Anyone wondering about the long term future of the US economy is amazed at how fast it is evolving.
There has been an unrelenting growth of services’ share of American GDP, from 25% to 45% over the last sixty years.
Far and away the fastest growth area for the past eight years has been health care, thanks to Obamacare. With that program now headed for the dustbin of history, those job gains are about to be quickly unwound.
It takes one health care professional to take care of 14 Americans. If you eliminate health care for 20 million, that eliminates 1.42 million jobs.
That’s what will happen if our national health care is eliminated without a replacement.
This is not necessarily a bad thing. Would you rather be mining coal or designing a website? Do you want to earn $12 an hour, or $150?
These statistics make us the envy of the world, as services are where the future lies. By creating so many key technologies, our country has been the most successful in the world in climbing up the value chain.
China can have all the $3 an hour jobs it wants.
Services largely comprise pure intellectual content, require no raw materials, and the end product can be transmitted over the Internet.
There is a reason why nearly a million foreign students have flocked to the US for an education.
Emerging nations like China and South Korea, which only see services generating 10%-15% of their GDP, are wracking their brains trying to figure out how to play catch up.