Where Do You Put Your Chips?

A conversation with a student prompts this question:

Suppose all the countries in the world today are arrayed before you like spaces on a craps table. You have to put all your chips on one country. The time horizon is your life span, plus that of your children, plus that of your grandchildren. Allowing reasonable overlap and life expectancy, let’s suppose that horizon is 100 years. So: if you have to put all your chips in a single bet on one country’s success from 2010–2110, which country do you choose?

Let’s make this question personal. You are a responsible and conscientious person, and you take seriously your obligation to do the best for your family that you can. Decisions you make about where to live will have an enormous effect on your, your children’s, and your grandchildren’s life prospects. So this decision is about you and your family: the “chips” are all of your economic, social, and family capital. The question is not only about money; it is about everything.

In 1810, I think the clear choice would have been England. In 1910, I think the clear choice would have been the United States. In 2010, however, I think—I fear—there are two good reasons not to be bullish on the United States:

(1) Our looming fiscal crisis is worse than in many other countries because we do not have us to free-ride on. My pessimistic prediction, unless our course is dramatically changed, is that we will see a series of international bailouts: the EU’s bailout of Greece will be only the first in a series; when the EU begins to teeter, the US will bail it out, as it will have done for several states within the US. When the US begins to teeter, its multiple layers of astronomical debt, with no back-ups, bailouts, or cushions available, its fiscal collapse may come swiftly and painfully.

(2) The United States will be one of the primary targets for various kinds of antagonisms, terrorist and otherwise. And as Marc Steyn has said, a falling camel attracts many knives. My emendation: a big falling camel—indeed, the biggest, baddest, most resented falling camel—will attract all the knives.

So which country do you think offers the best prospects of liberty and prosperity for you and your family over the next 100 years?

9 thoughts on “Where Do You Put Your Chips?

  1. The USA also has a scary-poor quality of social cohesion and discourse at the moment. And there’s definitely a whiff of desperation about the big governments attempt to grow the empire in spite of the underlying poor fundamentals. Time to get out while other countries will let you. Me, I’d back NZ. Or perhaps I should say, eventually I’ll be back in NZ

  2. I’m with you, Jim. Tom Sowell is also (legitamately) pessemistic. Though his reasoning rests primarily on the erosion of character and values here (as a prime mover of other things).

    What shakes me up a bit is when asked your question, I don’t know where I’d put my chips, due to ignorance of the state of other nations. Maybe NZ, Aust, or S. Korea.

  3. Great question! Yet another example of why I wanted a philosopher, and particularly Jim, on Pileus! They tend to ask great questions.

    I gotta think about this one. But aren’t the revealed preferences of millions who still come to the US from abroad instead of going to any of the other 190 or so countries some evidence that the US still wins the prize? Or are their time-horizons too short to help answer your question — they are discounting the future because of the present? Or do they have incomplete/imperfect information? Both? Others?

    And how many people who care about liberty and prosperity leave the US? I’m guessing few. Most ex-pats I’ve met abroad are essentially socialist elitists who want the “more sophisticated” scene in places like Europe and don’t mind the restrictions on their liberty (especially their economic liberty). But that is a pretty small N.

    So, still thinking.

  4. A few years ago I would have said Ireland because of their reduction in corporate income tax, GDP per capita, quality of life, ranking on the Economic Freedom Index and overall culture. However, the current financial crisis has hit it much harder than other countries. The “Irish Property Bubble” and overall level of debt makes me leery.

    Australia would probably be my second choice because it has the lowest percentage of debt as a proportion of GDP and the overall level of taxation seems to be decreasing. Drawbacks are it’s cap on carbon emissions and high cost of housing.

    With that said, I don’t know if there’s anywhere particularly “safe” to bet on in the current geopolitical climate…

  5. Of the places mentioned so far, I’m not sure I’d prefer any of them to the U.S. Now Switzerland definitely has a smaller government in the economic sense – and may have just as many personal freedoms, if not more.

  6. Wow great question. Although it has a high growth rate, definitely not China because of the authoritarian government and the fact there are way too many poor people. Japan would seem like a decent bet since things are pretty stable there and they have a high standard of living. They also don’t really have any enemies militarily so there would seem to be less chance of dying in a war.

    The US is always a good choice, although the racial and class divisions here are a little worrisome, as is the proximity to a Mexico that is becoming pretty lawless. I think if you’re going to be on the US, you might as well bet on Canada instead. Perhaps a slightly lower economic upside due to lower immigration, but also a lower downside. There’s also a smaller chance of dying in a war.

    A couple people in the comments mentioned NZ and Australia, which I didn’t think of at first. I think I’d go for either of these before Canada or Europe. they’re totally out of the way if a nuclear war hits. They also are not prime targets for terrorists. South Korea was also mentioned, but although they have a high rate of growth their standard of living is still below ours, the education system is totally draconian, and they could still get nuked or get into a devastating conventional war with North Korea.

  7. The problem with any of the small states mentioned above (or near the top of Economic Freedom of the World Index) is that they could be very much at the mercy of large states militarily or would suffer greatly if global free trade went down the tubes with the decline of American hegemony. Island countries (like New Zealand) could be especially impacted if they failed to develop sufficient naval power to protect trade routes.

    Hong Kong, Estonia would be in a particularly precarious situation.

    Switzerland, then, is probably a pretty good alternative among these small states. Australia too – though it is very much in the same basket as New Zealand (and China looms large on its horizon).

    Lots of good reasons to still stick with the US. Canada not bad too. Those two just have huge geopolitical advantages if we would be sensible enough to fully realize them.

  8. Switzerland has historically probably been the safest bet. Canada has a high degree of social cohesion and fairly reasonable fiscal policies. The farther away from the equator the better, all other things being equal, given the potential future impact of global warming.

  9. How about the Cayman Islands, Bermuda, or some other tropical paradise… if you can afford it?

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