Why the U.S. Will Never Compete Successfully with China

Readings for the 33rd Sunday in Ordinary Time : Proverbs 31: 10-13, 19-20, 30-31; Psalms 128: 1-5; 1st Thessalonians 5: 1-6; Matthew 25: 14-30

Don’t get me wrong. I’m happy that Joe Biden won the presidency and that the reign of Donald Trump is more or less behind us. However, a Biden presidency is not going to cure what’s wrong with the U.S. economy.

That simple truth was underlined for me by Paul Jay’s interview of the brilliant economist and former Wall Street analyst, Michael Hudson who has written the insightful . . . And Forgive Them Their Debts about debt elimination and the biblical Jubilee Year.

Hudson and Jay discussed the de-industrialization of the United States whose economy has become dependent not on producing goods and services, but on the financial sector – on investments, banking, debt, stocks and bonds.

Industrialization vs. Financialization

Meanwhile, China, our country’s chief competitor, has a far healthier economic system that actually provides manufacturing jobs and a rising standard of living for its people. In our globalized economy, that’s possible, because industries are drawn to China by wages that are much lower than in the U.S.

Yet, even with low wages, the Chinese working class is prospering, because of the country’s centralized economy that provides health care gratis and free education for its people along with subsidized housing, food and transportation. Besides that, the nationalized Chinese banking system (absent the profit motive) can easily remedy any debt problems by simply writing down debts should that sector develop problems.

According to Hudson and Jay, catching up with China will be impossible for the United States as long as it continues embracing the neo-liberal capitalist model. For one thing, that arrangement finds it unthinkable to engage in long-term planning; it can’t see beyond projected returns on a quarterly basis. Among other liabilities, that makes it impossible, for example to cope with climate change, that demands anticipating weather events decades from now.

In fact, to actually compete with the centrally planned elements of China’s economy, the U.S. would have to follow systemic suit. However, its program of privatization, deregulation and tax reduction has America moving in the exact opposite direction.

Again, according to Michael Hudson, course correction would include the ideologically “impossible” steps of taming of wage spirals by:

  • Taking de facto central planning away from Wall Street and returning it into the hands of elected government officials
  • Raising taxes on the 1%
  • Nationalizing the banking system
  • Enacting a green new deal to provide productive, environment-saving jobs for the unemployed and under-employed
  • Providing free tuition for all post-secondary students
  • Forgiving the $1.5 trillion that students still owe for their educations, thus freeing them to actually buy homes, automobiles and other necessities
  • Nationalizing health care thus relieving both employers and employees from the burden of meeting the costs of medical treatment and pharmaceuticals

Both Jay and Hudson agreed that without some apocalyptic catastrophe and without transcending our hamstrung two-party system, the chances of taking such measures (even if Democrats had control of both houses of Congress) are nil. Consequently, China will continue to outstrip the United States economically and socially. Simply put, its system is more flexible than the neo-liberal model.

Today’s Readings

I bring all of that up because today’s readings contrast economies (like China’s) that prioritize the needs of people with those that primarily serve the already wealthy. The first type centralizes the role of women. The second is condemned in Jesus’ famous Parable of the Talents.

Here are my “translations” of the readings. You can find the originals here.

Proverbs 31: 10-13, 19-20, 30-31

Deeply centered women are the anchors of the world – far more than the superficially beautiful and apparently charming. The value of virtuous women is beyond precious jewels. They not only benefit their own families with food and clothing; they also recognize and share what they have with the marginalized and poor. In fact, homemakers should be paid for housework and given high positions in government.

Psalms 128: 1-5

Whether they know it or not, such women and those they care for are blessed. They are following the Divine Mother’s path. The gardens they cultivate (actual and metaphorical) overflow with rich foods. Face it: they are responsible for the very continuance and prosperity of the human race. The men in their lives should honor them accordingly.

I Thessalonians 5: 1-6

Women’s pregnancy processes provide an apt image for the Divine Mother’s New World that we all anticipate. The enlightened among us (as opposed to those living in darkness) can already feel that the labor pangs are about to begin. Alert and clear-headed, the light-bearers stand ready like midwives to assist in the birthing.  

Matthew 25: 14-30

Such assistance in service of our Mother’s New Reality calls for departure from business as usual – from a system that rewards the 1% who do no actual work, but who rely on investments that end up enriching the already affluent while further impoverishing and punishing the actually poor and exploited.

Parable of the Talents

As I was saying, the readings just reviewed are about economic systems – one that treats its beneficiaries like the family they are, the other that prioritizes money and profit. The first three readings from Proverbs, Psalms and 1st Thessalonians reflect the values of a tribal culture where women’s productive capacity was still highly valued.  

On the other hand, Jesus’ Parable of the Talents centers on the male world of investment and profit-taking without real work. The story celebrates dropping out and refusing to cooperate with the dynamics of finance, interest and exploitation of the working class. Taken together, the readings put one in mind of the contrast between China’s people-oriented economy over against the U.S. profit-oriented system.

More specifically, Jesus’ parable contrasts obedient conformists with a counter-cultural rebel. The former invest in an economic system embodied in their boss – “a demanding person” the parable laments, “harvesting where he did not plant and gathering where he did not scatter.” In other words, like neo-liberal capitalism itself, the boss is a hard-ass S.O.B. who lives off the work of poor women farmers like the one celebrated in the Proverbs selection. The conformists go along with that system to which they can imagine no acceptable alternative.

Accordingly, the servant who is entrusted with five talents (more than 2 million dollars!) gains 2 million more and the one given two talents doubles his money as well. 

Meanwhile, the non-conformist hero of the parable (like China) refuses to adopt a system where, as Jesus puts it, “everyone who has is given more so that they grow rich, while the have-nots are robbed even of what they have.” Because of his decision to drop out, the rebel suffers predictable consequences. Like Jesus and his mentor, John the Baptist, the non-conformist is marginalized into an exterior darkness which the rich see as bleak and tearful (a place of “weeping and grinding of teeth”). However, Jesus promises that exile from the system of oppression represents a first step towards the inauguration of the very kingdom of God. It is filled with light and joy.

Conclusion

In voting for Joe Biden on November 3rd, so many of us did so with a heavy heart. Yes, we understandably want our world rid of Donald Trump once and for all. And thank God he’ll soon be gone — at least temporarily.

But obviously, Trump is not the problem. As this reflection has suggested, the problem is a system that prioritizes the welfare of investors like the rich man in the Parable of the Talents. And we all know that Mr. Biden and his running mate have no intention of departing from that economic arrangement.

Biden and Harris can’t even imagine a mechanism that treats everyone like family members rather than as interchangeable clients.

Yet somehow, like Paul in the reading from Thessalonians, the enlightened among us can already feel that the labor pangs of the new world Jesus envisioned. Alert and clear-headed, we must commit ourselves to pushing the system in that direction – towards something reflective of Michael Hudson’s recommendations, towards the North Star Jesus called God’s Kingdom.

Hoping against hope, pushing the Biden administration down that path represents our challenge over the next four years.