http://www.fortune.com/fortune/articles/0,15114,1081269-1,00.html A preview of the article: It's a pretty long article but worth a read, IMO. I generally feel like America's free-market economy & civil liberties will allow us to adjust more quickly & thus be more competitive than other countries, but this is kind of a different ball game because so many of these international companies are able to operate as if it were still completely in a free-market economy. I think it's possible that as other countries experience rapid growth America could stall for several years. However, eventually the playing fields would have to be level again. I just prefer they stay in our favor throughout. What are your thoughts? Is this something you worry about? What do you think should be done, if anything??
I think one of the areas where we cannot compete is in labor. Places like China can prosper in the business world because of the abundance cheap labor. They can pay a person (even a child) in a day an amount less than the minimum wage in the US. The US will never be able to compete with that, because it just isn't a reality for us. Hell, the minimum wage here isn't even enough to keep up with the standard of living. I think it's even enough to keep a person below the poverty line? But that is one of the arguments for American companies to seek labor elsewhere, because it is so cheap. But there, they run into getting lambasted for taking jobs away from this country and putting them somewhere else. I'm not saying that I agree with taking jobs away from this country, but from a business standpoint, I understand why they want to do it - any way you can increase profits while keeping your operating costs low is always a good thing for any business.
of course america can compete. look at companies like google and intel. america is full, of educated and hardworking innovators, plus tons of natural recources. the only thing that can keep us from competing is restrictive economic policy like hi taxes, wack environmental regulation and protectionist trade policy. plus, when other countries become richer and more developed that is good news for us, because they will have more people willing to buy our products. economics is not a zero sum gain, growth in other places is good for us. i think your article summed it up pretty well right here: "History says the rise of China, India, and other developing economies could someday lead to a new equilibrium that’s better for everyone. With resources deployed globally to their best use, prices could come down and living standards could eventually increase everywhere. After all, America’s rise didn’t impoverish Europe. On the contrary, the success of each continent helped the other get richer." exactly, specialization helps everyone. we get labor where labor is cheapest. we get education where education is best. we get research where the smart people are, regardless of what country it is. and that is how the stanmdard of liuving goes up, because everything is being done as efficiently as possible. nice er things are cheaper and innovation continues. eventually i believe we will get to the point where work is almost voluntary, because the things you need to survive will be so cheap and simple to get because of technology. you buy one universal nanotech object fabricator, and you are set.
The real question isn't can we compete. It is should we compete. If the Chinese can produce more cheaply than we can let them produce. We have in reality moved past an economy based on production. Let free trade keep on rolling.
