正文
US has been the most productive force of human civilization, hands down, it invented assembly line, trust and anti-trust, semiconductor, gene therapy, computer, internet... and lastly, Google. And it invented the mid class, a new society format where wealth is more evenly distributed in a large scale that's never before in human history.
But now, to say the least, it's very much challenged,
Considering a short 6 years ago, pre 2000, US was as high as sky.
So really what happened?
This got to be a huge subject. My short list of answers to the questions is:
1) US people getting content, lazy, and wasteful,
It's everyone first impression, and also backed by all kinds of scientific data, that Americans ranks among the worlds fattest nations. Heck, even myself is probably 20 lbs heavier than most of my peers in China. There is probably no better indicator that symbolizes the vast resource consumed and sometimes wasted by Americans than, if I can be blant, a big fat ass.
There are many symptoms of American consuming too much, and consuming too much than they produce... from Buffet eating, to SUV, to McMansions. But the most problematic one is probably one less singled out: sprawling.
No place that I have seen has more sprawling issues than LA. Millions of people keep moving from point A to point B to point C everyday on a web of streets over some 1000 square miles, with 12 lane highways often meshed with local streets, which creates incurable traffic jams. The sheer energy it takes to get LA just to function is astonishing.
But more sad than anything is that such energy, all the burned gas on the jammed or moving highway, once it's consumed it's gone instantly, there is no residual value, there is no depreciation schedule. All the efforts that the world spending to explore, to extract, to refine, to distribute to the local gas station, it's just gone forever. If you count all the pollution consequences, it is even worse.
The other thing is that in LA you will see that other than the little downtown, and strips on the beach, you'd only see a building over 3 floors once in a long while. It's a very inefficient to move electricity, gas, water, sewerage this way. Too many little towns will also means too many redundant civil gov't branches, police, and often its own schools.
2) Extremely high cost for business, legal and medical expense etc, lack of worker population growth, end result is low productivity output.
We all know that the most expensive component cost in a GM's car is not still, it's the health care cost for its employees. We also know the most feared thing in American is not a gun, instead it's a letter notifying that you are sued.
In the city we live in now, there is a science center that is undergoing some renovation. From the outside I can see it's adding two wings of maybe 10k square meter of display and activity space. It takes 2 long years to do the job with the price tag is $104m.
There is another project in the city, one company was order to pay $500m to clean up some land, of size about a football field, that it polluted sometime before. $500m! $500m burned just for clean up.
With that money and time, you can build an Olympic-ready stadium in a 2nd-tier city in China. Not too long ago I read a news about a dorm-type stadium in NanTong, Jiangsu, much like the Dallas Cowboy stadium, with cost less than $150m. The world's biggest shopping mall, located in DongGuan, which models after the Las Vegas casinos and Dislayland, plus the mall of size of 6 football stadium, costs only $1.3B from start to finish.
Competitive landscaped has changed, for a long while American owns the world productivity book, with Japan took it away for a while before squandering it. Now, thanks to the knowledge transfer and general free-trade global environment, China defines the world productivity by far. In US, now often there is little to show after a huge pile of cash was burned.
3) A reward system that encourages more derivative activities, such as sports and entertainment, speculation, etc
Many of the so-called "service economy" are expensive maintenance. The product of "service", unfortunately, often has no lasting residual value. Once they are done they are gone. To think about it, if you put up a skyscraper in New York or Chicago, such efforts have lasting value in both economic and social sense. Their "real" depreciation rate is often very little, or even negative.
On the contrast, the depreciation rate of many service activities is almost infinite, because the results often disappear right away.
This year everyone was a bit transfixed by the fact that the average bonus for a Goldman Sacks employee is at $620k. Naturally a great percentage of the best minds are attracted to the finance industry. While one can still argue that investment bankers, who grow companies instead of corns, are still doing a great service to the society, one can't keep wondering the other less glorious part of the Wall St, namely trading or speculating, has much if any social value. Jim Cramer, one of the more popular talk heads, calls all hedge funds predators.
4) war,
in the last 50 years, post WW2, almost any country involved in war activities has been greatly cursed. German and Japan from WWII, they have to start from basically a ruin. Fortunately they have the help of US and they succeeded. Viet Nam haunted US for 20 years. Afghanistan very much became the last straw that broke USSR's back. Same true for China. China was soundly rejected by the world when it had the policy of "exporting revolution". China's great rise came possible only after Deng decided to give up paranoid foreign policies, and join the world community as a citizen.
The war in Iraq will probably go into history not too much different as the USSR's in Afghanistan. It has cost US the great good will it has accumulated with the whole world, through sweat, blood and lives, during the last 100 years.
Still, except for the war, factor 1 to 3 have been existing for at least 20 years, and war is more or less an isolated event. So what exactly is the delta after 2000?
The delta, is the rising of China.
But now, to say the least, it's very much challenged,
Considering a short 6 years ago, pre 2000, US was as high as sky.
So really what happened?
This got to be a huge subject. My short list of answers to the questions is:
1) US people getting content, lazy, and wasteful,
It's everyone first impression, and also backed by all kinds of scientific data, that Americans ranks among the worlds fattest nations. Heck, even myself is probably 20 lbs heavier than most of my peers in China. There is probably no better indicator that symbolizes the vast resource consumed and sometimes wasted by Americans than, if I can be blant, a big fat ass.
There are many symptoms of American consuming too much, and consuming too much than they produce... from Buffet eating, to SUV, to McMansions. But the most problematic one is probably one less singled out: sprawling.
No place that I have seen has more sprawling issues than LA. Millions of people keep moving from point A to point B to point C everyday on a web of streets over some 1000 square miles, with 12 lane highways often meshed with local streets, which creates incurable traffic jams. The sheer energy it takes to get LA just to function is astonishing.
But more sad than anything is that such energy, all the burned gas on the jammed or moving highway, once it's consumed it's gone instantly, there is no residual value, there is no depreciation schedule. All the efforts that the world spending to explore, to extract, to refine, to distribute to the local gas station, it's just gone forever. If you count all the pollution consequences, it is even worse.
The other thing is that in LA you will see that other than the little downtown, and strips on the beach, you'd only see a building over 3 floors once in a long while. It's a very inefficient to move electricity, gas, water, sewerage this way. Too many little towns will also means too many redundant civil gov't branches, police, and often its own schools.
2) Extremely high cost for business, legal and medical expense etc, lack of worker population growth, end result is low productivity output.
We all know that the most expensive component cost in a GM's car is not still, it's the health care cost for its employees. We also know the most feared thing in American is not a gun, instead it's a letter notifying that you are sued.
In the city we live in now, there is a science center that is undergoing some renovation. From the outside I can see it's adding two wings of maybe 10k square meter of display and activity space. It takes 2 long years to do the job with the price tag is $104m.
There is another project in the city, one company was order to pay $500m to clean up some land, of size about a football field, that it polluted sometime before. $500m! $500m burned just for clean up.
With that money and time, you can build an Olympic-ready stadium in a 2nd-tier city in China. Not too long ago I read a news about a dorm-type stadium in NanTong, Jiangsu, much like the Dallas Cowboy stadium, with cost less than $150m. The world's biggest shopping mall, located in DongGuan, which models after the Las Vegas casinos and Dislayland, plus the mall of size of 6 football stadium, costs only $1.3B from start to finish.
Competitive landscaped has changed, for a long while American owns the world productivity book, with Japan took it away for a while before squandering it. Now, thanks to the knowledge transfer and general free-trade global environment, China defines the world productivity by far. In US, now often there is little to show after a huge pile of cash was burned.
3) A reward system that encourages more derivative activities, such as sports and entertainment, speculation, etc
Many of the so-called "service economy" are expensive maintenance. The product of "service", unfortunately, often has no lasting residual value. Once they are done they are gone. To think about it, if you put up a skyscraper in New York or Chicago, such efforts have lasting value in both economic and social sense. Their "real" depreciation rate is often very little, or even negative.
On the contrast, the depreciation rate of many service activities is almost infinite, because the results often disappear right away.
This year everyone was a bit transfixed by the fact that the average bonus for a Goldman Sacks employee is at $620k. Naturally a great percentage of the best minds are attracted to the finance industry. While one can still argue that investment bankers, who grow companies instead of corns, are still doing a great service to the society, one can't keep wondering the other less glorious part of the Wall St, namely trading or speculating, has much if any social value. Jim Cramer, one of the more popular talk heads, calls all hedge funds predators.
4) war,
in the last 50 years, post WW2, almost any country involved in war activities has been greatly cursed. German and Japan from WWII, they have to start from basically a ruin. Fortunately they have the help of US and they succeeded. Viet Nam haunted US for 20 years. Afghanistan very much became the last straw that broke USSR's back. Same true for China. China was soundly rejected by the world when it had the policy of "exporting revolution". China's great rise came possible only after Deng decided to give up paranoid foreign policies, and join the world community as a citizen.
The war in Iraq will probably go into history not too much different as the USSR's in Afghanistan. It has cost US the great good will it has accumulated with the whole world, through sweat, blood and lives, during the last 100 years.
Still, except for the war, factor 1 to 3 have been existing for at least 20 years, and war is more or less an isolated event. So what exactly is the delta after 2000?
The delta, is the rising of China.
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