On 9 Aug 2003 15:58:42 -0700, jim rozen wrote:
In article , Ed Huntress
says...

No, I didn't say we don't benefit from innovation. I said that relying on
innovation to compete with 80-cent/hr. wage rates is an artifact of the
past. It doesn't work as a general method for competing with low-wage
countries, now that our free-trade policies are having success in breaking
down the barriers for capital flow. A multinational will take that
innovation and implement it in the lowest-wage country that it can. That's
why, for example, Shanghai-GM now has one of the most advanced engine lines
in the world, which, starting next month, will be shipping complete engines
to Canada for installation in the 2004 Chevy Equinox SUV -- which then will
be shipped to the US. And so on.

Hmm. OK I'll bite here. If one follows this out to the
ultimate end, the implication is there will not be anyone
left in the US who can afford to buy a car, at some point
in the future. Because they're all unemployed, yes.

They'd only all be unemployed if you made the assumption
that they're all employed in manufacturing now. But that's
an unwarranted assumption. In fact, less than 8% of the
US workforce is employed in manufacturing now.

The US economy is not primarily a manufacturing economy,
and it hasn't been one for at least 50 years. Even then that
was just a blip caused by war time production requirements.
Over the course of the last century, the primary occupation
of the US work force has moved from agriculture to service
jobs, with a short period of domination by manufacturing
centered during and just after WWII.

Gary