By Karl W. B. Schwarz
6-23-14

The United States profited greatly from the Industrial Revolution and then the IT Revolutions that were first in the Internet and then expanded into the rapid growth of global communications over fiber optics. In those eras the USA emerged as a world leader, but it is currently sliding backwards in just about every category a person can name.

Maybe if the USA had spent more on education and excellence rather than war toys and spying, things might have turned out different over the past 4 presidential administrations.

Some in the USA leadership made a tragic mistake in thinking when they assumed that the USA could evolve as a consumer based market, outsource its technology to cheap labor markets such as China, and just sit back in the USA and rule with world through intellectual property, self-serving laws, goals of US hegemony and imperialism shielded behind the military might and petrodollar supremacy.

Different topic, but the USA itself has killed the US consumer and that is why things are declining so fast on so many fronts across America. The societal rot has set in and is advancing to what will be either debilitating or terminal stage.

As they say, the only constant is change and the latest big change is a megatrend named nanotechnology. In that new great technology revolution the USA is failing miserably and falling behind at an accelerating pace. This is where lack of vision and failure of leadership in Washington DC is soon to have a devastating effect on the USA from coast-to-coast.

The petrodollar supremacy is dying because fiscal policies have weakened the currency to the point that many nations prefer to not keep large stores of dollars as reserve currency and many are now conducting energy trading in their own national currencies. Many nations are also conducting overall trade of imports and exports of everything in their currencies rather than the dollar.

The goal of global American Empire is entirely dependent on the dollar being both the favored reserve currency and the petrodollar exchange medium. As that dies, major negative effects will be seen in the USA.

Suddenly a new rush of laws trying to hold back the tsunami are coming out of DC and they will do nothing but hasten the sheer negative impact.

Try to mentally imagine you are standing in a strong wind, maybe even a hurricane or tornado and pretend you are stopping it with your two outstretched hands. I know, impossible, but DC has that problem in seeing reality for what it is.

The TPP [Trans Pacific Partnership] is an attempt to reign in China and specifically excludes them as being a favored trading partner in the TPP. The USA added in Ecuador for two reasons. First, their UK Embassy is where Julian Assange of WikiLeaks was offered asylum. Secondly, China has made a $7.5 billion commitment for mining rights in Ecuador and now controls what is reportedly $200 billion in copper and polymetals (copper, silver, gold) in two huge mine concessions. There were some major US companies that wanted those massive natural resource reserves and were not let into the negotiations.

That is yet another example where failed US policy towards a nation has now cost dearly in terms of natural resources for future growth.

This map is why the USA has put forth the TPP. China is marching forward with great force, but without all of the theatrics and lies DC is so well known for especially since September 11, 2001.

http://www.heritage.org/research/projects/china-global-investment-tracker-interactive-map

The FATCA [Foreign Accounts Tax Compliance Act] law will become the equivalent of DC putting a gun to their head and ending their empire dreams in one shot. What appears to be a tax law is yet another attempt to micromanage every dollar based transaction and for anyone that fails to comply up to 30% forfeiture of US assets or 30% withholding of the cash amount of the transaction.

The FATCA Folly as foreigners and expat Americans call it is yet another way for the USA to spy and attempt to manipulate outcomes. Many nations, corporations and wealthy individuals are moving their asset allocation models into being one that has nothing to do with the US and the US dollar. Those moves will dry up foreign investment into the USA as quick as a rainfall in the desert turns back into an arid place.

The USA is the largest nation that attempts to tax is citizens on the basis of citizenship rather than residency of where they live and work. That is yet another strategy of intrusion into the affairs of other nations. Said another way, the USA almost alone thinks it has the right to tax the work product that happens outside of its territorial boundaries.

What is both hilarious and disgusting about FATCA is how they tagged it along to the HIRE Act, which is supposedly to be the US answer to job creation but they embed into it a one shot kill to the head and self-inflicted. This is the sort of Forrest Gump ‘stupid is as stupid does’ that defines why nothing Washington DC does works.

Then we hear about TISA [Trade in Services Agreement] Financial Services Annex, the super-secret classified attempt to push world services towards about 50 insider nations and put the screws to everyone else. That is yet another blatant attempt by the USA to expand the spying, manipulation and control so the USD does not turn into what I have termed it to be: Dead President’s Toilet Paper.

I got out of the USD in 2006 and have no intentions of getting back onboard until I see fiscal sanity in Washington DC. That means I am probably permanently detached from being dependent on the USD for anything because I do not have time for DC to wake up or grow up. I saw this calamity coming a long time ago and repositioned my life so that my family would not be flattened by what the Morons of DC have done.

Where the USA is losing out on the next megatrend revolution is in nanotechnology. I am the head of a major nanotechnology company so this is an area I am very familiar with and know much about. Right now China is leading the USA by margins of 4:1 to 6:1 every month and every year in new US patents on nanotechnology. It has been that way for the past 5 years while the US continues to fund, train, and arm terrorism so they can continue pretending to be saving the world from terrorism.

There are some graphics below that show the trends and the USA is sliding backwards in being competitive.

The following graphic shows the trends form 2007 to 2009 on where certain nations ranked in nanotechnology. The USA is pretty much Ivory Tower and is not excelling in commercialization or production, hence very little in the way of new job creation in nanotechnology.

The shifting around has been so severe since 2009 the USA no longer puts such charts together and show clearly how fast they are failing to get a good seat in the next big technology revolution.

Germany is spending more than any other EU nation but is not getting an ROI on their investment either. That is mainly due to a very obtuse German bureaucracy that is protectionist and kills just about everything they touch or at a minimum crushes it beyond repair.

I met a Turkish man in Germany that had the largest prepaid phone card business in that nation. He was returning to Turkey because of this one comment he made: “In Turkey it is 90% business, 10% paperwork. Here it is 60% paperwork, 40% business.” I was there for 35 months, his assessment was accurate.

I cannot get into it here other than state that we are aligned with Japan, South Korea, Brazil, India, Russia and Switzerland. We are all headed in unison into the Dominant Square in the upper right hand of the chart.

The following chart shows what nations are making the biggest investments, but Germany has barely moved up, Japan is declining and sliding backwards, the USA is making far too much investment into war toys and nanotechnology applications into same. As you can tell on the following chart the China focus has been continual, sustained focus and large.

Another place that China is making huge gains is in the total number of people employed in Science and Engineering (S/E). That huge jump in 2010 is even bigger now in 2014. By 2020 I think China may be leading by a margin that might be as high as 2 to 1 over the USA.

Another trend is the Chinese scientists and engineers are now better paid than their US and Europe counterparts. That increases the incentive to get the top educations in US and say Oxford or Cambridge in the UK and then return home and use that knowledge as a major technology competitor.

While USA and UK are both decidedly in the Ivory Tower category in the first graphic in this article, China is not. That is an intentional slight on the part of the USA to now show that China is the dominant nanotechnology nation at this time.

The leaders of China are focused on growth and technologies of the future, not war toys.

The most telling graph is the following one. This is where war policy and diversion of national priorities towards follies takes its biggest toll. The red line is China and Chart A is the rise of bachelor degrees for Chinese students and the Chart B is the number of PhDs some of those same students are going on to obtain.

In terms of bachelor degrees China has walked off and left the USA in its wake over the past 12 years. In higher level degrees like MS or PhD the past 7 years have put China ahead in the category, too.

The bogus Global War on Terror has seen about 3 million of America’s young men and women get sent to foreign lands to serve a lie. Many of them have been called up for 2, 3 or 4 tours and could not complete university. Some of them never came home except in a casket so never got a chance to complete university and move on with their life. Many came home with shattered health and just surviving became more important than finishing the university degree. I know quite a few ‘budding geniuses’ that were part of that 3 million abused Americans and they will never be the same again.

I saw the trend shown in Chart A and B up close and personal when living in Alpharetta Georgia and had meetings with Georgia Tech. At first I was stunned that there were no EU or US PhD candidates with a focus on nanotechnology, all were Chinese. When I dug deeper on the downward trends in educational attainment levels it was easier to understand why China is rising fast and others are declining fast.

The real figures for 2010 to 2014 are even more in China’s favor and indicative of continual decline of the USA. It is catching up with most EU nations, too.

Where all of this translates into money in the bank just due to sheer imports and exports is shown on the following map. China is the #1 trading partner with all of the countries shown in red. They are the #2 trading partner for all of the countries shown in Orange, which includes USA and Canada, and #3 or less where the countries are in yellow.

For all of this DC mindset of Global American Empire based on military supremacy and is drowning in Red Ink (losses or debts), the Chinese business model is all about business and profitability. That map above is a Global Empire of a new Superpower named China. Theirs is profitable; the US model is not except for the elite few.

Even those trends are moving more into China’s favor. There are unit trains traversing from China across Russia into Poland as well as the huge container ships. What was 1 train per week is now many times that. Heavy airfreight from China is now a regular event in many of the major EU airports including Prague Czech Republic.

Amidst all of the flap and rhetoric over Crimea, China has recently announced a multi-billion investment in Crimea that will position them to increase trade with Russia, Ukraine and Europe.

When the above map is updated to 2014 and beyond, it will not be much longer before even the yellow areas shown above will include that China will be the #1 or #2 trading partner for almost every nation in the world.

One trend that I am watching is China is moving out of the cheap production for US consumers. They started dumping that off to other nations like Vietnam, Indonesia, Philippines, etc. about 4 years ago. They are using their wealth and the scientific and engineering talent to move into much higher levels of technology competence. China will be a major producer of automobiles, commercial jets and many other high tech sectors.

As they have a decided advantage over the USA and EU in nanotechnology, that distance will widen and fast. Only reason I am certain we can go head-to-head with them is they tried to buy us out because we are so far ahead of them. It was comforting to hear them admit we are about 10 years ahead of them and we intend to stay out ahead of them.

In 2013 a global survey of how students are ranking in mathematics, science and literacy showed the USA ranked 36^th in math, 28^th in science and 24^th in literacy. Those figures have been steadily declining over the past 25 to 30 years.

It might surprise some but not me that China ranked 1^st in all three of those categories.

About the only thing Washington DC appreciates about having a stupid American electorate is they are too naïve, disinterested, distracted and stupid to vote DC out of office and fix what those charts above clearly show.

The good news from where I am sitting is Switzerland has moved up in overall standing in educational attainment and Germany has slipped considerably. That will take its toll on Germany as time goes on if they do not take steps to fix it. In Switzerland even at the age of 12-16 the universities are already getting the younger children engaged in preparatory training in science, technology and even marketing and how to form, run and grow a business.

The USA reminds me of an old saying in sports: If you are not planning to win, you are planning to lose. DC excels at losing and that is sad for America.