Thursday, December 24, 2009

America's Ridiculously Large $14T Economy

I took some criticism for the post below comparing the amount of durable goods manufactured in the U.S. in November to the entire annual output of goods and services (GDP) in some other countries. Perhaps I wasn't clear enough in my comparison, but I was trying to make the point that we lose sight of the ridiculous size of the U.S. economy ($14 trillion of annual output) and one way to put it in perspective is to show that just the manufacturing output (ignoring services and government) in the U.S., in just one month (ignoring the other 11), is about the same amount of output for all goods and services over the entire 12 months in many countries like Singapore, Chile and the Philippines.

Maybe the map above from a CD post in 2007 does a better job of demonstrating how large the $14 trillion U.S. economy is, by matching gross domestic product in 2006 for each of the fifty U.S. states (data here) to comparable GDP of entire countries (data here).

8 Comments:

At 12/24/2009 11:36 PM, Blogger QT said...

Considering the size of the national deficit, the US economy had better be large and had better grow. When one also factors in the Medicare and Social Security entitlements, the burden of obligation is quite daunting.

 
At 12/25/2009 7:32 AM, Anonymous Christopher Popham Smith said...

In its 12/21 issue, TIME magazine
informs us that true statistics
place the aggregate and current
rate of unemployment at a staggering 21.8%. And so, with an
economy as large as $14 trillion,
we should have no problem restoring
prosperity to everyone---right?
You bet there is a "burden of obligation", but how do we meet
that obligation until people are back to work?

 
At 12/25/2009 7:39 AM, Blogger rjs said...

youre doing the same thing you did in the previous post, measuring output by dollar value, and that only means our output is more expensive, not more...

 
At 12/25/2009 12:28 PM, Blogger PeakTrader said...

RJS, you should see "terms of trade."

"An improvement in a nation's terms of trade is good for that country in the sense that it has to pay less for the products it imports. That is, it has to give up fewer exports for the imports it receives."

Also, the output is more expensive, because the quality is better. Otherwise, lower quality goods can substituted or imported (if it's a tradable good).

If more Americans buy SUVs than compact autos, then the good becomes more expensive.

 
At 12/25/2009 5:24 PM, Blogger bix1951 said...

and we will never be satisfied
no matter how rich we get

 
At 12/25/2009 11:50 PM, Anonymous Uno said...

Cute map, but fallacious. Do the same map for GDP per capita.

I suspect it will strengthen your point. North and South Dakota have two of the strongest economies in the nation in relative terms. Kenya and Bulgaria aren't in the same league.

There are also issues of income distribution, freedom, democracy, and corruption to consider.

Size isn't everything.

 
At 12/27/2009 7:24 AM, Blogger rjs said...

to come back, just to put something else in "perspective":
Mao’s dream of catching up with the rest of the world has been realized, albeit a bit behind schedule, not only in steel making, where annual capacity has reached 660 million tons, but in many other sectors as well. In 2008, China ranked first in steel (about half of world production), cement (also about half), aluminum (about 40%), and glass (31%), to take just a few examples. The country topped the US in auto production in 2009, and remains second only to South Korea in shipbuilding, with 36% of global capacity.

 
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