If you’re looking for good news regarding the U.S. between possible Qur’an burnings, explosions, and Afghan PR troubles, you can no longer reach for the “We’re No. 1” foam hand- or even, for that matter, the “We’re No. 2” foam hand. According to the World Economic Forum’s rankings of economic competitiveness, the U.S. has slipped from second to fourth, falling not only behind previous No. 1 Switzerland, but now also popular socialist punch line Sweden and no-fun-zone Singapore. Why is the mighty U.S. falling behind such tiny, non-Middle-East-invading countries?
The WEF stated that the United States’ drop was due to “a build-up in U.S. macroeconomic imbalances, a weakening of the country's public and private institutions and concerns about the state of its financial markets.” Hidden behind the clutter of academic words lies one key trend: the U.S. is about as stable as your average schizophrenic.
The first term, “macroeconomic imbalances,” is a polite way of saying “too much debt.” Paying for two wars, a costly fiscal stimulus and government restructuring of the health and financial sectors, and a million little pet projects of politicians while facing a severe recession and historically low tax rates and revenues is not a recipe for balancing the federal books. Everybody pays lip service to “reducing our spiraling debt”, but no one agrees on exactly where the spending cuts or tax hikes will come from. Democrats are allergically aversive to the former, while Republicans treat the latter as an assault on freedom and liberty. An $11 trillion debt and a government unwilling to tackle the issue signifies that the “macroeconomic imbalances”, or as we call it, budget apocalypse, will continue. And as part of the “future generations” that politicians apparently care so much about, I’m worried that I’ll end up selling my soul to pay for their Social Security pensions while they mock us from their Florida retirement homes.
Political paralysis doesn’t exactly engender trust, and “a weakening of the country’s public and private institutions” may be related to that. Basically, when we face as big a problem as the economic recession, we expect the big dogs to take care of it- government, Dow Jones companies, etc. When, as in this case, they seem powerless, they’re naturally the biggest targets for public anger. Especially when they seem more interested in midterm elections and blowing up oil rigs.
One problem I do have with the WEF’s rankings is that it unfairly punishes the U.S. for the global financial crisis. Yes, America did lead the world into it, but economic imbalance is spread out around the world, so companies across the world are suffering and… not very competitive. Demoting the U.S. based on a global financial crisis seems unbalanced. In addition, does anyone really foresee the U.S. losing its place as the center of global business? Didn’t think so.
With the economy and international affairs as uncertain as it is, the WEF seemed to have placed an added emphasis on stability. And when your country is expected to take a leadership role during turbulent times, some of that uncertainty will be placed on your shoulders. Switzerland, Sweden and Singapore don’t have to worry about stabilizing the global financial system or eliminating Al-Qaeda anytime soon, so they are free to focus their efforts on the economy, making them more stable and therefore competitive. The United States has neither the luxury nor the will to focus exclusively on one thing, so they will be less stable and competitive. The WEF reports are nothing major to worry about, but do indicate that President Obama and Congress should put more of their resources and effort into rebuilding the economy instead of pursuing political goals.
