Canadian Cincinnatus

To win the debt limit debate you must personalize it

The problem for Republicans is that the debt limit debate is too abstract for many American voters to really understand. What they see is unpleasant: noisy, squalid negotiations that seem to go on forever. So when President Obama says, just raise the debt ceiling so that government can continue to function until after, oh say, Nov 2012, many members of the public, particularly those for whom politics is not a central interest, are sympathetic: “a year and a half of peace and quiet, sounds good to me.”

Part of the reason for this sentiment is the numbers involved are incomprehensibly large. How big is a trillion anyway? - that is 1,000,000,000,000. To get to the disinterested ‘moderate’ voters, the deficit hawks must personalize the debate.

To do that, you have to make this argument: there are roughly 308 million people in the US; $1 trillion in debt translates into roughly $5,000 of debt for every man, woman and child; the $14.5 trillion federal debt translates into a debt of roughly $47,000 for every American; the federal government accumulates $1.5 trillion in debt every year; if the debt limit is raised as president Obama would like and the government continues to spend at its current rate, that means an additional $11K of debt for every person. That is money you - yes you, I’m talking to you – have to eventually pay. If you have a family with 2 kids, that means your family – your family – must pay an additional fourth-four thousand dollars over and above any debt that you have accumulated for yourselves and that the federal government has already accumulated for you. 

At some point, a compromise on the dent ceiling will be reached. Who wins in that compromise depends on who wins the hearts and minds of the public. Why isn’t anybody in Washington making arguments like this?

So what if 2012 turns out like 1996?

Many conservative commentators are worried that the 2012 election will turn out like 1996, which saw Bill Clinton recover from the 1994 Republican landslide.

Personally, I doubt it. In 1996, unemployment was low, and falling; economic growth was strong and accelerating; gas prices were low and going nowhere; and Ross Perot siphoned off 8.4% of the total vote from hapless Bob Dole, the most lacklustre Republican Presidential candidate since Gerald Ford. None of these conditions (except for maybe the last – if Mitt Romney wins the nomination) obtain today. But even with all of this going in his favour, President Clinton still had to clinch the deal by passing comprehensive welfare reform (at the urging of Dick Morris). Can you imagine Barack Obama doing something comparable? I can’t. It’s simply not in his gene pool. And who is his Dick Morris anyway?

But still, what if Obama pulls off an Arkansas comeback? Would that be so bad?

I don’t think so. Lets look at the aftermath of 1996 to see why: first and foremost, the federal budget got balanced; second, the Republicans retained control of Congress for another 10 years; third, the GOP remained dominant in the state houses and governors mansions; fourth, capital gains taxes were cut; fifth, deregulation continued; and sixth, no more radical left-wing agenda items were enacted. So exactly in what way was 1996 good for Democrats?

It was certainly good for one Democrat, who got to stay in the White House for another 4 years (though at the height of the Monica Lewinski scandal he might have thought otherwise). But other than Bill Clinton, the aftermath of 1996 was a nightmare for the Democrat Party, both politically and policy-wise.

While I believe the possibility of Obama becoming a born-again pragmatic conservative is slim, conservatives should not be afraid of a 1996-like outcome. Personally, I think 1996 – in all its manifestations – would be a pretty good result, all things considered.

The Democrats are right about the debt crisis, but only in ways that undermine their basic governing philosophy

Democrats like to scoff at conservatives when we say lower tax rates can increase tax revenues. Conservatives like to point to the Laffer curve, which states that government revenues can go up when tax rates go down. Unfortunately, what conservatives don’t acknowledge (or are unaware of) is that the more politically popular a tax cut is, the less it stimulates the economy. To get people hiring again, you need to cut the tax rate of employers. And who are they? Mostly, they are the ‘millionaires and billionaires’ who make over $250K a year - to use Obama’s terminology. In other words, the Laffer curve is right, but only when it comes to tax cuts for rich people, corporations (the US has one of the highest corporate tax rates in the developed world), investors and savers.

Why don’t middle class income tax cuts do much? Because the middle class doesn’t do much hiring. They might spend a bit more but that isn’t particularly advantageous because they spend too much anyway, judging by the consumer debt load the average American carries.

Another thing: for a tax rate to be stimulative, it must be permanent. Hiring decisions are made on the basis of long-term planning, which are only affected by long-term tax rates. The temporary Bush tax cuts are nowhere near as stimulative as they would have been if they had been permanent from the start. That is why they failed to boost federal revenue.

Therefore, for a Republican tax cut program to bring in more revenue, the GOP must not pander the public with populist moves. They must attack the antibusiness rhetoric of Obama head on. There is no other choice.

Another thing the Democrats are partly right about is that when they say the deficit is caused by the Recession’s lower tax revenue not Obama’s spending, they are 50% correct. Though while spending soared under Obama, tax revenues have cratered. The graph below illustrates this.

But what is the best way increase tax revenue? By taxing the millionaires and billionaires who do the bulk of the hiring? No. That will drive even more people onto the unemployment line, increasing government spending even more. Much of the increased spending in the past two years has been due to government aid to the poor. A record 44 million Americans are now on food stamps. Medicaid, food stamps, section 8 vouchers and other welfare-based entitlement programs have all increased by over 50% in the past two years. These have been the real drivers of spending growth, not Social Security or Medicare (these middle class entitlements have increased by only 7% and 6% per year respectively). As Arthur Laffer himself pointed out, you can’t balance the budget on the back of the unemployed.

To increase tax revenues, you must grow the economy with pro-growth policies such as tax cuts on savings and work, as well as removing restrictions on work and savings through deregulation. Do that and tax revenues will swell while spending on those burgeoning welfare entitlement programs will simultaneously shrink as people will go back to work. Interestingly enough, Obamacare hasn’t been a big contributor to the deficit yet. That fiscal hurricane hasn’t made landfall yet. The treasury busting entitlements have all been in place since the New Deal and the Great Society.

Of course, none of this is to suggest that cutting discretionary federal spending back to 2008 levels (or for that matter to 2002 levels) is a bad idea. It is not. It is a very good idea. Ultimately, the budget can’t be balanced without serious cuts in discretionary programs. It is just that such cuts cannot by themselves solve America’s fiscal problem. The $1.5 trillion deficit is just too big for that.

 

Forbes magazine – “Give Greece What It Deserves: Communism”

This article in Forbes echoes I have been saying all along about the Greek crisis: don’t keep throwing good money after bad. The important thing for the EU is not to save Greece – it is all but lost – but to teach the other PIIGS (Portugal, Ireland, Italy and Spain) a lesson. The EU can do without Greece. It produces very little. But if the other PIIGS fail, the EU is toast.

“Once in a great while an opportunity comes along to deliver justice to a people, giving them what they truly deserve. Greece’s time has come.

It must be dawning on all but the most obtuse member of the banking elite that they can’t possibly steal enough money from German taxpayers to save the Greek government from default. Put it off, maybe, but collapse is inevitable.”

“Why not go all the way and give the country what many of its people have been violently demanding for almost a century?

Let them have Communism.”

“If you don’t want the real contagion to spread, that is the disease of believing you can perpetually consume more than you produce, leave Greece to the Greeks and let the bankers take their lumps.”

I think too many people forget what a horror communism is (cf Van Jones). Perhaps a real live example in a European nation might serve to remind them.

 

Illegal immigration from Mexico declining rapidly: a lesson for Mark Steyn

This from esteemed commentator, Michael Barone:

“From 1980 to 2008, more than 5 million Mexicans legally entered the United States. And Mexicans account for about 60 percent of the estimated 11 million illegal immigrants in the U.S. today.

Immigration policymakers have assumed that the flow of Mexican immigrants would continue indefinitely at this high level. But now evidence is accumulating that this vast surge of migration is ending. 

The Pew Hispanic Center, analyzing Census statistics, has estimated that illegal Mexican entrants have been reduced from 525,000 annually in the 2000-04 years to 100,000 in 2010.

‘The flow has already stopped,’ Douglas Massey of the Mexican Migration Project at Princeton recently told The New York Times. ‘The net traffic has gone to zero and is probably a little bit negative.’"

“The Pew Hispanic Center estimates the 2010 illegal population at 11.2 million, down from the 2007 peak of 12.0 million and just about the same level as in 2005. It's probably lower today.

Even more important, things have changed in Mexico. Its birth rate has fallen from 7 children per woman in 1971 to 3.2 in 1990 and 2 in 2010, barely enough to prevent population loss.”

“Mexico has finally become a majority middle-class country, former Foreign Minister Jorge Castaneda argues in his recent book ‘Manana Forever?’ Mexico has more cars and television sets than households now, most Mexicans have credit cards, and there are almost as many cell phones as people.”

“The historic experience has been that countries cease generating large numbers of immigrants when they reach a certain economic level, as Germany did in the 1880s. Mass migration from Puerto Rico, whose residents are U.S. citizens, ended in the early 1960s, when income levels reached one-third of those on the mainland.”

I bring this up for two reasons:

First, this is a complete surprise to me. Everything else I have read led to believe that illegal aliens were overrunning the US from Mexico. Apparently those writers who are predicting that America will be run over by Mexicans are still stuck in 2007.

Second, and more importantly, this is a good cautionary tale for apocalyptic demographers like Mark Steyn, who take exponential trends (all demographic trends are exponential), extrapolate them into the future several decades and predict the end of the world as we know it.

As economist Thomas Sowell once noted, if you take a physical trend – any physical trend, no matter what it is – and extrapolate it linearly into the future, the result will be catastrophe. Sowell’s point, of course, is not that the world is bound to end but that linear extrapolation of physical trends beyond the very near future (i.e. nowcasting) is invalid. The world just doesn’t work like that. Sowell made this point to counter the predictions by environmentalists of widespread famine and oil shortages by the mid 1980’s.

It strikes me that when Mark Steyn predicted the Eupocalypse in America Alone, he made the same mistake that Paul Ehrlich did in his book, The Population Bomb, only in reverse. If extrapolating linearly into the future is an inaccurate technique, then extrapolating exponentially into the future is doubly bad.

I know these criticisms of Mark Steyn will get some pushback from Steyniacs in the comments section so I want to head some of this criticism off at the pass. Do not think I am a pro-immigration type. I am not. I would like to see illegal immigration eliminated and legal immigration significantly reduced (both here and in the US) in order for the melting pot to have a chance to integrate everybody into the body politic. Rather, what I am is anti-doom-mongering.  

I actually enjoyed America Alone and think it serves as a good cautionary tale. My only point is that it is not a forecast. I look at it like those Congressional Budget Office projections that predict that the US federal debt will exceed the world's GDP by 2050 (or whenever). These projections are good to demonstrate the absurdity and, oh what's the word for it - oh yes, sustainability of the current trends, but most assuredly they are not accurate forecasts, mostly because the very trends they highlight will create countervailing forces that will decisively change the course of the US.

To put it another way, consider a cohort of 100 people in one generation. If those 100 people produce 99 children, we are in a demographic death spiral, and if those 100 people produce 101 children, we are in a population explosion. If we follow the extrapolation logic of both Ehrlich and Steyn, our thinking must oscillate wildly between a Steynian apocalypse and a Club of Rome apocalypse. Only if those 100 people produce 100.0 children is there no cause for panic.

How Obama is short-changing the middle class and how the GOP could benefit from it, if they were smart

One mistake that free market proponents often make is that they conflate free markets with capitalist. The two are not necessarily the same thing, especially with capitalists at the high end. Companies like General Electric and Goldman Sachs are almost as much political organizations as they are business entities.

The dirty little secret of these outfits is that they don’t much like free enterprise. Why would they? They are at the top. Free markets mean competition and competition means potential competitors. From the perspective of their self interest, once you have reached the high ranks, it is much easier (and safer) to use your influence to get laws passed that kneecap your competitors more than they kneecap you. As a bonus, you also get showered with taxpayer money. This is why big business is often in bed with socialist politicians. The baby they produce is called crony capitalism.

Which is why a big government guy like Obama is in cahoots with people like Gerry Immelt of GE. GE doesn’t mind anti-free market legislation like cap and trade because they will get all kinds of perks such as windmill contracts, and a ban on cheap light bulbs (which forces the public to buy more expensive substitutes). For Goldman Sachs, things are even better. The Fed loans them money at almost 0% interest, and they turn around and loan it to Tim Geithner for a percent more. No effort, guaranteed results and - because the sums are so huge - so are the profits. And best of all, the government implicitly insures them against failure because they are ‘too big to fail’.

The problem is, as Joel Kotkin points out, that the middle class in the US is really hurting. That is because the anti-business climate Obama has fostered has hit hard the upstart companies that provide most of the new jobs. 

This should be a golden opportunity for Republicans because the interests of the middle class are aligned with their free market principles. The GOP’s overall theme should not be government vs. private sector but insiders vs. outsiders. This message will allow them to point out all the cushy connections between the big banks and the Obama administration. And when Obama talks about taxing “millionaires and billionaires” they should point out that this group of people includes not just Paris Hilton but almost every employer. Why is there persistent high unemployment? Answer: because the President is at war with employers. When Obama talks about outsourcing jobs overseas, they should point out something Thomas Sowell said:

President Obama's rhetoric deplores such "outsourcing," but his administration's policies make outsourcing an ever more attractive alternative to investing in the United States and creating American jobs.

In other words, every law and regulation Obama has added, has helped to push jobs away from America. For a concrete example, take the aircraft plant Boeing built in South Carolina that would have employed 2,000. Obama’s National Labor Relations Board was working hard to stop that.

 

How to resurrect America’s inner cities: create jobs poor people can do

Walter Russell Mead is a professor of Foreign Affairs and Humanities at Bard College. Recently, at the American Interest, he wrote an essay on what is wrong with America’s blighted inner cities and how to correct the problem. It is a must read. A few selections to wet the appetite are reproduced here:

“We need to stop thinking about our inner city problems so heavily in terms of race.”

 “The first and most important precondition for returning health to poor urban neighborhoods is the creation of large numbers of private sector jobs that relatively unskilled people can do.”

“So where will the jobs come from?

Answer: if they come at all they will come from small business and many of these jobs will not be particularly attractive.

Businesses that hire low skilled workers without much experience or with checkered work histories are often smelly and noxious.  They are unlikely to pay particularly well.  There will be lots of casual day labor involved with not many benefits — and perhaps little information sent to the IRS.  Casual construction work and small repair shops where people bang metal and use power tools all day long are the kinds of employers we need in the inner city.  Working conditions are not always great — and these industries do not always attract the most humanitarian and generous people on earth.  The factories that hired illiterate and unskilled urban workers 100 years ago were offensive from many points of view;  they did, however, actually hire those workers and put tens of millions of people on the thorny, difficult and uphill path toward middle class life.

Think of the path to successful middle class living as a ladder; the lower rungs on that ladder are not nice places to be, but if those rungs don’t exist, nobody can climb.  When politicians talk about creating jobs, they always talk about creating ‘good’ jobs.  That is all very well, but unless there are bad jobs and lots of them, people in the inner cities will have a hard time getting on the ladder at all, much less climbing into the middle class.”

“Many sensitive and idealistic people in our society work very hard to keep from connecting these dots and admitting to themselves that bad jobs are something we need.”

“To get these jobs, we have to change the way our cities work.  Essentially, we have created urban environments in which the kind of enterprises that often hire the poor — low margin, poorly capitalized, noisy, smelly, dirty, informally managed without a long paper trail — can’t exist.  The kind of metal bashing repair shops that fill the cities of the developing world are almost impossible to operate here.  Plumbers, carpenters, electricians, pushcart vendors and day care operators need licenses; construction work has to comply with elaborate guidelines and city bureaucracies disgorge the required permits slowly and reluctantly.”

“The bien-pensant gentry politics that dominates political discussion in respectable circles has lost touch with the realities of American life and no longer really comprehends the issues at stake.”

“’Progressive’ policy now increasingly means policy that benefits genteel upper middle class liberals and public sector government workers; the resulting mix of complex and poorly applied regulations, high costs and high taxes throttles the only kind of job creation that could offer most inner city residents a feasible step up.”

“Without rapid, small business led growth, there is no way that the residents of our inner cities can escape the cycle of poverty that has them in its grip.  And progressive blue politics as conventionally understood systematically squeeze and crush growth in our cities.  The bluer a city, the bluer a state, the fewer private sector jobs it tends to create.

Until our urban leaders grasp these truths, conditions in the inner city will continue to go downhill as more and more cities start to look more and more like Detroit.”

Though the essay is long, it is well worth reading the whole thing. There are many interesting points that I didn’t quote for reasons of brevity.

I have only one thing to add to Mead’s essay and it is in the form of a personal anecdote. I have a friend who owns an auto body shop within the City of Toronto. In his shop can be found a paint booth. He tells me that auto body paint booths are now illegal in the City of Toronto even though Toronto is home to over a million cars, which is why auto body shops line the streets of Vaughn, immediately to the north of Toronto. His booth exists only because it was grandfathered at the time of the ban. But if he were to sell his shop, the new owner would have a mere 48 hours to get the spray booth up and running again or he would lose its grandfathered status.

Mead is living proof that not all academics are one dimensional, second rate, left-wing propagandists. We need more professors like him.

 

David Frum: the nervous Nellie of the conservative punditocracy

Moments of crisis are good at separating the reliable from the ‘wobbly’. After reading David Frum’s column in yesterday’s Post, where he excoriated conservative columnists south of the border for being “in denial over impact of debt default”, we can safely put Frum into the camp of unreliables.

His article was in reaction to columns such as the one he cited from the Washington Examiner. The quote he used as his jumping off point was:

“As the Bipartisan Policy Center has confirmed, Geithner could pay: the interest on the debt, all Social Security obligations, all Medicare and Medicaid obligations, all Defense contractor bills, all Veterans payments, and all active duty troops; and still have almost $7 billion left over for other items.

Yes, Geithner would still have to cut overall federal spending by 44%, and that would have economic consequences. But those consequences would not be as bad as defaulting on the debt. ...

Not raising the debt limit would cause a limited government shutdown, not default, as Obama has been claiming.”

The basic gist of Frum’s argument is that even if the Examiner’s accounting is true, a sudden cutback of US federal government spending by 44% would be too catastrophic for the economy to contemplate. This is how Frum makes his case:

“Suppose the government had to cut 44% from its budget on two weeks notice? How sharp a shock would that be to the world economy. 

Here’s a comparative. In the worst quarter of 2009, American consumers cut their spending by … not 44%, not even 4.4%, but 1.2%. That 1.2% drop in consumer spending helped tumble the economy into the worst collapse since the 1930s.

The U.S. consumer sector is even larger than the federal government sector. But it’s not unimaginably larger. U.S. consumers spend about $10 trillion a year. The federal government spends about $3.4 trillion.

If a cut of 1.2% from $10 trillion was an economic shock, a cut of 44% from $3.4 trillion will be a much, much, much bigger shock.”

Where to begin?

First of all, has David Frum ever heard of Say’s Law? In the words of Jean-Baptiste Say:

“The mere circumstance of creation of one product immediately opens a vent for other products.”

In other words, it is production not consumption that determines the size of a country’s GDP. Say’s Law formed the foundation of supply side economics developed by the Nobel prize winning Canadian economist, Robert Mundell that was successfully implemented by Ronald Reagan. You want an economy to grow, you must encourage savings and work (which are the key ingredients in production). If you do that, the consumption will take care of itself. The reason Say’s Law works is because our appetites are always greater than our desire to work.

To put all of this in the context of the current American budget debate, excess government spending can only have limited effect on economic growth because every dollar the government spends it has to tax, borrow or print. This is why the explosion of federal spending that has occurred under Obama (and, to be fair, also under the last year of Frum’s former employer, George W Bush, as well) has had no discernable positive effect on the economy. So here is my question to David Frum: if increasing federal spending has done so little to stimulate the US economy, why would you think cutting this spending off would hurt it?

What David Frum overlooks in his prediction of doom on Aug 2, is that a partial federal government shutdown will have positive effects (like an overnight elimination of the federal deficit) as well as negative effects (such as unpaid government workers and contractors). Though the borrowing respite will be temporary, for a while at least there will be no need for Tim Geithner to find new borrowers for T-bills or for the Fed to print more money. These are huge and immediate economic gains.

Second, the Great Recession was caused by a drop in consumer spending of 1.2%? Really? You mean it wasn’t caused by a collapse in the US financial system due to a surfeit of bad mortgages? So I guess all those business writers talking about subprime mortgages and asset backed securities were all blowing smoke. Who knew? I suppose the fact that the economy crashed on the same day as the Lehman Brothers bankruptcy was just a coincidence.

And third, at the current pace of spending, the US federal government is borrowing an additional $1.5 trillion every year. That can’t continue for much longer and when it must stop, that’s when the real economic consequences will be felt. It will be a fiscal inferno that will make a controlled, limited shutdown look like an ashcan fire. Most important of all, the longer a real solution is pushed back into the future, the bigger the consequences will be.

Like it or not Mr. Frum, Americans are living in interesting times. There are no longer any easy options. Every choice is fraught with peril but some contain real solutions. A cowardly compromise might provide temporarily political relief to John Boehner and Mitch McConnell, but cowardice has a way of coming back to haunt weak politicians. A good example is what happened to George H W Bush when he broke his “read my lips, no new taxes” promise in a similar confrontation with congressional Democrats.

Now is the time for bold, principled action, not mealy-mouthed appeasement to the forces that caused the problem in the first place. 

 

Why was the teen - charged in Constable Garrett Styles’ death - charged with first degree murder?

The distinction between first degree and second degree murder is that with first degree murder, the killer must have a premeditated idea or plan for what he did. With second degree murder, the killer acted upon a spur-of-the-moment emotional reaction. This legal distinction separates cold-blooded and hot-blooded murder.

According to the newspapers, the relevant circumstances of the story are as follows: the good constable pulled over a minivan on a country road at night; it was driven by a 15 year old who had taken it from his parents to go joyriding; in the middle of the traffic stop, the van accelerated forward without warning; Constable Styles hung on, trying to reach for the ignition key (so that he must have been leaning into the drivers side window as the car lurched forward); and after 300 m of this arrangement, the van rolled over into the ditch killing the officer and wounding the driver.

Where do you see first degree murder in this scenario? Heck, this isn’t even second degree murder!

I see no evidence at all of any intent to kill on the driver’s part. The worst thing that he could be guilty of is criminal levels of recklessness, i.e. manslaughter. The driver’s most probable train of thought - consistent with the known facts - are: “Oh shit! The cops are pulling me over. I’m in trouble now. My parents will be pissed. I might even be charged with auto theft!” Panic set in during the questioning and he bolts, hoping to get away and somehow fix the mess he found himself in – perhaps by ditching the minivan and hoping the cops come to believe it was stolen.

Isn’t this hypothetical narrative a bit more likely than an express intent on the driver’s part to kill Constable Styles? somehow knowing in advance that Styles would hang on to the minivan in such a way that he could be conveniently crushed in a rollover.

And as unlikely as that is, it is at best second degree murder. For the teen to have committed first-degree - i.e. premeditated - murder, he would have had to have taken the minivan from his parents with the express purpose – fully formed in his mind at the time he turned the key in his parents’ driveway - of killing a cop.

No, I don’t think even the Crown Attorney is so gullible as to believe this. What I think is happening here is that the criminal justice system is lashing out emotionally because one of their own was killed. Such a reaction is understandable, and in other circumstances it can even be socially valuable (to deter career criminals from intimidating peace officers). In this case however it is not only unjustified but ugly. The driver is no predatory criminal. He is no murderer. Where, in the known facts of the case, does he demonstrate sinister intent?

The justice system should be run by level-headed adults. And if we don’t want to see arrogant government departments behaving like bullies, they should be slapped down hard when they do. Hopefully the judge in this case will do so in the trial.

The next tech boom – 3D printing – may save North American manufacturing, at the expense of China

According to Mark Mills, of Forbes:

“The factory of the future is a fully-automated building filled with robotic systems and software. Purified raw materials and power go in, and a massive stream of customized products comes out. It is an incredibly efficient machine with nary an ounce of waste.”

“The poster child of the factory-of-the-future is visible in a hot new trend in the techno-dweeb sphere, so-called 3D Printing. These machines literally ‘print’ from computer images entire finished parts or simple products, ‘assembling’ from raw metal powders using powerful lasers or electron beams. They work much the same way much your computer’s laser printer does, though in the latter case using much less powerful lasers to print text using powdered inks. One guy, a computer, and a 3D ‘printer’ … presto a desktop factory.” 

“The future of manufacturing will be largely determined by the combination of two inexorable facts: technology gets cheaper over time, while labor gets more expensive. At the macro economic level, this trend is favorable to economies that are technology-advancing (i.e., the U.S.), not cheap-labor-centric (i.e., for now, China).”

“If the future of manufacturing is information-centric — from materials innovation, to 3D printing, to disruptive business models — is that a field where China necessarily dominates? Could be, but there is no guarantee. Creativity, innovation, flexibility, flexible education, entrepreneurship are the characteristics needed to foster the new era of manufacturing. These are the hallmarks of the American enterprise.”

Though, as Mills’ article points out, manufacturing based on nascent 3D printing technology is already here, who knows at this point how far this will go, and in what precise direction. Who, in 1990, predicted the internet revolution of the late 1990’s? Not-yet-invented technology is a very hard thing to pin down.

What this article does tell us however - and the reason I bring it up - is that all the doomsayers of America and the worshippers of New China (cf Thomas Freidman) are premature in their prognostications of Chinese hegemony. 

In spite of the two horrendous years of damage caused by Obama, Reid and Pelosi, the US still remains the friendliest place in the world for small, start-up business - the kind of organization that pioneers new technology the best. Replace Obama with minimal government President who understands that it is free markets and not crony capitalism that causes real economic growth and America’s best years could yet be ahead for her.

 

P.S. Embedded in the article is an interesting factoid for all you Mark Steyn-influenced demographers out there:

“Add to this formulation the demographic fact that, by about 2025 America will be a younger country than China.”