At current rates, the Chinese economy will surpass the US economy by 2020. Furthermore, at current rates, the Indian economy will surpass the US economy by 2050. How and why did we let this happen?!!!
Actually, I'm joking. I think it is an instructive lesson in economics. This expected circumstance is not indicative of a failure on the part of the US economy. Why WOULDN'T the Chinese economy -- when fully developed -- surpass the US economy? They have 1.6 billion consumers in their market!!! Why WOULDN'T the Indian economy -- when fully developed -- surpass the US economy? They have 1+ billion consumers in their market!!! It is important to realize that there were strict impediments to the development of both of these economies until relatively recently. In China, the impediment has been traditional communist central economic planning and management. In India, has been communism in the relatively recent past and then an educational impediment for sometime afterwards. When China began to ease back o nthe communist central economic planning, encouraging unfettered capitalism in some economic development zones, they saw the path to material abundance and took it. No more heavy handed communist central economic planning, much more entrepreneurism and local economic decision making, much less of the "iron rice bowl" mentatility: you have a job for life, the iron rice bowl. When India got its education picture somewhat repaired -- which I place roughly in the time frame of 1990 -- they have come on like gang busters. Any nation that unfetters the natural industriousness and ambition of its people will develop to material abundance, in my opinion.
Some questions. Do we as a nation and/or as the US government have any delusions about this economic fact? Is our planning or are our actions based on a contrary vision of the future? What are the implications for an economic world in which the US is not first, is not second, but is third? What happens if Russia ever gets their act together and unfetter their people's natural industriousness and ambition? At least one thing is a strong impediment in Russia -- unlawfulness, corruption, undemocratic forms of government (I view these as sort of all related, though I am no expert on Russia).
Maybe we can talk about this without the usual acrimony between liberals and conservatives. We all exist in the economy, we all have an interest in thriving in the economy over time. I don't know about you, but I've got some kids who will be active in the workforce in 2050 when India becomes number 2 and the US economy becomes number 3.
The key to the US continuing to be a player, even as low as 3rd or 4th will be to drastically cut military spending and bring it more in line with what these other nations are spending on their military needs. Work smarter, not harder is the key. Our industry and gov. need to invest in advanced technologies of all kinds, and continue to improve our agricultural prowess. 2 things America is good at, farming, and leading the high tech sector. From alternative green energy technologies to the computer driven future of Silicon Valley and the private sector dividends of a robust space program. NASA has been vastly undersold in its residual benefits to the private sector with much of its technology filtering into our daily lives and products we use. Dependence on foreign energy sources must be minimized for profitability to be realized here at home in a competitive global market. Stuffing the coffers of foreign interests which use those funds against us is not sustainable, nor sensible. Outsourcing is a dying art, the American worker can and will lead the way in high tech, skilled labor when the private sector chooses to innovate, out tech, and out think. Creating services or products here only to be outsourced will lead quickly to our demise as a global player and leave our economy and our workforce/consumers greatly disadvantaged while bolstering the economies of these emerging powers. Out sourcing if not abated will be the leech-craft/bleeding of our modern economic times.
Last edited by TexasGulf3; 02-25-2011 at 08:59 AM.
Have you ever seen their industrial complexs? Tenement buildings 4-8 stories high are built directly over the factories. Workers in droves march up and down gangplanks of stairs going to work and back to dormitory like living quarters. Many can barely afford the rent of these cubicals much less the manufactured goods that they themselves turn out around the clock. Shear numbers of a workerbee mentality that labor endlessly for meager wages and a quality of life that isn't much more then slavery at best. In the short haul, they have made their mark but we will see how long they manage to prosper with no consideration as to the laborer, and basic human rights in general. With more of a swing in free market idealology, they would be hard pressed to keep up with the demand of their own people much less the rest of the globe. Alas the Chicom government would find it too difficult to give its own people what they are due. The fruits of their labor. Pull the curtain back and you'll see that it still belongs to the Communist Party, marching to a little be different drumbeat.
Have you ever seen their industrial complexs? Tenement buildings 4-8 stories high are built directly over the factories. Workers in droves march up and down gangplanks of stairs going to work and back to dormitory like living quarters. Many can barely afford the rent of these cubicals much less the manufactured goods that they themselves turn out around the clock. Shear numbers of a workerbee mentality that labor endlessly for meager wages and a quality of life that isn't much more then slavery at best.
This could very well describe the beginnings of industrial development in either England or the United States. I'm not disagreeing, but I don't see how this description -- which I will accept as accurate without being able to corroborate that from my own knowledge -- bears on the fact that the Chinese economy will be the number 1 economy in the world.
Also, just as in England and the United States, these initial working conditions and low wages will not continue indefinitely. Again, as I said in my initial post, the energization that comes from freeing people to innovate, improve, and benefit from their own actions is very powerful. I have to think that in the long haul the Chinese government will not be able to impose low wages, squalid living conditions, and abysmal treatment of laborers forever.
The key to the US continuing to be a player, even as low as 3rd or 4th will be to drastically cut military spending and bring it more in line with what these other nations are spending on their military needs.
I agree with this, in a specific way. I think we ought to maintain strong defense infrastructure -- weapons systems such as aircraft, carriers, patriot missiles, etc. -- but unwind some of our foreign committments. Why do we need to be in South Korea? This pisses the Koreans off and costs us a LOT of money. Let the South Koreans handle their own defense -- maybe paying our defense contractor companies to buy weapons systems -- and maybe they'll have less money to come over here and dominate our mobile phone market, our high end television market, our automobile market. Believe me -- I used to work for Samsung and have twice visited South Korea on business -- South Korea is well up to providing economically for their own defense. Ditto with the Phillipenes and ***an and Germany and Thailand. The theory is this allows us to project power. True enough. But what are the downsides of this projection of power? Drain on the tax payers and the economy; bad relations in many of the countries where our bases are seen as unwelcome occupying forces. My recommendation is to begin by dialing back our foreign committments -- starting with the oldest such committments (we got in the Phillipenese during the Spanish American war -- we're talking the late 1800s people!) -- to prune about 1/3 of these foreign committments. Sit on that position for 10 or 20 years and see how it works out. Then, if that seemed to work, dial it back still further, always in incremental steps.
Work smarter, not harder is the key. Our industry and gov. need to invest in advanced technologies of all kinds, and continue to improve our agricultural prowess. 2 things America is good at, farming, and leading the high tech sector. From alternative green energy technologies to the computer driven future of Silicon Valley and the private sector dividends of a robust space program. NASA has been vastly undersold in its residual benefits to the private sector with much of its technology filtering into our daily lives and products we use.
I'm not sure I agree, at least not without some modifications. I don't like the government driving businesses. I don't think government is skilled at picking winners and losers in technology things. France is a major agricultural exporter. The US is a major agricultural exporter. The French export high end agricultural products -- Bordeaux wine, Roquefort cheese (how much is that $22/lbs?!!!), etc. The US exports low end commodity crops. If you want to be wealthy, I think it makes sense to try to compete in the high end markets. Why not more government encouragement to make and export fine wines and cheeses rather than . . . corn, soybeans, wheat. I'm not sure, either, that I agree about the role of NASA today. What technology has NASA delivered to the commercial business realm in the last 10 years? If you want to talk about technology drivers, look how much mobile phone technology has driven semiconductor over the past 10 years. What has NASA delivered to compare with that processor developement? Please don't tell me about how NASA did something back in the 60's that is the germ of everthing we do now or about DARPA starting the Internet. No contest, but that is 40 year old news.
Dependence on foreign energy sources must be minimized for profitability to be realized here at home in a competitive global market. Stuffing the coffers of foreign interests which use those funds against us is not sustainable, nor sensible.
Not sure I agree. If foreign energy is cheaper, how does it harm us to pay them? Is it that the money is going out of country? As someone has pointed out in another thread, if they continue to be paid in dollars, they ultimately have to bring those dollars back to the US and invest them. So, the investment comes back notwithstanding. Still, I guess I sort of agree. It is probably better that money goes into the pockets of Exxon or Phillips or Shell. But how much are these companies US companies? How does money flow through corporations? Is it proper to think of that money somehow reposing in the US and being better for us than sending it out of country? Does Exxon take our money and invest it out of country? Probably. Of course, to the extent the money is going in some Saudi Prince's swiss bank account, maybe that isn't so good.
. Outsourcing is a dying art, the American worker can and will lead the way in high tech, skilled labor when the private sector chooses to innovate, out tech, and out think. Creating services or products here only to be outsourced will lead quickly to our demise as a global player and leave our economy and our workforce/consumers greatly disadvantaged while bolstering the economies of these emerging powers. Out sourcing if not abated will be the leech-craft/bleeding of our modern economic times.
This sounds more like faith-based belief than something tied to reality. Offshoring continues. It saves money for companies that use offshoring. I don't see why the American worker is better than the Chinese worker or the Indian worker or the South Korean worker. Maybe you don't know it, but some of these countries have pretty damn good education systems. I offer South Korea as an example When you have a healthy, energetic, motivated, educated worker in South Korea who is happy working for 1/3 the total costs of an equivalent American worker . . . . your theory isn't going to hold up. Every worker in India is not well educated . . . but enough of them are to displace a whole lot of American workers. It is a matter of quality versus price point. Basically the American worker has to realize he/she is competing head-to-head with people living in China and India. Those people can experience a major upgrade of standard of living working for much less than our American workers are willing to work for.
By the way, I'm not particularly happy about this situation, but it is the reality of our modern global economy. I like to think that our superior standard of living here in the US is our birth right. When I think like that, however, I'm wrong. There is no such birth right. There is no special dispensation that permitted us to get where we are. Consider the vital importance of the fact that most of the rest of the world was totally wrecked and obliterated in 1945 and we were left standing holding all the cards and no damage and we could sell to all these countries needing to rebuild. How much of our prosperity since the Great Depression can be accounted for by that one idiosyncratic historical circumstance? A lot I think. If you buy this characterization, what is the basis for arguing that it is inevitable or reasonable to expect that our much better standard of living will continue? I think not. I don't like that, but that is where my logic and observations point. The best we can hope for, I'm afraid, is that our standard of living will remain high and these other developing economies will raise their economies towards our level; the worst case is that our standard of living declines in proportion as theirs rises. That is a question I do not have any insight into.
Sorry to appear to be counter attacking your views. I find them rational and reasonable, I just don't fully agree with all of them. And I do appreciate your commenting. My intention was to start a discussion thread on this topic. And I acknowledge that I'm not an expert in these things and these are just my opinions and thoughts, which may be wrong.
I agree with this, in a specific way. I think we ought to maintain strong defense infrastructure -- weapons systems such as aircraft, carriers, patriot missiles, etc. -- but unwind some of our foreign committments. Why do we need to be in South Korea? This pisses the Koreans off and costs us a LOT of money. Let the South Koreans handle their own defense -- maybe paying our defense contractor companies to buy weapons systems -- and maybe they'll have less money to come over here and dominate our mobile phone market, our high end television market, our automobile market. Believe me -- I used to work for Samsung and have twice visited South Korea on business -- South Korea is well up to providing economically for their own defense. Ditto with the Phillipenes and ***an and Germany and Thailand. The theory is this allows us to project power. True enough. But what are the downsides of this projection of power? Drain on the tax payers and the economy; bad relations in many of the countries where our bases are seen as unwelcome occupying forces. My recommendation is to begin by dialing back our foreign committments -- starting with the oldest such committments (we got in the Phillipenese during the Spanish American war -- we're talking the late 1800s people!) -- to prune about 1/3 of these foreign committments. Sit on that position for 10 or 20 years and see how it works out. Then, if that seemed to work, dial it back still further, always in incremental steps.
OK! WELL SAID!
Lets start here where we agree 100%.
This discussion reminds me of Thomas Jefferson, who almost started the first Civil War by threatening to shut down New England ports due to foreign trade therein involving us in foreign wars/influences. Not saying we should do so again mind you, we shouldn't, but the point being that if such a true Patriot and renowned Framer felt so strongly about 'America First ideas', perhaps we should give ear, or at least perspective for our times. Times change, but people and their trading nature doesn't ,, so I observe anyway.
Great discussion and responses my fellow forum member, I'll get to the others later,,,,,,,,,,,,,,,,,,,
US Economy being overtaken
