Is The USA Heading For Third World Status? (2007)

http://www.swans.com/library/art13/ga238.html

by csomar • 16 years ago

16 19 16 years ago

roundsquare2• 16 years ago

I'm not going to claim that its impossible for the US to (eventually) fall into third world status or that there aren't serious balance of trade issues to be dealt with. However there are two things that are not being considered here:

1) The export of information and skills is very important and becoming increasingly more important.

2) A lot of the issues in economics are generally self-correcting. This doesn't mean that there won't be pain along the way in the US, but it seems unlikely to take the US all the way to third world status.

Of course, I realize that these self-correct effects tend to come with open/fluid markets, which we don't have. However, as global trade increases, markets should become more open/fluid (which, in the end, should benefit more than just the US).

Edit: Small change for clarity.

kyteland• 16 years ago

The United States will always be a first world country because that is the definition of first world. First/second/third world status never changes.

http://en.wikipedia.org/wiki/First_World

http://en.wikipedia.org/wiki/Second_world

http://en.wikipedia.org/wiki/Third_world

Man, I'm starting to sound like a broken record.

roundsquare2• 16 years ago

Interesting, I didn't know the history of the term.

However, I feel you are being pedantic. If you replace "first world" with "rich" and third world with "poor" then the statements make sense (though you can disagree on if they are true or not).

Or am I missing something? I realize that being the US or aligned with the US has large implications in global politics, economics, etc... but that doesn't seem to invalidate the statement "The US might be come a poor country if/unless <whatever you think might make it a poor country>."

electromagnetic2• 16 years ago

The notion of the 'third world' as being poor occurred after the fact. The reason the majority of the third world countries never aligned was because they couldn't field a worthwhile military for a cold-war era threat, the vast majority of them still can't.

The idea that the US could fall so far from grace that it would be incapable of fielding a military is a much, much bigger thing than people imagine. Due to the size and natural resources of the US it fundamentally has an economic bottom line, despite all the economy going to crap it will still have access to raw materials to make a sufficient military to stand with its allies.

Many African countries have next to nothing in terms of established economy, or likely establishable economy. With little access to water, little access to raw materials and little access to arable land, there is quite literally zero hope for improvement, these countries by nature would be trapped in importing natural resources and exporting products, which is something no country has solely survived off.

For the US to ever reach third-world poverty, it would have to have almost zero access to clean water, zero access to natural resources and zero access to arable land. By virtue of americas geographical location, it is physically impossible for it to have no arable land and no clean water unless rain never falls again.

The simple notion that the US could fall so far is quite absurd, you might as well be arguing that overnight your dog turned into a cat. Unless there's a fundamental change in the ordering of the universe, a dog will never become a cat, and unless there's a fundamental change in the ecological systems of the earth (I'm talking WAY beyond global warming bullshit, the US has been habitable through ice ages and periods when Antarctica had plant life; I'm talking a dinosaur-killer required to make it uninhabitable) the US will never sink to third-world poverty.

Simply put, unless we change the fundamental ecological system of the planet well beyond recognition in any way or form as to what has existed before or in the short-term future, the US will still be a thriving country with a massive population. It might not be a world-hub of technological development, but it'll still be on a map. Of first world countries there is a whole host of countries that aren't known for any real technological development, but because of expert use of natural resources over a century or more, they still have excellent wealth and development.

As the old saying goes, it takes money to make money. Right now the US is still harvesting gold and diamonds out of its land, and is also harvesting black gold, most of these industries alone are more profitable than almost any of the poverty stricken countries in Africa. Zimbabwe has a GDP of ~3 billion, if it was a company we'd be talking about it being bought out by Google/Apple/Microsoft for $30bil and what they plan to do with it. There's quite literally more money in some companies than in entire swathes of Africa.

rmc• 16 years ago

This is nonsense. Go to a real third world county and you will see a massive difference between the USA and there. This article claims any country with "a high level of debt, an income distribution concentrated in the top 1% of the population, and an economy based on export of raw materials and import of manufactured products."

most of these apply to every country in the world.

alttab• 16 years ago

Not every country in the world can export raw materials and import manufactured products. Someone has to make the products. Who? China.

VBprogrammer• 16 years ago

If under your definition the USA is a heading towards being a third world country then perhaps you should consider your definition of a third world country inadequate.

electromagnetic2• 16 years ago

Agreed, the author lost me in the first paragraph. Sure the US imports a lot of products from (technically speaking) second world countries, however the US has major exports that no one in the world compares to. You want a computer? Show me an operating system used globally by the mass majority that isn't made in the US?

The US has a tech sector like no other, if you don't count Windows, Google, Facebook and World of Warcraft as exports then you really have no clue whatsoever about the economy. The raw materials for the development of such things are the luxuries we consider imported from other countries. Yes that futon a Google employee stuck in their office, that in no way contributes to their developing of Analytics, Docs, etc. Get real.

Lets be realistic here, we're all versed in computers and development here. Did any Ycombinator developer actually come up with their idea sat in a made-in-the-USA chair, at a made-in-the-USA desk working on a computer solely made-in-the-USA? No! I bet a fair percentage got the majority of their ideas like everybody else, sat on a crapper imported from Indonesia, or at the breakfast table made in China by a Swedish company, or on their commute in a German/Japanese/Korean car or an American car made from parts imported from down the road from me here in Canada.

Can we skip the naivety here? The US is switching from a physical exporter to an electronic exporter. Microsoft isn't one of the worlds biggest companies because it hauled dirt around looking for copper that could be turned into wires, it built software that everybody worldwide needs.

mpf62• 16 years ago

Actually, the US isn't a net exporter anymore. You are importing far more of value than you export (2009: +45%, 2008: +66%) and that is the problem.

How are you going to pay the people abroad that dig in the dirt for copper that you actually need? Currently, the US as a whole does pay with promises (debt).

There are at least about 10 companies the size of Microsoft missing to fill that gap.

pmichaud• 16 years ago

It makes a couple good points, but he loses credibility by fudging numbers and comparing apples to oranges, like saying we've accumulated $1.375 trillion in debt to China since 1967, when in fact that's the sum of what we've borrowed without considering what we've paid back (it's all revolving debt).

kiba• 16 years ago

I don't think all the wealthy people are evil people who exploited the poor.

What about YC millionaires and other type of people who gain their wealth by producing what people want?

What percentage of the affluent is actually a bunch of parasites who is only good for manipulating government regulations to keep out competitors?

pelle2• 16 years ago

I agree. This whole exploited the poor is such an old tired marxist argument.

There is definitely a big difference between rich and poor here but there is incredible diversity amongst the rich and there are a lot of them.

barryfandango• 16 years ago

Third world countries don't have universal healthcare! Now if you lot can just adopt the metric system we'll be getting somewhere. :)

pelle2• 16 years ago

Many countries considered third world actually do offer universal healthcare. This includes many Latin American countries and I would suspect many Asian countries as well.

bmunro• 16 years ago

Note that the article is three years old.

yardie• 16 years ago

Obviously the writer and poster have no idea what '3rd world' means.

mark_l_watson2• 16 years ago

Interesting reading the comments: is denial a river in Egypt? :-)

I aree that the USA has great assets (although many have been sold to foreign investors) but there is a disturbing trend of losing our lead in technology. As an example: in the 1970s, almost al ACM journal articles were written by US authors. Pick up a recent journal and you will notice that this has changed a lot.

The quotes by Paul Craig Roberts (3 years old) are probably right on - I often read his articles and he seems knowledgeable and trustworthy. Many kids in junior high in China now get to take calculus - but not here in the USA. India has invested its resources for several decades in improving its educational system, and they are harvesting the benefits.

I think (I hope!) that our (and the UK's) downward side in economic health will take a long time, but it is probably a forgone conclusion given our huge military expenditures and debt at the consumer and government levels. So, I don't expect us to fall off of an economic cliff, but I do expect steadily worsening conditions over the next few decades for the poor and diminishing middle class.

mark_l_watson2• 16 years ago

Here is an article that I feel paints a fairly accurate picture of the risks that the USA is facing:

http://www.moneyandmarkets.com/bernanke-running-amuck-6-3842...

There are a few things I don't agree with, but compare it in honesty with, for example, mainstream media's fudging of employment figures and playing along with our government's trying to hide the M3 figures, etc.

anamax• 16 years ago

(1) Would you rather be poor in the US or somewhere else? (2) Which way do people want to move (on average)?

Any ordering that is inconsistent with both of those is clearly wrong.

Is The USA Heading For Third World Status? (2007)

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