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Given certain discomfiting facts, can the U.S. continue to lead as an economic giant?

I’m going to cite a half-dozen sets of sobering facts and then ask a simple, discomfiting question: What in the world is keeping the United States afloat as the planet’s economic leader?

I’m going to cite a half-dozen sets of sobering facts and then ask a simple, discomfiting question: What in the world is keeping the United States afloat as the planet’s economic leader?

Mitch Pearlstein
Mitch Pearlstein

Here goes:

• The United States now ranks 16th among industrialized nations in college completion rates. It ranks 20th in high school completion rates. We used to be No. 1 in both.

• The number of foreign students studying engineering and physical sciences in U.S. graduate schools is actually greater than the number of American students doing so. Something called the World Economic Forum ranks the United States 48th in quality of mathematics and science education.

• Moving from educational problems to entwined family matters: Marriages are more fragile in the United States than virtually anywhere else in the world. In one study, children born to married parents in this country were more likely to experience their parents’ breaking up than were boys and girls born to cohabiting parents in Sweden.

• As for out-of-wedlock births, about 40 percent of all American children are born outside marriage, with the proportion reaching 80 percent and higher in some neighborhoods.

• In regard to business, physical infrastructure and the like, 51 percent of new patents awarded in the United States in 2009 went to non-U.S. companies. Only four of the top 10 companies receiving U.S. patents were American that year.

• No new nuclear plants and no new petroleum refineries have been built in the United States in a third of a century. Of the 60 new nuclear plants under construction around the world, a grand total of one is in this country.

As dirty as these half-dozen are, they say nothing about entitlement, debt and other crises. So how and why — beyond the fact that no major country is free of very large problems — does the United States still lead the world in real ways?

My favorite two-word answer remains “American exceptionalism,” both obvious and ineffable.

A more practical explanation

Faith in our uniqueness has never required any leap on my part. I’ve always been one with Abraham Lincoln, who believed that the United States (at a far rougher moment) was the planet’s last, best hope. Nevertheless, if forced to offer a more practical explanation for American economic leadership, and to do so in two words, they’d be “innovation” and “entrepreneurship,” about which more in a moment.

But what about coming decades?  Can the United States continue doing as comparatively terrifically as it has historically if it continues to slip into mediocrity and worse in critical comparisons with other nations?  “Almost certainly not” is the only honest answer, for no other reason than the emergence of immensely tougher worldwide competition.

The rhetorical risk here is sounding like a Time or Newsweek cover story in which a handful of data are transmuted into a New Biggest Threat Ever — a mega-explanation for what’s wrong and dangerous and on the edge of doing us in. Still, the signs of slippage compel attention.

Witness the fact, for example, that if the United States is to continue leading the world economically, it will have to rely on something other than the educational wherewithal of its rank-and-file citizens. A mega-tonnage improvement in K-12 schools’ results might change matters, but given how little a generation of “reforms” has accomplished so far, there’s no reason to believe American elementary and secondary education will get adequately better anytime soon.

But is it possible that this matters less than we think?  What if economic performance is really much more dependent on a comparatively small number of exceptionally creative men and women than on the average abilities of the population overall? What if we can continue getting by as an economic giant primarily through the talents of a handful of entrepreneurs, computer scientists and stem cell mavens (along with a few social scientists and art historians thrown in for broadening spice)?

Economic and social cleavages

Or, nonfacetiously getting to a fearful core, and focusing specifically on the powerful ways in which family fragmentation depresses academic achievement: Is it possible that our biggest worries might wind up pertaining not to overall economic growth but to economic and social cleavages that are bound to grow between different social classes and groups with radically different childbearing and childrearing patterns?

How might this be the case?  The connections are direct.

If enormous numbers of Americans continue having children outside of marriage — and lower-income men and women do so far more frequently than more-affluent ones — we know that their sons and daughters will not do as well, on average, as children born within marriage. The research on this is overwhelming and applies to educational achievement just as it does to poorer health, more drug use, more crime — every measure you can think of.

In other words, a commonwealth in which different groups routinely raise their children in differently fortified homes risks further morphing into a place where wealth is even less-well-shared, with inequalities of all sorts guaranteed to feed on themselves.

Yet despite such trends (and as teased), it’s entirely conceivable that our GDP can remain the biggest in the universe, but only as long as that handful of entrepreneurs, computer scientists and stem cell mavens keeps working like crazy. I recently read that a key indicator in whether an economy flourishes is the number of startups doing a billion dollars worth of annual business by their 20th anniversary — the very kinds of enterprises born of a remarkably talented few.

But how will those of too few skills fare in the midst of this economic success?  No answer is needed.

How do we thrive?
What do we need to do as a nation to thrive rather than decline?  Feel free to choose from a slew of things, both inside and outside of government, some of which (as friends on the left like to say) might be called “investments.” I’m thinking especially in this regard of adequate and consistent federal funding for scientific research.

But here are two rudiments which follow from everything above:

From the public sector, think of all the free-market policies that can maximize the number of businesses doing a billion dollars in sales within 20 years — then pass and implement them.

More private — intimately and keenly so — is to somehow revive marriage in places where it has nearly evaporated, thereby affording many more young people much better chances to share in what will remain our country’s enormous bounty.

Mitch Pearlstein is the founder and president of Center of the American Experiment in Minneapolis.