Perhaps the biggest myth held by the vast majority of Americans is that the United States "doesn't make much of anything anymore" -- that everything is now made in China. This belief is perpetuated because they, like me, shop at Wal-Mart, which has made much of its fortune by selling low-end merchandise made in China.
There's nothing wrong with that, by the way. When consumers can save money on what they buy, it means they have more left over to buy other things.
But how many Americans know that last year the United States sold a record $1.4 trillion in made-in-America exports, up by 12.7 percent from the year before? These exports generated 45 percent of this country's phenomenal third-quarter economic growth.
Another reason to feel good about the economy is its resilience. At $14 trillion a year and growing, it's capable of absorbing a lot of body blows and keep on ticking.
"This is an extremely resilient economy," says Ed Lazear, who chairs the President's Council of Economic Advisers. "It is really quite remarkable that during a quarter when we had housing-market issues, when we had a credit situation in the beginning of August, despite that, we still ended up with nearly 4 percent growth following another quarter where we had nearly 4 percent growth."
Clearly, the housing market is the economy's weakest sector right now, but it remains to be seen whether it will bring down the rest of the U.S. economy. My sense, based on all the other growth fundamentals, is that it will not. The mortgage-industry association reports that 95 percent of all of the country's mortgages are being paid on time.
Oil prices and higher gasoline and heating-oil prices that descend from them are also a concern. But so far the economy has been able to "shrug off higher oil prices primarily through gains in productivity growth and through expansions into other sectors," Lazear says.
What we need to be concerned about is the tax bill that the Democrats in the House are cooking up and their plans to let the Bush tax cuts expire, which would mean higher tax rates for virtually everyone in 2011.
That would abruptly end the economic growth we've experienced since the tax cuts of 2001 got this economy moving again.