There has been a lot in the media recently about how rapidly developing countries are rising economically. China, the world's workhorse, sees its economy groowing at about 10% per year--a staggering amount compared to ours, which "languishes" at a growth rate of roughly 3.5% (if we're lucky). And, of course, Americans are always worried that we are not rich enough compared with our future liabilitiea, especially for retirement and Medicare.
It might be nice to put some of these numbers in perspective. If we do that, the picture is genuinely startling. In 2005, the per capita Gross National Income (GNI) in the United States was about $43,500. That is, if you took the whole economic income of the U.S. amd divided our population into it, the result would be $43,500, roughly. That is higher than the comparable number for any other large industrial nation. The next closes would be Japan at roughly $39,000 per person. Overall, the United States is no. 7 on the GNI list, just under Luxembourg, Norway, Switzerland, Bermuda, Iceland, and Denmark.
China, on the other hand--an industrial powerhouse and the world's largest producer of steel, iron, and coal--comes in at $1,740 per person. It is No.128 on the list, just after Swaziland, Tonga, Samoa, and Cape Verde. But what about Thailand? Thailand is a booming Asian Tiger. What is its story on the wealth list? Thailand is No.110, with a per capita GNI of about $2,700, while France, widely called "The Sick Man of Europe," is No.19 The united Kingdom is ahead of both of them at about $37,000 per person per year. not shabby.
What about the super-rich oil states, with their limitless pools of black gold? They must surely be the ricest of all, surely. Well, not quite. Kuwait is in the big leagues, with a GNI of about $30,000 per capita. But mighty Saudi Arabia has a per capita GNI of about $13,000, or $4,500 less per person than Israel, which has no oil at all, as far I am aware. Oil-rich Iran is at $1,400 per person. Meanwhile, Ireland is now one of the richest small nations in the world, with a per capita GNI of about $41,000, way ahead of the U.K.
A Rich Nation, Not a Rich People
Now these numbers tell an amazing tale of just how rich Americans are. But the really astounding story is that, not only are Americans very rich on average, but compared with other wealthy countries, there are an awful lot of us. There are roughly 300 million Americans. Our total national income is on the order of $14 trillion. That's about as much as Germany, Japan, the U.K. and France put together. In fact, the income of the U.S. is about as big as the income of all of Europe, including oil-rich Russia.
My point is simply that America is a terribly, terribly rich country. However, that wealth is wildly unequal. The top one-tenth of 1% of earners (about130,000 people) earn more than the bottom 120 million. One-tenth of 1% own roughly 40% of all the wealth of the nation. Moreover, the nation has immense obligations that will be difficult to pay. Forty percent of American baby boomers have no savings to speak of for retirement. This is going to present a real crisis in coming years.
Will we stop being rich? Yes, if that means the gap between the United States and China will get smaller. But as the Chinese get rich, that does not make us poor--except in the paranoid mind. If history is any guide, we will stay comparatively rich for a very long time. And after that, it's someone else's problem anyway."In the long run,"as Lord Keynes said,"we are all dead."But look on the bright side. In the short run, as a nation, if not as individuals, we are rich.
