I see the United States experiencing slow growth for the foreseeable future, say a decade or two. Contrary to popular opinion, the pace of technological innovation has been quite slow, as evidenced by the data. We are an aging society with a growing and apparently unfixable set of fiscal problems.
First, there are more cheap entertainments than ever before, most of all through the Internet. I don't want to suggest this makes up for not having a job, or seeing no wage growth, but at the margin a lot of the fun on the Internet (including this symposium!) is free. The Internet also has strengthened a lot of social bonds and support networks.
Second, the United States has seen a lot of social progress over the last few decades, whether it be women's rights, gay rights, general tolerance, or any number of other issues. That has improved the lives of many millions. We also can see that crime rates have been falling for a long time and that makes a lot of aspects of life more secure and more enjoyable.
Third, I find it striking that American mobility peaked sometime in the 1980s. Today there are people moving to find jobs, but not at anything like previous levels in earlier downturns. Some of that results from "the problems are in many different places" and that's bad news. But some of it is also "being jobless today involves some greater cushions than in earlier times." Very few people are facing potential starvation. For instance many more men have working spouses. Durable goods have become more durable, or in other words your car is less likely to break down and that makes joblessness somewhat easier to bear.
I've traveled a lot in America in the last few years, including to the so-called Heartland. I see a worried country and an uncertain country but I do not see a miserable country.
On a lot of economic issues, I am a pessimist. For instance I don't think we will generate enough revenue to meet all of our fiscal commitments through the public sector, or to climb out of the hole of private sector "debt overhang" anytime soon. I don't expect high growth to resume anytime soon and I trace this back to some underlying failures in our systems of education, health care, and our general lack of innovation.
On "happiness issues" I am more optimistic. In matters of the spirit we are a resilient country and we will learn to be even more so.
Oddly, our very resilience may make the economic downturn somewhat worse. Changing one's situation for the better may not quite have the urgency that would be best for our GDP and employment statistics.