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Comment by rayiner | Hacker News Reader

> setting up a global system of economical hegemony and become the wealthiest nation on the history of mankind?

The U.S. was already the richest country in the world before either world war, coming out of a long period of economic isolation.

US GDP per capita growth has been about 2% per year continuously since 1830: https://unchartedterritories.tomaspueyo.com/p/us-gdp-per-cap.... It wasn’t notably higher after World War II than before World War I.

> The same applies to your background, it helped to build the USA as it exists today

The U.S. was already the richest country in the world before mass immigration from countries like mine.

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Your link actually proves the OP right and you wrong. Look at the graph of the running average of GDP and you see that after a huge spike in the 40s (due to the WW2 effort) GDP growth settles on a new higher average (with significantly less fluctuation).

The spike in the 1940s is the war itself and recovery from the Great Depression. Obviously NATO and the reserve currency and whatnot came after that spike. If you look at the second chart, we’re right around the same point as the historical 1.7% growth curve. If you look at the fifth chart, the large european economies also seemed to have grown slightly faster after the war than before it. So I’m not sure how much the U.S. is benefitting from being the hegemon.

The real reason the U.S. is so rich is that it was already the richest country in the world in 1900. The U.S. had almost 50% higher GDP per capita than western europe in 1900: https://www.researchgate.net/figure/Population-GDP-and-GDP-p.... Today, its still about 50%.

> If you look at the fifth chart, the large european economies also seemed to have grown slightly faster after the war than before it. So I’m not sure how much the U.S. is benefitting from being the hegemon.

Nobody's denying that the US-created world order has been good for its partners but that doesn't mean the benefit was at the US's expense. International trade is not a zero-sum game - the lifting tide and all that.

The post I was responding to implied that the U.S. enjoyed a special benefit from being the one maintaining the hegemonic world order: “The US's expenditure on its military was never to protect anyone from the Soviets but to impose its own world order against the Soviets, it's been always self-serving.”

If the U.S. obtained such a special benefit, it should have grown faster than western europe from 1950 to 1990, but it didn’t. If that growth comes from peace, not being the hegemon—as you put it, a rising tide lifts all boats—then the U.S. is disproportionately bankrolled a peace that western europe equally benefitted from.

Part of the story here is that international trade just isn’t that important to the U.S. 90% of U.S. GDP is domestic. Just 1.1% is exports to Europe.

> If the U.S. obtained such a special benefit, it should have grown faster than western europe from 1950 to 1990

Not necessarily; the US could have extracted that benefit by staying ahead of the rest of the world in terms of its citizens' wealth, with all the benefits this entails.

We can't know the "what-if" (would the US have become even richer by being an isolationist MAGA dreamland), but we know for a fact that the world order was created and maintained by the US, so it must have had its benefits all this time.

That’s possible, but it’s a much more uncertain claim than the one being made above. The US became 50% richer than western europe by being an “isolationist MAGA wonderland” before reengaging with the world during the wars.

Did hegemony help the U.S. maintain that edge? Maybe! But I think that’s a harder claim to prove than suggested by OP. I think the direct cause of America keeping its edge in the second half of the 20th century is we have Silicon Valley. I can think of a mechanism how reserve currency status is an indirect cause: reserve currency status means the world invests in American banks, and banks then use that money to fund tech startups. But is that really what’s happening? As I said above, I’m unsure.

Reserve currency status makes increasing money supply easier (the US has run large deficits and monetary expansions with less inflation than peers). "Petrodollars" create persistent demand for USD, independent of US domestic conditions - countries that import oil must earn USD (via exports, borrowing, or reserves) or hold US reserves in advance. Oil exporters, on the other hand, invest surplus dollars into US treasuries. This process absorbs US money creation and lowers US borrowing costs. This is an enormous advantage that the US is likely to lose if it continues on its isolationist course.

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