Krugman Wrong on the Golden Age

A case of a non-sequitor question "Is It Good to Live in A Destroyed World ?" (no one argues that) followed by number crunching on a faulty premise :'Net exports as a share of GDP'.

He writes:

On this blog and elsewhere, I often see assertions that America prospered after the Depression because our competitors were in a state of ruin.

That’s just not right.

This is a case of looking at a tree and forgetting the forest. We can start with dollar reserve currency, inheriting Britain's naval bases through lend lease, or seizing most of the world's gold supply. More importantly, consider how rare it was for a Mercedes Benz or Toyota to be seen on the streets of an American city in 1960. Or for high-value added South Korean or Taiwanese technology to be competing with and outselling U.S. technology. Those two countries were as poor as Africa at that time.

The US benefited from the destruction of its competitors first because it enabled a monopoly within its domestic market. Secondly, it enabled a monopoly in regional markets. And lastly, it enabled us to rebuild these competitors and sell our products to them. However, as they quickly rebuilt it meant the penetration of the US marketplace, partly opened up as a response to the Cold War. The U.S. car industry went under because it lost the competitive battle in the domestic marketplace to Germany, Japan and finally South Korea. Would this have happened in 1960 ? No.