- Alex Hutchins
- Jefferson City, TN
- United States
An economic perspective from a non economic educated person as to the future of the US in the global marketplace.
According to the author of The World is Flat, globalization started with the fall of the Berlin Wall. Why, you might ask? Because those living on the East Berlin side of the wall could finally see what the rest of the world had, and wanted it too.
The second point I would like to make is that as the population of China grows and participates more in the world economy, the more their middle class increases and the more their middle class wants what the American middle class has and takes for granted.
As other countries grow, like India for example, they will begin to naturally produce a middle class as well that will want what the American middle class has and takes for granted.
Since economics can be defined as: :the study of the allocation of scare resources that have multiple purposes," we can easily see that we might have a little bit of a problem globally in the years ahead with our scarce resources. That being said, the American middle class will have to start sharing its scarce resources with the rest of the world and in so doing, will inflate the cost of these scarce resources.
In other words, the supply and demand curve that nicely fit as an overlay over the US must now be used as an overlay over a map of the world, that will automatically shift our equilibrium outside of the continental boarders of the US. Consequently, as the middle class around the world comes up to this new global equilibrium, the US will have no choice but to come down.
I am not sure what the new look will be but I an tell you this, the middle class will not look like nor have the purchasing power that it has today or that it had 30 years ago.
And, in my economic novice opinion, it will start to be seen around 2025 and will gradually escalate and stabilize around 2050. About that same time, the demographics of the US will also be different. Asians/Hispanics will be fighting for the top spot with Blacks in third and Caucasians in fourth, changing our politics forever.