Re:Andy Grove: How To Make An American Job Before It's Too Late
by _delirium on Friday July 02, 2010 @06:32PM
(#1482594)
The benefits are very short-term at the cost of long-term benefits, though. We get cheap products now, at the cost of losing our ability to produce them. There are wide ranges of products now that the U.S. no longer knows how to manufacture. Even if we wanted to build factories to produce stuff again, we no longer know how, unless China were willing to lend us experts. And there's an even bigger range of things that would take us 5-10 years to ramp up if we really needed to make them again.
Basically we traded owning our own production for renting production from overseas. Renting often has lower immediate costs but higher long-term costs (and less freedom).
From the trade, we in the USA get cheaper products and low-cost loans/investment.
We then enact counter-productive feel-good policies that make us less competitive:
- employment-depressing labor rules (ranging from minimum wages to complex and expensive mandates)
- corporate welfare (including bailouts)
- subsidies for politically-popular activities (like home ownership and acquisition of often-superfluous academic credentials)
These choices are not the fault of the Chinese. At worst, because our trade with the Chinese makes us wealthier, we can then afford to make bigger mistakes elsewhere before correcting course. We spend the surpluses from trade on our anti-competitive policy luxuries.
"Winning" won't require getting tough on the Chinese, but getting tough on ourselves.