China has now overtaken Japan as the world’s second largest economic power. The news came with the inevitability we have come to expect, given their record of 10% annual growth. This rise from poverty has never been equaled in world history. Two hundred years from now, historians will remember this as the most important event of our times.
At almost the same moment came the news that Germany’s economy is charging ahead, growing faster than any other European economy. It is being powered forth by the reforms they have undertaken in the last five years. Those reforms ditched the old European social welfare system in favor of smaller government, lower taxes, less regulation and more market freedom. Germany is no longer the sick man of Europe.
(Indeed, in recent days the Cuban government has announced that they will be laying off more than one million government workers while loosening restrictions on the private sector, and the Swedes have voted in a center right government with the same goals. The private sector has been asked to shoulder a greater role in the provision of education, health care and welfare services. The move to the right is also evident in Britain, Norway, Denmark and Finland.)
And yet here in the United States, we are looking at the prospect of continued economic stagnation, fearful that we will continue to lose our manufacturing base while or infrastructure deteriorates, and less confident than we have ever been for our children’s future.
What’s wrong with this picture? Simply put,…
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