by Gary Alexander

May 7, 2024

As we approach the 80th anniversary of D-Day in June and the beginning of the end for the Axis powers in World War II, today marks the 79th anniversary of VE-Day, as the formal German surrender was made by German General Alfred Jodl on May 7, 1945. The big celebration came the next day, May 8, our VE-Day.

In the eight decades since World War II, the U.S. has been the world’s #1 economic and military power, although four or five rising powers have tried to dethrone Uncle Sam – depending on whether you count Hitler as our first big knockout victims. I was reminded of Victim #2 last week while rifling through some of my 14 editions of Wealth magazine, published in the mid-1980s. In our summer 1985 issue (title “Capitalism vs. Communism: The Re-emergence of Free Enterprise”), I saw these bullet points …

  • The U.S. created more jobs last year than all of Europe created in the last decade (source: FT)
  • Penalty in Russia for holding more than $100 in American currency: four years of hard labor. Amount offered by Russians on the street of Moscow for a pair of our faded blue jeans: $100.
  • What Russian children, age 8 to 10, say they want (in a poll of 300 Moscow schoolchildren): Lucrative jobs, two-bedroom apartments, cars, country homes, and foreign travel.

These last two points came out of a visit to Russia. At the time, many thought the Soviets were stronger than the U.S. in their military, their missile capacity, and even in their economy. In 1961, according to Paul Samuelson’s famous Economics textbook, the Soviet system was superior to the capitalist West and would surpass us by the mid-1980s, but I visited that Potemkin economy then and could see they poured everything into the military and had nothing left over for their citizens. Still, even as late as 1989, the year the Berlin Wall crumbled, Samuelson’s Economics textbook said, “The Soviet economy is proof that, contrary to what many skeptics…believed, a socialist command economy can function and even thrive.”

Sorry, Paul. Russia never thrived. It was even poorer than its seven captive East European satellites.

At the same time, in the 1980s, Japan was a free-market challenger for being Ichiban (“#1”), but they blew their wad in an inflationary bubble that peaked in 1989, going into a 30-year deflationary funk.

China is the most recent challenger, but they are now in danger of going the way of Japan and Russia.

That’s four failed challengers in the last 80 years, and the U.S. is still #1, with no viable challenger in sight. Maybe India will become the fifth challenger (stifle that laugh!), with the strongest GDP growth this year, but don’t count on it. They have more long-term structural impediments than either China or Japan. In this week’s Economist, their lead editorial cites India as the world’s fastest-growing big country, expanding at an annual rate of 6%-7% with “Private-sector confidence at its highest level since 2010.”

Yet that fine magazine’s back-page scorecard shows this array of scary numbers – 5% inflation, a 7.6% jobless rate, 5.3% debt-to-GDP ratio, 7.2% interest rates and a falling currency. A closer look under the hood shows even scarier numbers: “Out of a working-age population of one billion, only 100 million or so have formal jobs. Most of the rest are stuck in casual work or joblessness.” This is our next rival!?


In his April 26, 2024, Wall Street Journal Capital Account (“U.S. Economy Reigns…”), Greg Ip opens:

“This year, the U.S. will account for 26.3% of the global gross domestic product, the highest in almost two decades. That’s based on the latest projections from the International Monetary Fund. According to the IMF, Europe’s share of world GDP has dropped 1.4 percentage points since 2018, and Japan’s by 2.1 points. The U.S. share, by contrast, is up 2.3 points. China’s share is up since 2018, too. But instead of overtaking the U.S. as the world’s largest economy, the Chinese economy has slipped in size to 64% of the U.S.’s, from 67% in 2018.”  This chart followed:


Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

As an investment oasis, the U.S. has also long been the haven of first choice, just like the dollar has been the world’s reserve currency since 1944. For a short while, in the first decade of the century – after the birth of the euro, from about 1998 to the Great Financial Crisis of 2008 – Europe had its day in the sun, but that crisis hit European banks and governments deeper than it hurt American banks and our Treasury, so we saw crises erupt in the European PIGS (Portugal, Italy, Greece and Spain) in the following decade, and the U.S. once again became the investment oasis to the world in terms of market capitalization.


Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

Some Reasons Why the U.S. Will Likely Remain No. 1

The U.S. still has natural population growth from many pro-family regions like the Mountain West (with its Mormon heritage) and the South, plus lots of immigration, but large families aren’t limited to religious groups and immigrants. Canada also has immigration, but immigration shrank a bit last year (immigrants must have figured out it was cold up there). A new study by Catherine Ruth Pakaluk (“Hannah’s Children: The Women Quietly Defying the Birth Dearth”) shows that the percentage of religious families with large families (five children or more) has declined, and more college-educated women have created large families, while the number of women having five or more children has remained around 5% since 1990.

The U.S. also assimilates immigrants better than most other countries, especially those among our major competitors in Europe and Asia. This is fairly evident when you walk the streets of Tokyo or Beijing.

Why do we assimilate others so well? As usual, Ronald Reagan put it best, here in a 1988 speech:

“America represents something universal in the human spirit. I received a letter not long ago from a man who said, ‘You can go to Japan to live, but you cannot become Japanese. You can go to France to live and not become a Frenchman. You can go to live in Germany or Turkey, and you won’t become a German or a Turk.’ But then he added, ‘Anybody from any corner of the world can come to America to live and become an American.’?’ A person becomes an American by adopting America’s principles, especially those … in the Declaration of Independence.” 

Also, America represents an ongoing laboratory of growth, with 50 states competing among themselves to attract businesses and population (i.e., taxpayers) luring better ideas by offering more freedom, with those states that punish businesses and people (with high taxes and regulations) generally losing population.

In the same manner, the U.S. is like the most popular State among 50 big Nation States competing for people on a global scale, as the U.S. continues to attract the best and brightest minds to our universities and corporations. That’s why most of the new inventions and innovations come from our shores, not from overseas. Quick, name the top three inventions or innovations coming out of Europe or Asia since 1980.

Sure, other nations can copy or steal U.S. technology, but do these other nations innovate or create the big new ideas? Not likely, due to their central controls over private productivity and output, robbing their creative class of the fruits of their creativity – so the most creative among them often migrate to the U.S.

If I may close on a musical note, so many of America’s greatest composers and songwriters came to America because of persecution in Russia and Europe and made the music we love – music about the greatness of America. I cover their songs in my weekly radio programs. This coming weekend, I celebrate the songs of Dmitri Tiomkin (born May 10, 1894 in Ukraine), Max Steiner (May 10, 1888 in Vienna) and the greatest of all, Irving Berlin (born May 11, 1888 in Russia) as well as the Austrian-American hoofer who sang Berlin’s tunes, Fred Astaire, born Friedrich Austerlitz, August 10, 1899. Berlin put our holidays into song, from White Christmas to God Bless America to Thanksgiving (Count Your Blessings). Steiner wrote songs of the south (Tara’s Theme from Gone with the Wind) and Tiomkin wrote for the Westerns (including “Green Leaves of Summer” for “The Alamo”). Can you imagine any American-born composer emigrating to Japan, Russia, China, Austria or India and writing songs about his great new adopted land?

America is more than a nation. It is an idea, the only nation born out of ideas. May it always be so.

All content above represents the opinion of Gary Alexander of Navellier & Associates, Inc.

Please see important disclosures below.

About The Author

Gary Alexander

Gary Alexander has been Senior Writer at Navellier since 2009.  He edits Navellier’s weekly Marketmail and writes a weekly Growth Mail column, in which he uses market history to support the case for growth stocks.  For the previous 20 years before joining Navellier, he was Senior Executive Editor at InvestorPlace Media (formerly Phillips Publishing), where he worked with several leading investment analysts, including Louis Navellier (since 1997), helping launch Louis Navellier’s Blue Chip Growth and Global Growth newsletters.

Prior to that, Gary edited Wealth Magazine and Gold Newsletter and wrote various investment research reports for Jefferson Financial in New Orleans in the 1980s.  He began his financial newsletter career with KCI Communications in 1980, where he served as consulting editor for Personal Finance newsletter while serving as general manager of KCI’s Alexandria House book division.  Before that, he covered the economics beat for news magazines. All content of “Growth Mail” represents the opinion of Gary Alexander

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