America’s Greatness

You’re going to be fine, America, regardless of who will be President.


How did the U.S. become such a strong source of power? What has caused recent economic tepidity? What are our prospects?

Mike Gaiss recommended a book to me, Peter Zeihan’s The Accidental Superpower. It’s one of the best books I’ve read in a long time.

Here are the sources of U.S. wealth and power. It’s based on that real estate adage of “location, location, location”:

  • Has the biggest chunk of the most fertile soil in the world, which leads to tremendous capital wealth
  • A tremendous network of waterways that makes for extremely efficient commerce
  • Safe borders in the form of two oceans and two weaker neighbors
  • The largest consumer market in the world

So, those factors will not change going forward.

Sure, economic growth has been flattening, but that’s a function of demographics. Baby boomers are retiring and opting out of the job force, taking with them their capital-generation capabilities. The younger generation below them, Gen X, isn’t as plentiful; in fact, Gen X is the smallest generation in the country’s history. As a result, the U.S. consumer market, which drives about 70% of GDP, is shrinking.

There are two sources of good news, though. First, Gen Y will come online, and that cohort is larger than Gen X. So, in about 15 years, there will be a “repair” to the demographic problem.

Here is the U.S.’s demographics in 2030, with a more “filled out” demographic distribution:


Second, if you’re into “America First,” then you’ll want to know that many of the other nations do not have favorable demographics. Japan is already there: a shrinking population that is comprised mostly of the elderly.

Soon, countries like Russia, China, Germany, France, Italy and Spain will get here, too. Their demographic situations are worsening. For example, here is China in 2040:

China 2040

Russia is particularly screwed:


Those societies will increasingly face emptying government coffers. Consumers and workers will be outnumbered by retirees, who will draw pensions and have expensive health costs. So, on the world stage, China, Russia, and the E.U. countries will increasingly become weaker.

Zeihan believes that, in a few decades, there will be only one country that will be the leading provider of capital to the world and will be the only major consumer market anywhere: the U.S.A.

If you’d like to see one of his talks, which is a summary of his book, click here.

Fascinating stuff.

2 thoughts on “America’s Greatness

  1. About 6 months ago I watched CNN’s four-part series “1968” and was reminded of how truly horrible that time was in many respects.

    A presidential candidate shot to death – Robert Kennedy. Martin Luther King was shot to death – and during the following week riots in more than 100 cities nationwide leave 39 people dead, more than 2,600 injured and 21,000 arrested. North Korea capturing the USS Pueblo and its sailors. Tet in Vietnam – 543 Americans killed in action and 2,547 wounded during a single week. The My Lai massacre. The Democrats nominating convention in Chicago.

    Many despaired, feared that the nation would never recover. Grief washed over us. Hope was hard to find. But there was hope, and a better, though still imperfect, America emerged. As I remember the painful past of 1968 I am confident “You’re going to be fine, America, regardless of who will be President.”

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