[tt] future no longer brighter than the past

[Eugen Leitl]

(Merkinland uber alles)

http://www.cowboyeconomics.com/research/Economist_Warns_Future_Generations_May_Be_Worse_Off_Than_Past.asp

Economist Warns Future Generations May Be Worse Off Than Past (9/18/2008)

Tags: united states, gross domestic product

For the first time in America's recent history, future generations may be
worse off economically than their parents, warns economist Ross Gittell at
the University of New Hampshire.

Gittell, the James R Carter Professor at UNH, outlines what future
generations may face in "The New Economic Reality," which appears in the
August issue of The Analyst,a leading financial monthly publication in India.
It is a featured article in the edition that includes commentary from leading
business and economic analysts in the United States, India, China, Brazil and
Europe.

"Slow growth since 2001 and the immediate concerns in U.S. financial, housing
and consumer markets are shadows of the longer-term economic challenges that
will need to be addressed to ensure the future economic competitiveness and
prosperity of the U.S. economy," Gittell says.

The financial picture for the U.S. economy presented in Gittell's article
includes:

    * The U.S. share of the world's economy has declined 5 percent since
2001, while shares of Brazil, India, Russia and China have increased.

    * Real Gross Domestic Product growth from 2001 to 2006 was 16 percent for
the United States, well below China at more than 60 percent, India at 45
percent, Russia at 37 percent and Ireland at 28 percent.

    * From 2001 to 2006, exports from the United States grew less than 30
percent while exports from China grew more than 250 percent, from India 230
percent, from the United Kingdom 170 percent and from Brazil 160 percent.

    * Inflation-adjusted median weekly wages for U.S. workers increased just
.3 percent from 2000 to 2007, compared to 7.7 percent from 1989 to 2000.

    * In the last year, the U.S. unemployment rate has increased from 4.6
percent to 5.5 percent, and the number of unemployed has increased more than
20 percent.

    * Since November 2007, U.S. stock prices have declined more than 20
percent.

    * In the last 12 months, housing prices nationwide have dropped more than
15 percent.

    * The U.S. dollar has declined more than 40 percent in value during the
last six years.

    * The U.S. federal debt is now more than $9 trillion. 

Gittell says the main challenges to the U.S. economy include sustaining
global leadership in high value-added and wage activities, such as
knowledge-based and high technology industries; reducing demand for high cost
imported energy; and ensuring an adequate labor force with an ageing and
relatively slow growing population, and with restrictive immigration
policies.

The U.S. economy has been resilient in recovering from previous recessions,
he says. In fact, even with the long-term challenges facing the country, the
United States continues to lead the world economy. But the country needs to
build on its strengths and improve openness and activities in the global
economy to maintain its global economic advantage.

"Most likely, after the current economic malaise, the nation will enter a
period of moderate economic growth, albeit with growth rates lower than the
strongest performing economics," Gittell says. "And for many U.S. households
this may result in a new reality, with declining economic prospects for the
next generation."

Note: This story has been adapted from a news release issued by the
University of New Hampshire