In recent weeks, amid the health care debate, there's been a lot of misinformation regarding the wealth of the United States. So let's set the record straight: the United States has today roughly $50-60 trillion in wealth and investment capital, depending on how one measures each.
I'll repeat the low-end estimate for everyone: fifty trillion dollars. That's $50,000,000,000,000.
The United States: the golden door
In other words, despite the nation's most pronounced recession in more than a generation, despite the horrible housing slump, and despite the 2008 stock market plunge, the United States remains not only the richest nation in the world, but the richest nation and civilization the world has ever known.
No nation has ever created and amassed more wealth in absolute terms than the United States.
In other words, even with the numerous problems the nation faces - 47 million Americans (and climbing) without health insurance, the need for entitlement reform (including Medicare and Medicaid), the banking crisis/bailout, climate change, and the budget deficit - the issue is not whether the money exists to solve the problems, but who pays.
Here's another stat: wealth in the United States has roughly quadrupled in the past 30 years, but the median income of working-class Americans has declined, in real terms. And poverty rates, which had fallen throughout the 1990s, reversed this decade. If each problem -- stagnant wages in many job segments, and poverty -- is not addressed, it's my argument that the two will pose serious threats to both U.S. GDP growth and the nation's economic model, which would obviously be bad news for U.S. stock markets and investors.
Further, don't let anyone ever tell you 'the nation is bankrupt' or 'we have an unserviceable budget deficit and national debt.' If an emergency occurred and the nation was forced to do so, it could eliminate the budget deficit and national debt very quickly. If you doubt this, see paragraph two above.
A new era in United States
I mention all this now because market absolutism - the belief that the free market, unbridled and left to its own natural forces, is the solution to every economic, social, and political problem -- has been discredited as a philosophy every bit as much as the propaganda that flowed from the Politburo in the former Soviet Union. Like orthodox communism, market absolutism is dead.
Further, no matter what the economic conservatives say, or how many dubious critiques they offer for federal and in some cases international intervention, the era of the free market as metaphysical sovereign is over. The free market-created financial crisis has required, and will continue to require, collective action to create a more-stable, constructive, and just economic order.
And in the months and years ahead, after the U.S. economy has returned to sustainable growth, you'll begin to see a discussion emerging regarding the structural problems facing the nation, including resource allocation and the impact/consequences of greed, as well as public policy proposals to address each.
And as this debate progresses, keep one fact at the forefront: there's more than enough money available in the United States to address all of these problems.
Financial Editor Joseph Lazzaro is writing a book on the U.S. presidency and the U.S. economy.
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