Oppenheimer: U.S. is dysfunctional politically, but hope is not lost
The United States is becoming a dysfunctional country: politically, it's lurching from one embarrassment to the next, but economically and technologically, it's rising at an amazing speed.
That's one of the first things that came to my mind when I read a new report by Merrill Lynch stating that "an economic revival is taking hold in the United States," and saw a separate report from the U.S. Patent and Trademark Office showing that the technological gap between this country and its closest rivals remains as large as ever.
To be sure, the United States has egg on its face when it comes to its image abroad.
Just when the headlines of former National Security Agency contractor Edward Snowden's defection were beginning to fade from the front pages, new Snowden revelations about alleged U.S. electronic surveillance operations in Europe and Latin America are riling U.S. friends and foes alike.
Even close Washington allies, such as Mexico, Colombia and Chile are demanding explanations - and apologies - from the Obama administration. It's the biggest U.S. diplomatic fiasco since WikiLeaks' 2010 disclosure of thousands of U.S. diplomatic cables, including some in which high-ranking U.S. officials questioned the mental health of Argentina's president, and called then Italian Prime Minister Silvio Berlusconi "vain and ineffective."
When it comes to domestic politics, Washington is not doing much better. Congressional gridlock is as bad as ever - the 113th Congress has passed only 15 legislative items during the first six months this year, a historic low - and Democrats and Republicans are unlikely to work more closely as we approach the 2014 mid-term elections.
But economically and technologically, it's an entirely different story. The Dow Jones industrial average and the Standard and Poor's 500 index of stocks reached all-time highs last week, and the U.S. government reported a $116 billion budget surplus in June, the largest in five years.
More importantly, several long-term trends bode well for the U.S. economy.
According to the recent Merrill Lynch Wealth Management Report entitled "A transforming world," the U.S. economic "revival" is due to three factors: a growing energy independence, an increasingly competitive manufacturing sector and continued technological leadership.
After depending on oil imports for almost 70 years, the United States is on its way to achieving energy independence thanks to the new hydraulic fracturing - or "fracking" - natural gas extraction technology. This energy revolution will expand to all corners of the economy, as U.S. manufacturers benefit from lower energy costs, it says.
Simultaneously, massive layoffs after the 2008 economic crisis have lowered U.S. labor costs, making U.S. corporations more profitable and manufacturing very competitive, it says.
Finally, an explosive growth in technological innovation - including robotics, cloud computing and personalized medicine based on genetic testing - will give a further push to the U.S. economy, the report says.
A separate report from the U.S. Patent and Trademark Office confirms that, when it comes to innovation, the United States remains far ahead of any other country. U.S. companies and individual inventors filed 134,200 patents of new invention at the U.S. Patent and Trademark Office in 2012, up from 121,300 the previous year, according to the new figures.
The number of patents registered at the U.S. agency is considered a key benchmark for innovation because inventors from most countries want to register their patents in the world's largest market.
The United States was followed far behind by Japan's 52,800 patents, Germany's 15,000 and South Korea's 14,000. By comparison, China registered 6,000 patents, India 1,700 and Russia 340.
Among Latin American countries, Brazil registered 256 patents, Mexico 153, Argentina 67, Chile 38, Venezuela 26 and Colombia 16.
Most economists agree that patents are an increasingly important measure of economic development because the world is moving further into a knowledge economy in which countries that produce high-tech goods and services become much richer than those that only sell raw materials.
It's no coincidence that the richest people on earth, such as Microsoft founder Bill Gates or Mexican telecommunications tycoon Carlos Slim, produce technology related goods. In today's world, a successful software program or a popular design are much more valuable exports than food - or most metals.
My opinion: When I travel abroad and somebody asks how the United Sates is doing, I usually respond that it depends how you look at it. Politically, it's losing ground; economically and technologically, it's surging.
It's like a creative, hard-working giant with no social skills. You can either laugh at its political embarrassments, or marvel at its innovation ability - or both.
Andres Oppenheimer is a Latin America correspondent for The Miami Herald.