The New Normal
Here is a scary thought. The Pareto Principle in economics says that 80% of the effects come from 20% of the causes. In practical terms it might mean that 20% of your movies at Warner Bros. would generate 80% of the revenue. Pareto himself noted that 80% of the waelth in Italy was held by 20% of the people.
This morning unemployment hit 10.2%, a 26 year high. Yesterday the Labor Department reported that productivity surged to 9.5%. The U.S. has worked hard to transform itself into a knowledge economy and companies like Google and Goldman Sachs record record revenues per worker. What if some version of the Pareto Principle begins to apply itself to employment–20% of the workers produce 80% of the GDP? Dan Greenhaus of Miller Taback & Co has the grim reality of our future.
We have argued and continue to argue that another jobless recovery is materializing and if our estimates for G.D.P. growth going forward materialize, the unemployment rate will remain at elevated levels for several years. Nearly 16 million people are unemployed right now while another 9 million are working part-time jobs because they cannot get a full-time job.
So here is the reality of life for the bottom 40% of America’s families. After they pay for food, housing and transportation they have $1200 per year to spend on “discretionary items” like clothing, medicine and doctors. Never mind telephone, Internet or cable TV which are supposed to be middle class entitlements. I don’t believe the 25 million underemployed people in this country are not going to sit on their hands passively zoned out in front of the TV set in the next two years, especially when they see Hedge Fund managers taking home $100 million bonuses for successfully taking down companies like Abitibi-Bowater, CIT, General Growth Properties, Six Flags and even General Motors with their brilliant government subsidized Credit Default Swaps and bond packages that forced the companies into bankruptcy.
In earlier times we had outsider artists who could articulate the rage like Woody Guthrie in the Depression.
Yes, as through this world I’ve wandered
I’ve seen lots of funny men;
Some will rob you with a six-gun,
And some with a fountain pen.
I believe it’s going to take a new renaissance of rebellious artists, spiritual leaders and politicians to wake up the public to the reality of the real America. Glenn Beck has no solutions but to retreat to a fantasy world of the 1950′s. The truth is that for more than half a century Republicans and Democrats alike have been prisoners of the conventional wisdom propounded by Wall Street bankers, military contractors, the Chamber of Commerce and their academic neoclassical economics enablers. The result is a hollowed out economy with no manufacturing base for exports except in making weapons of mass destruction, dependent on financial bubbles to keep the party going. Well, the party is over. Anyone who thought that just electing Barack Obama was the solution to our problems, misunderstood the institutional power of the Establishment and their conventional wisdom.
As I have said before, we are in an Interregnum where the old is dying, but the new cannot be born. Obama’s election was just the start of what needs to be a new age of reform. Writing of the Progressive Era 100 years ago, Richard Hofstadter noted that the reform movement “was the effort to restore a type of economic individualism and political democracy that was widely believed to have existed earlier in America and to have been destroyed by the great corporation and the corrupt political machine.”
Of course the task of Teddy Roosevelt, Upton Sinclair and the Muckrakers of 1904 was a lot easier than the task of Barack Obama. America was entering a period of technological mastery and export superiority. Jobs were plentiful. What TR had to do was break up the monopolies and end the corruption and greed in industries like meat packing and coal mining. Obama will have to do all of that (break up the Big Banks and reform the food and energy businesses), but his task will be far greater because he has to help create 30 million new jobs in the next few years. To do that we will need to remake our industrial base, because it’s clear these jobs are not going to come from the existing knowledge and service economy that gets more productive by the day.
“If we were able to rebuild it, the new industry would use high-productivity automation. It wouldn’t create enough jobs for humans.”
BJH, with all due respect, this is dangerous nonsense, and not just the nonsense about the “industrial base” being hallowed out and needing “rebuilding” when American (false).
The logic you are using regarding productive modern capital is wrong. Take your approach to it’s logical conclusion to see its problems more starkly.
If productive capital “wouldn’t create jobs”… we should switch our economy to less productive capital in order to return to full employment. Instead of digging foundations with shovels, we should have them dug with spoons.
Better yet, let’s ban trucks and have everyone carry cargo on their heads.
This, of course, is the keynesian “digging ditches” nonsense.
Getting more productive is the path to prosperity. Cursing the job-killing machines is the oldest fallacy in the book. The clear path of history, just as in food production, is that productivity boosts real wages and enables new industries to form.
Here’s a tip on this problem: if nobody can afford the stuff being made in these productivity-enhanced factories, the factories will go bankrupt.
All of this is a fallacy of closed “circular flow” thinking. “Men should be able to afford the output of their labor with their wage” is the kind of seductive logical mistake one must work to avoid. That is the long-defunct notion that economic value is derived from labor itself or some objective inherent worth rather than marginal utility for the consumer.
We don’t work for work’s sake. We work in order to purchase the goods and services we can’t provide for ourselves. If those goods and services can be provided cheaper, we get to work less for the same standard of living.
In the end, if robots could replace most of our jobs, that would be good for all of society because 75% of the cost of goods is labor. That would free up everyone to pursue their dreams. To paint. To parent. You name it.
People would still find new things to do. Most of the top jobs today didn’t exist 50 years ago. The job most human being did for thousands of years, food production, is now done almost entirely by machines and the average working class person with 20k in take-home pay gets the benefit of spending less than a quarter of that income on food.
Think about that. How are all these people making enough to pay for food times 4 if they can’t get a job on a farm because of those machines?
The classical labor theory of value was replaced by marginal utility for a reason.
Sorry for being so didactic. This issue is important. Have a great night.
> We don’t work for work’s sake.
> We work in order to purchase the goods
> and services we can’t provide for ourselves.
While accurate as it was meant this is not a complete truth.
The joy of community, earned respect, pride in ability, self esteem from contribtuion and the recognition in the reward along with many other non financial non traded intangible ‘marginal’ values people invest in their work are where ideological consistency with economic models (based on market trading) diverges from the political possiblities in competing for peoples support for policy.
The political market trades in ideas, emotions and aspirations that aren’t traded in cash markets and don’t follow the simple lines and curves we were all shonwi n ECON 101.
That supply and demand, the effects of tax etc can be measured and modeled informs us about how economic transactions aggregate but it doesn’t help as much as some think to explain why people set the values they do.
Which can make political pronouncments derived from economic observation naive.
> But I don’t see what “politics” has to do with it
We’re talking about the world around us, and often how we’d like it’s current governance to change policies.
Most of the topics here begin with Jon highighting something then people discussing how it’s good/bad and how we’d like it better orgainsed when we disagree with the current state of things.
These are political issues.
When someone argues that everyone would be better off if economic policies were less dictated and more free to reflect free markets it’s a political issue.
Politics took the free/open markets away, agitating for them back is a political act.
With reghards to poeples valuing of their jobs/work…
> people find all of those social and
> psychological needs filled in many different
> ways, often not through their job
One does not get to tell people what they value. It doesn’t matter what we think if people find worth in their jobs.
It doesn’t matter that I find work tiresome and would happily live without labour – when we talk about people valuing their work for more than their income we’re just not talking about me.
Being able to recognize that many people don’t attach certain values to their work says nothing about all those people who do.
> there’s no reason to expect that make-work
> can provide that any better than the work
> people could find in a world of flexible wages
This may well be true, my musing wasn’t so much about the possibility of a free market for labour keeping people employed as it was about the political diffilculty in getting there from here.
The western world hasn’t really had a free labour market during the modern industrial era (post World War 2), so much being disguised by the booming benefits of productivity.
For most people, and political classes the most pointedly, the idea is a complete and very scary unknown.
BJH,
Bastiat did it better than me:
http://bastiat.org/en/petition.html
John, you make some interesting points as usual, especially your link to the Bastiat piece. What much of this conversation, and many more before it, hinge on is the tension between lower prices and profitability and higher – rising – unemployment as jobs disappear to outsourcing or higher worker productivity or new technologies. How is this tension to be solved? That is the real question that requires a new response.
Take your example of the farmers. Most of the farm products on markets today are from large corporate farms. These so-called farmers reap huge agriculture subsidies and profits while at the same time selling at a price lower than smaller family farms can. A win for the consumers – and the corporate farmer shareholders/owners – but it puts smaller farmers out of business, increasing bankruptcies and unemployment. A month or so ago, I read that a year ago when gas prices were so high, one of the large produce companies, based in California (Dole or Del Monte or some such company), decided it was too expensive to ship broccoli (or some such produce) from California to New York. As a result, the company bought up as much available farmland as they could in New York to grow broccoli. While this action reduced the price of broccoli for consumers, it effectively drove small farmers out of business. Now, the problem exists of what can or will these small farmers, who have spent generations on the land, do to pay their bills? How are they and their families to survive?
To diverge slightly from the core of this issue is the matter of subsidies and protectionism. Do we, as a country, need to artificially stabilize the price of farm goods, especially when that means a greater advantage to corporate farms? Take the case of sugar. Right now, it is illegal to import sugar into this country, even though the cost of imported sugar would be much lower, thus reducing the cost to manufacturers and consumers alike. But opening the door to imported sugar effectively reduce the profits of one very wealthy family in Florida which holds a virtual monopoly on the sugar business…and effectively force many cane and beet sugar growers either out of business or into new crops.
These examples, although foggy perhaps, are what I meant by antiquated thinking in solving 21st C problems. The manufacturing and service industry jobs that have off-shored will never return. That is a sheer fact of reality. So the problem exists of what to do with all those people who lost their jobs?
Jon is wrong, I believe, to suggest that the only solution to full employment is for hire employees companies neither need nor can afford. If you carry his logic, as I currently – and maybe inaccurately – understand it further, if a company were to hire all these additional employees, reducing the hours worked by their current staff, then to be profitable a company would have to enforce job sharing. Job sharing, in order to be economically viable for a company, would mean reduced wages and benefits for the current staff. Let’s take Jon’s employment case for an example. Let’s say that his university decided it wanted to hire back some of those unemployed professors, but since budgets are restrictive it said that the only way to hire even one more professor, four other professors would have to give up a quarter of their classes, a quarter of their wages and a quarter of their benefits. I cannot believe that scenario would go over well.
Still the problem remains of continuing high unemployment, and the tension between costs and unemployment. While most educated workers will be able to transition into new businesses once emerging industries begin to grow, there will still be a great many who have neither the desire nor the ability to get a higher education. Not everyone is suited to a college education. So, what do these displaced workers do? Turn burgers at MacDonald’s for minimum wage? Even at an $8/hr wage, a 40-hour weekly gross income is only $320…or about $16,000 annual gross income. Hardly enough for a single person, let alone a family, to survive on.
So, what needs to be done to resolve this tension? I believe there are plenty of solutions, but few politicians are brave enough to advocate them because of the corruption within the political system that awards favors and protectionism and subsidies for dollars rendered. Plus, there is a startlingly lack of imagination and innovation within the body politic because they’re petrified of “upsetting the apple cart” which might lose them their well-financed jobs. Lots could be done to erase the anti-competitiveness and level the playing field by removing subsidies; eliminating protections; leveling out – as in a flat tax with no deductions other than dependents – the tax system to give small and mid-sized businesses a competitive opportunity as well as the average taxpayer; breaking up the TBTF banks that, as long as they exist, will pose a danger to the economy; requiring transparency in financial transactions (think CDSs) that effectively could end the casino culture on Wall St.; end the huge military industrial complex that greedily gobbles up the nation’s treasure; and finally invest in education and long term infrastructure.
The only missing piece of my puzzle – one that haunts me – is how to get banks back in the business of lending rather than gambling on “get rich quick” schemes so a whole new set of entrepreneurs can bring out the next generation of goods and services the world will want or need.
Valerie,
Thanks for the compliment. And there’s a ton of great stuff in your post here. Especially this:
—-
“Lots could be done to erase the anti-competitiveness and level the playing field by removing subsidies; eliminating protections; leveling out – as in a flat tax with no deductions other than dependents – the tax system to give small and mid-sized businesses a competitive opportunity as well as the average taxpayer; breaking up the TBTF banks that, as long as they exist, will pose a danger to the economy; requiring transparency in financial transactions (think CDSs) that effectively could end the casino culture on Wall St.; end the huge military industrial complex that greedily gobbles up the nation’s treasure;”
—-
Great stuff. We are of the same mind on many things, Valerie Curl.
Change is hard. It’s hard on the people that must endure it. I don’t (or try not to) say that “everyone wins” with freedom and free trade, because it’s not true. There are losers. People whose life-long pursuit dies. Whose business dries up. These are hard things and I have interest in making light of them.
Still, the political effort to prevent such change kills the goose of prosperity for all. We see that with tariffs like those levied by Bush on Steel and Obama on Tires. All consumers becomes poorer so that a tiny, politically powerful and electorally vital minority can be better off. It’s immoral, it makes society poorer and it fosters lobbying instead of innovating.
Now, to the discussion of your less-than-great stuff:
—-
“Take your example of the farmers. Most of the farm products on markets today are from large corporate farms. These so-called farmers reap huge agriculture subsidies and profits while at the same time selling at a price lower than smaller family farms can. A win for the consumers – and the corporate farmer shareholders/owners – but it puts smaller farmers out of business, increasing bankruptcies and unemployment.”
—-
I think you are mistaken in some respects here. Many (most?) of the food products available are not subsidized or protected by import quotas. On the other hand, I think the largest crops are (corn, wheat, sugar). That needs to stop immediately and would be successful, just as it was in New Zealand. Small farming may now simply be a niche pursuit for organics, etc. Maybe not. So be it. Judging it to be “good” normatively is just religion by zealous “buy local” fundamentalists that can’t bear the thought that efficiency and productivity are, in fact, the most environmental approach we can have. 1000 small organic farms may very well be much more harmful to the environment (never mind the economy) than a handful of super-productive high-yield farms. Or maybe not. That’s an empirical question that the “buy local” set treats as gospel truth regardless.
But this is part of a larger romance and nostalgia in the minds of the intellectual progressive “left” (or whatever, I hate that generalization). There was a time, during the FDR era, when progressives were obsessed about “efficiency” and looked up to the fascist model of pre-war Italy. The NRA was an effort to formalize and codify efficiency and bigness. The New Dealers saw excessive competition as a problem. Big corporations, Big Government and Big Labor was the order of the day for New Dealer’s progressivism.
And yet, the earlier (and then later) “progressives” saw trust-busting as a crucial component of their so-called “reform”. TR and the rest were all about anti-trust (though, in reality, it was all merely a tool of incompetent competitors rather than consumer protection, which is why attacking companies for charging LOW prices has been the norm), and yet FDR was breaking the letter and spirit of this misguided anti-trust law with his NRA cartels.
This, I believe was based on the fallacious ideology that the capitalist economy spirals inherently into crisis as diminishing returns on production eliminate profit. It’s a Marxist concept divorced from reality of human action, creativity and the diversity and complexity of our world. It’s circular flow thinking. Closed loop thinking.
The history of economics in the progressive movement is one of bi-polar, unhinged reaction to the perceived ills of the moment with only one undying faith: that government and its technocrats are somehow immune to the Animal Spirits and can swoop in to correct all so-called “market failures”. Call it the Stiglitz model or the Keynesian Model or whatever. It’s the hope for Angels to win elections from a see of mortals. This is why the Galbraiths of our world are always and everywhere romantics for “planning”. I simply call it hubris.
You can chart the same flip-flopping course through the progressive love/hate relationship with economic growth, oscillating between state-lead “pro-growth” and then “anti-growth” whims.
Don’t fall into closed-loop trap. It’s intuitive feeling, but it’s wrong. Jobs are created and destroyed every day. The schemers with the guns are no better at seeing through the fog of uncertainty than any other speculator. They simply can use guns to back their plans and extract their revenue when they fail. That is the key difference between the private entrepreneur and the public bureaucrat.
“the curious task of economics is to demonstrate to men how little they really know about what they imagine they can design” – F A Hayek.
As I like to say on my facebook posts…”interesting stuff” … so here I am a middle-aged well-educated very experienced professional librarian/bookseller who wondered about all of this stuff last year about this time and decided to do something about it…I was definitely in the lower 40% of American families salary-wise…I saw a very bleak future for anyone who had to work for a living in the US of A … so I quickly got my teaching certificate and hightailed it out of the country…I and some 20,000 other native English speakers are now teaching English in South Korea where the money is good ( you can save a lot), housing is cheap (I have a free apartment that is so much better than anything I have lived in the the US in the last ten years), healthcare is reasonable (everyone is insured – it only took them 12 years to implement universal coverage), taxes are minimal (I’m currently exempt from income tax but if I stay more than two years my taxes shoot up to a maximum of 17%) and if I stay into my retirement years I can actually expect to receive the benefits – we don’t file tax returns, our employers take care of what equals a US tax return so I am certain that the administrative side of collecting taxes is significantly less than the US – my monthly insurance premium is about $50 and I have to pay 20% of any medical costs – for example my physical for work which included blood work and x-rays cost me $30, I didn’t need an appointment and the whole thing took about 30 minutes – without a doubt THE most efficient health care service I have ever received in my life – cars are fairly inexpensive here but gas is pricey (as it should be) which encourages folks to use the incredible public transportation services – I can ride from my incredibly small rural outpost to the third largest city in the country for less than $15 – my takehome pay exceeds what I made on my last job in the US even though I took a 20% salary cut – I have money in the bank, a fairly easy life, and I’m helping rural kids learn English, something I apparently wasn’t qualified to do in the US – I watch the local farmers every day toiling on the land by hand, without major mechanization or much chemical use and I am amazed at how the agricultural economy here runs – it’s not perfect (I broke down and traveled to Daegu to buy bacon at Costco) but for me I am having the best, relatively stress-free, time of my life – South Korea consistently ranks in the top 15 economies based on GDP – I’m pretty sure that I am never coming back
That IS an interesting story. Korea is an amazing success story.
Wouldn’t it be so much better if we shut down global trade in order to “rebuild our industrial base” and made it impossible for you to go get that job?
Free movement and free trade at work.
Fiona, tell us more about the culture.
As I like to say on my facebook posts…”interesting stuff” … so here I am a middle-aged well-educated very experienced professional librarian/bookseller who wondered about all of this stuff last year about this time and decided to do something about it…I was definitely in the lower 40% of American families salary-wise…I saw a very bleak future for anyone who had to work for a living in the US of A … so I quickly got my teaching certificate and hightailed it out of the country…I and some 20,000 other native English speakers are now teaching English in South Korea where the money is good ( you can save a lot), housing is cheap (I have a free apartment that is so much better than anything I have lived in the the US in the last ten years), healthcare is reasonable (everyone is insured – it only took them 12 years to implement universal coverage), taxes are minimal (I’m currently exempt from income tax but if I stay more than two years my taxes shoot up to a maximum of 17%) and if I stay into my retirement years I can actually expect to receive the benefits – we don’t file tax returns, our employers take care of what equals a US tax return so I am certain that the administrative side of collecting taxes is significantly less than the US – my monthly insurance premium is about $50 and I have to pay 20% of any medical costs – for example my physical for work which included blood work and x-rays cost me $30, I didn’t need an appointment and the whole thing took about 30 minutes – without a doubt THE most efficient health care service I have ever received in my life – cars are fairly inexpensive here but gas is pricey (as it should be) which encourages folks to use the incredible public transportation services – I can ride from my incredibly small rural outpost to the third largest city in the country for less than $15 – my takehome pay exceeds what I made on my last job in the US even though I took a 20% salary cut – I have money in the bank, a fairly easy life, and I’m helping rural kids learn English, something I apparently wasn’t qualified to do in the US – I watch the local farmers every day toiling on the land by hand, without major mechanization or much chemical use and I am amazed at how the agricultural economy here runs – it’s not perfect (I broke down and traveled to Daegu to buy bacon at Costco) but for me I am having the best, relatively stress-free, time of my life – South Korea consistently ranks in the top 15 economies based on GDP – I’m pretty sure that I am never coming back
That IS an interesting story. Korea is an amazing success story.
Wouldn’t it be so much better if we shut down global trade in order to “rebuild our industrial base” and made it impossible for you to go get that job?
Free movement and free trade at work.
Fiona, tell us more about the culture.
Hekateris,
I empathize with your situation. Truly.
You don’t understand. You’re buying the “because we (the politicians) say jump, people will simply ask how high?”. It’s the standard model of politics: talk about the result as if its assured, move on with no regard for the unintended consequences.
Pushing up the minimum wage gives SOME people a higher wage AT THE EXPENSE of higher unemployment for people who are priced out of the market.
If you are 17, can barely read, have no high-school diploma and no record with any other employment, you aren’t worth $7.25/hour when that wage can go toward more productive equipment or a more experienced worker.
So that 17 year old is priced out of the legitimate economy and pushed into the black market which for many kids like this leads to drug dealing. At that point, the drug-warfare state proceeds to do it’s best at making you a felon and permanently unemployable.
Meanwhile, you can’t get a 13-year-old kid in my neighborhood to baby sit for much less than minimum wage even though it’s a cash business and they aren’t under the law. Funny how supply and demand work.
The minimum wage laws are nonsense and hurt the people who need that first job the most. Meanwhile, they have no impact whatsoever on anyone whose value exceeds the wage naturally on the market (which is most people over 20). They are perverse and destructive to the poor and should be abolished.
> The minimum wage laws are nonsense and hurt
> the people who need that first job the most
The last time I saw research testing this hypothesis in the real world it was not well supported.
Someone posted a link to a famous letter by Bastiat recently that argued that cheaper imports represented a gift of the difference in cost to consumers. That gift an obvious benefit to their wealth, and could no more be agitated against as the gift of wind for windmills or fish for fishermen.
After all if you object to something because it’s cheap logically you should object to anything gifted by nature because it’s free.
Putting aside the mistaken belief that much of anything is free (as ecologists are trying desperately to hammer home to economists there’s a cost in pollution and decimation of resources) the logic in this kind of argument is clear.
There are base costs, lower limits. Bastiat used what could be seen in agraian economies to make a point – it doesn’t make sense to rail against something cheaper because it’s cheaper.
I mention this because I intend to make a connection between that logic and socially mandated resource boundaries.
There’s no point railing against a socially mandated minimum standard because it’s mandated.
The idea that minimum wages force costs up and reduce the opportunity for employment due to reduced opportunity to invest in marginally profitable low skilled enterprises is not wholly born out by observation.
It may just fuel inflation, but unlike the inflation fueled by the printing of money for the investing classes this inflation may benefit the poorest by lagging their rise in income.
Nor is it entirely clear that if some opportunities are lost they outweigh the greater good.
The poorer community is more cooperative and generous than the richer – increasing funds among the poorest does good for the wider community even if unevenly distributed.
It’s hard to untangle the morass of reality and exceptionally hard to identify cause and effect in the aggregated effects of economic interaction, but you can’t beat checking theory against reality.
I ought point out that I’m not confident I know about life in the U.S with regards to this – I don’t know the relative values and costs of things nor have any experience with the social and community orgainzation of the U.S.
It may just be that labour costs are pushing any reasonable limit and the incentive to export employment balanced on a spreadsheets tiny adjustment in many U.S. businesses, so I don’t presume to know if any suggested minimum wage makes sense.
I just know that the simple mantra of minimum wage = bad is as mistaken as minimum age and minimum protection = bad is.
Nice post Fiona.
Nice post Fiona.
Nice post Fiona.
thanks for the kind messages…Korea is far from a perfect society but I am amazed at how such a geographically small country (about the size of New Jersey) can rank so high economically.
Some of things that I don’t like here include widespread racism, an incessant need to prove that Koreans are superior to all other cultures, pressure to succeed which is resulting on some alarming suicide trends especially in the cities, H1N1 paranoia, unimaginative architecture, overuse of red pepper to disguise boring food, a beauty obsession that is positively scary, and having to travel 2.5 hours to buy bacon (inside joke)
I see myself as part of the brain drain that the US is now experiencing, much as England did in the late 50′s and early 60′s, the same brain drain that lead my father, an aerospace engineer, to leave the UK for greener grass in the US. I am old enough to remember the incredible economic turmoil of the 1970′s and I am really tired of hearing about how tough things are now – they have always been pretty tough for those of us not on the high-wage fast-track.
but I digress…… Korea is an interesting mix of high-tech industry and small scale farming and fishing… from what I have seen everyone works here but not the three jobs I had to take on to keep a roof over my head in the US … nobody goes bankrupt because they have a medical condition … all children go to regular school and are expected to achieve no matter what their learning or physical disabilities are … I could go on and on but I won’t
If you want to see a glimpse of rural life here, check out the amazing film “Old Partner” which was the hit of the film festival circuit this year – http://en.wikipedia.org/wiki/Old_Partner – I see men like this every day here in the countryside although most of them use these weird little tractors instead of a cow
I should also add that I am also following in the footsteps of that great 19th century traveler Isabella Bird and am hoping to work up a film project about her … anybody interested in helping?
Fiona,
Do you know how S. Korea manages its’ economy? In other words, what has the government done to encourage business, pay for health care, and still not let its budget deficit grow out of control?
What lessons can the US take from S. Korea?
thanks for the kind messages…Korea is far from a perfect society but I am amazed at how such a geographically small country (about the size of New Jersey) can rank so high economically.
Some of things that I don’t like here include widespread racism, an incessant need to prove that Koreans are superior to all other cultures, pressure to succeed which is resulting on some alarming suicide trends especially in the cities, H1N1 paranoia, unimaginative architecture, overuse of red pepper to disguise boring food, a beauty obsession that is positively scary, and having to travel 2.5 hours to buy bacon (inside joke)
I see myself as part of the brain drain that the US is now experiencing, much as England did in the late 50′s and early 60′s, the same brain drain that lead my father, an aerospace engineer, to leave the UK for greener grass in the US. I am old enough to remember the incredible economic turmoil of the 1970′s and I am really tired of hearing about how tough things are now – they have always been pretty tough for those of us not on the high-wage fast-track.
but I digress…… Korea is an interesting mix of high-tech industry and small scale farming and fishing… from what I have seen everyone works here but not the three jobs I had to take on to keep a roof over my head in the US … nobody goes bankrupt because they have a medical condition … all children go to regular school and are expected to achieve no matter what their learning or physical disabilities are … I could go on and on but I won’t
If you want to see a glimpse of rural life here, check out the amazing film “Old Partner” which was the hit of the film festival circuit this year – http://en.wikipedia.org/wiki/Old_Partner – I see men like this every day here in the countryside although most of them use these weird little tractors instead of a cow
I should also add that I am also following in the footsteps of that great 19th century traveler Isabella Bird and am hoping to work up a film project about her … anybody interested in helping?
Fiona,
Do you know how S. Korea manages its’ economy? In other words, what has the government done to encourage business, pay for health care, and still not let its budget deficit grow out of control?
What lessons can the US take from S. Korea?
Len and Fentex:
First, how do you incentivize growing markets instead of market share? What mechanism do you use in a supposedly free market?
Two articles I read today illustrate my concern. Both are about Goldman Sachs. One in the UK Guardian which speaks to corporate culture and its personnel’s values. The other was about G-S being turned down by the WH in their attempt to buy Freddie Mac and Fannie Mae debt. While I didn’t quite understand the entire article, what struck me was a G-S quote: “don’t they know who we are?” It was as if to say, “Don’t they realize how important and superior we are? We should have anything we want because we’re better than everyone else.” So, again, I ask how do you change the incentives?
And, Fentex, I suspect that most people do not see the correlation between what they pay in taxes and subsidies, price supports, and protectionism.
It’s kind of like someone I knew years ago whose husband died in an accident. She was perfectly capable of working – strong, able, intelligent, creative – to support her 2 children but didn’t want to work. In her mind, living on “the dole” was perfectly fine. She failed to see the correlation between what she was receiving and what the taxpayers were paying. In her mind, it was government money…not the money of hard-working taxpayers like me or her friends or her family. Somehow, in her mind, it was free money. Money that, apparently, magically appeared out of nowhere and cost no one anything.
The same thing goes, until now, for how tax monies are spent. Most people don’t know. And until now, with so many people out of work, most have not had the time to look and question. After all, you can’t work 50 to 60 hours a week, do all the necessary chores, spend time with the kids, and still keep up with how Congress is spending tax dollars. You just trusted. Or if you knew, you were too busy trying to keep everything together and pay the bills that you just didn’t have the time, let alone energy, to devote to dealing with obvious Congressional misappropriations.
While I still think the “tea party” protests are way over the top and not at all on the mark, these people do make a point. And that point is that too much of our national treasure has gone to people and companies who neither need it nor deserve it. The system rewards the companies with the greatest lobbying dollars at the expense of everyone else, pushing up tax rates and preventing innovation…along with preventing needed infrastructure projects from being completed.
According to the Society of Civil Engineers, most of the country’s bridges, dams, and other civil structures are overdue to fail. In other words, crumble. Yet, we continue to pour tax dollars into industry sectors that do not need and should not have protection.
Hey, but the good news is that Congress is getting rich! A recent survey from Open Source stated that most Senators, since being voted into office, are now millionaires. Never mind that you and I can’t find a job that pays the bills or provides any kind of financial security.
The libertarian position would be it’s not anyones responibility to create incentives, one leaves it to the demand to be the incentive.
People a little more willing to allow governments to have economic policies argue over how best to encourage investment without damaging distortions – reducing costs by reducing regulatory requirements, explicit tax incentives (research gets a lot of that) and loans with conditions through to protection of markets.
Personally I’m a big fan of simply not discouraging new investment by ensuring everyone gets treated the same – not creating incentives to move capital to artifically supported markets, not permitting non-productive tax dodges and favoured industries.
I’ve also long maintained that a primary concern of governance to the supression of corruption. Corruption is a cancer that destroys all other efforts at progress and is a primary cause of most subsequent ills.
Mistaken policy and missteps can be easily corrected in a polling booth, but corruption can’t be.
I endorse this reply from Fentex 100%.
Government need not and should not “encourage” investment or entrepreneurship. Having the power to do so simply makes it a magnet for rent-seeking lobby money which is a sunk-cost to society and a great creator of corruption. Just look at Jersey. The state government is so overbearing that it’s basically assumed one must grease the palms of some politician in order to get anything done. The result is The Soprano State.
Power attracts corruption.
“First, how do you incentivize growing markets instead of market share? What mechanism do you use in a supposedly free market?”
First, there are many systems at work here. The banking system has obviously gone completely nuts. I say fat broomsticks up their rears from the brush end first. That H1N1 vaccine scandal is an incredible insult to the nation on top of the criminal investing. No love lost here.
So take a moment to look away from that rage maker to some areas where we have created and grown markets. Here is one example: standards-based software. Yeah, those Internet millionaires. How did they do it? If you put Apple and Warstler in one corner and almost everyone else in the other, they did it by using open standards based on shared intellectual property. (So did Morgan but he did it by being willing to poison the system whereas Apple does it with a closed walled garden.)
A second ingredient is market tier collapse brought about by simpler standards, the 80/20 kind that instead of boiling the ocean and erecting complexity barriers, rip through the complexity and extract the high potential core. When that happens the top tiers that monopolize markets have to adapt their product lines very rapidly or fall behind as the market expands rapidly. Microsoft has been pretty good at that. Apple steals and improves. Who made the first iPods? It wasn’t Apple. Who made the first GUI-enriched operating systems? It wasn’t Apple. Or Microsoft.
The story of Silicon Valley is not the story of some kids in a garage or a few renegade engineers going private. It is the story of billions in spookware investing in research aided by a university dean who insisted that students take that research and start companies. This isn’t precisely a ‘free market’. It is directed evolution.
Had GM and Chrysler taken responsibility as Ford did, they would still be competitive. No free lunch.
Power attracts corruption but smart power defends itself from corruption. It understands the poison and refuses it just as Ford did.
Take the example of the music and film industries. The dumb ones will do as the manager for U2 did and the RIAA did and sue the pants off their customers. They’ll die along with their brands. The smart ones will understand the changes taking place and start negotiations with their customers respectfully. They’ll find a way to keep copyright alive but still share what has little value to them in terms of quality. They’ll manage their hidden costs to the advantage of the market growth. They’ll create new production standards for that end while at the same time creating a vehicle for sharing new contracts with their members while not slamming the door on new talent and ideas. They’ll keep the elite cultivar and cross-breed it with the healthy plants found in the wild, in the garages, and they’ll offer it up on terms equitable to the wild ones so they can form their own families. They’ll be examples one can respect because instead of assaulting them and trying to take away their access, they’ll defend it and look for other ways to monetize. They’ll play smart like Ford, like the A-listers in Britain who told their government that going after the Internet access of private individuals was just wrong. They’ll pick battles with the C-listers who try to poison the environment and the big companies who engineer the poison. They’ll point their guns where the enemies of growth are. They’ll refuse the deals that may enrich them but rob the commons. They’ll quit robbing the future in honor of the present.
And for that, we will respect them and reward them. We’ll recognize the hidden costs. We’ll refuse to take their property as our own as if we were raiding an Irish farm in times of famine.
When the top tiers collapse into the second and third tiers of a market, it is not the end of quality. It is another cycle of growth.
Too Big Too Fail is just wrong. Too greedy too care is just stupid.
The “too greedy to care” being “stupid” algorithm only works if the greedy individuals suffer some kind of consequence that actually matter to them personally. They demonstrably could not care less if the rest of us desiccate and disappear, since They’ve Got Their. The balloonist bankers get their millions or billions and get to ride off into the sunset. That’s not a cycle, it’s a cliff, for the rest of us.
It is amazing how fast water wastes a mountain of mud. We can always print more money.
Len and Fentex:
First, how do you incentivize growing markets instead of market share? What mechanism do you use in a supposedly free market?
Two articles I read today illustrate my concern. Both are about Goldman Sachs. One in the UK Guardian which speaks to corporate culture and its personnel’s values. The other was about G-S being turned down by the WH in their attempt to buy Freddie Mac and Fannie Mae debt. While I didn’t quite understand the entire article, what struck me was a G-S quote: “don’t they know who we are?” It was as if to say, “Don’t they realize how important and superior we are? We should have anything we want because we’re better than everyone else.” So, again, I ask how do you change the incentives?
And, Fentex, I suspect that most people do not see the correlation between what they pay in taxes and subsidies, price supports, and protectionism.
It’s kind of like someone I knew years ago whose husband died in an accident. She was perfectly capable of working – strong, able, intelligent, creative – to support her 2 children but didn’t want to work. In her mind, living on “the dole” was perfectly fine. She failed to see the correlation between what she was receiving and what the taxpayers were paying. In her mind, it was government money…not the money of hard-working taxpayers like me or her friends or her family. Somehow, in her mind, it was free money. Money that, apparently, magically appeared out of nowhere and cost no one anything.
The same thing goes, until now, for how tax monies are spent. Most people don’t know. And until now, with so many people out of work, most have not had the time to look and question. After all, you can’t work 50 to 60 hours a week, do all the necessary chores, spend time with the kids, and still keep up with how Congress is spending tax dollars. You just trusted. Or if you knew, you were too busy trying to keep everything together and pay the bills that you just didn’t have the time, let alone energy, to devote to dealing with obvious Congressional misappropriations.
While I still think the “tea party” protests are way over the top and not at all on the mark, these people do make a point. And that point is that too much of our national treasure has gone to people and companies who neither need it nor deserve it. The system rewards the companies with the greatest lobbying dollars at the expense of everyone else, pushing up tax rates and preventing innovation…along with preventing needed infrastructure projects from being completed.
According to the Society of Civil Engineers, most of the country’s bridges, dams, and other civil structures are overdue to fail. In other words, crumble. Yet, we continue to pour tax dollars into industry sectors that do not need and should not have protection.
Hey, but the good news is that Congress is getting rich! A recent survey from Open Source stated that most Senators, since being voted into office, are now millionaires. Never mind that you and I can’t find a job that pays the bills or provides any kind of financial security.
The libertarian position would be it’s not anyones responibility to create incentives, one leaves it to the demand to be the incentive.
People a little more willing to allow governments to have economic policies argue over how best to encourage investment without damaging distortions – reducing costs by reducing regulatory requirements, explicit tax incentives (research gets a lot of that) and loans with conditions through to protection of markets.
Personally I’m a big fan of simply not discouraging new investment by ensuring everyone gets treated the same – not creating incentives to move capital to artifically supported markets, not permitting non-productive tax dodges and favoured industries.
I’ve also long maintained that a primary concern of governance to the supression of corruption. Corruption is a cancer that destroys all other efforts at progress and is a primary cause of most subsequent ills.
Mistaken policy and missteps can be easily corrected in a polling booth, but corruption can’t be.
I endorse this reply from Fentex 100%.
Government need not and should not “encourage” investment or entrepreneurship. Having the power to do so simply makes it a magnet for rent-seeking lobby money which is a sunk-cost to society and a great creator of corruption. Just look at Jersey. The state government is so overbearing that it’s basically assumed one must grease the palms of some politician in order to get anything done. The result is The Soprano State.
Power attracts corruption.
“First, how do you incentivize growing markets instead of market share? What mechanism do you use in a supposedly free market?”
First, there are many systems at work here. The banking system has obviously gone completely nuts. I say fat broomsticks up their rears from the brush end first. That H1N1 vaccine scandal is an incredible insult to the nation on top of the criminal investing. No love lost here.
So take a moment to look away from that rage maker to some areas where we have created and grown markets. Here is one example: standards-based software. Yeah, those Internet millionaires. How did they do it? If you put Apple and Warstler in one corner and almost everyone else in the other, they did it by using open standards based on shared intellectual property. (So did Morgan but he did it by being willing to poison the system whereas Apple does it with a closed walled garden.)
A second ingredient is market tier collapse brought about by simpler standards, the 80/20 kind that instead of boiling the ocean and erecting complexity barriers, rip through the complexity and extract the high potential core. When that happens the top tiers that monopolize markets have to adapt their product lines very rapidly or fall behind as the market expands rapidly. Microsoft has been pretty good at that. Apple steals and improves. Who made the first iPods? It wasn’t Apple. Who made the first GUI-enriched operating systems? It wasn’t Apple. Or Microsoft.
The story of Silicon Valley is not the story of some kids in a garage or a few renegade engineers going private. It is the story of billions in spookware investing in research aided by a university dean who insisted that students take that research and start companies. This isn’t precisely a ‘free market’. It is directed evolution.
Had GM and Chrysler taken responsibility as Ford did, they would still be competitive. No free lunch.
Power attracts corruption but smart power defends itself from corruption. It understands the poison and refuses it just as Ford did.
Take the example of the music and film industries. The dumb ones will do as the manager for U2 did and the RIAA did and sue the pants off their customers. They’ll die along with their brands. The smart ones will understand the changes taking place and start negotiations with their customers respectfully. They’ll find a way to keep copyright alive but still share what has little value to them in terms of quality. They’ll manage their hidden costs to the advantage of the market growth. They’ll create new production standards for that end while at the same time creating a vehicle for sharing new contracts with their members while not slamming the door on new talent and ideas. They’ll keep the elite cultivar and cross-breed it with the healthy plants found in the wild, in the garages, and they’ll offer it up on terms equitable to the wild ones so they can form their own families. They’ll be examples one can respect because instead of assaulting them and trying to take away their access, they’ll defend it and look for other ways to monetize. They’ll play smart like Ford, like the A-listers in Britain who told their government that going after the Internet access of private individuals was just wrong. They’ll pick battles with the C-listers who try to poison the environment and the big companies who engineer the poison. They’ll point their guns where the enemies of growth are. They’ll refuse the deals that may enrich them but rob the commons. They’ll quit robbing the future in honor of the present.
And for that, we will respect them and reward them. We’ll recognize the hidden costs. We’ll refuse to take their property as our own as if we were raiding an Irish farm in times of famine.
When the top tiers collapse into the second and third tiers of a market, it is not the end of quality. It is another cycle of growth.
Too Big Too Fail is just wrong. Too greedy too care is just stupid.
The “too greedy to care” being “stupid” algorithm only works if the greedy individuals suffer some kind of consequence that actually matter to them personally. They demonstrably could not care less if the rest of us desiccate and disappear, since They’ve Got Their. The balloonist bankers get their millions or billions and get to ride off into the sunset. That’s not a cycle, it’s a cliff, for the rest of us.
It is amazing how fast water wastes a mountain of mud. We can always print more money.
Fiona,
Do you know how S. Korea manages its’ economy? In other words, what has the government done to encourage business, pay for health care, and still not let its budget deficit grow out of control?
What lessons can the US take from S. Korea?
“Do you know how S. Korea manages its’ economy? In other words, what has the government done to encourage business, pay for health care, and still not let its budget deficit grow out of control?”
I’m glad you asked that..the Wall Street Journal did a piece recently about the South Korean economy
http://online.wsj.com/article/SB125651482563207031.html
As far as health care goes I think it is because everyone is in the same pool, everyone pays for insurance and expects to pay 20% of their health costs. Koreans are fastidious about health to the point of obsession in some ways but they still have undrinkable water for the most part (or so I have been told)
Two points that I failed to bring up earlier that totally surprised me are the dedication, lead by the federal government, to environmental issues and telecommunications. South Korea has one of the highest broadband penetration rates in the world. Even in my fairly poor community every household has high-speed internet access. The monthly rate is fairly cheap, about $35, and I watch tv and movies via my internet hookup – very nice!!!
The entire country recycles and I mean everybody. We have recycling stations all over our town and we sort everything. Food waste that can be fed to animals goes in one bin. All of the packaging goes into another, paper , glass and metal into yet more bins. For details on recycling here try this link http://www.korea4expats.com/article-recycling.html
The other thing that amazes me is the adoption of alternative energy. My county is considered the poorest in the country and we have a wind farm. I see wind turbines all over the place. Koreans are attempting to do something about the plague of air pollution in the cities and there is an optional program to reduce driving where you only drive every other day based on the last digit of your car tag.
I will be glad to answer other questions as I can.
Rats. I’m not a WSJ member which makes it impossible for me to read the entire article.
Any chance you could explain?
“Do you know how S. Korea manages its’ economy? In other words, what has the government done to encourage business, pay for health care, and still not let its budget deficit grow out of control?”
I’m glad you asked that..the Wall Street Journal did a piece recently about the South Korean economy
http://online.wsj.com/article/SB125651482563207031.html
As far as health care goes I think it is because everyone is in the same pool, everyone pays for insurance and expects to pay 20% of their health costs. Koreans are fastidious about health to the point of obsession in some ways but they still have undrinkable water for the most part (or so I have been told)
Two points that I failed to bring up earlier that totally surprised me are the dedication, lead by the federal government, to environmental issues and telecommunications. South Korea has one of the highest broadband penetration rates in the world. Even in my fairly poor community every household has high-speed internet access. The monthly rate is fairly cheap, about $35, and I watch tv and movies via my internet hookup – very nice!!!
The entire country recycles and I mean everybody. We have recycling stations all over our town and we sort everything. Food waste that can be fed to animals goes in one bin. All of the packaging goes into another, paper , glass and metal into yet more bins. For details on recycling here try this link http://www.korea4expats.com/article-recycling.html
The other thing that amazes me is the adoption of alternative energy. My county is considered the poorest in the country and we have a wind farm. I see wind turbines all over the place. Koreans are attempting to do something about the plague of air pollution in the cities and there is an optional program to reduce driving where you only drive every other day based on the last digit of your car tag.
I will be glad to answer other questions as I can.
Rats. I’m not a WSJ member which makes it impossible for me to read the entire article.
Any chance you could explain?
WPA
CCC
That would be a start…
And we will eventually be manufacturing here again. Look at the history since WWII just in my industry…music…Japan…huge gains in the world, then industrial wages exceeded those in the US by about 1995. The rise of Korea…then a lot of those jobs outsourced first to Indonesia, now China because once again, the industrial wages shot up quickly. Now it’s China and India, and it will take longer for their wages to approach parity with ours…Japan’s, Germany, etc., but it will eventually. Then where does manufacturing go? Add in peak oil, and you’ll have a slow movement back to more local production as international transportation becomes more and more of a price issue. Already you have shipping companies slowing down freighters and tankers a good 20% in order to save bunker fuel. This could take 150 years or more to level out, but it will.
So much so wrong in that post, it’s really quite impressive.
“And we will eventually be manufacturing here again.”
America is the leading manufacturer on earth, so this statement is purely false. Indeed manufacturing employment has been declining in the USA… just as it has in China… just as farm employment fell as that became productive. That’s the nature of getting better at doing stuff with robots, and it is, on balance good for us. It’s not easy for those pushed out of their jobs by the robots, but it’s good for everyone else. There’s no reason to scorn service jobs. Service is a good thing.
WPA, CCC, “Peak Oil”. It’s a cornucopia of fallacious fun. WPA and CCC were the least bad of FDR’s disastrous reign, but they were only deemed necessarily because of depression Hoover and the Fed created and FDR himself extended. “Peak Oil” is a non-issue. We will run out of oil some day. That day may come in 100 years or 30 or who the hell knows.
Regardless, as we run out, the prices will rise for real (instead of due to inflation by the Fed like in 2008) and alternatives will become viable. The energized hybrid market in 2008 after a decade of nobody caring is proof of that as well as being proof that the “oil crisis” in the 1970s was 100% caused by government price controls.
> “Peak Oil” is a non-issue.
Like hell it is. The world’s been living high on the hog for a while now and it’s not going to want to be weaned off it – but there is no easy replacement to hand for oils high energy density.
The faster oil runs out the more it’s going to hurt, the more it’s going to cause frustrations and conflicts.
Which isn’t to make any claims about what’s been responsible for fluctuations in oil’s price.
Allow me to re-phrase. “Peak Oil” will take care of itself without any “help” from coercive force, subsidy or mandate from the govt. Market prices will do the trick to alter consumption and incentivize entrepreneurial discovery of alternatives.
The three links you need on this and the broader set of Malthusian fear monger issues:
‘Peak Oil’ is a waste of Energy:
http://www.nytimes.com/2009/08/25/opinion/25lynch.html?pagewanted=1&_r=1
‘The Simon-Ehrlich Wager’:
http://www.perc.org/articles/article588.php
‘Falling fertility”
http://www.economist.com/opinion/displaystory.cfm?story_id=14744915
You keep saying it — now back it up. You got any credible proof that “America is the leading manufacturer on earth”? Or is that just another postulate in the faith, like the notion that “fraud” can magically be countered by some Deus Ex Machina?
http://community.machinedesign.com/blogs/editordesk/archive/2008/01/29/sobering-manufacturing-statistics-for-the-upcoming-primary-election.aspx
http://www.americaneconomicalert.org/view_art.asp?Prod_ID=3061
But of course you may be relying on one sentence in the CIA World Factbook,, snuck in among all the other facts showing weak and declining everything and debt to the world, that doesn’t break out how much of our “industrial” production is the machinery of war. And of course it’s ok with your Grand Global View that manufacturing job losses are huge and that it’s libertarianly correct that the wage slaves in broken lands should pick up those functions.
I’ve posted this link many times:
http://www.msnbc.msn.com/id/30229507/ns/business-us_business/
I’m not talking about Manufacturing employment. I’m talking about manufacturing output. The robots are taking over most of the jobs in manufacturing and that’s fine. It’s the same progress that enabled our entire nation (plus a surplus) to be fed by only 2% of the labor force.
But in the world of 1950’s Nostalgianomics, working on an assembly line is for some utterly arbitrary (and frankly ridiculous) reason, worse than working in businesses that directly serve people.
Humans doesn’t need to be assemblers if the robots can do it for us. That frees more of us up to be communicators, teachers, councilors, designers, inventors, developers, doctors, lawyers, marketers, decorators, etc.
All good things. Give up the religion, JTM. That “golden era” of manufacturing employment is gone and that’s a good thing. There’s plenty of problems left to solve with new jobs to come that will solve them. Always has been, probably always will be.
I can see why you prefer to stick with that article for your repetitive citations. Harold L. Sirkin, “Mr. Globality” himself, sounds exactly like your kind of guy, in fact you kind of sound exactly like him. Other than some Chamber of Commerce kind of assertions, and noting kind of aslant that maybe a lot of what is being counted as “American” industrial output may be from foreign factories owned by “American multinationals” (and isn’t that phrase itself a sick joke?) and the contribution to the net that “aircraft and missiles” apparently makes, I don’t see that your Sirkin circularity “proves” any such thing about the strength of US industrial output. It certainly discounts any possible notion that as Freud would have had it, the two main things humans need are Arbeit und Liebe, meaningful work and love in their lives.
And I have had plant jobs and know there’s not much joy and virtue in assembly line work and the other miseries that the blandishments of the people who proceded you in touting the virtues of Free Market Capitalism brought to the Industrial Revolution. There’s a reason folks might want to point out your use of straw man arguments — like your claim that anyone who thinks your prescription for the next Golden Age is full of wholes is “guilty” of “Nostalgianomics,” that typical sneering, condescending hogwash label that you might expect to come out the tight asses of the people at the Cato Institute — that veritable sewer outfall of self-serving “wisdom,” wil do anything to cure what ails us. One might more justifiably assert that your “libertarian” prescription for what to do “going forward” is “Jetson-omics.”
WPA
CCC
That would be a start…
And we will eventually be manufacturing here again. Look at the history since WWII just in my industry…music…Japan…huge gains in the world, then industrial wages exceeded those in the US by about 1995. The rise of Korea…then a lot of those jobs outsourced first to Indonesia, now China because once again, the industrial wages shot up quickly. Now it’s China and India, and it will take longer for their wages to approach parity with ours…Japan’s, Germany, etc., but it will eventually. Then where does manufacturing go? Add in peak oil, and you’ll have a slow movement back to more local production as international transportation becomes more and more of a price issue. Already you have shipping companies slowing down freighters and tankers a good 20% in order to save bunker fuel. This could take 150 years or more to level out, but it will.
So much so wrong in that post, it’s really quite impressive.
“And we will eventually be manufacturing here again.”
America is the leading manufacturer on earth, so this statement is purely false. Indeed manufacturing employment has been declining in the USA… just as it has in China… just as farm employment fell as that became productive. That’s the nature of getting better at doing stuff with robots, and it is, on balance good for us. It’s not easy for those pushed out of their jobs by the robots, but it’s good for everyone else. There’s no reason to scorn service jobs. Service is a good thing.
WPA, CCC, “Peak Oil”. It’s a cornucopia of fallacious fun. WPA and CCC were the least bad of FDR’s disastrous reign, but they were only deemed necessarily because of depression Hoover and the Fed created and FDR himself extended. “Peak Oil” is a non-issue. We will run out of oil some day. That day may come in 100 years or 30 or who the hell knows.
Regardless, as we run out, the prices will rise for real (instead of due to inflation by the Fed like in 2008) and alternatives will become viable. The energized hybrid market in 2008 after a decade of nobody caring is proof of that as well as being proof that the “oil crisis” in the 1970s was 100% caused by government price controls.
You keep saying it — now back it up. You got any credible proof that “America is the leading manufacturer on earth”? Or is that just another postulate in the faith, like the notion that “fraud” can magically be countered by some Deus Ex Machina?
http://community.machinedesign.com/blogs/editordesk/archive/2008/01/29/sobering-manufacturing-statistics-for-the-upcoming-primary-election.aspx
http://www.americaneconomicalert.org/view_art.asp?Prod_ID=3061
But of course you may be relying on one sentence in the CIA World Factbook,, snuck in among all the other facts showing weak and declining everything and debt to the world, that doesn’t break out how much of our “industrial” production is the machinery of war. And of course it’s ok with your Grand Global View that manufacturing job losses are huge and that it’s libertarianly correct that the wage slaves in broken lands should pick up those functions.
I’ve posted this link many times:
http://www.msnbc.msn.com/id/30229507/ns/business-us_business/
I’m not talking about Manufacturing employment. I’m talking about manufacturing output. The robots are taking over most of the jobs in manufacturing and that’s fine. It’s the same progress that enabled our entire nation (plus a surplus) to be fed by only 2% of the labor force.
But in the world of 1950’s Nostalgianomics, working on an assembly line is for some utterly arbitrary (and frankly ridiculous) reason, worse than working in businesses that directly serve people.
Humans doesn’t need to be assemblers if the robots can do it for us. That frees more of us up to be communicators, teachers, councilors, designers, inventors, developers, doctors, lawyers, marketers, decorators, etc.
All good things. Give up the religion, JTM. That “golden era” of manufacturing employment is gone and that’s a good thing. There’s plenty of problems left to solve with new jobs to come that will solve them. Always has been, probably always will be.
I can see why you prefer to stick with that article for your repetitive citations. Harold L. Sirkin, “Mr. Globality” himself, sounds exactly like your kind of guy, in fact you kind of sound exactly like him. Other than some Chamber of Commerce kind of assertions, and noting kind of aslant that maybe a lot of what is being counted as “American” industrial output may be from foreign factories owned by “American multinationals” (and isn’t that phrase itself a sick joke?) and the contribution to the net that “aircraft and missiles” apparently makes, I don’t see that your Sirkin circularity “proves” any such thing about the strength of US industrial output. It certainly discounts any possible notion that as Freud would have had it, the two main things humans need are Arbeit und Liebe, meaningful work and love in their lives.
And I have had plant jobs and know there’s not much joy and virtue in assembly line work and the other miseries that the blandishments of the people who proceded you in touting the virtues of Free Market Capitalism brought to the Industrial Revolution. There’s a reason folks might want to point out your use of straw man arguments — like your claim that anyone who thinks your prescription for the next Golden Age is full of wholes is “guilty” of “Nostalgianomics,” that typical sneering, condescending hogwash label that you might expect to come out the tight asses of the people at the Cato Institute — that veritable sewer outfall of self-serving “wisdom,” wil do anything to cure what ails us. One might more justifiably assert that your “libertarian” prescription for what to do “going forward” is “Jetson-omics.”
WPA
CCC
That would be a start…
And we will eventually be manufacturing here again. Look at the history since WWII just in my industry…music…Japan…huge gains in the world, then industrial wages exceeded those in the US by about 1995. The rise of Korea…then a lot of those jobs outsourced first to Indonesia, now China because once again, the industrial wages shot up quickly. Now it’s China and India, and it will take longer for their wages to approach parity with ours…Japan’s, Germany, etc., but it will eventually. Then where does manufacturing go? Add in peak oil, and you’ll have a slow movement back to more local production as international transportation becomes more and more of a price issue. Already you have shipping companies slowing down freighters and tankers a good 20% in order to save bunker fuel. This could take 150 years or more to level out, but it will.
So much so wrong in that post, it’s really quite impressive.
“And we will eventually be manufacturing here again.”
America is the leading manufacturer on earth, so this statement is purely false. Indeed manufacturing employment has been declining in the USA… just as it has in China… just as farm employment fell as that became productive. That’s the nature of getting better at doing stuff with robots, and it is, on balance good for us. It’s not easy for those pushed out of their jobs by the robots, but it’s good for everyone else. There’s no reason to scorn service jobs. Service is a good thing.
WPA, CCC, “Peak Oil”. It’s a cornucopia of fallacious fun. WPA and CCC were the least bad of FDR’s disastrous reign, but they were only deemed necessarily because of depression Hoover and the Fed created and FDR himself extended. “Peak Oil” is a non-issue. We will run out of oil some day. That day may come in 100 years or 30 or who the hell knows.
Regardless, as we run out, the prices will rise for real (instead of due to inflation by the Fed like in 2008) and alternatives will become viable. The energized hybrid market in 2008 after a decade of nobody caring is proof of that as well as being proof that the “oil crisis” in the 1970s was 100% caused by government price controls.
> “Peak Oil” is a non-issue.
Like hell it is. The world’s been living high on the hog for a while now and it’s not going to want to be weaned off it – but there is no easy replacement to hand for oils high energy density.
The faster oil runs out the more it’s going to hurt, the more it’s going to cause frustrations and conflicts.
Which isn’t to make any claims about what’s been responsible for fluctuations in oil’s price.
Allow me to re-phrase. “Peak Oil” will take care of itself without any “help” from coercive force, subsidy or mandate from the govt. Market prices will do the trick to alter consumption and incentivize entrepreneurial discovery of alternatives.
The three links you need on this and the broader set of Malthusian fear monger issues:
‘Peak Oil’ is a waste of Energy:
http://www.nytimes.com/2009/08/25/opinion/25lynch.html?pagewanted=1&_r=1
‘The Simon-Ehrlich Wager’:
http://www.perc.org/articles/article588.php
‘Falling fertility”
http://www.economist.com/opinion/displaystory.cfm?story_id=14744915
You keep saying it — now back it up. You got any credible proof that “America is the leading manufacturer on earth”? Or is that just another postulate in the faith, like the notion that “fraud” can magically be countered by some Deus Ex Machina?
http://community.machinedesign.com/blogs/editordesk/archive/2008/01/29/sobering-manufacturing-statistics-for-the-upcoming-primary-election.aspx
http://www.americaneconomicalert.org/view_art.asp?Prod_ID=3061
But of course you may be relying on one sentence in the CIA World Factbook,, snuck in among all the other facts showing weak and declining everything and debt to the world, that doesn’t break out how much of our “industrial” production is the machinery of war. And of course it’s ok with your Grand Global View that manufacturing job losses are huge and that it’s libertarianly correct that the wage slaves in broken lands should pick up those functions.
I’ve posted this link many times:
http://www.msnbc.msn.com/id/30229507/ns/business-us_business/
I’m not talking about Manufacturing employment. I’m talking about manufacturing output. The robots are taking over most of the jobs in manufacturing and that’s fine. It’s the same progress that enabled our entire nation (plus a surplus) to be fed by only 2% of the labor force.
But in the world of 1950’s Nostalgianomics, working on an assembly line is for some utterly arbitrary (and frankly ridiculous) reason, worse than working in businesses that directly serve people.
Humans doesn’t need to be assemblers if the robots can do it for us. That frees more of us up to be communicators, teachers, councilors, designers, inventors, developers, doctors, lawyers, marketers, decorators, etc.
All good things. Give up the religion, JTM. That “golden era” of manufacturing employment is gone and that’s a good thing. There’s plenty of problems left to solve with new jobs to come that will solve them. Always has been, probably always will be.
I can see why you prefer to stick with that article for your repetitive citations. Harold L. Sirkin, “Mr. Globality” himself, sounds exactly like your kind of guy, in fact you kind of sound exactly like him. Other than some Chamber of Commerce kind of assertions, and noting kind of aslant that maybe a lot of what is being counted as “American” industrial output may be from foreign factories owned by “American multinationals” (and isn’t that phrase itself a sick joke?) and the contribution to the net that “aircraft and missiles” apparently makes, I don’t see that your Sirkin circularity “proves” any such thing about the strength of US industrial output. It certainly discounts any possible notion that as Freud would have had it, the two main things humans need are Arbeit und Liebe, meaningful work and love in their lives.
And I have had plant jobs and know there’s not much joy and virtue in assembly line work and the other miseries that the blandishments of the people who proceded you in touting the virtues of Free Market Capitalism brought to the Industrial Revolution. There’s a reason folks might want to point out your use of straw man arguments — like your claim that anyone who thinks your prescription for the next Golden Age is full of wholes is “guilty” of “Nostalgianomics,” that typical sneering, condescending hogwash label that you might expect to come out the tight asses of the people at the Cato Institute — that veritable sewer outfall of self-serving “wisdom,” wil do anything to cure what ails us. One might more justifiably assert that your “libertarian” prescription for what to do “going forward” is “Jetson-omics.”
BTW, one of the “advantages” that Korea has…like Japan…is a very homogenized culture. There are very few ethnic minorities to be seen, and there are virtually no “illegal aliens” other than welcomed escapees from North Korea.
Being a melting pot carries a cost as well as bringing benefits. Too bad our fearless leaders can’t do more with the benefits and admit to the costs. If Koreans can learn English, why can’t we?
BTW, one of the “advantages” that Korea has…like Japan…is a very homogenized culture. There are very few ethnic minorities to be seen, and there are virtually no “illegal aliens” other than welcomed escapees from North Korea.
Being a melting pot carries a cost as well as bringing benefits. Too bad our fearless leaders can’t do more with the benefits and admit to the costs. If Koreans can learn English, why can’t we?
Don’t the Japanese look at the Koreans as a “minority”?
John, there is an historic antipathy between the Koreans and the Japanese.
Many centuries ago, Japan attempted to annex Korea through warfare. Yes, many Japanese thought of Koreans as being a “minority.” Actually, it’s far more racial in nature. But that’s pretty much a norm in a homogeneous society that for hundreds of centuries remained closed to foreign immigration.
This is why I’m so ardently pro-free trade, pro-open borders and anti-welfare-state. It’s all about peace and love. Seriously
Trade interconnects. It fosters relationships that don’t form in isolation. It binds through mutual necessity in a peaceful and socially constructive way. Welfare statism on the other hand creates a “keep your immigrant hands off my tax dollars” mentality that fosters xenophobia and more isolation which makes the world more fragile and at risk of war. You can see that kind of nationalism throughout the Europe-socialist zone. It’s repulsive.
Another interesting aside. For all the talk of pending malthusian resource scarcity, it is very interesting that small nations with relatively little natural resources have done so well: Singapore, Hong Kong, Japan, Korea. Natural resources can, in fact, be a curse that establishes lazy oligarchs who turn to hands-outs as a way to maintain political stability (think oil-rich nations especially Saudi Arabia and Venezuela).
Decent, predictable rule of law and property rights beats natural resources any day of the week.
> Many centuries ago…
Try sixty years ago for the most recent chapter.
>You can see that kind of nationalism throughout
> the Europe-socialist zone.
The European Union exists to create a common market and state aimed at removing the divisions that lead to their internicine wars.
A few years ago I drove/wove from Calais to Istanbul and couldn’t help but notice the extensive motorway building everywhere I went.
My girlfriend was joking about roving tunnel salesmen being on a commission for the number of tunnels under Greek, Croat, Serb, Italian etc mountains roads were being driven through.
Europeans are trying very hard to knit their economies together for this express purpose (of avoiding wars).
“Europeans are trying very hard to knit their economies together for this express purpose (of avoiding wars).”
Indeed. But some are not doing a very good job integrating immigrants. It’s a natural tension, birds-of-a-feather and all that. But when you have a hefty welfare state and high tax rates, that creates a natural dislike for newcomers hoping onto the rolls of the doles.
Don’t the Japanese look at the Koreans as a “minority”?
John, there is an historic antipathy between the Koreans and the Japanese.
Many centuries ago, Japan attempted to annex Korea through warfare. Yes, many Japanese thought of Koreans as being a “minority.” Actually, it’s far more racial in nature. But that’s pretty much a norm in a homogeneous society that for hundreds of centuries remained closed to foreign immigration.
> Many centuries ago…
Try sixty years ago for the most recent chapter.
>You can see that kind of nationalism throughout
> the Europe-socialist zone.
The European Union exists to create a common market and state aimed at removing the divisions that lead to their internicine wars.
A few years ago I drove/wove from Calais to Istanbul and couldn’t help but notice the extensive motorway building everywhere I went.
My girlfriend was joking about roving tunnel salesmen being on a commission for the number of tunnels under Greek, Croat, Serb, Italian etc mountains roads were being driven through.
Europeans are trying very hard to knit their economies together for this express purpose (of avoiding wars).
“Europeans are trying very hard to knit their economies together for this express purpose (of avoiding wars).”
Indeed. But some are not doing a very good job integrating immigrants. It’s a natural tension, birds-of-a-feather and all that. But when you have a hefty welfare state and high tax rates, that creates a natural dislike for newcomers hoping onto the rolls of the doles.
Rats. I’m not a WSJ member which makes it impossible for me to read the entire article.
Any chance you could explain?
John, there is an historic antipathy between the Koreans and the Japanese.
Many centuries ago, Japan attempted to annex Korea through warfare. Yes, many Japanese thought of Koreans as being a “minority.” Actually, it’s far more racial in nature. But that’s pretty much a norm in a homogeneous society that for hundreds of centuries remained closed to foreign immigration.
This is why I’m so ardently pro-free trade, pro-open borders and anti-welfare-state. It’s all about peace and love. Seriously
Trade interconnects. It fosters relationships that don’t form in isolation. It binds through mutual necessity in a peaceful and socially constructive way. Welfare statism on the other hand creates a “keep your immigrant hands off my tax dollars” mentality that fosters xenophobia and more isolation which makes the world more fragile and at risk of war. You can see that kind of nationalism throughout the Europe-socialist zone. It’s repulsive.
Another interesting aside. For all the talk of pending malthusian resource scarcity, it is very interesting that small nations with relatively little natural resources have done so well: Singapore, Hong Kong, Japan, Korea. Natural resources can, in fact, be a curse that establishes lazy oligarchs who turn to hands-outs as a way to maintain political stability (think oil-rich nations especially Saudi Arabia and Venezuela).
Decent, predictable rule of law and property rights beats natural resources any day of the week.
> Many centuries ago…
Try sixty years ago for the most recent chapter.
>You can see that kind of nationalism throughout
> the Europe-socialist zone.
The European Union exists to create a common market and state aimed at removing the divisions that lead to their internicine wars.
A few years ago I drove/wove from Calais to Istanbul and couldn’t help but notice the extensive motorway building everywhere I went.
My girlfriend was joking about roving tunnel salesmen being on a commission for the number of tunnels under Greek, Croat, Serb, Italian etc mountains roads were being driven through.
Europeans are trying very hard to knit their economies together for this express purpose (of avoiding wars).
“Europeans are trying very hard to knit their economies together for this express purpose (of avoiding wars).”
Indeed. But some are not doing a very good job integrating immigrants. It’s a natural tension, birds-of-a-feather and all that. But when you have a hefty welfare state and high tax rates, that creates a natural dislike for newcomers hoping onto the rolls of the doles.
The libertarian position would be it’s not anyones responibility to create incentives, one leaves it to the demand to be the incentive.
People a little more willing to allow governments to have economic policies argue over how best to encourage investment without damaging distortions – reducing costs by reducing regulatory requirements, explicit tax incentives (research gets a lot of that) and loans with conditions through to protection of markets.
Personally I’m a big fan of simply not discouraging new investment by ensuring everyone gets treated the same – not creating incentives to move capital to artifically supported markets, not permitting non-productive tax dodges and favoured industries.
I’ve also long maintained that a primary concern of governance to the supression of corruption. Corruption is a cancer that destroys all other efforts at progress and is a primary cause of most subsequent ills.
Mistaken policy and missteps can be easily corrected in a polling booth, but corruption can’t be.
Allow me to re-phrase. “Peak Oil” will take care of itself without any “help” from coercive force, subsidy or mandate from the govt. Market prices will do the trick to alter consumption and incentivize entrepreneurial discovery of alternatives.
The three links you need on this and the broader set of Malthusian fear monger issues:
‘Peak Oil’ is a waste of Energy:
http://www.nytimes.com/2009/08/25/opinion/25lynch.html?pagewanted=1&_r=1
‘The Simon-Ehrlich Wager’:
http://www.perc.org/articles/article588.php
‘Falling fertility”
http://www.economist.com/opinion/displaystory.cfm?story_id=14744915
just a couple of notes about South Korea
1. We do indeed have a large illegal alien population here – it’s estimated that 20% of the foreign population, around 225,000 right now, are working here illegally – some are even ethnically Korean but have been living in China – there are detention facilities for illegals but they are somewhat controversial – many Koreans emigrated from here over the last 20 years or so and there is a tremendous shortage of unskilled labor and, like the US, they are seriously worried about a rapidly aging population
2. We start teaching English in the first grade here and you really can’t get into the University without English competency – private academies called hagwons abound which provide even more English instruction – students go to school from 9am to 3:30 and then often go straight to hagwon after school for several more hours – the regular school week includes 2 saturdays a month but overall the students are in the classroom about the same number of hours as US schoolchildren but it is not uncommon to see small children in hagwons late into the evening – every school has broadband access and I teach in a truly state of the art classroom in the poorest county in the country – Koreans value education
3. The economy – the postings are in and during the 3rd quarter the economy grew by 2.9% while the US economy continued to shrink – as I understand it the government basically spent a lot of money to grease the wheels – jobs were created (they continue to bring in English teachers at government expense), bridges and roads were built or repaired, but most importantly they did everything they could to bolster people’s confidence in the economy – a detailed, but slanted, look at the current picture can be found here http://www.koreatimes.co.kr/www/news/biz/2009/10/127_54316.html
just a couple of notes about South Korea
1. We do indeed have a large illegal alien population here – it’s estimated that 20% of the foreign population, around 225,000 right now, are working here illegally – some are even ethnically Korean but have been living in China – there are detention facilities for illegals but they are somewhat controversial – many Koreans emigrated from here over the last 20 years or so and there is a tremendous shortage of unskilled labor and, like the US, they are seriously worried about a rapidly aging population
2. We start teaching English in the first grade here and you really can’t get into the University without English competency – private academies called hagwons abound which provide even more English instruction – students go to school from 9am to 3:30 and then often go straight to hagwon after school for several more hours – the regular school week includes 2 saturdays a month but overall the students are in the classroom about the same number of hours as US schoolchildren but it is not uncommon to see small children in hagwons late into the evening – every school has broadband access and I teach in a truly state of the art classroom in the poorest county in the country – Koreans value education
3. The economy – the postings are in and during the 3rd quarter the economy grew by 2.9% while the US economy continued to shrink – as I understand it the government basically spent a lot of money to grease the wheels – jobs were created (they continue to bring in English teachers at government expense), bridges and roads were built or repaired, but most importantly they did everything they could to bolster people’s confidence in the economy – a detailed, but slanted, look at the current picture can be found here http://www.koreatimes.co.kr/www/news/biz/2009/10/127_54316.html
just a couple of notes about South Korea
1. We do indeed have a large illegal alien population here – it’s estimated that 20% of the foreign population, around 225,000 right now, are working here illegally – some are even ethnically Korean but have been living in China – there are detention facilities for illegals but they are somewhat controversial – many Koreans emigrated from here over the last 20 years or so and there is a tremendous shortage of unskilled labor and, like the US, they are seriously worried about a rapidly aging population
2. We start teaching English in the first grade here and you really can’t get into the University without English competency – private academies called hagwons abound which provide even more English instruction – students go to school from 9am to 3:30 and then often go straight to hagwon after school for several more hours – the regular school week includes 2 saturdays a month but overall the students are in the classroom about the same number of hours as US schoolchildren but it is not uncommon to see small children in hagwons late into the evening – every school has broadband access and I teach in a truly state of the art classroom in the poorest county in the country – Koreans value education
3. The economy – the postings are in and during the 3rd quarter the economy grew by 2.9% while the US economy continued to shrink – as I understand it the government basically spent a lot of money to grease the wheels – jobs were created (they continue to bring in English teachers at government expense), bridges and roads were built or repaired, but most importantly they did everything they could to bolster people’s confidence in the economy – a detailed, but slanted, look at the current picture can be found here http://www.koreatimes.co.kr/www/news/biz/2009/10/127_54316.html
Wet blankets and icewater –
It appears that such rosiness as was in the cheeks of The Nation’s Economy was just a passing fever, and that the patient is sicker than Dr. Pangloss wanted to let on…
http://www.dailykos.com/story/2009/11/9/802392/-Breaking:-BLS,-Fed,-BEA,-et-al-Overstate-Strength-of-Economy
And of course there’s that “bulge” between U3 and U6…
Now what?
What’s next?
What?! They lied? Who lied? The Fed, BLS, Mr. Market or the media assigned to their watch? Maybe they all did. But in their defense, it’s become terribly confusing over the past year with all of the new acronyms, Czars and such.
If this article is correct, care to guess on where the DOW and S&P 500 should be? Hint, nowhere near the stratospheric heights it’s levitated to since Mar.
Here’s a companion article published in Harper’s in 2008 http://www.harpers.org/archive/2008/05/0082023
It seems this nonsense has been going on for quite a while.
Wet blankets and icewater –
It appears that such rosiness as was in the cheeks of The Nation’s Economy was just a passing fever, and that the patient is sicker than Dr. Pangloss wanted to let on…
http://www.dailykos.com/story/2009/11/9/802392/-Breaking:-BLS,-Fed,-BEA,-et-al-Overstate-Strength-of-Economy
And of course there’s that “bulge” between U3 and U6…
Now what?
What’s next?
What?! They lied? Who lied? The Fed, BLS, Mr. Market or the media assigned to their watch? Maybe they all did. But in their defense, it’s become terribly confusing over the past year with all of the new acronyms, Czars and such.
If this article is correct, care to guess on where the DOW and S&P 500 should be? Hint, nowhere near the stratospheric heights it’s levitated to since Mar.
Here’s a companion article published in Harper’s in 2008 http://www.harpers.org/archive/2008/05/0082023
It seems this nonsense has been going on for quite a while.
Wet blankets and icewater –
It appears that such rosiness as was in the cheeks of The Nation’s Economy was just a passing fever, and that the patient is sicker than Dr. Pangloss wanted to let on…
http://www.dailykos.com/story/2009/11/9/802392/-Breaking:-BLS,-Fed,-BEA,-et-al-Overstate-Strength-of-Economy
And of course there’s that “bulge” between U3 and U6…
Now what?
What’s next?
What?! They lied? Who lied? The Fed, BLS, Mr. Market or the media assigned to their watch? Maybe they all did. But in their defense, it’s become terribly confusing over the past year with all of the new acronyms, Czars and such.
If this article is correct, care to guess on where the DOW and S&P 500 should be? Hint, nowhere near the stratospheric heights it’s levitated to since Mar.
Here’s a companion article published in Harper’s in 2008 http://www.harpers.org/archive/2008/05/0082023
It seems this nonsense has been going on for quite a while.
“First, how do you incentivize growing markets instead of market share? What mechanism do you use in a supposedly free market?”
First, there are many systems at work here. The banking system has obviously gone completely nuts. I say fat broomsticks up their rears from the brush end first. That H1N1 vaccine scandal is an incredible insult to the nation on top of the criminal investing. No love lost here.
So take a moment to look away from that rage maker to some areas where we have created and grown markets. Here is one example: standards-based software. Yeah, those Internet millionaires. How did they do it? If you put Apple and Warstler in one corner and almost everyone else in the other, they did it by using open standards based on shared intellectual property. (So did Morgan but he did it by being willing to poison the system whereas Apple does it with a closed walled garden.)
A second ingredient is market tier collapse brought about by simpler standards, the 80/20 kind that instead of boiling the ocean and erecting complexity barriers, rip through the complexity and extract the high potential core. When that happens the top tiers that monopolize markets have to adapt their product lines very rapidly or fall behind as the market expands rapidly. Microsoft has been pretty good at that. Apple steals and improves. Who made the first iPods? It wasn’t Apple. Who made the first GUI-enriched operating systems? It wasn’t Apple. Or Microsoft.
The story of Silicon Valley is not the story of some kids in a garage or a few renegade engineers going private. It is the story of billions in spookware investing in research aided by a university dean who insisted that students take that research and start companies. This isn’t precisely a ‘free market’. It is directed evolution.
Had GM and Chrysler taken responsibility as Ford did, they would still be competitive. No free lunch.
Power attracts corruption but smart power defends itself from corruption. It understands the poison and refuses it just as Ford did.
Take the example of the music and film industries. The dumb ones will do as the manager for U2 did and the RIAA did and sue the pants off their customers. They’ll die along with their brands. The smart ones will understand the changes taking place and start negotiations with their customers respectfully. They’ll find a way to keep copyright alive but still share what has little value to them in terms of quality. They’ll manage their hidden costs to the advantage of the market growth. They’ll create new production standards for that end while at the same time creating a vehicle for sharing new contracts with their members while not slamming the door on new talent and ideas. They’ll keep the elite cultivar and cross-breed it with the healthy plants found in the wild, in the garages, and they’ll offer it up on terms equitable to the wild ones so they can form their own families. They’ll be examples one can respect because instead of assaulting them and trying to take away their access, they’ll defend it and look for other ways to monetize. They’ll play smart like Ford, like the A-listers in Britain who told their government that going after the Internet access of private individuals was just wrong. They’ll pick battles with the C-listers who try to poison the environment and the big companies who engineer the poison. They’ll point their guns where the enemies of growth are. They’ll refuse the deals that may enrich them but rob the commons. They’ll quit robbing the future in honor of the present.
And for that, we will respect them and reward them. We’ll recognize the hidden costs. We’ll refuse to take their property as our own as if we were raiding an Irish farm in times of famine.
When the top tiers collapse into the second and third tiers of a market, it is not the end of quality. It is another cycle of growth.
Too Big Too Fail is just wrong. Too greedy too care is just stupid.
The “too greedy to care” being “stupid” algorithm only works if the greedy individuals suffer some kind of consequence that actually matter to them personally. They demonstrably could not care less if the rest of us desiccate and disappear, since They’ve Got Their. The balloonist bankers get their millions or billions and get to ride off into the sunset. That’s not a cycle, it’s a cliff, for the rest of us.
hopefully my last post on the Korean economy – for those who doubt the value of universal health coverage here is a posting just made by one of my middle-aged English teacher friends here in Korea
“Memo: If you have excruciating chest pains in Korea and think you’re having a heart attack: 1. get co-teacher to write note describing symptoms, 2. go to clinic, 3. get chest x-ray, heart test in less than 1 hour, 4. discover pulled muscle in your ribs, 5. get GOOD meds, 6. take meds 7. feel good, COST: (for Dr., X-ray, EKG and meds) 9,600 KRW, USD: $8.30. Korean health care “ROK’s!”"
Maybe but you gotta live with people who think you are a dog. A well cared for dog but a dog.
I’ll take my chances here with Blue Cross Blue Shield and a BA that enabled me to become a VP because I worked at it.
Are you suggesting that South Korea is a lazy man’s socialist paradise, where hard work never pays off, and advancement based on merit is impossible?
In South Korea, apparently they treat foreigners as pets. That’s why they all work so hard to learn to speak English. Because they see us as dogs.
Sled dogs have the same view except one.
What I am responding to is what she is describing and what I hear from friends who worked in Asia. It’s all second hand, of course, but yes, reports are the racism toward the non-Koreans is very intense. So even if the hand is kind, as discussed here often, it isn’t worth being indentured on a plantation, IMO. Others will have different opinions. It seems to work for Fiona.
What I take away is that universal health care can be of benefit to any industrial society.
hopefully my last post on the Korean economy – for those who doubt the value of universal health coverage here is a posting just made by one of my middle-aged English teacher friends here in Korea
“Memo: If you have excruciating chest pains in Korea and think you’re having a heart attack: 1. get co-teacher to write note describing symptoms, 2. go to clinic, 3. get chest x-ray, heart test in less than 1 hour, 4. discover pulled muscle in your ribs, 5. get GOOD meds, 6. take meds 7. feel good, COST: (for Dr., X-ray, EKG and meds) 9,600 KRW, USD: $8.30. Korean health care “ROK’s!”"
Maybe but you gotta live with people who think you are a dog. A well cared for dog but a dog.
I’ll take my chances here with Blue Cross Blue Shield and a BA that enabled me to become a VP because I worked at it.
Are you suggesting that South Korea is a lazy man’s socialist paradise, where hard work never pays off, and advancement based on merit is impossible?
In South Korea, apparently they treat foreigners as pets. That’s why they all work so hard to learn to speak English. Because they see us as dogs.
Sled dogs have the same view except one.
What I am responding to is what she is describing and what I hear from friends who worked in Asia. It’s all second hand, of course, but yes, reports are the racism toward the non-Koreans is very intense. So even if the hand is kind, as discussed here often, it isn’t worth being indentured on a plantation, IMO. Others will have different opinions. It seems to work for Fiona.
What I take away is that universal health care can be of benefit to any industrial society.
Are you suggesting that South Korea is a lazy man’s socialist paradise, where hard work never pays off, and advancement based on merit is impossible?
In South Korea, apparently they treat foreigners as pets. That’s why they all work so hard to learn to speak English. Because they see us as dogs.
Sled dogs have the same view except one.
What I am responding to is what she is describing and what I hear from friends who worked in Asia. It’s all second hand, of course, but yes, reports are the racism toward the non-Koreans is very intense. So even if the hand is kind, as discussed here often, it isn’t worth being indentured on a plantation, IMO. Others will have different opinions. It seems to work for Fiona.
What I take away is that universal health care can be of benefit to any industrial society.
South Korea is hardly a socialist paradise and the racism that I have read about appears to be prevalent in the larger cities but then I have lived in a great many places in the US and found the worst racists in my life living in Chicago (and that was after ten years in the deep South)- I can only speak from my experience but I have found this to be one of the most generous societies that I have ever lived in – as in any close society, outsiders are subject to speculation and much rumor mongering – yesterday I heard that the local doctor has said that all foreigners have H1N1 which was news to me and the other teachers who aren’t sick
I can’t complain and I’m having the time of my life
“I can’t complain and I’m having the time of my life”
That’s all anyone can ask. Peace.
South Korea is hardly a socialist paradise and the racism that I have read about appears to be prevalent in the larger cities but then I have lived in a great many places in the US and found the worst racists in my life living in Chicago (and that was after ten years in the deep South)- I can only speak from my experience but I have found this to be one of the most generous societies that I have ever lived in – as in any close society, outsiders are subject to speculation and much rumor mongering – yesterday I heard that the local doctor has said that all foreigners have H1N1 which was news to me and the other teachers who aren’t sick
I can’t complain and I’m having the time of my life
“I can’t complain and I’m having the time of my life”
That’s all anyone can ask. Peace.
South Korea is hardly a socialist paradise and the racism that I have read about appears to be prevalent in the larger cities but then I have lived in a great many places in the US and found the worst racists in my life living in Chicago (and that was after ten years in the deep South)- I can only speak from my experience but I have found this to be one of the most generous societies that I have ever lived in – as in any close society, outsiders are subject to speculation and much rumor mongering – yesterday I heard that the local doctor has said that all foreigners have H1N1 which was news to me and the other teachers who aren’t sick
I can’t complain and I’m having the time of my life
“I can’t complain and I’m having the time of my life”
That’s all anyone can ask. Peace.
Oh screw it altogether. It’s not to take heads but to preserve them. The Roosevelts both were ridiculed for this, but they both fed off the past. (so did John Kennedy do daily).
We’re idiots concerning the past. My late
mentor used to warn that this might happen and now bigawd it has done.
Oh screw it altogether. It’s not to take heads but to preserve them. The Roosevelts both were ridiculed for this, but they both fed off the past. (so did John Kennedy do daily).
We’re idiots concerning the past. My late
mentor used to warn that this might happen and now bigawd it has done.
Oh screw it altogether. It’s not to take heads but to preserve them. The Roosevelts both were ridiculed for this, but they both fed off the past. (so did John Kennedy do daily).
We’re idiots concerning the past. My late
mentor used to warn that this might happen and now bigawd it has done.