The Monolithic Economy of The U.S.A

[Music] this is the United States of America the wealthiest most powerful nation on the planet by a very respectable margin the sheer scale of the United States wealth and influence is really really hard to fathom even for macro economists sure there are GDP figures and trade balances and labor force figures but they are best for telling the story of a normal national economy and the United States is far from that it's consumer retail sector is bigger than all but nine of the largest national economies in the world California one of its states has a bigger GDP figure than the United Kingdom and the US has 49 more where that came from the US economy goes beyond this though it is the foundation for the world economy in the 20th and the 21st centuries and it's influence isn't caused by something so old-fashioned as Empire but rather industry today US companies can be seen donating industries and economies all over the world and at the same time foreign companies from Europe and Asia fight endlessly to break into the US market the largest and most influential consumer market in the world the US economy is too large with too many facets to explore in a short video enough to be blessed by the YouTube algorithm so we will be making this as a video series but for now in this video I want to explore how the United States got to where it is today what made the United States so special has to be wealthier than the bottom 100 countries on earth combined 20 times over in many senses it didn't really have anything going for it over a lot of other countries found at around the same time and under the same circumstances America has a large land mass with lot of resources sure but so does Russia Canada Brazil and Australia but they don't hold a candle to the wealth of the USA America has a large and very productive population and sure that India and China have populations four times that of the USA and while they are large economies in their own right they are still nothing on the scale of the USA America is home to the greatest modern capitalistic market in the world that drives and rewards innovation in industry and again this is true but many markets in many countries exist like this in the world today and for the most part the consumer market as a result of America's extensive wealth rather than what caused it to really understand unbelievable success we must first understand the country's unbelievable history America as we know it really got going on July 4th of 1776 when it claimed independence from the British Empire which is a position many many countries have been in before but America was the first and it was a bit more of an ordeal than most countries had when they told the motherland that they were moving out on their own gaining independence even been the first of the bunch to gain independence from England was nothing really that special in and of itself plenty of countries have done this to varying degrees of success the first real boon that set America on the path of prosperity came from a genius bit of forethought by its leadership at the time god-emperor Washington Washington had won the war of independence and was so wildly popular with his citizens of the newly founded United States that he could have very easily become a monarch if he had wanted to instead he decided that all that hereditary leadership business was a bit sixteenth-century and set up a two-term limit for presidents and with the founding fathers a lot of the basis for the democratic system of the United States today the big deal here was that this was the first successful transition of a democratically elected government ever when Washington passed the role of president to John Adams sure the system was not yet perfect John Adams was Washington's vice president at the time and the whole voting was only open to white male landowners but it was still a democracy and it worked as intended which was a huge deal most countries in the world today still get democratic elections awfully wrong and civil wars and mass civil unrest is not uncommon when beloved and tenured figures die or are voted out or are hmm politely asked to leave office this all sounds very political and it is but the idea of having a constant system of successive leaders and governing bodies that is not impacted by a life or death of a single individual is hugely stabilizing in an economy in European countries at the time if the monarch died the leadership of that nation went to the Monarchs firstborn son no matter how young or ill-equipped for national leadership he was and this was the best case scenario worst case scenario was that there was a major disagreement about who the legitimate leader of the country was and the whole country was a big Chamizal for an extend to 100 years this is the first big benefit of a good democracy it is stable President of the United States is technically the most dangerous job in the country eight presidents have died while in office four of which were from natural courses and four of which were let's say job-related injuries but none of these deaths caused civil wars or protests or power vacuums it was obviously unfortunate in all instances but the head of state position just went to the vice president who filled in until the next general election for any regular Channel viewers you may know what I'm about to say next stability is the foundation of a good economy and a good democracy is a very very stable system you don't have to worry about civil war or mass protests every 40 years after the latest ruler dies off it is just business as usual a democracy adds more to the economy than just ability though it adds social mobility and Europe around this time the Industrial Revolution was starting to take off steam power is making the work of many of the work of a few and people who were once farmers could produce much much more value by working in a factory this was all well and good but for the average worker as really just business as usual no matter how hard one worked there was a very strict social hierarchy and it was rare for people to break that mold their Parliament was filled with lords and Earls and Dukes and that was presided over by a king or queen the factories were owned by the same people that owned the farms that the workers toiled on before this ultimately stifled innovation and productivity for every James Watt and George Steffensen that made steam engines and railways they were probably a hundred children that never got the opportunity to invent or create as they were thrown into work at very young ages the United States at this time was not industrializing at the same rate but for citizens of the country there was far more opportunities for private enterprise brought about in part due to the system enshrined into the creation of the country itself this private industry and self managed innovation was also supported by another genius bit of forethought by the founding fathers when you think of the US Constitution you tend to think of the big stuff the rights to religion free speech a fair trial and an ar-15 but the founding fathers were more meticulous than just that when they were planning out freedom land they added a lot of Asterix scissors a big one was on the First Amendment to the Constitution which covers the right to religion and free speech one of the asterisks is to that free speech deal was that the Congress shall have the power to promote the progress of science and useful arts by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries basically you can say whatever you want as long as it wasn't something that someone had put in a story or in an invention before securing this was a huge boost to creation as a career endeavor previously invention had pretty much been the domain of the rich and well-educated similar to creating a piece of art you are unlikely to make much money off it but it may have earned you some extra respect amongst your chums at the weekly high tea table with the American system though the promise of wealth was a huge incentive for anybody to try their hand at creating something that could produce value and while it can be argued that money may not be the primary motivator of people looking to create a better steam engine or the most bendable TV show it is certainly a consideration and something that America has cultivated very well especially when you consider it in conjunction with the social mobility that we have explored earlier America's foundation of free enterprise social mobility stable democracy and a cultivation of technical advancement was all well and good but it didn't really get it anywhere early on between its independence in the 1900s a period of over 100 years it was still outpaced by more established European economies going through their own Industrial Revolution but this was more or less to be expected in this time the infant country went through dozens of conflicts a civil war expanded all the way from coast to coast and went from 13 states to 44 with six still to come but you can't really hold that against them it wasn't to say the American system was bad for the most part it was brilliant but if you put Usain Bolt at the age of 10 on a race track chances are even I an aging overweight or comas could beat him down 100 meters and who actually not nevermind but you still get the point establish countries like France England Belgium and the like we're also just out ahead by virtue of their vast foreign colonies that allowed them to expect resources from foreign nations America didn't really partake in that not to say there was Saints or anything but it just wasn't the type of industry that they were in by the early 1900's this all turned around though industry had been important since the Industrial Revolution but it had grown and grown to become the deciding factor of world economies rather than how much spice or teeth could grow or export by this time America had gone through its own Industrial Revolution it was a properly unified a massive country with huge swathes of arable farmland enormous deposits of oil and increasingly valuable and useful commodity access to the Atlantic and Pacific Oceans for trade and friendly neighbors with both Canada and Mexico but even all of this might not have meant much by itself we have seen time and time again on this channel how countries can squander every natural resource and geographical advantage they are given but the United States didn't they combine these undeniable advantages with good fundamental economics that were revolutionary at the time but are mostly taken for granted around the world today the United States was once a British colony and ever since they have been a bit weird about the whole colonialism business America rose to prominence around the same time colonialism was becoming uncool but today America is a nation that is more intertwined with other nations than any other colonial power ever was in the next video in this series on the United States we will look into how this nation has created a global Empire for itself not through conquest and exploitation but rather globalization and cooperation in the meantime I have a few announcements for the channel I have finally given in and started a patreon page for the channel this is in the hope to raise enough money to hire a full time video editor that will be able to go beyond my learn as you go technique with Adobe Premiere so yeah if that is something that you're happy to consider it would be greatly appreciated the next announcement is that I'm out of hospital and I will be able to host the Q&A session again this week so come and join the discord server if you want to participate in that or watch the YouTube livestream that I will be linking in the video description half an hour after this video goes up thanks guys bye

Channel: Economics Explained

Views: 702,439

Keywords: the economy of united states, the economics of united states, the economy of united states explained, the economics of united states explained, united states economics explained, economics explained united states, united states economy explained, united states economy, united states economy economics explained, economics, united states economics, how united states economy works, usa economics, the economics of the usa, usa economics explained, economics explained

Id: ZsaZnl-vWyQ

Length: 11min 5sec (665 seconds)

Published: Sun Dec 01 2019