And here is where you are mistaken:
1.) the Federal government does take in more than it spends, and writes a big fat IOU to *itself.* The majority holder in US government securities are US banks and private citizens, *we owe money to ourself.*
2.) The measure of GDP also takes into account intangible benefits such as government provided health care. The figures are notoriously skewed because of welfare state spending such as countries like Sweden. The fact is, the US produces (again last figures I have from early 90's) a 4 trillion dollar economy. If you use your noodle its not hard to see that GDP is skewered, as it is absurd that Norway has a bigger economy than we do.
3.) Other measures of national wealth are also machine tool manufacturing, electronic automation, and number of cars per family. We lead the pack. I had the opportunity to sit in on presentation by some Harvard economist (sorry I was more interested in what he had to say than his name) who compared industrial production in machinery, electronics, and automobiles to name a few, and despite the news you read in the paper, the US is not falling behind. What it does is innovate new industries and leave old ones behind. |
