Saturday, February 6, 2016

Economy: What Happened With The Americans?

(Drivebycuriosity) - What happened with the Americans? Shortly after Albert Einstein arrived in the US he wrote: "The second thing that strikes the visitor is the joyous, positive attitude to life. The smile on the faces of the people in photographs is symbolical of one of the greatest assets of the American" (einsteinsworld).

Where has this "joyous, positive attitude to life" gone? Today`s America seems to be a nation of pessimists. According to Gallup the "economic confidence" of the Americans is negative (gallup).  Gallup's U.S. Economic Confidence Index is at minus 12. This barometer measures how Americans rate current economic conditions and whether they feel the economy is getting better or getting worse. Another poll from last October also shows that "many Americans are pessimistic about the nation's economic future" (nbcnews) and in January 2015 64% of the Americans said "US is still in a recession" (foxnews). Many claim, that "living standards are bad and getting worse, and today’s children are the first generation in our nation’s history that cannot expect to be better off than their parents" ( cato-unbound ). And there is a cult around dystopian science fiction movies & books (driveby).

The gloomy sentiment doesn`t fit to the reality.  The number of jobs in the US has been rising steadily since the recession ended in 2009. In January the US labor market created just 151,000 new jobs, but the year-over-year change was 2.67 million new jobs, a solid growth  (calculatedrisk). Hourly wages growth accelerated in January to plus 0.5% and wages were 2.5% higher than in January 2015. The unemployment rate dropped to 4.9% & the weekly jobless claims are at a historical low. The inflation rate is about zero because rising rents & health costs are compensated by sharply falling gasoline prices and heating costs. Life expectancy in the US is higher than ever and the threat of infectious diseases is the lowest ever because medicaments & medical technologies have been getting better (vox).

I believe that the general pessimism about the future - and the cult of dystopian - is irrational. The future isn`t bleak, things don´t get worse all the time. Quite contrary, history tells us that human conditions have been improving over the time. Life in the 16th century - and before - was miserable but it got slowly better. In the 19th century the improvements gained speed and have been been accelerating since then (mauldin). Almost any day something new comes up which makes our life more comfortable: Self-driving cars will have fewer accidents; Internet connected devices will help to monitor our health; in 2013 the first kidney grew in vitro in the U.S. and the first human liver grew from stem cells in Japan (wikipedia).

There is no reason that the positive historical trend should stop or reverse its course. Humans have always found ways to achieve a better life - for themselves and for others. And the general fear of science and technology is irrational. Scientists gave us penicillin, antibiotica and insulin, they laid the foundations for cars, trains and planes and they created electrocardiography, laser, computers, Internet and all the other technologies which make our lives safer and more comfortable.

I believe that coming generations will live even longer and healthier thanks to science and technological progress (forbes). They will benefit from new medicaments; nanotechnology will create new and better materials, including carbon fibers that are much stronger & less heavy than steal; 3D printing will make many things much cheaper; stem cell therapy will treat or prevent more and more diseases. 

                                                Daily Brainwashing

Why are the Americans so timid? Maybe the recession of 2008 is still in the mind of many people even that they earn more today than before 2008. The negative sentiment also could be the result of the daily brainwashing by the media and pessimistic pundits on TV, Internet and in the newspapers & magazines. BusinessInsider, Marketwatch and other news platforms make a lot of money by spreading negative news and pressimistic predictions ("warnings") and continuous reminders to the 2008 recession. Scarring the masses is a profitable business model. The general pessimism also could be - at least partially - a result of the herding behavior. People are scarred because others (friends, experts, celebs) show pessimism.

Wall Street is a perfect mirror for the general paranoia. The US stock market is down 8% year-to-date, the worst start to a year ever. Stocks have been falling because of fears that the global economy might slide into a new recession. Positive news is ignored (like job & wage growth, dropping gasoline prices), negative news is overblown, and pessimistic rumors rule the gloomy sentiment.

What would Einstein say if he would arrive in the US today?

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