David Brooks mourns the loss of energy and invention in the United States:
There are also periodic crises of faith. Today, the rise of China is producing such a crisis. It is not only China’s economic growth rate that produces this anxiety. The deeper issue is spiritual. The Chinese, though members of a famously old civilization, seem to possess some of the vigor that once defined the U.S. The Chinese are now an astonishingly optimistic people. Eighty-six percent of Chinese believe their country is headed in the right direction, compared with 37 percent of Americans.
The Chinese now have lavish faith in their scientific and technological potential. Newsweek and Intel just reported the results of their Global Innovation Survey. Only 22 percent of the Chinese believe their country is an innovation leader now, but 63 percent are confident that their country will be the global technology leader within 30 years. The majority of the Chinese believe that China will produce the next society-changing innovation, while only a third of Americans believe the next breakthrough will happen here, according to the survey.
While I would welcome increasing prosperity in China and I think that China’s current emphasis on science education will almost certainly result in an increasing amount of science being done in China, I’m skeptical that China will become the global technology leader in the foreseeable future. Or, more precisely, I believe that to the extent that China does increasingly become a center of science and technological innovation it will necessarily become less Chinese. Specifically, I think there are pretty good reasons that English will remain the lingua franca of science. English’s hegemony in science education and publishing is accelerating, not slowing, cf here and here.
I think that Mr. Brooks is thinking of a highly idealized even sanitized version of American history. Other qualities he doesn’t mention attributed to Americans by our cousins in England and Europe are being shrewd, greedy, and vulgar and I find all of those qualities in plenty in myself and my fellow countrymen.
I think that Americans are savvy readers of markets and responsive to incentives and that’s what they’re doing right now.
The term rent seeking, meaning using mostly governmental power to manipulate the economic environment to your advantage rather than earning profits by making, selling, or doing things, hadn’t been coined back in the antediluvian days when I took economics but the behavior is probably as old as humanity. Today in the United States rent seeking is the surest way to achieve wealth.
Consider the case of the recent bailout of General Motors. GM received a grant advertised as a loan of some $50 billion dollars. GM hasn’t had cumulative net earnings of $50 billion dollars over the period of the last 25 years. This is rent seeking bold, bald, and ugly. It is what we have seen in banking, too.
In the United States today we provide incentives to having wealth (as all countries do) and penalize acquiring wealth. If we want Americans to dream bold dreams and look to the horizon, we’ve got to provide the incentives for doing so and limit the effectiveness of rent seeking as a means of realizing success.