From Understanding America, for better understanding America.

RECOMMENDED READING

Each Friday, I’ll be sending out a rundown of what I found most interesting during the week and why. We’ll play around with the format over time, so your comments are welcome. Before jumping in, though, I do hope you’ll take a look at my introductory post from Tuesday if you have not done so already: Welcome to Understanding America.

ONE THING TO READ

I highly recommend diving into the “Soviet America” debate started by Niall Ferguson’s essay in The Free PressWe Are All Soviets Now, with replies from Jonah Goldberg at The DispatchCathy Young at The Bulwark, and Noah Smith at Noahpinion, and Ferguson’s rebuttal on Twitter and Helen Andrews at the American Conservative arguing that Ferguson didn’t go far enough.

The exchange is interesting in the specifics—you’ll learn a lot about the many ways things look like they’re going well in America and the many ways they seem to be going poorly—but more so, I think, in the perfection of the form that so many debates take these days over the American condition. The disagreement is not about any particular data point, but rather about which ones matter.

Ferguson highlights the many indicia of national decay by which the United States looks more like the late-era Soviet Union than the liberal democratic superpower that defeated it. But is the fact of millions of immigrants crossing illegally into our country in search of work, cheered on by the corporate class and the governing party in defiance of the obvious wishes of most citizens, a sign of an especially robust economy or a truly broken polity? And which economy is more robust, anyway: one that sees higher GDP growth because immigrants are streaming so quickly over the border, or one that sees higher wage growth because labor markets are tight?

It is always helpful if people on both sides of these debates describe their measuring sticks clearly. If your definition of success is a well-functioning republic in which common citizens can build decent lives and participate fully in their communities, you will find Ferguson’s critique compelling. If success is large inflows of labor, capital, and goods fueling high levels of GDP growth, debt, and consumption, then you’ll likely side with Goldberg. Though, perhaps tellingly, his effort to applaud the “staggering wealth of the American consumer” provides a link to a table of GDP per capita, which says little about wealth or the typical consumer.

In fact, from 1989–2019, the total wealth in the bottom 50% of U.S. households fell by $1.5 trillion, while total wealth among the top 10% rose by $28.6 trillion. I know which of those two numbers Ferguson would focus on and which Goldberg would highlight; and I’m pretty sure I know which is more important to the health of nations.

Continue reading at Oren Cass's Substack, Understanding America
Oren Cass
Oren Cass is chief economist at American Compass.
@oren_cass
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Welcome to Understanding America

Your guide to the future of economics, American politics, and public policy.