loufe 2y ago
  It's also the distorted ability to rack up ungodly amounts of debt without facing the normal consequences of doing that. The US economy is booming, but it's borrowing from two decades from now to fuel the moment. When their debt gets unmanageable, the world's economy will enter a depression, IMO.
  • skybrian 2y ago
    Maybe, but low interest rates have been over for two years and so far, so good. Also, not exactly borrowing from the future (this is impossible without a time machine). More like borrowing from others based on expectations about future income.
• Entalpi 2y ago
  Does anyone know of a more accurate economic measurement of growth rather than GDP? Building bombs a la Russia and paying a lot for healthcare is great for GDP but are those money well spent to grow the economy?
• Kon5ole 2y ago
  Being poor is really terrible in the US, being rich is really great. Everybody learns this from day 1 and get reminded of it almost daily. There are downsides to such a society but it creates a strong incentive to get rich, or at least to never become poor, and thus more economic activity.
• skybrian 2y ago
  Krugman pointed out [1] that 10% of US GDP is in tech counties and Manhattan, with 4.4% of employment. I wonder if productivity growth is mostly there too? [1] https://bsky.app/profile/pkrugman.bsky.social/post/3lcii6zna2k2d https://bsky.app/profile/pkrugman.bsky.social/post/3lcii6zna...
• spaceguillotine 2y ago
  I've never known more homeless people before in my life in America, seems like its only the rich getting richer and the poor getting poorer and less healthy.
  • bpt3 2y ago
    And I know zero homeless people. Anecdotal observations are meaningless with respect to a multi-trillion dollar economy with hundreds of millions of participants.
    • atoav 2y ago
      What are you talking about? Anecdotal evidence alone is worthless, but paired with statistical evidence it isn't. And we have that evidence. Also: you "not knowing" a homeless person is itself anecdotal and not only that: it is actually worse than the evidence you attacked. The critiqued evidence is about how many of X a person sees. That isn't perfect, as it depends and how observant that person is and how much they go out (and where). Your counter of "not knowing" is by magnitudes worse, since on top of the previous flaws your number now also depends on how sociable you are towards homeless people (given the sentiment displayed I guess: not at all). So not only is your criticism wrong, you are actually at fault of the very method you critizised — only to a much higher degree.
      • bpt3 2y ago
        > What are you talking about? I'm talking about how an individual experience is irrelevant when talking about the entire US economy. > Anecdotal evidence alone is worthless, but paired with statistical evidence it isn't. And we have that evidence. I guess? But only because you've paired something worthless with something that isn't and then focused only on the portion that isn't worthless. > Also: you "not knowing" a homeless person is itself anecdotal and not only that: it is actually worse than the evidence you attacked. Whoosh. > The critiqued evidence is about how many of X a person sees. That isn't perfect, as it depends and how observant that person is and how much they go out (and where). Your counter of "not knowing" is by magnitudes worse, since on top of the previous flaws your number now also depends on how sociable you are towards homeless people (given the sentiment displayed I guess: not at all). Again, whoosh. > So not only is your criticism wrong, you are actually at fault of the very method you critizised — only to a much higher degree. Whoosh!
• redeux 2y ago
  The results of the last election tell a much different story. If the economy was soaring for the average person then I don’t think control of the government would have changed or at least not as dramatically.
  • mattnewton 2y ago
    https://www.pewresearch.org/politics/2024/01/25/views-of-the-nations-economy/ https://www.pewresearch.org/politics/2024/01/25/views-of-the... Views of how the economy is doing are also highly correlated with political party and where you get your news. I’m not sure where the casual relationship begins but it could be where you get your news determines how you think the economy is doing and where you get your news is from political voices you agree with
  • Gibbon1 2y ago
    The St Louis fed has a plot of units of housing over the last 25 years. Since 2008 we're short about 15 million units of housing. Which is how everyone that works for a living is getting squeezed. Rents and mortgages have sucked up all the disposable income.
  • TrapLord_Rhodo 2y ago
    The economy can be soaring and the average person still struggling... Alot of the economy has been more and more centralized. Stocks and real estate might be at all time highs, but thats not liquid to the average joe.
  • dtquad 2y ago
    [flagged]
  • refurb 2y ago
    The economy was but one of many issues that help decide the election.
• theowwnanan 2y ago
  Keeping stock market healthy is good for all
• deleted 2y ago
  [deleted]
• nextworddev 2y ago
  It’s called having world’s reserve currency plus leader in tech platforms and AI.
• indulona 2y ago
  because of uncontrolled money printing, duh.
• epolanski 2y ago
  Because America has the right mix of ingredients of greed, capital, culture, know-how, regulations, etc to thrive in the age of IT and finance. Those who replicate the formula may not have the ingredients and those who do have the ingredients use different formulas.
• locusm 2y ago
  Australia has gone backwards in the last 3 years - I think we sit around 20th in the world now.
• karaterobot 2y ago
  I knew that if I clicked into this thread, I'd learn about how this was actually bad news.
  • qwerpy 2y ago
    Between the self-hating Americans and the smug Europeans, there were a lot of people who just had to voice their displeasure.
• TriangleEdge 2y ago
  America is so prosperous that there's armed guards in grocery stores here in Seattle.
• joejohnson 2y ago
  One of America’s biggest rivals is in fact the EU and a unified Eurasian continent. But luckily the ties connecting this continent literally blew up, the price of energy in Western Europe skyrocketed and it sent Germany (and thus the whole EU) into a recession. Even better, these “allies” are being forced to fund their own demise.
  • jaco6 2y ago
    You’re right. If I were European I’d be wondering why we don’t team up with Russia in our own alliance and leave NATO to the Anglos.
    • wezdog1 2y ago
      An undemocratic despot nation? Keep up the great ideas.
• reramuyc 2y ago
  [dead]
• PittleyDunkin 2y ago
  I realize we must reason in terms of states, but the real players make moves that states will go iut of their way to avoid recognizing. We MUST move beyond states and into mayor holders of capital as primary entities of meaning in this world. The state's peak was sometime between 1995 and 2005.
  • deleted 2y ago
    [deleted]
• laidoffamazon 2y ago
  And yet, exit polls said ~67% thought the economy was in bad shape. I tend to agree with the objective data showing economic strength here. I think a big cross section of the country was just struck by nothing less than a mania.
• sriram_malhar 2y ago
  I like Vinod Khosla's take (on Twitter): Stop measuring GDP and instead measure the total income of the bottom 50% of the population and optimize policy for that. Additions and exits from this group can also be tracked. We get what we measure. Will this raise income inequality?
  • RcouF1uZ4gsC 2y ago
    This the guy that illegally keeps fencing off public beach?
    • janalsncm 2y ago
      I would say this is a pretty good example of an ad hominem attack. https://en.m.wikipedia.org/wiki/Ad_hominem https://en.m.wikipedia.org/wiki/Ad_hominem If the standard is that someone has to be unimpeachable before they can suggest a well-being metric than no one can.
      • semiquaver 2y ago
        I disagree. When one demonstrates contempt for the public we should be inclined to pay less attention to their opinions on public welfare.
      • anon291 2y ago
        No this is an example of pointing out hypocrisy. He says that others should do what he is not willing to do. If he were to practice what he preached, the bottom 50% of income earners would have access to his beach.
        • inemesitaffia 2y ago
          The messenger doesn't need to stand by his message
          • 0xDEAFBEAD 2y ago
• yabatopia 2y ago
  Oh boy, here we go again. It's like the pre-2008 financial crisis all over again. Growth is nice, but one look at the debt charts (public debt, credit card debt, car debt, mortgages, student loans, ...) and the trends in defaults and you know what's coming. Add the upcoming tariff plans and the gutting of financial regulations and consumer protection in the mix and you start asking yourself: in 10 years time, will we talk about the financial crisis of 2025 or 2026?
• dependsontheq 2y ago
  There are only a few factors driving this and they are very hard for Europe to solve: - the Bay Area an industrial cluster not comparable to anything we had before due to the scalability and the capital requirements of the products - the US market, the most powerful consumer market in history allowing massive economies of scale at companies, companies can work with a much higher productivity level - capital markets that can finance the most outlandish ideas - better demographics - less crisis and russian intervention (Brexit, Syrian war, Ukraine war are all part of Russias attacks) - bureacracy and regulations are totally overvalued as a factor, definitely something we should solve, but the EU would not be a tech leader without GDPR
• _1tem 2y ago
  If you go to the doctor with a problem and get a blood test and they say that everything looks fine, but you don’t feel fine, then you don’t say: “well the numbers are right, I should feel fine”. Rather you try to find what the numbers aren’t capturing, because you know something is wrong. Same with the economy. The perception of the economy being bad is really pervasive as demonstrated by the last election, and perception matters, because selective numbers don’t tell the whole story.
  • Havoc 2y ago
    That’s also not a US phenomenon. Hearing the exact same in UK too. The stats say things are ok but people standing at grocery checkout disagree Strong divergence of 1% and rest
    • adamc 2y ago
      As someone doing OK economically, when I go to the grocery I see the same thing they do: Prices are going up on key items much faster than income is rising. I didn't vote based on that, but that doesn't mean they are wrong that it's a problem. It's easy to imagine that if you were barely making it, things are worse now. Rising income isn't a phenomenon that hits everyone equally.
      • eitally 2y ago
        Indeed. The problem is that for most people income doesn't really go up unless they change jobs. Or, at least it goes up so slowly (0-3%/yr) as to be undetectable compared to, for example, the price of a loaf of bread going from $4.99 (2020) to $5.99 (2023) to $6.99 (July 2024) to $7.99 (December, 2024). I think the "vibecession" concept makes sense when considering CPI of consumables since individuals are far more attuned to price changes than they are for durable goods.
  • michaelcampbell 2y ago
    "The map is not the territory"
  • 2y ago
• hunglee2 2y ago
  GDP is a measure of the marketisation of society. If I go visit my grandma over the weekend, my activities do not register on GDP. If I hire a care assistant for $800 per day to do so, that's $800 to national GDP. The encroachment of the market into society correlates with record levels of mental and physical health crisis. US life expectancy has declined over the past three years, even as 'the economy' has surged ahead. The measures are wrong - and we all know it - apart from the financial press it seems
  • fooker 2y ago
    > US life expectancy has declined over the past three years Do you have a source for this ?
    • Terr_ 2y ago
      There was a big dip in 2021, but it has started rising again, and it's possible it might rendezvous again with the old trend. This means parent-poster might be technically correct in the sense of "between T to T+3 it decreased", but I would not jump straight to blaming the the longer-term background horribleness of US health insurance for it. It's far more likely to be that teensy-weensy COVID-19 pandemic, both in terms of direct damage and also reduced care for everything else. https://www.politico.com/news/2024/03/21/cdc-us-life-expectancy-rises-after-two-year-dip-00148193 https://www.politico.com/news/2024/03/21/cdc-us-life-expecta...
      • topkai22 2y ago
        Covid and opioid deaths. Opioids are bad. To quote the lancet “Opioid overdose mortality rates are alarmingly high, but measures based on death counts alone do not fully capture the impact of this crisis as they do not account for the young age at which most opioid-related deaths occur…” (https://www.thelancet.com/journals/lanam/article/PIIS2667-193X(24)00140-6/fulltext https://www.thelancet.com/journals/lanam/article/PIIS2667-19...) The particular article found opioid deaths lowered life expectancy by 0.67 years, which is a crazy number. Drug overdose deaths finally seem to be trending down in 2024, but they are still elevated and awful.
• arkh 2y ago
  > Why America's economy is soaring ahead of its rivals Because young people are not taxed to pay for retired people vacations. And because there is less of a credential obsession for most jobs. So you get people starting to work younger: they create value earlier instead of being a pure weight on the system. They're taxed less so they keep more of their money so they're established (house, business etc.) earlier and can spawn a new generation earlier. Most of the socialized states have become gerontocracies where most of the GDP is funneled from the young actives to the retirees. Be it from socialized healthcare (old people use the majority of it), cushy retirement benefits or the simple fact they own most property and can rent it and lobby to keep prices high. In France, median retirees have enjoyed better revenues than median working people for multiple years already. What was created so old people who can't work would not be destitute has become a life goal because it's "when you can start to enjoy things". 50 years ago, we had 3 active people paying for 1 retiree. Now those 3 people? We only got 1.7 active people paying for each of them. Either the current working generation decides to stop the cycle and sacrifice themselves by continuing to pay for baby boomers and they forego their own "end of life vacation" so their rare grand children can benefit from their own work. Or the country is a third world economy next century.
• goodpoint 2y ago
  "rivals"?!
• sharpshadow 2y ago
  The DAX reached this year a new record of over 20000. Is Germany doing good right now? On the news reports they even have to mention that it’s how the investors predict the future market, because everybody here know the economy is shit atm. If I’m not mistaken most of the growth in the capital market comes from the continuing money „printing“ right?
  • Lionga 2y ago
    DAX companies make 90% of the money outside of Germany. Thinking the DAX reflects the german economy is uninformed at best.
• pelorat 2y ago
  Us Europeans are more 'detached' from the economy than people are in the USA. We basically coast along. We don't live on credit, but debit, and most people have zero investments outside their house. We're content and risk adverse and don't care much for the stock market (even though many people's pensions are tied to it). In places where higher education is cheap, or even sometimes free (like Sweden), there's less pressure to perform after graduation. It's quite common to study some field, but after graduation you go do something completely unrelated. A degree is just a means to an end, something to put on your CV to get an edge over those that does not have a degree. Those who study for the purpose of using their knowledge to create a successful business are very few. And when it comes to starting a business, the EU market is rarely the target, instead the focus is the domestic and much smaller market. It's also difficult to start a company that targets a larger market from the get go, because it means you need to advertise in multiple countries, target different languages, set up offices and contacts, and all of that costs money that startups do not have. The EU single market is largely a myth from the perspective of wanting to start a successful company that can compete internationally. It's not any easier now than it was before the EU existed. The EU is still a collection of different countries, with different languages, and the people in one country doesn't really care about what happens across their border or which new and up-and-coming company they have to offer. EU citizens like American companies, because we here about them on the news constantly, but we are completely oblivious to companies from our European neighbors.
  • sajithdilshan 2y ago
    This is so true. I’m a software engineer in Berlin, and I’m from Sri Lanka. It amazes me how many young people are still pursuing bachelor’s or master’s degrees in business management or related fields instead of specializing in STEM fields, where they’d have a better chance of securing a high-paying job and making a meaningful impact. It seems like everyone wants to work for big four audit firms, but they often end up doing poorly paid internships in companies unrelated to their higher studies field. As you mentioned, the EU single market is just another bureaucratic monster. If you want to expand your business to other countries, you’ll need to apply for passporting. Then, if you ever want to provide services related to local taxes, you’ll have to have a physical office registered in the respective country. Each country also has its own nationalistic preferences regarding which services and products they use. For example, the French tend to prefer French companies over any other company that provides the same product, or even a better version from another European country. In essence, the EU is simply a massive tax burden on European citizens, benefiting only a handful of countries within the continent.
• lifeplusplus 2y ago
  Housing and rent say otherwise
• _1tem 2y ago
  For some reason I can’t help but think of the analogies of our current situation to the last years of the Soviet Union, when on paper it looked like a juggernaut albeit with decrepit leaders, but the numbers were lies, more lies and statistics. The elites were filthy rich but the situation on the ground was unraveling - basic services were starting to fail (analogies to Private Equity ruining everything in America from clinics to plumbing). And then you have Gorbachev who recognized the situation and attempted a “perestroika” (analogous to Trump and his reformist policies including DOGE) but that led to the final collapse. The analogies are just too many, even the failure in Afghanistan.
  • TheJoeMan 2y ago
    Perhaps you're onto something regarding the "vibesession"... right now, if I had to call a plumber, I would feel immense dread. I would undoubtedly be fleeced with no recourse and still receive substandard work. What's the difference between this and the socialists where you figured you'd get crap service for "free"?
  • RationPhantoms 2y ago
    I think I'd pay a premium to ensure the company I'm dealing with is not run by private equity. Is there a way to see that as a common citizen in the US?
• PeterStuer 2y ago
  Why does America still have anything that resembles an economy?? Two word answer: reserve currency
• leokennis 2y ago
  And yet, mysteriously, somehow, as a European, I am pretty glad not to be a US citizen right now. I earn more than enough to live while working only 36 hours per week and my government is not run by lunatics.
  • Toine 2y ago
    > my government is not run by lunatics Oh my sweet summer child
  • jokethrowaway 2y ago
    I'm glad for you and vehemently disagree. Taxation is ridiculously high, public service has abysmal quality so I need to pay for private care to get healthcare in time and crime runs rampant on the streets. Albeit it's still not as bad as the US. Our politicians are completely deranged. The only thing keeping me in EU is the fact that taxes in the US is still pretty high tax / high cost of living, too many people are woke and crime is too high. Landscapes, history, culture and food in Europe are also unbeatable.
• gadders 2y ago
  We have a strange situation in the UK where GDP is going up (thanks to immigration) but GDP per person is actually going down (thanks to immigration).
• loftsy 2y ago
  I long for a US-like entrepreneurial attitude here in the UK. Business people here think that they are playing zero sum games. Everyone looks to the govt for funding and direction. I am reflecting on Deepmind. This company saw the AI revolution before anyone else. London based. They did an amazing job. Sold to Google. The problem is that long term the growth and money now goes back to the US. Maybe the UK is just too small to produce world leading companies.
  • dukeyukey 2y ago
    The UK already has world-leading companies (as do many smaller countries), but it's very very hard to produce planet-scale wide-appeal consumer companies dur to market size. Even if it does happen, the temptation to appeal more and more to the US market is irresistable.
  • March_Hare 2y ago
    I'm sure it's not nothing, but to what extent does it matter that Alphabet is headquartered in the US? Deepmind seems to still be based in Kings Cross - and London benefits.
• fragmede 2y ago
  What turns commenters so smarmy and grumpy when the topic is historical? So many comments are uncurious swipes telling each other to read a book.
• flkenosad 2y ago
  Some day we'll have so much digital money we can buy whatever we want! Too bad there won't be any trees left...
• flkenosad 2y ago
  Because they could care less about anything else.
• sufehmi 2y ago
  https://archive.md/t8z0P https://archive.md/t8z0P
• jcfrei 2y ago
  I've given the strength of the US economy a lot of thought recently and it comes down to 8 main reasons. The two obvious ones are: - Liberal labour and corporate laws - abundance of resources (fossil fuels + fertile soil) The other 6: - Low housing prices due to vast land reserves and cheap construction. leaves more capital available to invest into the stock and bond markets - An excellent system of highways. reduces transportation costs for companies and allows for high labour market flexibility (+ high willingness of Americans to commute large distances) - Coherent labour market that spans roughly 330M people - A nation wide well established 401k system that funnels a lot of the retirement savings into US stocks and bonds - incl. venture capital. - higher affinity for risk taking. Americans are in large parts descendants of risk taking expats - Large maritime borders and only two (friendly) neighboring countries
  • BirAdam 2y ago
    I would say that those are solid reasons historically, but I would say that stocks/401k/IRA have spun out of control and driven P/E ratios to stupid levels that are unsustainable. Also, housing prices are no longer affordable for the majority. For example, many people I know bought homes in 2019-2022 and they are now stuck. They could sell and make money, but then they’d be buying roughly an equivalent house to the one they’re in due to rising costs. They could rent, but rents have become extortionate.
• macronitis 2y ago
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• elzbardico 2y ago
  During the peak of Brazil’s Military Rule and the Economic Miracle in the early 1970s, one of the General-Presidents, Emílio Médici, made a strikingly honest remark: “The economy is thriving, but the people are not.”
• piker 2y ago
  My experience as a expat in London is that new things aren’t really being built in Europe today, and that fact is greenwashed over to keep the people here from recognizing how miserable the infrastructure and housing are compared to modern North American counterparts.
• hnpolicestate 2y ago
  Let them eat cake.
• dathinab 2y ago
  Is "Americas's economy" soaring or "Americas top .1%s economy" soaring? Because as someone not from the US it often looks a lot (a very big lot) like that in recent year most economical growth exclusively went to a very small minority of US citizens but not the US as a whole. Like wasn't people economically struggling while the Democrats claiming everything is fine 'cause look economy is growing one of the more believable reasons of people not voting for Democrats (!= voting for Trump)???
  • BirAdam 2y ago
    Yeah. The US economy isn’t doing well overall, and it would be worse if the US Dollar weren’t the global reserve. The thing you mention with money going to the top is exactly what one should expect in inflationary monetary policies and large amounts of government spending. It’s also what one should expect in a representative democracy. Money goes first to the banking cartel and the. To those who are politically and/or financially well connected. Period. They enrich themselves and the rest of us pay $6 for a carton of eggs.
• pattt 2y ago
  Different regions play complementary roles in the global economy. The oversimplified description is that the US drives innovation and risk-taking, Europe prioritizes social welfare and sustainability and Asia powers manufacturing. Forcing everyone to compete in the US-style growth race would be disastrous - imagine the burnouts, resource drain and market instability if every country tried to be Silicon Valley. Plus, many Europeans simply don't share the "get rich quick" mentality - they value work-life balance and social security more. Whether we're being pushed into this growth-obsessed game is another debate. Ideally, regions should focus on their strengths while maintaining independence. Europe can keep its social model while smartly adopting tech, Asia can focus on sustainable industry, and the US can lead in innovation. It's like an ecosystem - diversity makes it stronger. The goal shouldn't be for everyone to play the same exhausting game, but to maintain different approaches that complement each other.
  • shaftoe 2y ago
    Your model works when every player provides something of value. What does Europe's self indulgent attitude bring to the international table?
    • nemo44x 2y ago
      A few luxury brands and a well preserved history and culture that is nice for tourism. Lots of high value human capital if only they could truly unlock it and allow it to thrive. Today's Europe is just milking what it can as it continues its decades long crisis of identity and pessimism. Demographics are destiny and it's extremely problematic for Europe's future. There's no real leadership and it's one large admin state that can only agree to fund people's lives today at the cost of tomorrows lives using whatever assets it has left from its golden age before the wars. It's no wonder no one is having kids as they know the future is bleak. Just let the admin state manage my life and take it easy and not worry too much and fade away into the future until it's all gone...slowly and then all at once. The jungle produces strong creatures and much of the leading world is much more full of jungle animals than the zoo animals the people of the European continent have become generation over generation.
• slifin 2y ago
  The US dollar is the world's reserve currency So countries keep huge stores of dollars in their reserves because they need it for trade Then what happens is the US starts the money printer to pay for US government services This inflates the dollar and means that everyone who holds the dollar has lost value Including Americans who are paid for their labour with dollars and do not own assets So wealthy Americans/companies see an influx of money, asset prices rise and every other country gets poorer relative to the USA
  • agp2572 2y ago
    I would argue the opposite. If you compare US dollar to every other currency the value of their currency has decreased a lot compares to US dollar. This would be a plus to hold US dollar as their own currency has depreciated and holding more dollars has helped them reduce their losses. But it has one down side is that if you hold too much US dollar the country exposes itself to US monetary policy.
    • trts 2y ago
      not sure there is a country on earth that you could save your money in the national currency and not watch inflation rip away the value of your earnings. The purchasing power of USD has declined 95% over the past century. Prettiest horse in the glue factory
      • RandomLensman 2y ago
        Is that with or without interest on holding the USD?
      • feoren 2y ago
        My hot take: currency is not meant to be held, it's meant to be spent. I know, I know: "store of value" is one of its definitions, but it's OK to have short-term and long-term stores of value. Money velocity is a healthy thing for the economy. Hoarding wealth isn't, and besides, everyone with significant wealth is already storing most of it in assets anyway. There's really no reason to want a particular currency to retain its value over 100 years; 1% to 2% inflation is quite healthy. It doesn't rip away the value of your earnings as long as salaries keep up with inflation -- which they don't, but that's the real problem.
• lenerdenator 2y ago
  The American stock market is soaring ahead of its rivals. Stock markets are just an indicator of how surplus value is distributed to shareholders, not a picture of actual economic health.
  • TulliusCicero 2y ago
    GDP (per capita) is not the same thing as the stock market, even if they're often roughly correlated.
• talkingtab 2y ago
  This is corporate propaganda. A corporate take on America based on stories that are atypical. The US is a country where the stock market is soaring while more and more people are not paid a living wage, are homeless and cannot obtain fundamental health care. FT is a written for and read by those fewer and fewer people who benefit benefit from this situation. As tech people we are often the beneficiaries of the ever growing disparity between the haves and have-nots, so we do not want hear or think about where this road leads us. Not a good place folks. America has given free reign to Corporations with United vs FEC. The preamble to the constitution now reads "We the Corporations of the United States".
  • deleted 2y ago
    [deleted]
• maxehmookau 2y ago
  Is it because corporate profits are put ahead of the living standards of the masses? I bet it's that.
• insane_dreamer 2y ago
  If you look at the "American economy" as "corporate growth and wealth", then yeah, it's doing great. Best in the world. But if you look at it as "the economic wellbeing of the country's citizens", then it's average at best. The second measure is the one that matters. Enough with the debunked trickle down economics bullshit.
• ricksunny 2y ago
  What does ‘soaring’ mean? Are economies ‘rivals’ to each other? Are we in a race? Where is the finish-line? Thank god for this instructiveness of this headline for remediating the apparent deficency of the economics classes I took in university and in business school. /s The business press makes me want to gag sometimes, and trims our mindset to keep us plebes in an unnecessarily competitive mindset with respect to each other. Who do you think benefits from this narrative? What are FT’s interests here? Subscriber revenue? Ad revenue? What are the interests of those stakeholders?
• nyeah 2y ago
  Good as far as it goes. But employees don't get paid in productivity, we get wages.
• gorfian_robot 2y ago
  why does this article conflate the existence of AI startups with strong economic growth for the last four years? it is almost like there is another factor at play ....
• corimaith 2y ago
  I see the economic conspiracy theorists are on a field day here...
• satao 2y ago
  America is a de facto keynesian state while the European Union is pushin austerity since 2008
• ffitch 2y ago
  2.8% GDP (and labour productivity) growth doesn’t look that impressive when budget deficit is at 6.4%. A large portion of US GDP is domestic consumption.
• bugtodiffer 2y ago
  is it? x'D
• vondur 2y ago
  I guess compared to most of Europe, which is getting poorer? I think the coming decades will now be dominated by the growth of the Indian economy, who will probably be the biggest beneficiary of the worldwide de-investment in China.
• dannyobrien 2y ago
  Just to throw in another opinion, one that I think will be guaranteed to annoy the majority of commenters so far: This piece argues that the US isn't doing that well economically in absolute or historical terms, but only looks like that way because the popular point of comparison, Europe, is doing even worse: https://thenextrecession.wordpress.com/2024/12/04/us-economy-an-exceptional-boom-or-a-bubble-to-burst/ https://thenextrecession.wordpress.com/2024/12/04/us-economy...
  • rustyzig 2y ago
    Isn't that the general understanding? As I understand it, everyone was expecting the world to fall into a recession on the heels of the COVID situation and everything that came with that. Which much of the rest of the world effectively has (or at least close to it), as expected. The surprise is that the US is still doing okay.
  • TulliusCicero 2y ago
    But Japan is also doing not great, right?
• whateveracct 2y ago
  the funny thing to me about the "Well, I'm not doing good in this economy" anecdata rebuttals to the reportedly good US economy is that..people have always lived paycheck to paycheck in the US economy. Eliminating that shouldn't be the benchmark for "good." Literally everyone can't be a winner all the time.
• steveBK123 2y ago
  US economy is soaring because the old guard (Europe) passed peak and all the new guard (Japan, Korea, Taiwan, China, BRICS) didn't quite live up to the hype once they reached near wealth parity. Where would you rather invest today - US or a demographically stagnant, highly regulated Europe? US or rapidly shrinking countries with risk-averse cultures like Japan and Korea? How about China where they might expropriate you / throw you in jail? Or Taiwan which is under the cloud of Chinese invasion? Etc. Cleanest dirty shirt and all that.
  • saturn8601 2y ago
    Said in another way: The US is the last standing haven for the robber barrons of the world. Once the US falls there will be nowhere left for them to go. If we just fast forward the video tape we see where this is going. Maybe thats why Elon is so eager to get to Mars.
    • steveBK123 2y ago
      The US is the last place standing that doesn't look at all innovators & leaders as robber barons. Some are, sure. But if you want economic growth, someone needs to take risk. Capital formation, investment, founding companies. This is what leads to hiring and jobs. Look at ossified cultures in EU, UK, and even Japan where stringent hiring/firing laws, shrinking populations and dire economic growth mean it's great to already be 40/50+ years old protected worker. Unfortunately it also means youth can't find jobs, and where they can they are under more tenuous contractual agreements than their older cohort has. Plus an increasing share of the taxes the youth pay will be to fund the generous retirement of their elders who outnumber them. And again before some US Doomers chime in, take a global perspective. Go look up some rich world unemployment stats. The US right now has some of the lowest unemployment both historically and when compared against all the current global rates.
• jurli 2y ago
  It's kind of crazy that with so many opinions on economics, no one ever mentions the most obvious things. When elite papers say the "economy is doing well," what they usually mean is "the GDP is going up way higher than other places." What exactly is a GDP? It's literally the total sum of money SPENT by government, consumers, and businesses combined (this is the textbook definition, and how it's calculated). When prices of stuff go up by 25% because there's a shortage of labor, or shortage of material, or shortage of infrastructural efficiency, by definition the GDP goes up 25%. There isn't any increase in life quality, nor any increase in the amount of stuff produced. This is why people feel like the economy is complete shit, while all the numbers point to the economy is doing well, and all the institutions that rely on these data (think tanks, policymakers, journalists) are baffled why people don't feel the same. In contrast, in places that produce things very cheaply, if the export goes down, its GDP numbers will go down by definition. This in turn causes an overflow of goods internally, and prices paid by internal consumers even lower, therefore decreasing the GDP numbers even more. This is the opposite of the above scenario, where people are getting better things for cheaper, and their lives are improving without any increase in total compensation. All the while the numbers are telling a different story. I think GDP might have been one of the biggest red herrings for policymakers. It's distorting their view of what's going well and what isn't.
• garydonna540 2y ago
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