New raw materials are key to U.S. future

Since the end of World War II, the U.S. economy has led development in most sectors of industry, including computers, medical, communications and military technologies.

But today, the nation finds itself questioning its future as an economic powerhouse. Even before the financial crises of 2008 there was a nagging feeling that the United States was slipping relative to countries such as China. The attacks of 9/11 added to this vulnerability -- the feeling that somehow we were losing all that once marked the United States as a great power.

But is that really the case?

True, the nation has lost its role as a manufacturing giant that was capable of converting its plants from making cars to making tanks, ships and airplanes. But much of that transformation came as part of a deliberate strategy to give up the old industries such as steel and coal in favor of the new industries based on technologies and the knowledge economy.

The farming out of Rust Belt industries to the less-sophisticated economies such as those in China and Eastern Europe was supposed to clear the way for the United States to develop industries of the future.

But a funny thing happened on the way to the future: Developing countries such as China, India, Brazil and the European Union have combined to provide the United States with a group of bona fide competitors.

No longer are the Earth's resources being dominated by the U.S. economy. Today we see China buying oil from Venezuela and raw materials from sub-Saharan Africa. Natural resources including gas, oil and water are now in high demand by the new economies of the world.

Yet many Americans fail to understand that the United States is no longer the only major consumer striving for the so-called good life. That's not surprising.

When the United States was the world's only "Costco-size" consumer, we could expect to dominate the supply of the world's raw materials. But now, as consumer economist Juliet Schor of Boston College argues, when China and India begin to consume at the same rate as America, the world's population will need the resources of four more planet Earths.

Since we won't have those, it is vital that the world's next economic leader develop new sources or substitute sources of raw materials to supply the next generation of industries and technologies. If America hopes to regain and maintain its global leadership role, then this is the nation's challenge.

The nation will have to commit itself and its resources to becoming more competitive, particularly in those next-generation industries and technologies. And it will be crucial to maintain a strong economic infrastructure in order to compete.

The recent financial disasters in the banking industry do not bode well for the nation's future. A renewed economy will need a banking industry that is part of the solution and not the crux of the problem.

"It is still impossible to conceive of a committee [to save the world]. ... that is not run by a Yank," she wrote.