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Re: OT: Can Americans Compete ?

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see what you think about this Fortune article
More proof that you can lay all the economists in the world end to end and they couldn't reach a conclusion. Colvin tells us successful competition means dropping wages so people will hire Americans instead of Indian and Chinese engineers. Therefore the only way to preserve our standard of living is to destroy it. He says that we need to be better educated, even though it sure as hell isn't education that makes corporate America outsource jobs.

Our competitiveness problems are rooted in the notion that quarterly reports were more important than the quality and quantity of our manufacturing. It's been that way so long that neither is all that great. Look at the history of railroads, textiles, big steel, consumer electronics, automobiles and apparently now the airlines. They got big and complacent and imagined that the business was only a cash cow. It didn't matter if you weren't improving the product line as long as wall Street liked your stock. And when people started buying imports, you got a protective tariff or cut your quality so you could cut your prices.

We've still got the largest economy in the world but we can't support it because we don't make what people want. For a while American companies be able buy and re-sell such things from countries who do make stuff, but when corporate China or India gets far enough along the learning curve (like the Japanese auto industry did in the 70's) they can sell their stuff without a middleman or a made-in-the-USA label. It's bad enough that we can't supply ourselves with top quality automobiles or alloy steel, but we're also killing the underpinnings of our ability to defend ourselves if we don't build ships or make boots or uniforms.

OTOH, it's always been the case that overheated economies have always cooled down, and generally the hotter the economy the more drastic the cool-down. Colvin (and me, for that matter) could be wrong for another reason and that Chinese or Indian economic dominance will go the same way as the irresistible Japanese economy. One good thing about economics is that even though there aren't any right answers, there aren't any wrong answers either.


Christopher Wright P.E. |"They couldn't hit an elephant at
chrisw(--nospam--at)skypoint.com   | this distance" (last words of Gen.
.......................................| John Sedgwick, Spotsylvania 1864)
http://www.skypoint.com/~chrisw/


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