The known world is all that exists. We know it all. Every nook and cranny on the planet, both above and below the surface, can be seen from an iPhone in the palm of one’s hand. Still, the frontier beckons.
As the U.S economy tries to find its footing in the face of rising foreigners, the concern that envelopes Washington is if future generations of Americans can be better off than the current generations. As more and more people want to live better lives around the world, all at the same time for the first time since the Industrial Revolution, the demand for the finite natural endowments under our feet only grows. We indeed live in interesting times.
If the economic growth rates of every major part of the world are pegged at their current rates taking into account population growth rates, the American standard of living by mid-century will, in fact, rise anywhere between 33 per cent to 100 per cent above what it is now. So, will China’s and India’s. And on average, so will the world’s. Changing this dynamic is not feasible and is inefficient if it is tried, because self-defense, both military and diplomatic, increases economic well-being as it did for the United States.
Conflict with others to prevent how much they will consume fearing that U.S consumption could become more expensive due to the rising scarcity of resources is cognitive dissonance. It is a trick of perception because it is fundamentally counter to human nature. It passes demagogues for patriots, causing more harm than good.
The wealthy countries around the world, since the Industrial Revolution, are technically more efficient but not as efficient in their consumption habits. The emerging countries are technically not as efficient and consumption efficiency does not yet apply to them because they do not yet consume as much. As they begin to consume more, both technical efficiency and consumption efficiency matter for all. Technical efficiency is about how much less of a resource can be used to produce the same good or service. Consumption efficiency is about not turning into a use-and-throw society and consuming beyond satiation.
The Ricardian comparative advantage (after David Ricardo who first formalized trade theory) of nations competing to enhance the economic well-being of their peoples is not as much competition for resources anymore (because it must not be the case), but how best can resources be used. It is about technical change to conserve resources and about living habits that support such a technical change. Other countries will buy from countries which have more efficient technologies and will emulate cultures which are sustainable because their sense of everyday scarcity, today, is as real as the American Great Depression nearly a century ago.
The American disadvantage today is that the world wants American technologies but not the American way of life. The paradox of the American way of life is that technical change has increased waste in consumption. The country is full of landfills, obesity is a health problem and all of the world’s gas is not enough for American cars. Land use is nonchalant. America neither likes to recycle nor conserve. It likes to borrow from the future to spend today. The irony of economic liberty in America is economic inefficiency, no different from that of the former Soviet Union which had curtailed economic liberty. It is an economic model we would only be far too reckless and suicidal to export. It simply is not the way capitalism is supposed to be.
The way we make things and the way we live is the last frontier that beckons humanity on earth. That frontier is what has been endowed to us naturally by Mother Earth and that journey must begin now, within our shores, because it is a long, hard slog in the struggle for survival.