Why So Many (In The West) Are So Pissed Off

Via BusinessCycle.com,

Campaigning to “Make America Great Again,” Donald Trump swept to the presidency last November 8, buoyed by a wave of anger and sense of betrayal in the American heartland.

He knew that, for many, the American Dream had receded inexorably beyond reach, lingering only in distant memories. Critically, American parents no longer expect what had been virtually guaranteed in the mid-20th century – that our children would be better off than we are.

It isn’t just less-educated middle-aged White Americans who believe that American greatness will be restored by pushing back hard against the “other,” including China, India, and immigrants who don’t look like them. A much larger part of America seems open to the simple notion that what ails us is someone else’s fault.

This is because hardly anyone on the right or the left realizes just how fleeting the dominance of the West – and the U.S. in particular – has been in the longer sweep of human history.

Few appreciate the uncomfortable fact that, while China and India have advanced rapidly in recent decades, even this is only a partial reversal back to the historical norm. A two-millennium perspective – derived primarily from the lifework of Angus Maddison – shows that, for more than 90% of the time, China and India dominated the world economy, together accounting for about half or more of global GDP in terms of real purchasing power (Chart 1).

In year 1, India’s share was nearly a third of global GDP and China’s was over a quarter – both bigger than the Roman Empire’s. Rome had a huge trade deficit with China, whose silk was worth about its weight in gold. Pliny the Elder was so incensed that he viewed the diaphanous fabric as “transforming wives into adulteresses and maidens into prostitutes, while also threatening to make Roman men effeminate,” noted one scholar. In turn, the Roman Senate, attempting to staunch the outflow of gold, prohibited the wearing of silk by men. At the time, Asia produced almost three-quarters of global output. A thousand years later, that proportion had declined only a little.

China and India ruled the roost for the vast majority of the last two millennia and, until the late 19th century, each had a bigger global GDP share than the U.S.

However, the picture looks quite different if we zoom in on recent centuries, as most do (Chart 2). By the mid-19th century Britain was waging the Opium Wars – with opium seen as the only commodity that could offset the ruinous trade deficit created by its voracious appetite for imported Chinese silk, ceramics and tea – helping to bring about the collapse of the last Chinese dynasty. And enormous shifts began with the rise of the West – shown by the blue areas of the chart – which then dominated the global economy by the mid-20th century.

Yet, that epic “moment” was the exception in the long history of world GDP. The rapid reversals of fortune depicted in the rightmost section of Chart 1 indicate just how breathtakingly fast the rise of the West was, and how equally swift the reversal of fortune has been.

Europe’s Industrial Revolution, which started in the late 1700s and soon spread to the U.S. – in combination with Western colonial exploitation – caused the plunge in India’s and China’s GDP shares between the early 19th and mid-20th centuries. In a span of just 130 years – from 1820 to 1950 – the GDP share of Asia, excluding the Middle East, plummeted from almost 60% to only 16% (Chart 2).

Following World War II, the U.S. reigned supreme, commanding more than a third of world GDP, while Western Europe’s share fell to well under a quarter. Yet, the combination still accounted for a record 57% of global GDP.

The mid-20th century marked the zenith of the West’s GDP share, which America dominated for decades thereafter. So it’s this period that “Make America Great Again” really harks back to.

For Asia, excluding the Middle East, the comeback started slowly, between 1950 and 1980. The climb then accelerated, with that share surging past 30% by the turn of the century, and standing at 43% today, a 160-year high.

Meanwhile, the combined share of the U.S. and Western Europe has fallen to just one-third – a 166-year low. And the U.S. share is now half of its mid-20th century peak. It’s the headlong pace of this decline that’s worthy of notice.

The far right side of Chart 2 includes the early 21st century, when the reversal of fortune really sped up. Just since the start of this century, Western Europe has lost nearly a third of its global GDP share, while the U.S. has lost more than a fifth – similar to the fastest periods of decline for China and India between the mid-19th and mid-20th centuries. It’s this swift swing of the pendulum, back from its mid-20th century extreme, that provides the necessary historical perspective for understanding the angst in the West today.

Until the mid-20th century, the two key factors driving the rise of the West relative to the rest were the Industrial Revolution and colonialism. But then came the twilight of colonialism, followed in recent decades by rapid technological catch-up in China and India – which isn’t over.

So, has the relative decline of the West and the rise of the rest run its course? If not, it’ll be a tall order for the U.S. to again command over a third of world GDP – or even the 22% share averaged over the Reagan years.

The decline in American dominance is driven by more than China and India’s resurgence.

Separately, there’s been a downshift in U.S. trend growth, driven by demographics and productivity growth, as partly acknowledged by the latest IMF projections of five-year-ahead annual GDP growth:  12/3% for the U.S. – close to Fed and CBO estimates – compared to 5¾% for China and 81/6% for India.

In fact, their combined share of world GDP outstripped America’s in 2008 for the first time in a century, and today is one and a half times as large. In five years – based on IMF projections – it’ll be closer to double the U.S. share, or almost as much even if we sustain 3% growth, as optimists hope. Regardless, China is ready to "take center stage in the world," as President Xi Jinping just announced. India, with more favorable demographics, won’t be far behind.

For us Americans, it isn’t a reversion to mid-20th century levels of U.S. global dominance that matters most, but rather a fair shot at greater prosperity for our children. For sure, that will require more productivity-enhancing investment in physical and human capital. But it’s also critical that the resulting benefits reach the middle and working classes. Only then can the U.S. reclaim the mantle of the greatest land of opportunity the world has ever known.


Solosides Wed, 11/08/2017 - 16:28 Permalink

Remember Goyim, as the police state encloses you, and as the police themselves become more armed than most militaries around the planet. Violence is never the answer. We will be far better off allowing our benevolent masters to stomp us out of existence.

loebster Thought Processor Wed, 11/08/2017 - 17:11 Permalink

Why So Many In The West Are So Pissed Off?

(((THEY))) took over the DEM and destroyed it.
(((THEY))) became the neocons that are destroying the REP.
(((THEY))) took over the FED and destroyed the US Dollar.
(((THEY))) took over Hollywood and destroyed our culture.
(((THEY))) took over Congress and are destroying America.
(((THEY))) stole Palestine, did 9/11, and destroyed the Middle East.

It's BECAUSE of THEM. https://goo.gl/bFYusM

In reply to by Thought Processor

Escrava Isaura loebster Wed, 11/08/2017 - 17:15 Permalink

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Here are the 3 reasons: “Brace yourself! The American Empire is over. The descent is going to be horrifying!” — Chris Hedges, 2012 “United States is becoming a failed state, and thus a danger to its own people and the world.” — Noam Chomsky, 2006. “I do not think what we face is a problem. It is a predicament. And predicaments do not have solutions.” — Greg Machala, 2017   

In reply to by loebster

Chupacabra-322 Croesus Wed, 11/08/2017 - 17:19 Permalink

@ Croesus,

“These people are playing with matches… I don’t think they understand the scope and scale of the wildfire they are flirting with. They are fucking around with a civil war that could last a decade and cause millions of deaths… and the sad truth is that 95% of the problems we have in this country could be solved tomorrow, by noon… simply by dragging 100 people out in the street and shooting them in the fucking head.”

And lemme tell ya, he had the list… he rattled off 25 or 30 names of well-known, prominent politicians, mostly Democrats, but a few Republicans, several members of the current Cabinet, a couple of Obama’s “czars”, a couple of figures from the Bush administration and the Republican establishment, several media company executives and on-camera newscasters, reporters, and pundits, a couple of people who are active in leftist politics but not in elected office… he had obviously thought about this to some degree already.


In reply to by Croesus

Croesus Chupacabra-322 Wed, 11/08/2017 - 18:02 Permalink

@ Chupacabra:

You know it, man! My advice to people who think like we do, is that they:

- Plan ahead. Save, Stock, and Supply. If you need 1, buy several.

- Adapt your lifestyle. Adjust to "living with less". Sooner or later, most people will have to make a hard adjustment to their way of life. If they do it willingly, it will be easier on them psychologically, than it will be for those who are forced into it.

- Grab some popcorn, sit back, and watch the show. You know there are plenty of people out there who have short tempers, and are generally on edge. When SHTF, they will react like a bomb going off. Let them react. It will show the enemy's capabilities, and weed-out some of the idiots who are more of a liability than an asset.


In reply to by Chupacabra-322

True Blue 7thGenMO Wed, 11/08/2017 - 17:05 Permalink

And for the trillions wasted on welfare, we could have had colonies on the moon and Mars.Where people who actually should have gone to college could find real and productive employment. Instead we have an over-'educated' generation of snowflakes, gender studies majors, grievance studies majors and drama majors who should have never been admitted to an accredited 'college' in the first place.

In reply to by 7thGenMO

Endgame Napoleon 7thGenMO Wed, 11/08/2017 - 17:32 Permalink

Then we would have even more men and mommas, competing for jobs with college degrees, reducing the value of degrees even more. Anything that is less rare is less valuable, and the non-degree-holding robots are about to make most skills even less rare.

This will be true in China and India as well, and no amount of pay-per-birth freebies, given out for womb productivity in the fake-feminist West, will lessen the economic pain from too many workers chasing too few bill-paying jobs.

Solution of worldwide politicians: more free stuff for working mommas, including mommas working part-time, low-wage jobs and driving down wages, to compel them to create more human workers to compete with robots for jobs.

People don’t land in high-paying positions due to a lack of logical thinking.

Womb Productivity = Economic Growth

That’s all there is to it despite all of the currently impoverished countries with high womb productivity and youthful populations.

Why do you need experts with PhDs in economics to design such simplistic economic plans?

More $6,269 child tax credits for mommas who produce more human competitors for the robot-dominated industries will do it!

If you question the womb-productivity rewards, you are a sexist, but you can presumably question the robot job displacement without being called a robot racist because robots do not look like humans (yet).

Regardless of economic history, which is interestingly presented in this article, Americans will not excuse the selling off of their own country’s middle class to foreign countries.

In reply to by 7thGenMO

ClickNLook Wed, 11/08/2017 - 16:41 Permalink

It was "Change" and "fix Washington", now it is "MAGA" which is to me a repackaged "change" and "drain the swamp", what it will be next time?

It gotta be as catchy as these two.

BTW, MAGA is Reagan's catch phrase.