Robert J. Samuelson argues against undue economic pessimism in "Sputnik Scare, Updated":
Every complex economy is more (or less) than the sum of its parts. What matters is not just how much we save -- but how well we invest. . . .
The Sputnik syndrome is an illusion. It transforms a few selective economic happenings -- a satellite here, a Toyota there, poor test scores everywhere -- into a full-blown theory of economic inferiority or superiority. As often as not, the result is misleading. We are now going through this process with China and India. Their entry into the global economy is a big deal, with some obvious pluses and minuses for us. As they get richer, some of their talent that once came our way may stay home (especially if we make getting U.S. visas harder). On the other hand, good ideas that originate in Bangalore or Shanghai will soon benefit people everywhere -- just as good American or Japanese ideas have before. . . .
On being overtaken, history teaches another lesson. America's economic strengths lie in qualities that are hard to distill into simple statistics or trends. We've maintained beliefs and practices that compensate for our weaknesses, including ambitiousness; openness to change (even unpleasant change); competition; hard work; and a willingness to take and reward risks. If we lose this magic combination, it won't be China's fault.