[100%Michigan]

Thanks for the comments everyone, please countinue to post many more.
What effects would Michigan have if China stop trading with us?

[Indentured Servant]

In a global free market (globalization if you will) a nation cannot maintain high wages and cheap prices. High wages produces high prices and low wages produce low prices other expenses being the same. This is due to the fact that wages/salaries are a large component of price dynamics.

American consumers salivation for cheap(er) prices are fed by American corporation’s salivation for higher profit margins. It’s a marriage made in heaven but like most marriages in America, the romance and happiness will be short lived.

Companies can only increase their profit margins by capturing market share and sales volume at the expense of higher wage companies. So early on those who offshore and use cheap labor by other means will gain the most. Overtime, however, other American companies that want to stay in business have to do the same thing and eventually the buying power of the American consumer is reduced because due to being paid less.

It’s the transition period of going from a high wage nation to a lower wage nation that is the most profitable. As soon as low wages saturate the American workforce, there is no more advantage to be gained from having a cheaper labor component cost of price over the competition as the price point for labor has reached equilibrium. At that point the standard of living of Americas middle class and poor will be effectively eroded, while corporate elites get richer by profiting immensely from turning America into a moderate, if not low wage nation from that of a high wage nation.

[magellan]

Originally Posted by Indentured Servant

In a global free market (globalization if you will) a nation cannot maintain high wages and cheap prices. High wages produces high prices and low wages produce low prices other expenses being the same. This is due to the fact that wages/salaries are a large component of price dynamics.

American consumers salivation for cheap(er) prices are fed by American corporation’s salivation for higher profit margins. It’s a marriage made in heaven but like most marriages in America, the romance and happiness will be short lived.

Companies can only increase their profit margins by capturing market share and sales volume at the expense of higher wage companies. So early on those who offshore and use cheap labor by other means will gain the most. Overtime, however, other American companies that want to stay in business have to do the same thing and eventually the buying power of the American consumer is reduced because due to being paid less.

It’s the transition period of going from a high wage nation to a lower wage nation that is the most profitable. As soon as low wages saturate the American workforce, there is no more advantage to be gained from having a cheaper labor component cost of price over the competition as the price point for labor has reached equilibrium. At that point the standard of living of Americas middle class and poor will be effectively eroded, while corporate elites get richer by profiting immensely from turning America into a moderate, if not low wage nation from that of a high wage nation.

Ouch. Fonts too small for these old eyes.

[tecpatl]

"American consumers salivation for cheap(er) prices are fed by American corporation’s salivation for higher profit margins. It’s a marriage made in heaven but like most marriages in America, the romance and happiness will be short lived."
And, of course, nothing more amusing and/or sad than a Chevy with a "BuyAmerican" bumpersticker parked out there in the Wal-Mart parking lot.

[100%Michigan]

I will still check all my replies, but from here on out I will stop posting a thank you comment. You will see fewer of my replies on the same thread to messages, and questions. Due to making new threads, I cannot keep track of each and every message thanking everyone. So thank you everyone who have posted comments and those to come in the future. I look forward to reading you comments but my replies and thank you messages will rarely be seen. (I posted this message due to the fact many people I run into like to see replies from the person who post the thread and see how their comments help the person who posted the thread.)
Thank you-
Moderator please read my reason for editing this thread.

[FERRETI]

The rich in America will be very few and they will have to invest overseas.The standard here will be leveled out with China if not get below China.Mark my word as America has nothing going.If you think technology..think again...The rest of the world catched up and there is no WWII position for America left...Americwill be nothing but a replacement of other countries standard and it could go lower with all this population.

[FERRETI]

I see green if Michigan focuses on farming as food prices will grow like oil and there is room for the metals and other raw materials...Nobody really needs technology unless it`s cheap...Already..foreign oil companies dont need extraction technologies...So its only food and raw materials...

[mejami]

Originally Posted by Indentured Servant

I think we should look at the “changing world” abstractly instead of nominally. In other words, instead of seeing the assembly line worker or the nuts and bolts worker as the poster child of who will be hurt by the changing world, we need to look a little deeper so that no one is given a false sense of security. Manufacturing jobs were threatened because people in other nations could assemble goods a lot cheaper. Well…..manufacturing is not the only profession that can be done cheaper someplace else. Engineers, Computer scientist, Architects and a host of others professions can be just as easily off shored as manufacturing and in fact are. The only professions in America that are safe are professional services where it is imperative that the service provider be local….like a doctor, physical therapist or any health care related profession, lawyers, judges, police, fireman, cashier, waitress, retail clerk, food service personnel….for example.

America for a long time drained the brains from the rest of the world. The best and brightest of many then third world nations could only find opportunity in the US. Many were attracted here to attend prestigious US universities which are in abundance and lacking in their own nation. If you look at the graduate schools of American universities, they are close to being majority foreign students. The trend now is that more of these bright foreign students are going back to their native country and finding opportunities and not become a benefit for the US economy. Another trend is that many nations like China and India are evolving their own highly accredited top notch universities. Therefore, the “brain drain” trend that benefit the US economy is slowing as the best and brightest of many nations are staying in their own country to the benefit of their countries economy and competitiveness.

Somehow American seems to have this notion that we are inherently the smartest people on earth. We keep thinking that knowledge capital is ultimately what is going to keep the US economy on top of the world. What? Did I miss something? The last I checked US students were not even ranked in the top 10 globally in math and science testing and the trend is that we keep falling further behind. As I pointed out earlier, the majority of Graduate students at the best universities in this country, certainly in disciplines like, Engineering and computer science, are foreign students. If we cannot drain the brains of other nations like we have done in the past, how do we expect to maintain intellectual advantage? We can’t.

This country is going to take a BIG hit reality check over the next 10 years that will force some structural changes in America. Old paradigms will have to be scraped and our nation will have to be “reinvented” to stabilize itself to compete in a changing world.

How can you not look at the 'nuts and bolts' when it is the nuts and bolts that holds this city together. If everyone who lives in the city keeps putting their city down, don't you know that it makes for a low morale. I guess the question is, what are YOU doing that is going to change Detroit for the better? Certainly all the negative talking is not motivating anyone into doing anything positive: if anything, it would discourage any prospective business from moving here and discourage anyone from thinking that there is anything they can do to make things better.
Yes, my neighborhood may be just a hole in the wall but as the hole gets bigger the whole wall will come down. Improvement has to start somewhere and it may as well be in my neighborhood. I have created a blog at blogspot 'views of detroit' to do my part in promoting good news of the city. We all must do our part and not just shove all the blame on others. Yes, this whole nation is in a pickle, but its the 'nuts and bolts' that assists in holding things together.

[malamute]

Originally Posted by FERRETI

I see green if Michigan focuses on farming as food prices will grow like oil and there is room for the metals and other raw materials...Nobody really needs technology unless it`s cheap...Already..foreign oil companies dont need extraction technologies...So its only food and raw materials...

A lot of the good farm land has been paved under, houses built for urban sprawl. Farms and orchards require land -- and land is at a premium.

Too bad someone doesn't really get working on building alternate energy cars -- affordable ones that the average person could look at.

[suzy2]

Those who say we need to get rid of the Big 3 don't know what they are talking about...Yes we need to clean up the absurd waste, huge bonuses, executive's pay, abuse of the workman's comp system.. Instead of giving all these ridiculous bonuses to management (how they sleep at night is beyond me) why not hire someone to clean up all the crookedness....If the Big 3 only banked their profits and saved for a rainy day, they wouldn't be in this predicament. All these buyouts and bonuses were not give out years ago....WHY NOW?? You don't need a degree to figure that out....MY GOD executives just because it's not YOUR money personally doesn't give you the right to waste it....We are on this earth to help each other....I truly believe that's how we are going to be judged. We all make mistakes, noone is perfect but for the love of God, let's all wake up.....

One more thing, I forgot to mention. All of you that buy foreign cars, did you know that NONE of them donated to Katrina and other catastrophes...ONLY the BIG 3 did....So not only are you supporting foreign countries by buying their cars, you are also showing your indifference to humanity....Foreign countries are laughing at us.....we need to end NAFTA...once and for all and we need to bring manufacturing back to the U.S.