Advertisem*nt
SKIP ADVERTIsem*nT
You have a preview view of this article while we are checking your access. When we have confirmed access, the full article content will load.
Supported by
SKIP ADVERTIsem*nT
Paul Krugman
By Paul Krugman
Opinion Columnist
U.S. economic news has been pretty good lately. Our job market has fully recovered from Covid and then some, defying predictions of permanent “scarring” from pandemic disruptions. Inflation is down, falling faster than in any other large advanced economy. At the same time, economic trouble seems to abound abroad, notably in China, where the end of the “zero Covid” policy hasn’t brought the expected economic surge.
Perhaps inevitably, I’ve lately been sensing a mood swing in how the United States sees itself in the world. American triumphalism — we’re No. 1! — is making a comeback.
As always, we should curb our enthusiasm. Our global standing is never as good or as bad as conventional wisdom has it at any given moment. And the downside of getting puffed up about our relative performance is that we may fail to learn from things other nations do better.
I say this as someone who’s seen us go through multiple ups and downs on this front. There was the manic Morning in America phase of the mid-1980s, followed by the depressive mood of the early ’90s: “The Cold War is over and Japan won.” Then came a late-90s surge in triumphalism as America temporarily took the lead in taking advantage of the internet, which receded as other countries also got online, productivity gains from information technology petered out, America led the way into global financial crisis and China emerged as a powerful economic rival.
Now the boastfulness is back, with a special emphasis on trashing European economic performance. For example, I’ve been seeing media organizations that really should know better saying things like this: “America’s economy is nearly twice the size of the eurozone’s. In 2008 they were similar,” which appeared on a chart in The Wall Street Journal.
This isn’t exactly a false statement, but it’s deeply misleading. It’s true that in 2008 the dollar value of our gross domestic product was only 4 percent higher than that of the eurozone — the group of European countries that share a common currency — while by 2022 America’s dollar G.D.P. was 81 percent larger. But most of that widening gap reflected the declining value of the euro relative to that of the dollar on foreign exchange markets rather than real differences in economic growth. And as any international economist can tell you, a strong currency is by no means the same thing as a strong economy.
Advertisem*nt
SKIP ADVERTIsem*nT
