A friend recently sent me a column by Robert J. Samuelson that makes me wonder if strong economic growth is a pleasant memory. Are we doomed to a future of slow economic growth? And, most importantly, can our society withstand such a down-shifting?
Since 1959, the U.S. has enjoyed approximately a 3% annual growth rate in GDP. A product of the Age of Enlightenment, we’ve always assumed that things would always improve. The conservative Cato Institute think tank explained that our growth since 1950 resulted from (1) a larger workforce from female participation, (2) a better educated work force, (3) more capital, e.g., machines & computers, per employee, and (4) technological & organizational innovation.
Unfortunately, labor force participation by women has decreased from 59.9% in 2000 to 57.7% last year. High school and college graduation rates have stopped increasing. Capital investment by business has been lagging for years.
Today, we’re only growing from 1.5-2.0%. That’s not much additional income to keep a population happy when faced with higher taxes, possibly higher health insurance costs, and worsening income inequality. Is there a tipping point, at which the resentment boils over and irrationality prevails? If so, how will we know it when we approach that point?
Always seeing a glass as 51% full, I’m praying that our workforce increases from Hispanic additions, that education becomes more STEM-centric, and that businesses will lose their fear of politicians and start investing capital.
Even England is growing more rapidly than the U.S. How will this country be different if we must lower our social