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Are the American people obsolete?
- J3L2404 16y ago'Of course there are alternative options, which would not require the departure of most Americans from America for new lives on distant shores. One would be a new social contract, in which the American people, through representatives whom they actually control, would ordain that American corporations are chartered to create jobs in the U.S. for American workers, and if that does not interest their shareholders and managers then they can do without legal privileges granted by the sovereign people, like limited liability.'
- yequalsx 16y agoI think too, in addition to what you suggest here, is that the size and scope of corporations needs to be limited. A company like Citi is too big to control. It is so big that its collapse would cause problems for the country even if the source of the collapse comes from its dealing in other countries. We need a new system but it appears to me that what we have in the U.S. and elsewhere is regulatory capture. I don't see anything changing in the near term.
- eru 16y agoHow about breaking the country up into smaller pieces? Citi can only be too big to fail, if there's a big country behind for the guarantee. Small countries would also ease regulatory capture, since all those small regulatory regimes would have to compete with each other.
- arethuza 16y agoIt is arguable that creating a very attractive environment for international corporations can actually make the problem worse - look at Ireland.
- yummyfajitas 16y agoWhy do you believe Ireland's attractive business environment caused their current problems? Do you believe Ireland would be better off without Google and various others locating HQ in Ireland?
- arethuza 16y agoMy own suspicion is that the high levels of inward investment to Ireland primed the asset bubble that developed there, Of course, the problem wasn't caused by the likes of Microsoft, Google etc. setting up their offices there but it probably did contribute to the irrational exuberance that keeps these bubbles growing. It is a pretty scary situation they are in: http://www.bbc.co.uk/blogs/thereporters/robertpeston/2010/11/hl_ireland_an_extreme_version.html http://www.bbc.co.uk/blogs/thereporters/robertpeston/2010/11...
- yummyfajitas 16y agoIs this summary of the dangers correct: attractive business environment -> investment, growth -> optimism -> increased risk of bubbles?
- patrickk 16y agoCreating an attractive environment for international corporations has largely been good for Ireland, and not the root cause of our current woes - that would be the ridiculous decision by our Minister of Finance to issue a blanket guarantee to our major banks, which were oversized relative to the size of our domestic economy. This has resulted in the current bailouts and humiliation. The 'Celtic Tiger' (booming Irish economy) went through two main periods - c.1995 - 2001 (Celtic Tiger part 1), and 2003-2007 (part 2). The first period was fueled by foreign direct investment by American multinationals - if I recall correctly, American companies have more net investments in Ireland than they do in China. Ireland exported more computer services in 2002 than the US did, which is pretty mind-boggling. This export-led growth teed up the next stage, which was simply an out of control housing bubble. See this for more information: http://en.wikipedia.org/wiki/Celtic_Tiger#Downturn.2C_2001.E2.80.932003 http://en.wikipedia.org/wiki/Celtic_Tiger#Downturn.2C_2001.E... I'm hoping our open nature, which leaves a country vulnerable in a global recession, will allow us to recover quickly. Iceland seems to be doing ok and they were worse off than we were. There are some signs of a recovery e.g. Facebook recently announced expansion in their Dublin office. Google and Apple are also expanding here, exports are up, and curtailing the out of control public servants wage bill will make us more cost competitive internationally.
- lukeschlather 16y agoIt would be a race to the bottom. We largely already see that in the "developing" world. When a factory causes sufficient growth that a country demands higher wages, the multinational that owns the factory picks up and moves to an even more impoverished nation, and the worse-off are climbing over each other trying to create the most lenient regulations to attract business. Then once the corporation has departed, the original country collapses back into poverty. Rinse and repeat over decades.
- yummyfajitas 16y agoThen once the corporation has departed, the original country collapses back into poverty. Could you provide an example of this part?
- lukeschlather 16y agoVenezuela or Nicaragua. Though obviously the departure isn't necessarily the choice of the corporation in either of those cases. Well, in Nicaragua I'd say the most recent event was the hurricane, and so regulation wasn't the cause of industry's (tourism's) departure. But I still stand by the general theme, that multinational corporations are engaged in something of a bait-and-switch, even if there's no intentional malice behind it. And in Venezuela, one can blame Chavez, but clearly his platform resonates with people because of a pattern of exploitation, even if Chavez himself turns out to be merely a new vector for exploitation.
- yummyfajitas 16y agoI agree that corporations departing can cause (or be caused by) a bad economy. But neither of your examples are part of the chain of events you described: Investment -> growth -> higher wages -> low-wage seeking investment leaving -> decline I fully agree with all steps in this chain besides the last. As you say, Nicaragua was a natural disaster and Venezuela was an unnatural disaster. I agree that both of these things can cause a nation to decline, and can also cause foreign corporations to flee the country. But I wasn't asking whether disasters can harm a country and also chase away foreign investment.
- eru 16y agoSounds like: Those evil foreigners are taking our jobs.
- exit 16y agowhen actually it's: evil corporations are creating a class of disenfranchised workers. the essential evil is this notion of nationality. for most of history people had the ability to vote with their feet. nationality is essentially undemocratic in that respect.
- tomjen3 16y agoWtf is wrong with this board? This is the place for getting shit done, and all I find are a bunch of whiney people, with the same complaints you would find on the democratic underground or counterpunch.
- matwood 16y agoWhile we're at it we should throw out foreign companies who create jobs here. Toyota, Honda, and BMW all have plants in the US...oh wait
- nhangen 16y agoAre you suggesting socialism as the answer to the issue? I don't understand how in a place where we talk about building fortunes via startups and innovation, we also talk about stifling the very motivation for these companies to exist. You do this, and suddenly every company moves overseas and chooses to pay taxes in another country, at which point we lose the possibility of jobs and the tax money that these companies provide.
- yequalsx 16y agoNot every company has moved out of socialist-like Sweden. There are motivations beyond just profit and profit isn't always the best form of motivation.
- nhangen 16y agoThere's a big difference in the culture of a company that was built in a socialist country versus that of one built in a capitalist country. Perhaps private companies have more wiggle room. Rather than mandating, why not buy enough stock to have an influence on company decisions?
- jkeel 16y agoWhat this article describes is what I've been noticing but I've tried to focus on my startup. Although, that said I worry that there are big shifts occurring that people are not paying attention to. While we are are trying to create our business we need to remember that we are part of a community. Whether it be our country, state, county, city, district or neighborhood we need to ensure that those communities stay functional by participating as a citizen in this country. I fear that some (not all) of the mega corporations are so motivated by profits that they forget any duties to their country. Although, why should they as many are now multi-national and stock holders consist of many rich foreigners that do not live here. If we want to be able to do business here and be successful we need to make sure that the country continues to be a high quality place to live (and work) for the average US citizen. Just my 2 cents.
- yequalsx 16y agoBefore globalization and free trade it was roughly true that what was good for American industry was good for the American people. Now that money can be transferred from country to country easily, that factories can be transferred easily, etc. it is no longer true, necessarily, that what is good for American industry is good for the American people. The economic and political beliefs of the masses have not caught up to this new reality. They still think in terms of Ford being an American company rather than a company whose headquarters are in America. The interests of a corporation are to its shareholders and not to any particular country. Mega corporations like Shell transcend the nation state. They are able to influence the national policies of multiple countries at once. Unfortunately politics is local and the big picture is lost on the majority of people. People are largely stuck in the paradigm of my country versus your country. This is allowing corporations to commit morally dubious acts on a grand scale.
- yummyfajitas 16y agoWhy do you feel it is bad for the American people to have our computers and televisions made in China? Are consumers enjoying cheaper goods not also Americans? (Note: Ford is a silly example. Many of our cars are already made in the US by machines owned by domestic subsidiaries of foreign corporations. The machines are operated by a small number of non-union laborers earning high wages.)
- jimbokun 16y ago"Why do you feel it is bad for the American people to have our computers and televisions made in China?" I do not see this claim in the comment you are replying to.
- krschultz 16y ago"Before globalization and free trade it was roughly true that what was good for American industry was good for the American people. " Offshoring manufacturing may leave a small group of people without jobs, but it lowers the cost of goods for everyone.
- ovi256 16y ago"the only thing missing is a non-voting immigrant mercenary army, whose legions can be deployed in foreign wars without creating grieving parents, widows and children who vote in American elections." That is already well under way, the Marine Corp in particular recruits heavily amongst immigrants without asking many questions about their legal status and promising (and delivering) citizenship afterwards. SERVICE GUARANTEES CITIZENSHIP. WOULD YOU LIKE TO KNOW MORE ?
- arethuza 16y agoOther approaches that have worked pretty well: http://en.wikipedia.org/wiki/French_Foreign_Legion http://en.wikipedia.org/wiki/French_Foreign_Legion http://en.wikipedia.org/wiki/Gurkha http://en.wikipedia.org/wiki/Gurkha
- sudont 16y agoAlso, the effects of French vs British Colonialism: http://blog.foreignpolicy.com/posts/2010/11/16/how_helpful_was_british_colonialism http://blog.foreignpolicy.com/posts/2010/11/16/how_helpful_w...
- J3L2404 16y agoWant to stop war. Bring back the draft.
- randallsquared 16y agoThis is equivalent to killing people until they agree with you, which is basically just making war on a different group of people in the name of "stopping war". And as the Vietnam era shows, it's not even immediately effective, nor a lasting effect.
- deleted 16y ago[deleted]
- J3L2404 16y ago
- eru 16y agoSo much whining. Just have a look at how, say, Germany copes with globalization. It's a rich country that exports to China.
- J3L2404 16y agoAnd how they cope with immigration. German law states that people who help, instigate, prolong or support the stay of an illegal immigrant can be penalized. That means that doctors, nurses and other hospital staff is required to report people to the authorities when the illegal status of an immigrant seeking medical help. The medical profession opposes this rule that is a lot stricter than in many other european countries, where help can be given to aliens without revealing their identity.
- yequalsx 16y agoThere, precisely, is the problem. Not every nation can be like Germany. It's not possible for every nation to have an overall trade surplus. Being like Germany is not a solution.
- cdavid 16y agogermany had an anemic gdp growth in the last two decades, significantly worse than most countries of comparitive size (population and gdp-wise). Look at gdp growth of other big european countries, or worse USA, it is quite striking
- arethuza 16y agoWhich just goes to show that GDP growth rate taken in isolation might not be such a great measure of the overall health of an economy.
- cdavid 16y agoSo what's your measure of Germany's economic health ?
- jwh 16y agoPart of that slow GDP growth can be attributed to having to absorb an entire communist country (East Germany) into a capitalistic society (West Germany).
- kmfrk 16y agoHas yellow journalism destroyed good reporting? Also, the internet is dead.
- jimbokun 16y agoI thought the "recommendations" for action at the end were a bit superfluous. Besides that, what parts of the analysis in the article do you find inaccurate, specifically?
- kmfrk 16y agoI just hate the kind of title the article uses. Don't write a question in the title, especially while making such a big prediction like that. It's very Wired-esque.
- pbhjpbhj 16y agoFrom the article >They [Wall Street traders] can flourish even if the U.S. declines, as long as they can tap into growth in other regions of the world. They can flourish by forcing US decline. This is part of the problem.
- rbanffy 16y ago> They can flourish by forcing US decline I'm not sure how that would work out. US is a huge consumer pool and forcing its decline would damage everyone.
- pbhjpbhj 16y agoShort-termism. I wasn't suggesting that as a "species" they could flourish and continue to do so (though that's possible) but that just as one can profit by driving a company into the ground (remember naked short selling) one can profit by destabilising a whole economy and destroying entire industries. Generally speaking if you've made billions of dollars you don't care that you can't earn any more the same way. Indeed if I can destroy US car manufacture and have stakes in Japanese car manufacture then it's a plus for me. If you make money destroying society then you switch to selling anti-depressants, DIY divorce kits, handguns, etc. and make more money. It's the capitalist way. Ain't it fine.
- pbhjpbhj 16y agoI don't think it's that the American people in particular are obsolete I think that we have over-population and that a proportion of the worlds population are not required for industry, food production. That the rich elite would choose to pay as little as possible in wages is simple capitalism enabled by a global market; it's basically a war for survival. Those in power offer barely enough to work yourself to survival and we get to battle amongst ourselves to see who gets those scraps - my view of the next few decades is pretty bleak.
- jscore 16y agoWhile labor is shifting overseas, consumers are not. America is the most consumer driven economy in the world and should remain so for a bit even given the recession (thank quantitive easing and low interest rates for that). All those trade surplus countries like Germany, China most sell to someone when their domestic consumers are not buying. China will probably catchup at some point (in consumer demand) but that won't be for another generation or more.
- jimbokun 16y ago"New York Mayor Michael Bloomberg recently revealed the plutocratic perspective on immigration when he defended illegal immigration by asking, "Who takes care of the greens and the fairways in your golf course?"" Any ambitions Bloomberg may have had to run for President, are pretty much put to rest by this quotation.
- krschultz 16y agoHe is not partisan enough to get through a President primary anyway. Republicans hate his gun laws and Democrats hate his support of charter schools, to name just two things he has done that piss off either side.
- deleted 16y ago[deleted]
- stevenbedrick 16y agoIndeed, but it's still a fair question, just framed badly. What he should have said was "who works in every kitchen in every diner, and who maintains every public green space, and who builds every house?"
- J3L2404 16y agoNot every house. There are still lots of small companies that play by the rules - Of course they are at a disadvantage for that integrity, but when a company takes shortcuts in one area they are likely taking shortcuts in other areas, ultimately producing inferior products. You get what you pay for.
- hugh3 16y agoWhoever is willing to do the job for least? Other first-world countries get by just fine without an illegal-immigrant underclass to do the menial jobs. In Australia, building houses is a respectable and well-paid trade. Kitchens in fast-food restaurants are worked by high school students with part-time jobs. And public green spaces are maintained by... well I dunno, some low-skilled worker making a decent wage. We also have a 5.2% unemployment rate, and no real social underclass the way there is in America.
- jdietrich 16y agoIt is worth remembering that the average American consumes an exceptional amount of resources. Compared even to the relatively profligate Europeans, the average American consumes twice as much energy, twice as much water and lives on more than twice as much land. The disparity with even wealthy urban Chinese or Indians is greater still. This lifestyle has in part been justified by the very high historical levels of American productivity, but it is clear that American productivity is not increasing at nearly the rate of that in emerging markets. We are left with an obvious conclusion - as a factor of production, American citizens continue to be very resource-intensive, but are becoming comparatively less productive. It seems to me that America is unique in a culture that sees consumption of scarce resources as tantamount to a human right. Much of the cultural divide in the US seems to rest on this basic notion. Many political issues in the US are really debates about resources that no-one seems prepared to engage with - the US healthcare debate ought to be a debate about why Americans spend such incredible sums on medicine, but is instead primarily a debate about what kind of accounting we use to pay those incredible sums. The idea of what it means to be American is obsolete. The sprawling suburb, the hour-long commute, the SUV, the McMansion, all artifacts of an empire in terminal decline. American citizens simply cannot consume such vast resources if they do not have the productivity to match. I see every reason why Chinese and Indian productivity will continue to rise, but little reason why American productivity would suddenly rally. The American people are left with an obvious choice - produce more or consume less.
- allenp 16y agoI don't really see why the rate of productivity should matter as much as the absolute value of productivity in regards to distribution of wealth. I agree the American suburban lifestyle is and will continue to decline as it just simply is not sustainable. These will be the new ghettos as more and more poor are pushed out of the cities into the now decaying suburbs. As to why American productivity would rally, I can only imagine vast advances from nano and bio-tech and machines that build other machines.
- jordan0day 16y agoAs long as it's the rich who have the money to pay for increasingly expensive resources like gas, what's their motivation for moving away from the suburbs?
- known 16y agoFree market economy in globalization == Race to the bottom
- DanielBMarkham 16y agoIf most Americans are no longer needed by the American rich, then perhaps the United States should consider a policy adopted by the aristocracies and oligarchies of many countries with surplus populations in the past: the promotion of emigration. The rich might consent to a one-time tax to bribe middle-class and working-class Americans into departing the U.S. for other lands, and bribing foreign countries to accept them, in order to be alleviated from a high tax burden in the long run. This is an amazing bit of backwards reasoning. The rich, who don't need the rest of us, will pay us to leave? In what kind of sense, even if the author is correct on all other counts, would this work? Why pay a thousand people to leave when you can just leave yourself? I liked this article because it spotted a lot of trends, but to me it looked at them all backwards. The rich have a lot more and are a very small minority that no longer depend on us. But heck, that was true 100 years ago. I'm not aware of any rich people that stayed in the United States because of the military or the market here. Yes, if you go back to the robber barons they needed to be near the workforce, but that's assuming that we have two states, robber barron and the currently rich. The word "rich" covers a helluva lot more ground than that. In my opinion, the wheels are coming off the wagon, for whatever reasons. This means that everybody will pull out their pet theories and causes and try to nail them on to reality, as this author is doing. The upside to this is that it doesn't matter which theory you choose: things aren't working and folks are looking for people to blame for it. Emigration might be a wise choice not for the poor and unwashed, but for most people, middle-class and rich alike, leaving the truly poor helpless people the only ones left. (along with the folks who prey on them, which, like the robber barons, can't be very far from their "market") I consulted with a startup 8 years ago that was doing just this: finding and disseminating information about cheap foreign locations for middle-class Americans to retire to. Looks like this is going to be a really good growth industry.
- bhousel 16y agoThis is an amazing bit of backwards reasoning. The rich, who don't need the rest of us, will pay us to leave? In what kind of sense, even if the author is correct on all other counts, would this work? Why pay a thousand people to leave when you can just leave yourself? The article seemed an obvious satire to me. You read it literally?
- giardini 16y agoSatire? Anyone remember the term "satire"? Please remain calm and use your dictionary. The author is making fun of a particular type of individual.
- deleted 16y ago[deleted]
- daniel-cussen 16y agoThere are so many reasons manufacturing in US is declining. It used to be the US was one of the few places you could set up a factory without it getting bombed or confiscated. It then had a monopoly on manufacturing and the rest of the world competed to produce commodities to trade for the finished products. With protracted peacetime came establishment of factories elsewhere and competition for manufacturing without a corresponding increase in commodity production. So now an American worker has to compete with a Chinese or Hindu worker, and if he's more expensive, he'll lose and the Asian will win. An American worker is more expensive than his Chinese counterpart at any exchange rate because of the prices of commodities they consume. A worker can't work without a car in most US cities, but in China he sure can. Beside commutes, housing is expensive (for whatever reasons). Then you have healthcare costs that are globally superlative and that the employer has to pay for, and taxes that are by no means small. Then you have the legal system, which themselves are a huge burden. Court awards and consequently settlements are very large by global standards. This also costs a business more than money; it costs it time and requires the bureaucratic complexity to deal effectively with liability. Then there's Sarbanes-Oxley and lobbying. On top of that there's IP law: if part of a product is patented in the US, that product can't be imported by foreign companies, but it can be sold outside the country. But an American company can't sell it in US or export it. And on and on. Under such conditions, who would want to build a factory here?
- fredBuddemeyer 16y agono but marxism is. the author's classification of people into these sets of workers and owners is a product of his imagination; pension funds made them the same people a long time ago to say nothing of entrepreneurs, professionals and folks like us that old karl couldn't have imagined. this thinking shows even more disregard for people than the author's facetious proposals.
- wazoox 16y ago> They can flourish even if the U.S. declines, as long as they can tap into growth in other regions of the world. Except that other regions of the world may not accept them so easily... Who need rich parasites?
- fredBuddemeyer 16y agono but marxism is
- muhfuhkuh 16y agoLet's get down to brass tacks. It's not the American people who are obsolete, it's the notion that corporations are something more significant to us than a place to temporarily lay down our investment bet for a brief while. Anything more is asking for heartbreak. Just because the government personifies a corporation doesn't mean we have to as individuals. Hows about this for a radical idea: We don't NEED our corporations, or our rich. No, seriously, we don't. "But who will make our products," you ask. Well, who does that now? Not us, not anymore. Does it matter? Consumer products will always be relatively easily manufactured, and why would we focus on making easy stuff? Look at the Germans: They have trade surpluses not because they make the latest Christmas toy craze or plates and sporks, but because they make precision tools, gauges, and other engineered products for industry. Their concept of manufacturing, called Mittelstand, sees small and mid-size companies -- over 90% of German companies are that size and they employ over 70% of the German population -- doing the lion's share of manufacturing, much of it for export to other countries. Germans are, as a people, self-reliant to the detriment of their corporations; we in the US are the opposite. But, if this article is true in any measure, that will have to change. It's unfortunate that Obama and others in our government don't place enough emphasis on things like YC and the SBA. We need _everyone else_ to see that there is an alternative to becoming a 99er and/or relying on either Big Government or Big Corporate (BG/C) to save us. BG/C will always stand together, whether through regulatory capture, (de)regulation that only serves to curtail competition from upstarts, or blatant TBTF corporate welfare. I know, Germans and Chinese small business ownership is a very cultural thing, and I can't pretend that it takes a certain mentality to start and run a business. But, that's the excitement of risk. I think everyone can agree that we're at a really low point in American morale. That "can do" spirit that used to pervade our psyche is replaced with rage and finger-pointing. What we need to do is learn to bootstrap again. I want people who have been or know someone who has been affected by this corporate "pivot" away from America to ask them what do they have to lose by starting their own business. The hustle atmosphere is what causes job growth in the first place. If ideas are too expensive to bootstrap, join or start an incubator. I see life science and biotech incubators in every r&d park in every major city in the US, more so than other technologies. Why? Pooling of resources, and volume discounts on lab and materials. It's all in how you look at things: It may be a lot harder to start a business than to work for a corporation, but what if it's impossible to find a job at one now? What is the possible alternative? Becoming a 99er, then switiching straight over to welfare? Is that really what people are resigning themselves to when the corporations won't hire them? Trite but apropos movie quote conclusion? "It's only after we've lost everything that we're free to do anything."
- known 16y agoRefugees viz Albert Einstein & H1Bs viz Linus Torvalds contributed to the prosperity of America. Talented Americans should now migrate and contribute to the rest of the world.
- known 16y agoAmerican people are obsolete only when American rich are willing to pay the $200 trillion debt. http://goo.gl/3fleL http://goo.gl/3fleL
- known 16y agoAmerican people and not obsolete. I think Adam Smith's http://en.wikipedia.org/wiki/Profit_motive http://en.wikipedia.org/wiki/Profit_motive concept is obsolete.