Some people probably think that a Paris-like scene in a major U.S. city is the stuff of fairy tales. That it could never happen here. That problems like discontent and unemployment could never have the magnitude here that they have in France. That if there ever were such profound social unrest and such pressing social problems as exist in the Parisian suburbs that our "democratic" government would take immediate steps to remedy the situation, restore order, and take responsibility.
A different POV would bring up these points- The Automobile Industry isn't the only tangible industry. Defence, Aerospace, Financial Services are big contributors to the US economy.
- For Millenia, the West has bought goods made in the East via the Silk Route. The only century in which goods did not move from East to West was the 20th Century. Outsourcing is the same in principle but magnified 100x times
- The beauty of the US system is the ability to adapt and create jobs. French Style economic policies are far different from what is seen in the US. That's why its unlikely that there will be 30% unemployment in the US. At least in the near future.
1 comment:
Thanks for the comment and the link. You've got some good stuff here.
How did you get to my blog? By searching for "Bangalore"?
In response, in the order you mentioned...
1) "Financial services" is exactly what I mean when I say the US economy is based on services; I don't consider this a "flesh and blood" industry in that it doesn't produce anything tangible. When the real-life industries that create the wealth that drive the financial industry dry up, I'm afraid the financial industry will, too. RE: defense and aerospace... you're right; they are flesh and blood, and I left them out. Problem with them is that they, like the automobile industry, depend on--what else--cheap oil. Ask the major airlines.
2) You are correct regarding the silk route. However, there are two important differences. A) While it is not a problem is SOME goods--frankincense, myrrh, what have you--come from the East, it is a *major* problem for the West if ALL goods come from the East... we're well on our way. B) In the same way, outsourcing may not be bad in small amounts. However, 100X magnification is pretty strong magnification. For instance, the FDA has set the "acceptable" level of arsenic in drinking water at 10 parts per billion. We can argue all we want over whether it is really safe to have *any* arsenic in our drinking water, just as we can argue about whether outsourcing American jobs could ever really be a good idea for the American way of life. But if we were to magnify this "acceptable" level of arsenic 100 times to *1000 parts per billion*, I'm sure most people would agree that we've entered some pretty dangerous territory.
3) US-style capitalism obviously has its merits, and the French system obviously has its faults. 30% is a long, long way away (though not AS far away in our most forsaken urban areas). Also, I'm not a trained economist. However, the beauty of a party socialist or fully socialist system is that industries and jobs that *do* exist will persist and keep on churning EVEN in times of profound recession, and the economy therefore recovers somewhat quickly. In capitalism, when a recession or a "Depression" hits and the losses start piling up, boom, you're done, businesses aren't liquid anymore, doors close, and jobs are the first thing to go (ask anyone who has been laid off or otherwise "downsized"). Isn't that why the system is so prone to dramatic cycles of boom and bust? As the oil dries up and the heavy-metal industries go with it, you can bet that hundreds of businesses will tank and the stock market will go with it.
How long will it take for us to dig ourselves out of recession like this with "financial services" as our engine?
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