The U.S. Can't Import Its Way to Economic Prosperity

Much has been written about the shortcomings of China's export-dependent economic model, which has emphasized growth by selling to other countries rather than generating its own domestic demand. But the U.S. has similar drawbacks with its model, some of which have become apparent during the pandemic — specifically, an excessive focus on importing economic activity rather than investing in and developing it locally. This can be seen in universities becoming increasingly dependent on international students, city tax bases relying on suburban commuters and tourists and Sun Belt states emphasizing importing talent and business rather than generating it locally. The U.S. as a whole, and many local and regional economies, would be better off with a more balanced approach by investing more in our own people and communities rather than looking elsewhere for growth.

It's understandable why the U.S. has been focused on importing economic activity; often it passes as a free lunch, like discovering oil in your backyard. But in the same way that countries with an abundance of natural resources skimp on internal investment, the so-called resource curse can lead to broader neglect elsewhere.