In article , Old Nick says...

There has to be a mass market large enough to absorb Chinese
production. And that market has to be rich enough to pay for that
production. If all the jobs are going to China, who is going to buy
what they build if it isn't the Chinese? And how will the Chinese
buy them if their wages don't rise? And what does that do to the
comparative advantage of Chinese factories over US ones?

In the end they will have none. But it will sure bite hard in the
meantime. And in the end I believe we will all have a "standard of
living" somewhere in between. Quality of life? I shudder to think.

This is where the econonomics guys either do the sleight
of hand thing to distract, or say, 'trust us it will work out.'
My personal feeling is, they simply don't know. No clue.

That *one* issue (what happens to the US markets when the
US companies shift operations overseas - and not just
manufacturing, btw) is where the rubber meets the road.
Can the markets continue as they are now, if the outsourcing
causes massive US unemployment?

Secondly, unless that corporation is that evil of evils, a straight
out trader in companies and shares, the purpose of a corporation is
_not_ to earn value for its shareholders. The purpose of a corporation
is to carry out its job well.

Wrong wrong wrong. You would never make it in the 'evil
corporate boss' school. That is *exactly* the purported
reason for corporations to exist. To provide ROI. Not
any of the other touchy-feely crap. If they could provide
ROI to the shareholders by running little old ladies through
giant Waring blenders, they would do that. If they could
provide ROI by throwing orphans and widows out in the
streets in winter, they'd do *that*, too. This is the
fundamental tenent of capitalism, which is: if we can
boost the stock price somehow, even for a tiny bit, at
the expense of long term benefit, we *have* to do this,
or somebody else will, and eat our lunch.

They don't carry out jobs. They make money. There are
plenty of corporations that don't do any real work at
all and are wildly successful, because they keep the
investors happy and keep their stock price up.

If you could change any of the above points, even *one*
of them, then you would be halfway there to solving
the 'china' problem. Because those points, deep down
inside of it, are the cause of the 'china problem.'

Jim

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