Lucky

I never thought I'd say this, but..... Those of us who live in the U.S. are very lucky.

It's not that I've never felt lucky to live in the U.S. It's just that people in the U.S. say things like, 'The US is the greatest country on Earth' or 'Everybody wants to live here' without asking or even wondering why. I've always felt that while the U.S. is an ok country, there are likely countries with better systems and more humane policies. As such, it's been a while since I've felt let alone expressed that I'm truly lucky to live in the U.S.

I didn't come to Argentina with the intention of making an honest comparison to the U.S. or as a means of seeing how others lived so that I could appreciate my life in the U.S. I came as an opportunist who felt excitement about the value of my U.S. dollar spending power (3 pesos=1USD). I also wanted to increase my Spanish skills, have an adventure, gain life experience, eat carne (just kidding but not really), gain a different perspective, and have fun. In any case, after inadvertently learning about the history of Argentina and the plight of the average Argentine through working with Argentines and becoming a working Joe myself, I've come to understand that the average U.S. citizen is by comparison very lucky.

For my Fox News Bill O'Reilly loving friends and family (I love you all), my sense that we are lucky is not about the fact that we are the most free or that we all love freedom or that our way of life is the best or that our culture is the best or that our government is the most fair or that life is much better in the U.S.

We are lucky because we have a giant economic safety net. What do I mean by that? I mean that our country can make all kinds of economic and political blunders and no matter how many times we fall off the mountain, there is one thing that has and will for at least the foreseeable future save us-our rabid consumer culture and giant and currently irreplaceable marketplace. For this reason, our dollar will not fall too far, no matter how much and how many different types of debt we incur, no matter how many banks fail, no matter how many people are suckered into home loans that they can't pay. The rest of the world needs our addiction to buying stuff. They are as addicted to our consumption as we are to their stuff. As a result, until another country surpasses our marketplace in size and buying power (see China in a decade or s0-they are growing at 10% every year and currently represent 25% of the US economy), we will continue to experience only kid glove economic blows. This is one reason why the president asks us to keep buying stuff. It is our salvation.

The following is an exerpt from The New Yorker (James Surowiecki) that explains how Iceland is suffering economic woes since other countries have been spooked by the meltdown in the U.S. subprime market and have pulled money from investment in Iceland. As a result, the country's currency, the krona, has lost 22% of its value in the last year and the economy has been thrust into recession, despite the fact that they have more or less played by the rules. The difference between Iceland and the U.S. is that Iceland doesn't represent a signifant consumer market for the rest of the world (their population is the size of Pittsburgh). Consequently, they are considered irrelevant- there's no substantial reason for other countries to maintain their investment.

'And that's the second lesson of Iceland's plight; even in a flat world, there are different rules for different players. In order to prop up the krona, and keep foreign capital from fleeing, Iceland's central bank has had to raise interest rates to an astounding fifteen per cent, a move that will slow the economy to a crawl. By contrast, the dollar, while weak, has evaded the krona's precipitous fall; the Federal Reserve, far from raising interet rates, has slashed them; and Congress is borrowing a hundred and fifty-two billion dollars to hand out tax rebates. Iceland's government has been forced to inflict pain; the U.S. is doing everything possible to avoid it. If Iceland were to attempt to emulate America's approach, its currency would be demolished, and foreign investors would almost certainly head for the exits. The U.S, by contrast, remains the beneficiary of the world's generosity-no matter how bad our financial situation looks, countries like China and Japan keep pouring hundreds of billons of dollars into U.S. seurities. They're doing this not out of kindness, of course, but because the U.S. is a colossal market and they need us to keep buying stuff. The world can't afford to have the U.S. fail, and so we are able to get away with behavior that would wreck smaller countries. Great for us, but when we look at Iceland's predicament we should say that there but for the grace of China go we.'

My entire stay in Argentina, the following types of economic questions have been swirling in my head: Why is it so expensive to buy foreign products in AR, why did the country allow its currency become devalued so drastically, why is it so difficult for people here to get a line of credit, why do most people have to pay the full cost of a home upfront instead of getting a mortgage, why are credit limits so low, why are the offerings of foreign goods and products so dismal in comparison to the U.S., how come these same products are so expensive (more than quality products in the U.S.), how can companies and businesses treat customers with such comparitive disrespect and poor service, and why do the people put up with such terrible products and services? The only answer that Argentines have given me is that business leaders here are corrupt and take too big a cut and mistreat people for their own benefit and government officials are crooked and do the same.

I believe that's true, but only partially so. While Argentina has made its share of economic blunders and more, their fault is less in their selves than in their stars. That is, Argentina is unlucky. They have never developed the marketplace or the population or the geography to attract good international business. As a result, they are just like Iceland, only worse because their currency is so woefully devalued. Companies are only peripherally concerned with Argentina. As a result, there is less competition, and not much interest in competing. International business is difficult to attract and existing businesses aren't interested in and don't need to treat customers well because few other options or competition exist and economically, it's simply not worth the effort. Instead, companies concern themselves with kissing the feet of the biggest marketplace in the world. The U.S. receives the best and cheapest products, we max out our credit cards, we take on home loans we can't afford, we complain at the first sign of consumer injustice, we develop a gigantic sense of consumer entitlement.... and companies enable it. The businesses of the world are addicted to our rabid consumerism just as we are addicted to their products. We enjoy a dependent co-dependent relationship that ensures our high standard of living.

I predict that despite our many deficits, the rise in gas and food prices, decreasing home values, and the drop in the value of the dollar, we will continue to experience only a slow drop in our standard of living. However, things might get ugly as soon as another consumer economy replaces ours in size, power, and consumer apetite. It is only a matter of time then before we will feel what it is like to be less relevant.