Arthur,
In a very strange way I feel that America is repeating some of the features
of the British decline. There can be little doubt that we were the first
into the industrial revolution. Yet, just as we were getting into our
stride (say from 1780-1850) our technologies and industries were already
leaving our shores -- mainly for Germany and America. In fact, quite a
severe reaction set in against engineering in our leading universities
(while Germany was building technical colleges all over). Yet enough
science survived and, towards the end of our time (as any sort of viable
economy) at around 1950-60 we had developed two of the greatest discoveries
of our era as a final gesture -- antibiotics (from molecular biology), and
the computer (from Turing's maths ideas). We developed both of these but
were unable to hang onto them
In a similar way, America has been losing all its consumer goods
manufacturing to Japan and China and, like us, has been turning away from
engineering. Much more science survived than in our case, however, and, in
turn, American science labs have been developing what is the most complex
science of them all -- genetics. The possible developments from genetics
range from new energy technologies, through to medicine, through to
actually making products in new ways. Will America be able to hang onto
these future technologies? This, I feel is the big question for America.
I think the present recession will turn into a permanently depressed
condition until the new DNA-based technologies come along. But it may be a
century away before it works its way round to full employment again.
Keith
At 10:04 09/09/2010 -0400, you wrote:
It is the last para in the article that caught my attention.
In this election season, the politicians who are really serious about
creating jobs and bringing down
<http://www.washingtonpost.com/wp-dyn/content/article/2010/09/03/AR2010090301979.html>unemployment
won't be the ones screaming about tax cuts, or stimulus or some imagined
government takeover of the economy. They'll be the ones talking about how
to make the American economy competitive again.
The US economy was moving along and was more or less competitive. The
great change happened when competition was opened with countries with
dramatically lower wages, labour standards, environmental standards,
etc. Against this the US lost ground. Opening the door to China,
first with Walmart and then with others following quickly to take
advantage of the cost structure abroad has given lower cost products of
all kinds to Western consumers at the cost of lost jobs across a broad
range of industries.
I really cant see how the American economy can become competitive again
until a few things happen: living standards and wages decline in the US;
wages and living standards rise in China, India, etc. Or as Keith
continues to say there is a dramatic new consumer technology which leads
to a new industry in the West and which remains in the West long enough to
invigorate the entire economy.
So the trouble is largely self-inflicted in my view. Short term gains (in
price of consumer and a range of industrial products from low cost
producers) is now leading to long term pain as jobs disappear, the tax
base shrinks, technological skill migrate abroad. And, even worse, as the
labour force ages the technology of designing and making things begins to
erode simply because there are fewer and fewer entry level positions for
new workers who can learn from the older workers. The older workers are
gone, many of the industries are in a slump or are gone and so yes there
is trouble. (of course you can add to this the financial debacle;
Afghanistan, etc.)
So we should listen very carefully to those who put forward policies to
make the US competitive again. I dont see anything just yet beyond the
chestnuts of increased productivity, smartinnovation, more technology, etc.
Arthur
From: [email protected]
[mailto:[email protected]] On Behalf Of Ed Weick
Sent: Thursday, September 09, 2010 9:32 AM
To: Keith Hudson; RE-DESIGNING WORK, INCOME DISTRIBUTION, EDUCATION
Subject: Re: [Futurework] Trouble, trouble and more trouble
Good morning (over here) Keith,
I'm not denying that the availability of new status goods have had a
significant effect in determining economic behaviour, but I think a great
deal also depends on how people feel about their world and their ability
to do things that can effect it positively. Right now, we are living
through a period of doom and gloom compared to how we felt, say, a decade
ago and we feel there isn't much we can do about it. People, governments
and the economy in general are over leveraged and the value of most
peoples prime asset, housing, is falling. Unemployment is high and many
people of prime working age have dropped out of the labour force. Some
commentators tell us that we are into a double-dip recession, while others
tell us to forget about double dip, we are into a recession that will not
end for a long time. Non-economic factors feed the dark mood: the high
hopes of military action in Iraq and Afghanistan are crashing to the ground.
At a time like this, one has to try very very hard to remain
optimistic. No dark age has lasted forever and I'm hopeful that we'll see
this one move on as well.
Ed
----- Original Message -----
From: <mailto:[email protected]>Keith Hudson
To: <mailto:[email protected]>RE-DESIGNING WORK, INCOME
DISTRIBUTION,EDUCATION
Sent: Thursday, September 09, 2010 3:34 AM
Subject: Re: [Futurework] Trouble, trouble and more trouble
Ed,
Yes, a good article.
My hypothesis, as you know, is that from about the 1980s there were no
more uniquely new (mass producible) status goods to motivate the masses.
This was the real, underlying reason why credit expanded so enormously at
that time. However, whether one believes that my view is correct or not,
there still remains the problem that the Western industrial economy seems
to have reached structural buffers in employment, as Steven Pearlstein
well describes. There are no resource constraints -- so far -- to account
for this.
Meanwhile, the birth rate of the advanced countries is declining fast.
Even if an amazing new technology with a full-employment structure were to
be presented to us right now, we (parents or governments) couldn't afford
to educate our children to the higher standards that would be required.
The only solution I can think of -- and it's one I don't like -- is that
the 20% or so of the population who are still thriving in today's (and
tomorrow's) recession, and can afford to educate their children in the
best schools and universities, will have more children in the coming years
and reverse the negative replacement trend. There is anecdotal evidence
(enough to convince me) that this trend is already starting. (It's in the
category of being fashionable at present.) But there is no hard evidence
as yet that this is a real trend.
Keith
At 15:12 08/09/2010 -0400, you wrote:
From the Washington Post
Ed
----------
The bleak truth about unemployment
By
<http://projects.washingtonpost.com/staff/articles/steven+pearlstein/>Steven
Pearlstein
Tuesday, September 7, 2010; 9:04 PM
Somewhere between the rantings of the Republican right, which is peddling
the nonsense that excessive government spending is to blame for high
unemployment, and the Democratic left, which clings to the false hope that
another helping of fiscal stimulus is all that is needed to get millions
of Americans permanently back to work, is this stubborn reality:
Snip, snip, snip
In this election season, the politicians who are really serious about
creating jobs and bringing down
<http://www.washingtonpost.com/wp-dyn/content/article/2010/09/03/AR2010090301979.html>unemployment
won't be the ones screaming about tax cuts, or stimulus or some imagined
government takeover of the economy. They'll be the ones talking about how
to make the American economy competitive again.
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Keith Hudson, Saltford, England
----------
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Keith Hudson, Saltford, England
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https://lists.uwaterloo.ca/mailman/listinfo/futurework
