Do the Baby Boomers Understand the World Economy?

At the end of World War II, the United States was the only developed nation with it economy intact. Indeed, during the war the United States had developed its industry to unprecedented levels to support the war effort. Its population had saved a great deal since there were few consumption goods to buy, full employment for years, and a vivid memory of the depression. Starting after the war, the United States invested heavily in human resources -- the GI Bill, alone sent millions of returning veterans of the war through college. Having learned the importance of technology in the war, the United States began to build its scientific and technological capacity. And of course, it benefited greatly from an influx of the intellectual leaders from Europe, who fled the Nazis and the European devastation caused by the war.

The Truman administration through the Marshall Plan stimulated the economic restoration of Europe. So too, it supported reforms in Japan that lead to the development of Japanese economic power in the second half of the 20th century. The tripartite growth of these economies resulted in synergies, and indeed helped the U.S. economy to continue to grow in the aftermath of the war. The creation of the European Common Market helped to continue European economic growth, and the accession of Central and Eastern European nations to the Europe has resulted in further strengthening of the European economy. Europe again is a comparable economic power to North America.

Following the growth of Japan, the Asian tigers followed by China and (later) India have participated in enormous growth in Asian economies. Asia, with more than half of the world's population is joining Europe and North America as a comparable global economic power. While the Western European economic restoration can be seen as repairing the damages of the first half of the 20th century (World War I, the Great Depression, and World War II), the Asian economic restoration can be seen as part of a longer historical process, repairing not only the damages of the wars and depression of the first part of the century, but of colonialism, in the previous centuries, and of failed experiments with centrally planned economies in the latter half of the 20th century.

The Cold War suggested that the Soviet Union was a comparable global power to the United States in the immediate post World War II period, but that was not true. Soviet economic power did not match its military power and was far inferior to that of the United States. Russia, and the Russian speaking nations seem now to be repairing the damage caused by central planning. Indeed, one may hope that Russia and other large nations -- Brazil, Indonesia, Mexico -- will grow their economies That leaves Sub-Saharan Africa, the Islamic countries and parts of Latin America and the Caribbean as trailing economies. Still the world economy is now global, and the balance is quite different than that of the 1945-1975 period.

The Baby Boomers, born between 1945 and 1965, grew up in a world in which the United States had exceptional domination of the world's economy, and thus exceptional power and influence. That generation is now of an age that they dominate the halls of power. They occupy the top jobs in big corporations and in the government. They are the senior professors in the universities, and run foundations, think tanks, and other civil society organizations. Lets hope they can adjust the attitudes formed in the 60's and 70's to the new economic realities, and the resulting power relationships among countries and regions.