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United States' brand has been damaged by our own doing. Specifically, the executives that paid off the politicians whose job was to ensure a level playing field

United States' brand has been damaged by our own doing. Specifically, the executives that paid off the politicians whose job was to ensure a level playing field in terms of trade. I am really convinced of the following, open for critiques: US Executives paid off politicians who then allowed trade deficit to pile up, we saw one of the biggest wealth transfers in the history of mankind - Some 30 trillion dollars of growth in China. Whatever was returned then went into American executives' who made sure that the median wages were as low as possible (paid off politicians again) which lead to massive wealth inequality here domestically. I think the people to blame are not executives. These are the wolves. The real assholes of America are the politicians, both left and right, who put their own interest before public's. Infrastructure, education, building the nation to be capable to compete was put aside, instead they promoted consumerism, big-fat American dream and laughed off to their multimillion dollar estates. You make a good point about rule of law - yes, it is in favor of big corp. Not for medium and small businesses. Italy has some ridiculous % of GDP coming from companies less than 50 employees. I forgot what that % is, but it is like 50% or more. This is what America could have been. A powerhouse of innovation, extremely motivated workforce, excellent education system and health system, virtually no poverty and infrastructure could be unlike any other nation. Living here in Silicon Valley, it feels like a crumbling place ridden with crime, feces and homeless people everywhere. Depressing.

refurb 6y ago
we saw one of the biggest wealth transfers in the history of mankind - Some 30 trillion dollars of growth in China. Economic growth is not the same as a wealth transfer. It's not a zero sum game.
- fermienrico 6y ago
  It is an opportunity cost though, no? That wealth could have resulted in domestic progress. If I am making Jeans in 1995 in America, but in 2000 I lay off workers, shut down cotton fields, dying processes, etc. and off shore it, while hiring 2 people instead of 50 - to manage suppliers, that indeed, unquestionably has resulted in loss of wealth. Can you explain how this would be a zero sum game? I know @naval keeps tooting that and it makes sense to me in macroeconomically, but I can't convince myself - I think of a closed thermodynamic system with system energy = work done + heat transfer out. That's how I think of the economic systems too when it comes to microeconomics.
  - refurb 6y ago
    My comment was more that it's not a zero sum game and that a significant part of China's growth was not at the expense of the US (but part of it obviously was). By offshoring the manufacturing of jeans, American jobs were lost, correct. But presumably the cost of manufacturing was lowered which opened up new markets (can charge less and still make a profit) and those profits flowed back into the US. And at the same time, American consumers benefited by lower cost jeans (whether price decrease or a slowing of price increases). The Chinese benefited because they were get a piece of that overall value chain - the manufacturing part.
    - fermienrico 6y ago
      > those profits flowed back into the US We are on the same page then - those profits do flow back to the US, but as huge pays for CEOs, executives and the upper echelons of the company. This was the original premise of my argument, and you're right - it is not a zero sum game strictly speaking. We haven't done enough to make sure the middleclass wages rise with the increased economic output. American wages have been stagnant [1] even though those companies have brought back wealth. If there were laws that oversee buy-backs, disproportional executive pays, corporate taxes, and other systems that ensure that profits do actually benefit the nation - we would have been in a better position. I am not a proponent of some kind of socialistic marxist society; Capitalism with strict laws and checks/balances is great. [1] https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/ https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us...
    - bduerst 6y ago
      Pretty Much - I seem to remember an Economist article talking about how the 2000's saw some of the largest gains for the middle class globally, with China's middle class being one of the contributing factors. But you're right, jobs are not zero sum either. They create new jobs, which in turn create other new jobs, and so forth. If they didn't, we'd all pretty much be unemployed except for farmers.
baby 6y ago
For the US to be stable and grow it needs the rest of the world to be stable and grow. Simple as.

refurb 6y ago

we saw one of the biggest wealth transfers in the history of mankind - Some 30 trillion dollars of growth in China. Economic growth is not the same as a wealth transfer. It's not a zero sum game.

fermienrico 6y ago
It is an opportunity cost though, no? That wealth could have resulted in domestic progress. If I am making Jeans in 1995 in America, but in 2000 I lay off workers, shut down cotton fields, dying processes, etc. and off shore it, while hiring 2 people instead of 50 - to manage suppliers, that indeed, unquestionably has resulted in loss of wealth. Can you explain how this would be a zero sum game? I know @naval keeps tooting that and it makes sense to me in macroeconomically, but I can't convince myself - I think of a closed thermodynamic system with system energy = work done + heat transfer out. That's how I think of the economic systems too when it comes to microeconomics.
- refurb 6y ago
  My comment was more that it's not a zero sum game and that a significant part of China's growth was not at the expense of the US (but part of it obviously was). By offshoring the manufacturing of jeans, American jobs were lost, correct. But presumably the cost of manufacturing was lowered which opened up new markets (can charge less and still make a profit) and those profits flowed back into the US. And at the same time, American consumers benefited by lower cost jeans (whether price decrease or a slowing of price increases). The Chinese benefited because they were get a piece of that overall value chain - the manufacturing part.
  - fermienrico 6y ago
    > those profits flowed back into the US We are on the same page then - those profits do flow back to the US, but as huge pays for CEOs, executives and the upper echelons of the company. This was the original premise of my argument, and you're right - it is not a zero sum game strictly speaking. We haven't done enough to make sure the middleclass wages rise with the increased economic output. American wages have been stagnant [1] even though those companies have brought back wealth. If there were laws that oversee buy-backs, disproportional executive pays, corporate taxes, and other systems that ensure that profits do actually benefit the nation - we would have been in a better position. I am not a proponent of some kind of socialistic marxist society; Capitalism with strict laws and checks/balances is great. [1] https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/ https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us...
  - bduerst 6y ago
    Pretty Much - I seem to remember an Economist article talking about how the 2000's saw some of the largest gains for the middle class globally, with China's middle class being one of the contributing factors. But you're right, jobs are not zero sum either. They create new jobs, which in turn create other new jobs, and so forth. If they didn't, we'd all pretty much be unemployed except for farmers.

baby 6y ago

For the US to be stable and grow it needs the rest of the world to be stable and grow. Simple as.