Take, for instance, the case of automotive industry. The cars from China are, as of now, ridiculed by the Western carmakers as being mere inferior copies of the high class products that they are making. Here one should remember that Toyota had received the same treatment in the 1960s. But today, the American carmakers are getting desperate to catch up with the growth of Toyota.
Another important aspect is that the U.S. trade deficit has been growing steadily since the 1970s. Its trade deficit has been increasing at a large rate since 1997. The United States reported a trade deficit equivalent to $45 billion in July of 2011.
This can affect the fate of the dollar. It has to be noted that China is shifting some of its massive foreign holdings into gold and away from the US dollar, undermining the dollar's role as the world's reserve currency. China plans to make its currency, the yuan, fully convertible for trading on international markets by 2015.
Buying gold and allowing the yuan to be traded freely would weaken the US dollar's dominance as the international reserve currency. The move would have major implications, making it more expensive for the U.S. government to borrow money and to run perpetual trade and budget deficits.
The last element within the third world phrase has to be concerned with enormous concentration of wealth within a small segment of the polity. The gaps in after-tax income between the richest one percent of Americans and the middle and poorest fifths of the country had more than tripled between 1979 and 2007.
There are other factors which will be contributing to third world status. This will include the state of education, health care, the infrastructure and a large middle class. The US education and health care systems are dangerously lagging behind the other first world nations. The U.S. is alone among developed nations in not having a universal healthcare system.
The U.S .is ranked 41st in the world for infant mortality rate and 46th for total life expectancy. The Organisation for Economic Co-operation and Development (OECD) found that the United States ranked poorly in terms of Years of Potential Life Lost, a statistical measure of years of life lost under the age of 70 that were amenable to being saved by health care.
All these factors warn the U.S. to take immediate measures to prevent the future from becoming worse. --
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