Donald Trump's campaign has captured the deep disillusionment among many voters about America’s place in the world. “This country is in big trouble,” he said in the first GOP debate, a theme he has repeated in countless speeches since. “We don't win anymore. We lose to China. We lose to Mexico both in trade and at the border. We lose to everybody.”
Trump isn’t the only candidate to make this point. Scratch below the surface of either the Republican or Democratic presidential contests, and it is clear that much of the debate is over the United States’ economic standing in the world, and what it will take, in Trump’s words, to “make America great again.” The important word being “again.” Trump’s rhetoric—and much of that from Democratic insurgent Bernie Sanders—longs for an earlier time in which the United States was the strongest and most productive economy in the world and faced little in the way of global competition. It is no coincidence that both candidates find common ground in rejecting trade agreements, such as the Trans-Pacific Partnership (TPP), that would intensify the competition.
But nostalgia isn’t a good guide for policy. Strategies designed without an appreciation for where the United States actually stands could end up undermining its strengths without fixing any of the weaknesses.
So how does the United States stack up? According to the World Economic Forum’s most recent Global Competitiveness Report, the United States is the third most competitive economy in the world, behind only tiny Switzerland and Singapore and slightly ahead of other large economies such as Germany, Japan, and the United Kingdom. That is several notches up from the seventh-place spot the United States held as recently as 2012. U.S. job creation over the past five years has outpaced that of any other advanced economy, and the U.S. dollar has surged as investors flee Europe and Asia in search of better returns.
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