Essay: Slow and steady growth over the long term via capitalism and the rule of law versus short-sighted authoritarian economic growth that is costly to the long term economy

Chart of the growth of U.S. GNP from January 1947 to January 2023.

A great strength of the United States is its very consistent growth of its GNP over decades and its quick recovery the few times its GNP has gone down.

For more information on this topic, please see: Should You Be Bullish on America? and Why is America so rich?

Investopedia says about the importance of labor productivity to an economy, "Labor productivity is largely driven by investment in capital, technological progress, and human capital development. Labor productivity is directly linked to improved standards of living in the form of higher consumption."

According the Yahoo Finance: "According to Yahoo Finance: "Efficiency in production, also coined as productivity, is one of the major driving forces behind economic resilience in a country... The United States has one of the strongest economies in the world. The country hosts some of the largest companies in the world, which contributes to the high GDP per capita in the country."

As can be seen in the map above, the USA has one of the highest labor productivity rates in the world and it is significantly higher than both China and Russia.

Steady, long term economic growth: Tortoises usually beat hares

Do you remember the story of the tortoise and the hare which taught that slow and steady wins the race?

It turns out that this is right when it comes to most economies. A great video on this matter is at Should You Be Bullish on America?

Do you remember the story of the tortoise and the hare which taught that slow and steady wins the race? It turns out that this is right when it comes to economies. A great video on this matter is at Should You Be Bullish on America?

A few points:

1. Capitalism is far superior economically to socialism/communism (See: Socialism vs. Capitalism: One Clear Winner). Many ardent cheerleaders of the multipolar fantasy are anti-capitalist individuals who don't understand basic economics. As a result of this, they are communist China cheerleaders.

China's multiple economic crisis:

China fueled much of its economy in the past via debt-fueled projects which have had a low return on investment over the long term (ghost cities, etc.). As a result, it has a debt to GDP ratio of approximately 250% of GDP.

Presently, communist China is facing multiple crisis with the three major crisis below being signs of growing deflationary pressures on their economy:

• Chinese real estate crisis (2020–present)

• Chinese stock markets crisis (Since 2021, China’s stock markets have lost about $7 trillion in value.)

• Youth unemployment in China

Since 2021, China’s stock markets have lost about $7 trillion in value.

2. The communist Soviet Union saw a spectacular rise in its economy and then crashed and burned. See: Why the USSR Collapsed Economically, Investopedia

Japan experienced lost decades of economic stagnation due to a balance sheet recession. China for some of the same reasons plus other major reasons is headed for long-term economic decline in all likelihood.

• Can China learn lessons from Japan’s ‘lost 30 years’?, South China Morning Post, 2023

• Is China facing Japan-style 'lost decades'?ーNHK WORLD-JAPAN NEWS, 2023

• The Four Big Structural Forces Holding Back China's Economy, Bloomberg Podcast, 2023

• Is China Past Its Peak?, Wall Street Journal, August 15, 2023

• Has China’s Growth Gone from Miracle to Malady?, Brookings Institution, March 30-31, 2023

3. Capitalistic countries with the rule of law are far more efficient than communist countries with their rampant corruption and they are more efficient than non-communist kleptocracies as well. Many China/Russia cheerleaders turn a blind eye to the rampant corruption in China and Russia (See: Chinese Communist Party and corruption and Vladimir Putin is a corrupt kleptocrat and an authoritarian).