Why Is America So Rich? | 5 Minute Video
Why is America the world’s richest nation? Is it mostly because of the government, or is it thanks to entrepreneurs and businessmen? Historian Burt Folsom of Hillsdale College explains.
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Script:
The United States is the world’s most prosperous economy. It’s been that way for so long — over a hundred years — that we take it for granted.
But how did it happen?
There are many answers, of course. One is that the United States values the free market over government control of the economy.
But here’s a point that is seldom made:
It didn’t begin that way
Before the country placed its trust in the free market, it trusted the government to make important business decisions. Or to put it another way, only after the government failed repeatedly to promote economic growth and only after private enterprise succeeded where the government failed did the United States start to develop a world beating economy.
Let’s look at three telling examples:
In 1808 John Jacob Astor formed the American Fur Company and marketed American furs around the world. Europeans adored beaver hats for their peerless warmth and durability. Astor gave them what they wanted.
Instead of leaving the fur business to capable entrepreneurs like Astor, the government decided it wanted to be in on the action.
So, it subsidized its own fur company run by a self-promoting government official named Thomas McKenney. McKenney should have won the competition. After all, he had the federal government backing him.
But while Astor employed hundreds of people and still made a tidy profit, McKenney’s company lost money every year. Finally, Congress in 1822, came to its senses and ended the subsidies for McKenney and his associates.
A similar situation developed in the 1840’s around the telegraph.
The telegraph was the first step toward the instant communication we have today. Invented by Samuel Morse, the telegraph transmitted sound – as dots and dashes representing letters of the alphabet.
Morse built his first telegraph wire between Washington, D.C. and Baltimore with the help of a government grant. Morse, more of an idealist than businessman, agreed to let the government own and operate the telegraph “in the national interest.”
But the government steadily lost money each month it operated the telegraph. During 1845, expenditures for the telegraph exceeded revenue by six-to-one and sometimes by ten-to-one. Seeing no value in the invention, Congress turned the money-loser over to private enterprise.
In the hands of entrepreneurs, the business took off. Telegraph promoters showed the press how it could instantly report stories occurring hundreds of miles away. Bankers, stock brokers and insurance companies saw how they could instantly monitor investments near and far. And dozens of other valuable uses were soon discovered.
As the quality of service improved, telegraph lines were strung across the country – from 40 miles of wire in 1846 to 23,000 miles in 1852. By the 1860s, the U.S. had a transcontinental telegraph wire. And by the end of that decade entrepreneurs had strung a telegraph cable across the Atlantic Ocean.
Why didn’t the US government profitably use what Morse had invented? Part of the answer is that the incentives for bureaucrats differ sharply from those of entrepreneurs. When government operated the telegraph, Washington bureaucrats received no profits from the messages they sent, and the cash they lost was the taxpayers’, not their own. So government officials had no incentive to improve service, to find new customers, or to expand to more cities.
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This doesn't explain anything. Loads of countries have similarly free markets and they are not doing nearly as well.
(Honest leadership simple answer)
USA is rich because of Petrodollar not capitalism or socialism etc.
The answer is 400 years of slavery.
You forgot to factor in free slave labor – typical white view
The US is not really wealthy at all. It is all smoke and mirrors at this point. The wealth of a nation is based off their citizens and their skills/abilities to deliver. The US no longer has that advantage. We are in the midst of the greatest collapse in the history of the world. Brought to you by greed, and the current Left leaning education system.
I mean, having seized the majority of world's gold and subsequently becoming the global money printer, this allowed the US to take out a line of credit on the rest of the planet. With a debt-to-GDP over 100% in 2024, the US is not even close to the world's richest country in real terms. Scamming the entire planet is their greatest innovation. That and perhaps the moon landing.
conservative propaganda
This video aged like milk
Competitive Innovative, Improving, Advancement Anti Complacent Market/Free Market economies. We want that in South Africa 🇿🇦and the rest of Africa. Every nation in Africa's currencies backed by gold and oil on top of an innovative competitive economy, social and political stability. As a continent we'll beat the Western world it will be a vicious economic beat down by outperformance.
The global South has a lot more land, more people, more resources and human capital than the west. We just need infrastructure, proper leaders, the right incentives to create enterprise employment housing and efficiencies.
Small to large competitive improving advancing enterprise with a skilled educated productive workforce
World Class Education system
Competent public sector
Excellent private sector
Strong cohesive supportive families
Robust Infrastructure
Ethical and Competent Leadership and more
Is the formula for a nation to compete and succeed.
This guy needs to learn to speak
we work hard in what used to be a free market that let us expand and grow as a whole society.
I was used to thinking this is a unbiased channel. But i am wrong. Free market is obviously good for economy. But this right wing propaganda just tell the failure and try to believe us on privatization of every business. But will not talk about Aramco oil company worlds most profitable company from saudi govt. Many chinese billion dollar SEO's comapny run successfully. Right wing will talk about US failed SOE's management that china did. There should exist both public and private. Only private mainly lead to monopoly or oligarchy of companies like US food companies do by lobbying US senate. They want privatization of oil companies which lead to trillions of profit. Oil business is not so complicated and govt should not privatize this business and give all profits to corporates not the people.
selling hats or selling bandages and other cheap but must have commodities in various wars on all sides ?
So i just looked up American Fur Company on Youtube and i mean, this video is full of spin.
McKenney did run a bunch of trading posts to trade with the Indians but it was a non-profit enterprise designed to build better relations with the indians, so it wasn't trying to make a profit.
Astor successfully lobbied to have it shut down because it competed with his business interests.
And Astor's business was so profitable bc the expulsion of British traders from the US west gave him essentially a monopoly on the US fur trade so he was more a beneficiary of government regulation than a victim.
1 america has more rules, regulations and business hampering taxes then other countrys.
2 the government is the sole driving force of the economy through publicly funded research or by acts and subsidy's that expand agriculture for example like the homestead act.
3 the telegraph shouldve stayed im national hands to help the lives of farmers, the farmers wanted a nationalized telegraph look up the greenback movement, the grangers or farmers alliance.
3 Collins traversed the Atlantic whereas Vanderbilt only had inland water services
Public services are made to lose money, it should not be run like a business as its made to be used as a service that wouldve helped everyone. This is not mentioning the money made by farmers for example because of the telegraph services they had, or the people who made thing ins america from the publicly funded steam ships as we could not have know that.
So how did america become rich? Colonization and good geography, the american military mostly the navy had colonized many places that made the government money like cuba and protected business interests in china. In fact american business was incredibly lack luster during the 1800's, their was always a european power that did better so we had to use our materials like the California gold rush that brought a wave of people and eased the expansion of the pacific.
Tldr free market enterprise was incredibly lacking during that time and was reliant on the government like with the trans continental railroad and homestead act, the public services we had were either dumb i will concede that or shouldve been kept for the help they gave to others that in the long run wouldve increased our wealth. Our real wealth came from our rapid expansion that gave us natural resources, a lot of human labor and better trade relations like with the colonization of cuba and the phillipines that allowed us to protect our trade interests in china.
Slavery
you can check usa debt online…(in real time)
do the math..
for every American citizen there is 100.000$ debt.
that system is bound to fall one day.
i dont know how you handle you finance at home ,but to keep it simple.
its::
income-debt-expense=net balance.
its a very well developed country, but its falling apart.
old railways, old roads…old sewage systems…stuff like that.
massive spending in ww2,massive spending in cold war….
its like keeping an old motor running, to keep the world powers in place.
kinda like the soviet block.
who has most oil to keep there motor running!?
Colonialism is the only reason why america is so rich. Ppl do not get it bc they r brainwashed by the US oligarch-controlled media and channels like this.The purposes of colonialism include economic exploitation of the colony's natural resources, creation of new markets for the colonizer, and extension of the colonizer's way of life beyond its national borders. American colonies include Latin America, Eastern Europe and Asia. Those who do not want to become american colonies are subject to severe sanctions, embargoes and militar interventions (Iraq, Syria, Lybia, Iran, N Korea, Venezuela, Russia, China, Belorussia, Cuba etc). To justify wars against them the US turns their own people against them by spreading fake news about them.😢 But in most colonies they simply install puppet governments (buy them) and folks in those countries have no idea that they r colonies, not sovereign states. In all other aspects the US is no different or more capitalistic, than any other capitalist country in the world.
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😂😂😂😂😂 Satan is in full effect
As a Greek, socialism is good, EXCEPT THAT the government get to run the place without answering to anyone. It is like an oligarchy in which you vote for yiur king and nobles. This has goods, do not be fooled, for example Greece has much better healthcare for the dollar than US. But overall the mismanagement is abundant and mind blowing, exactly because in the end it's not their own business or their own money, so, for example, nobody will ever complain vs an incompetent colleague, or even fire them. It is a strange world where people are very nice to each other, there are no backstabbings in the workplace, but on the other hand many people do the bare minimum and get the same as others who try much more. In my opinion socialism provides a much better life experience overall for the average person, but in the end the country goes bamkrupt because of mismanagement 😅
Good video, samples are all known but isn't even by far explaining the complexity of the question, just one slice.
Am proud a part of us 🇺🇸💯❤️
It's rich cuz they print money
A free market economy is open to the world. That means free trade with anyone. Let the market decide who produces the best strawberries, robots or shoes.
Answer in one line: Free Market
AMERICA is a CONTINENT made up of 35 countries and more than 1000 million inhabitants poor stupid ignorant people are pitiful
AMERICA is a CONTINENT not a country