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How do you handle the World Trade model where foreign governments have no issue propping up their large industrial companies hit by recessions (companies that w
by lenley 16y ago
How do you handle the World Trade model where foreign governments have no issue propping up their large industrial companies hit by recessions (companies that would also benefit from the decrease in your countries industrial capacity)?
- stretchwithme 16y agothat's their business. if they wish to subsidize the production of products so that we pay less, let them. It has never been a path to real success. all that sort of thing does is build up dependency on the government and an insulation from the actual marketplace. That is more GM's problem than its solution.
- notauser 16y agoIn the past it has been a path to real success, and consumers ended up paying more because of it. One example would be the Japanese electronics industry in the 60s-70s, which was subsidized until it broke the back of US competition. It then reaped a good profit for a long time before other countries caught up. (I doubt that GM could do this, at least not without a lot more money. But examples of "successful" subsidization programs to strategically promote industry do exist.)
- stretchwithme 16y agoI think they also had lower wages, statistical process control, concurrent engineering, the Taguchi method, the five why's, just in time manufacturing and many other innovations going for them as well. You can't say their success was due to subsidies without eliminating the effects of all of these other things.