Addressing the Declinists

An example of the America-in-terminal-decline point of view is Kevin Phillips's Wealth and Democracy,²³ in which Phillips argues that, like Spain, Holland, and Britain before it, America exhibits all the classic symptoms of cyclical decline: a preoccupation with finance, technology, and services rather than basic manufacturing; capital markets prone to bubbles and speculation; the export of jobs and capital; the import of cheap foreign labor to do jobs Americans don't want; a growing inequality of income and wealth; and frequent and incipient wars.²⁴

But Phillips has it exactly backwards: Whether or not these were symptoms of decline in societies hundreds of years ago, they are, today, symptoms of vigor, of continued dominance. Because Phillips's view of the world is widely held, let's examine each of his symptoms of decline. In brief:

• Contrary to Phillips's view, in the early twenty-first century it is important that simple (basic) manufacturing take place in societies where less expensive labor can produce goods more cheaply and efficiently. This not only contributes to economic progress in those countries, but the resulting less-expensive goods are then more affordable not merely to rich postindustrial populations, but also to people in developing societies.
• Bubbles will always be a part of capital markets and economies because they reflect not markets or economies or anything specifically American, but human nature. Nor is there anything especially modern about bubbles. Yes, America recently had its Tech Bubble and its Housing Bubble, but Holland had its Tulip Bubble (1634), England had its South Sea Bubble (1720), Japan had an entire Bubble Economy (beginning in 1984), Europe has its Debt Bubble, China has its Real Estate (and Inflation) Bubble, and so on.
• Yes, America exports capital, but that capital is used by less developed economies to build economic capacity, reducing global poverty and, ultimately, enlarging the markets for American goods and services—in addition to making the world a safer, more just, and more stable place.
• The “cheap foreign labor” that America imports (legally and quasi-illegally²⁵) doesn't stay cheap very long. Within a few generations, immigrants, like those who came before them, tend to become productive citizens even by Phillips's narrow standards.
• I have already addressed the inequality of income and wealth in America—it is not the size of the disparity that matters, but the absolute level of affluence of the nonwealthy, as well as the ability of the nonwealthy to become rich.
• I have also briefly addressed the delicate issue of war. It is undoubtedly true that a warmongering America bent on world domination by military might would present a serious and undoubtedly effective means of engineering our ultimate decline. But that is a far different America from the one that stands vigilant over the free world, its vigor as the world's wealthiest and most powerful country undiminished, very much as though it were still a youthful, struggling country, rather than the world's oldest government.

Similarly, we hear virtually every day about other evidence of our decline.²⁶ Not long ago, for example, a friend pointed out to me that the average Japanese high school math student would rank in the top 1 percent of American high school math students. This is certainly an alarming statistic (if true), but there is a problem with such statistics—namely, that we have been hearing them year after year since at least Sputnik,²⁷ and, so far, at least, America has only become ever more dominant. (Indeed, the society whose educational prowess was so superior to ours in 1957 no longer exists.)

A superbly well-educated population is certainly a useful thing to have, but as in so much of life it isn't what you've got, but what you do with what you've got that matters. A truly uneducated America would undoubtedly be a recipe for disaster. But a reasonably well-educated America motivated to deploy every ounce of its competitiveness is an unstoppable juggernaut.

There are, in other words, conditions that could cause America to begin an inexorable decline into mediocrity, and it would be interesting and instructive to consider what those conditions might be. But Phillips's (and others') focus on the specific conditions of the distant past, rather than on the effect of those conditions, has led the pundits far astray. Indeed, many of the conditions that were symptoms of decline in past civilizations are now, given the dramatic change in economic and political conditions, symptoms of continued vigor.