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Old 01-12-2009, 09:28 AM
 
Location: Rockland County New York
2,984 posts, read 5,343,183 times
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Quote:
Originally Posted by rubber_factory View Post
So, in other words, the big problem is that Americans are not inventing anything useful that our foreign competitors cannot.

Somehow, in my mind, this globalization problem is interrelated with the policy of 'recession-postponing' that we have been pursuing. Aren't recessions useful for structural changes in the economy?

I just can't help but think that globalization is inevitable, and the real "problem" is that we have done a terrible job of adapting our labor force to it. As someone who isn't too far out of college, it seems like we're producing an entire generation of lawyers, bankers, and real estate agents.
We do a great deal of design and research here in the U.S but that technology it applied to foreign markets during the product’s production stage. For example Boeing designed the new 787 but a great number of it's components are being manufactured in China, including the tail section for the plane. Its American know how and foreign production lines.
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Old 01-12-2009, 09:36 AM
 
Location: Seattle, WA
209 posts, read 549,319 times
Reputation: 87
Quote:
Originally Posted by rubber_factory View Post
So, in other words, the big problem is that Americans are not inventing anything useful that our foreign competitors cannot.

Somehow, in my mind, this globalization problem is interrelated with the policy of 'recession-postponing' that we have been pursuing. Aren't recessions useful for structural changes in the economy?

I just can't help but think that globalization is inevitable, and the real "problem" is that we have done a terrible job of adapting our labor force to it. As someone who isn't too far out of college, it seems like we're producing an entire generation of lawyers, insurance agents, bankers, and real estate agents.
I'll answer both your questions. 1. It is not that we are not inventing because we are but we are not producing and that leads to these trade imbalances and reduces production jobs in America that normally pay a higher wage which builds our middle class. 2. Yes, in our current monetary system that is controlled by interest rates, we need to let the recessions happen to purge the excesses that happened during the expansion stage of the business cycle. 3. Yes, I agree it is a farse to think we can have an entire economy built on a "service-basis" that will make us self-sufficient with a strong middle class. The reason a middle class is important, is for the fact it gives the lower class an example to strive for so they make decisions that look to the future not just the day to day needs. This is what would be called a "future preference".
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Old 01-12-2009, 09:41 AM
 
8,980 posts, read 7,922,849 times
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McLaughlin's change of opinion is an indication that the process is now starting to inflict pain on the elites. Globalization was supposed to provide an endless flow of cheap inputs to their businesses and cheap capital to the financial sector where the top 10% own practically all of the assets.

The foreign governments require US companies, such as Boeing, to manufacture major systems in their country as a condition of these large purchases. China is gearing up to establish its own commercial aircraft manufacturing industry.
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Old 01-12-2009, 02:48 PM
 
Location: Rockland County New York
2,984 posts, read 5,343,183 times
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Quote:
Originally Posted by lchoro View Post
McLaughlin's change of opinion is an indication that the process is now starting to inflict pain on the elites. Globalization was supposed to provide an endless flow of cheap inputs to their businesses and cheap capital to the financial sector where the top 10% own practically all of the assets.

The foreign governments require US companies, such as Boeing, to manufacture major systems in their country as a condition of these large purchases. China is gearing up to establish its own commercial aircraft manufacturing industry.
Your statement is right on the ball. For some years now most of the major airlines have been sending their aircraft to China to be repaired or completely rebuilt thus developing their expertise in airplane production and repair. Men and women in the United States who used to work for American Air and other airlines in their repair shops are now flipping burgers at McDonalds. As their ability to pass on their knowledge to the next generation disappears, so goes another industry. China is a rising star and America’s sun is setting.
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Old 01-12-2009, 03:29 PM
 
22,770 posts, read 27,058,289 times
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Quote:
Originally Posted by BankREO View Post
I'll answer both your questions. 1. It is not that we are not inventing because we are but we are not producing and that leads to these trade imbalances and reduces production jobs in America that normally pay a higher wage which builds our middle class. 2. Yes, in our current monetary system that is controlled by interest rates, we need to let the recessions happen to purge the excesses that happened during the expansion stage of the business cycle. 3. Yes, I agree it is a farse to think we can have an entire economy built on a "service-basis" that will make us self-sufficient with a strong middle class. The reason a middle class is important, is for the fact it gives the lower class an example to strive for so they make decisions that look to the future not just the day to day needs. This is what would be called a "future preference".
So regarding #1, what do you believe are the short term and long term solutions to returning 'production jobs' to the middle class?

One thing I don't fully understand - Why can't we thrive on a service economy? We can export services more easily than we can export goods anyway, right? My thoughts were not that a service economy was a bad idea. I was just pointing out that we don't seem to be pointed in the right direction with regard to exporting our services.
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Old 01-12-2009, 05:24 PM
 
2,541 posts, read 10,533,295 times
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I think what we need is a competitive edge

We use to have a competitive edge over the third world countries like China and India, and now for some reason we do not

How did that happen, and why did we let that happen?

We can be a service based, but we have to make sure the service is not/cannot be outsourced, so only americans can do it
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Old 01-12-2009, 07:22 PM
 
Location: Seattle, WA
209 posts, read 549,319 times
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Quote:
Originally Posted by rubber_factory View Post
So regarding #1, what do you believe are the short term and long term solutions to returning 'production jobs' to the middle class?

One thing I don't fully understand - Why can't we thrive on a service economy? We can export services more easily than we can export goods anyway, right? My thoughts were not that a service economy was a bad idea. I was just pointing out that we don't seem to be pointed in the right direction with regard to exporting our services.
Here are a couple long and short terms items we need to address to start the rebuilding process:
1. Stop the incentive to ship jobs overseas - My answer would be that you would have to pay the minimum wage in the state your company is incorporated in the country you ship the job.
2. Provide incentives for creating production jobs in America - Tax credits, public spending projects going to open bid to private companies focusing on infrastructure (communications, transportation & energy) and government back long-term loans for creating industry that services the U.S. market
3. College Education for all U.S. citizens - This is very important, have an equality of opportunity is what is needed above all in America to make sure our people have a future preference and are thinking about how to better themselves.
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Old 01-12-2009, 07:53 PM
 
Location: NJ
2,212 posts, read 6,464,726 times
Reputation: 2177
Quote:
Originally Posted by rubber_factory View Post
Somehow, in my mind, this globalization problem is interrelated with the policy of 'recession-postponing' that we have been pursuing. Aren't recessions useful for structural changes in the economy?

I just can't help but think that globalization is inevitable, and the real "problem" is that we have done a terrible job of adapting our labor force to it. As someone who isn't too far out of college, it seems like we're producing an entire generation of lawyers, insurance agents, bankers, and real estate agents.
I agree.
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Old 01-13-2009, 01:46 PM
 
Location: Seattle, WA
209 posts, read 549,319 times
Reputation: 87
Quote:
Originally Posted by NJ Chutzpah View Post
I think what we need is a competitive edge

We use to have a competitive edge over the third world countries like China and India, and now for some reason we do not

How did that happen, and why did we let that happen?

We can be a service based, but we have to make sure the service is not/cannot be outsourced, so only americans can do it
I disagree that we can be a world economic power and have a service based economy. Production is the real wealth because its takes the real wealth (our resources) and make them more productive. That is actually value, serving someone else only is useful until they no longer require your services. That would put our outlook much more dependent on forces outside of our control.
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Old 01-13-2009, 02:50 PM
 
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
24,653 posts, read 42,329,886 times
Reputation: 27042
Quote:
Originally Posted by BankREO View Post
Here are a couple long and short terms items we need to address to start the rebuilding process:
1. Stop the incentive to ship jobs overseas - My answer would be that you would have to pay the minimum wage in the state your company is incorporated in the country you ship the job.
Agree in principle (as an 'ex-outsource engineer'). Taxes, costs, credits, tariffs, foreign 'technology development' incentives, competitive advantage of WW development and production .. pretty complex formula for reasons to be international, but YES, the USA should have a more intelligent and comprehensive economic strategy to play in the world (i.e. Singapore... targeting edu and incentives to PREPARE future industries). Of course your recommendation (= wages) would disrupt the economy of the country that receives the job. We've seen many countries quickly become 'unaffordable', and then have had to transition to another 'cheaper' labor source. The USA and Germany have done a great job of educating the world in manufacturing and service 'competitiveness'. That will (is) coming back to bite us.

Quote:
2. Provide incentives for creating production jobs in America - Tax credits, public spending projects going to open bid to private companies focusing on infrastructure (communications, transportation & energy) and government back long-term loans for creating industry that services the U.S. market
Agree in principle (as an 'ex-toolmaker' and lifelong alternative energy geek). I do question whether enough manufacturing / technology capability remains in USA. We must do this QUICK before we are too dumb. The USA is dreadfully deficient in having a competitive infrastructure to 'play with the big dogs... (I am 30 minutes from a metro area, but STILL only have dial-up available for internet... not cell / EVDO / broadband, and sate dishes "outlawed' in federal scenic area.) The 'capitalistic' nature of the USA has significant negative repercussions to the bulk of our land mass (rural). Energy, Trans, and Communications are vital to economic growth / (that has staying power)... but Who will pay??? We must be smart 'spender's'

Quote:
3. College Education for all U.S. citizens - This is very important, have an equality of opportunity is what is needed above all in America to make sure our people have a future preference and are thinking about how to better themselves.
Agree in principle (as a current 'antique' grad student) But... the current quality of USA higher EDU is pathetic. I have noticed significant decline in the last 10 yrs. The 'dumbing down' of our public schools has infiltrated the higher ed providers. I look forward to having foreign students participate in class and lab work. They are intellectual and intent on getting purposefully educated. (Most know what the option is (life-long poverty)). Serious cultural change needs to take place amongst the current and future college age generation. I Hope.... this does not require a 'depression' / needs based knowledge ... but it possibly may. I feel a lot of this comes from the current mindset that US kids are deserving (expectant) of having their parents pay for college. I will bet the recent change in 'investment wealth' may provide a wake-up call to students AND parents. But... NPR program this weekend had many interviews of struggling college kids who all said.. "Gosh, my parents are having to work 2 jobs, and mortgage their home to pay for my college. I feel bad that my younger siblings may not be able to go to college"... NOT ... "gosh.. I'm grown up (nearly) and my parents need to pay taxes and eat... I'm gonna pay my own way with jobs and very affordable loans"

I agree that "Service" economy is not the answer...
low / no capital (does not do much for overall economy) - low technology / invention required -
often easily outsourced - requires customers with some wealth (which we may not have for long)
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