RE: A hole in the theory of the global economy.

RE: A hole in the theory of the global economy. (Full Version)

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meatcleaver -> RE: A hole in the theory of the global economy. (10/11/2007 4:31:40 AM)
quote: ORIGINAL: Politesub53 Sam, i think the scandal about the lead in toys is as much the fault of Mattel as of the Chinese. Mattel wanted cheap labour and took their eye off quality control, i am just glad that they found out before the busy Christmas period. I heard on the radio that Mattel admitted that the problem with the toys recalled were design faults and there was no fault with the Chinese manufacturers.

meatcleaver -> RE: A hole in the theory of the global economy. (10/11/2007 4:41:02 AM)
quote: ORIGINAL: samboct I'm all for it. How about an environmental tax- levied unless the companies in China can prove every step in the supply chain isn't contributing to lower air quality in the US? The flaw in this is that the USA is the biggest polluting nation in the world. And yes, carbon dioxide is a pollutant. Apart from that, the USA manages to beat China hands down with only a fraction of the population.

NeedToUseYou -> RE: A hole in the theory of the global economy. (10/11/2007 5:11:00 AM)
My view is the US is pretty well fucked in the long term. The problem with the globalization mantra, that we all rise together is that it is total bullshit. While in theory it would be possible given infinite resources and space. However, until we start mining asteroids, or/and invent a nearly free energy source, all the money really represents is the ability to buy raw materials and "intellectual property". The "educated" can be duplicated as in engineers can be trained, so ideas are an infinite resource, know-how is an infinite resource. So, our "ideas" will surely be devalued by the educated in other countries over time, Japan is a pretty good example of how short a road to totally devaluing our "idea" engine can be. So, china will not need our innovation, patents, etc... forever. What then? Financial industries, fall in the same category, it merely requires a cheap system, and educated participants. So, what is floating our boat, are the most highly reproducable resources(intellectual property, and financial services). What is keeping us afloat less and less, is the manufacturing base, and raw material production. While we have lots of raw materials, we don't have nearly enough of the one raw material that matters, oil. So, we can't keep the economy afloat in that regard without seizing more of it. Manufacturing infrastructure, would take decades to turn around, and as long as capital can gain a greater return investing outside the borders(in countries with near slave labor, and very detrimental environmental policies), there really is little reason for that to occur on the broad scale. My view is the only thing that can save the US, and most western countries in the long run, is a greatly reduced energy costs, and/or if india or china get into some kind of prolonged military build up or war. As Military spending unless used to secure resources, is just money flushed down the toilet. It would help if we stopped flusing a trillion a year or so, down the drain on foreign military except in those countries that have oil.(speaking in a purely financial viewpoint not a moral stance). Basicly, the only long term win strategy for the US, is either grab the resources, that we don't have thus not have a net loss on that end of the trade spectrum. Or achieve a revolutionary leap in energy production. As Energy costs are directly related to profitablity in recycling. If energy was nearly free, then our dependance on new resources would be dramaticly reduced via not having to mine energy, or pump energy, or pump plastic, it would actually be profitable without government subsidies to recycle it. Currently it is worse in terms of energy use and cost to recycle most things. (Yeah, i know we don't pump plasic, but oil is mainly used for fuel, chemical production and plastic). That is really the only way I can see how the world will "rise together" cheap unlimited energy. Otherwise, there is a finite amount of resources that money ultimately is viaing for so it can take those raw materials and produce something worth more raw materials than one started with, and while the money itself can be created into infinity its worth will always be pegged to the supply. Cheering globalization, and increased production world wide, and in developing nations. Ironicly, is cheering for resource depletion. The only out to where everyone could win is vastly reduced energy costs. That's it. Without that, without a doubt either they will lose or we will. So, closed markets make some amount of sense, in that regard. However, it won't happen, IMO, until it becomes obvious that demand for materials is outstripping supply, then lock down will inevitably occur. We won't be treating raw materials like an infinite pool to draw from, and under such a scenario labor cost become less a factor, thus less reason to export labor. Globalization, in its current form really boils down to a raise to see who can utilize resources the fastest, and make the most money off of it. Little value is put on conservation as presently resources are so cheap and the markup on finished product so great comparative, that it would be a waste of time. While great in theory, it relies on the presently flawed premise that resources will be available. So, is globalization good or bad. Well, if viewing it from an immediate cost reduction perspective, obviously its good. If one is looking at it from a sustainable standpoint, it's the worst thing to happen. As production increases, consumption increases, resource depletion increases. Leading to bad stuff we have no solution for at present. LOL. Hrmmm, that really had nothing to do with the OP I guess. Oh well, I started ranting. hehe.

LadyEllen -> RE: A hole in the theory of the global economy. (10/11/2007 5:11:28 AM)
In my view, it is the duty of governments to protect their people and to provide an environment whereby the greatest possible prosperity and well being is made possible for the people, by way of the people's own efforts within that framework. And to organise a tax system which takes a fair proportion of the prosperity produced to perpetuate and promote the protection of the people and the happy environment whereby prosperity and well being is made attainable for all. The problem being however, that the people, charged with creating their own prosperity will seek out the lowest possible cost for source of supply whilst seeking to sell their production - whether this is services or goods, at the highest possible price. Thus we source goods from low wage economies to sell here, and we source services from low wage economies (or the people from low wage economies themselves) to sell here, where the price of such goods and services is comparatively high, we can provide our import at a competitive price and yield higher profits than if we sourced locally. Why this is a problem is that the true cost of such strategies to the prosperity and well being of the people, by way of the loss of jobs and accompanying economic activity in our countries alongside the cost of providing social benefits to those without jobs, makes the imports far costlier than if we had sourced locally. For the individual businesses, it makes sense to import - but for the people as a whole it does not. There has also been much made of the value of competition in an open market - this I agree with. However, this is contingent on there being a fairly even playing field on which to compete - and this is absent, because we are importing goods and services which are not competing on the basis of higher quality or greater utility or amazing innovation, but goods and services which compete on one basis only, and that is cost. Where we trade with other nations with similar costings, we find that the net effect is mutually beneficial - the example of Canada and the US was given; each side benefits similarly. Where we trade with other nations with significantly lower costings - China for example, the benefit goes only one way and that is to China, who are receiving huge revenues from what we import, whilst we as a nation receive little or nothing in return but the loss of jobs and the accompanying costs that brings. Working down in the ports from time to time one sees this in action - container ships coming in from China full of laden containers, but going back with nothing in them but air because we cannot sell at our costings in China. In the meantime of course, those importing the low cost goods are becoming rich, whilst the rest are becoming poor. To allow this to occur, indeed to have promoted it, is a failure of government in its duties to the people. Which brings us back to the perpetual cry on these boards that the government is not at all interested in the interests of the people, but interested in the interests of those who provide electoral funding and perhaps other fringe benefits in return for appropriate policies. E

thompsonx -> RE: A hole in the theory of the global economy. (10/11/2007 5:36:50 AM)
quote: ORIGINAL: Politesub53 Thompson, i dont see how you can equate slavery with cheap labour, one is forced and one is not. I agree the people involved are still being used, although the pittance they recieve is better than they would otherwise have. In some countries working for foreign firms is the difference between eating and not eating. Politesub: You seem to be arguing both sides of the point at the same time. First you say that hunger is not force then you imply that it is and that as such, starving to death slowly is better than starving to death quickly. The argument that everyone wants the lowest price is fatuous. Everyone wants premium quality...what they can afford causes them to accept less than premium quality. The argument for slavery was that no one would buy cotton if the slave owners had to pay free labor to produce it. Well now we have free labor producing cotton and lo and behold people buy it. thompson

meatcleaver -> RE: A hole in the theory of the global economy. (10/11/2007 5:44:55 AM)
quote: ORIGINAL: NeedToUseYou Cheering globalization, and increased production world wide, and in developing nations. Ironicly, is cheering for resource depletion. We have been depleting resources at a remarkable rate without the help of developing nations for a long time now. This is the achilles heel of captialism. For everyone in the world to have the living standard of the average American, the human race needs five planet earths not just the one we have. The idea that with our current primitive technology that the world economy can grow and grow without reaching a crisis point is nonsense. We have already dumped on our children and grandchildren so many problems because of the blind greed of the last couple of generations. We really do need to conserve energy, use far less and invest in renewables, that is not impossible. However, the people with the power only think of themselves and only today, which means that unless we all wake up we we all be up to the neck in the proverbiable brown stuff. Let's face it, the latest TV doesn't improve the programmes on TV so why waste resources buying one. There are so many luxuries we can do without and so save resources without reducing the quality of life. If you buy good quality furniture, you have it for a life time and like a good wine, it improves with age. New and more isn't always better.

seeksfemslave -> RE: A hole in the theory of the global economy. (10/11/2007 6:00:50 AM)
As for this argument about lead in toys: well toy soldiers for example used to be made of lead. It didnt do a great deal of harm even when little Tommy swallowed the general. The only certain outcome was a sore arse at some point in the cycle. Water pipes where I live are actually made of lead and we are all living longer so it cant have caused too many probs. Another crisis concoted by the 'elf&safety division of the PC brigade ? Has anybody mentioned miltary expenditure being a major factor in Western decline. Some posts are so long my eyes glaze over. If Prince William had got a job as an apprentice plumber instead of an officer and gentlemen it would indicate a much healthier society. IMO.

Griswold -> RE: A hole in the theory of the global economy. (10/11/2007 6:18:20 AM)
quote: ORIGINAL: seeksfemslave A poster in this thread, who made some good economic points said. I paraphrase..... let others manufacture the simple things eg TVs while we do high value added things like software... Clearly poster you have no idea how technically advanced is a TV system. Transmission/Reception. Excellent point, and I cautioned myself when I put that item in my argument, however, TV's, radios and computers became commodities when we showed the Chinese how to make them. At that point the technology no longer mattered in the manufacturing process....only how many they wanted to make for less than we did. And apparently their numbers have constently been high enough and cheap enough to alleviate our desire to make TV's. The original point, as I see it was Popeye's incredulity at the fact that others alluded to the fact that we aren't educated enough to stay in the world market competitively. The fact that countries who only 20 years ago manufactured products that we shuddered to purchase for lack of quality in every respect, are today entrenched in markets we once owned, that are in fact surrounded by technology, TV's and computers being just one example. If we don't start teaching our children well, if we don't insist on our kids getting a vastly superior education, if we don't focus on creating a generation of superstars in physics and mathematics...we won't even be making high value products anymore. It's fixable, but if we refuse to listen to arguments that clearly prove Americans are losing jobs because they're not educated enough, then I think it's just going to become a self fullfilling prophecy and the work will continue to go to those who believe that education is a good investment.

pahunkboy -> RE: A hole in the theory of the global economy. (10/11/2007 6:37:21 AM)
the world is an ash tray!

Politesub53 -> RE: A hole in the theory of the global economy. (10/11/2007 8:15:19 AM)
quote: ORIGINAL: thompsonx Politesub: You seem to be arguing both sides of the point at the same time. First you say that hunger is not force then you imply that it is and that as such, starving to death slowly is better than starving to death quickly. The argument that everyone wants the lowest price is fatuous. Everyone wants premium quality...what they can afford causes them to accept less than premium quality. The argument for slavery was that no one would buy cotton if the slave owners had to pay free labor to produce it. Well now we have free labor producing cotton and lo and behold people buy it. thompson As per usual you are deciding what i meant. I didnt imply anything, slavery and cheap labour are not the same, regardless of what you want to think. As for the the argument on cost, even at the top end of the market people want to pay as little as possible. No doubt you will reply i am wrong, so type away.

pahunkboy -> RE: A hole in the theory of the global economy. (10/11/2007 8:24:54 AM)
Mattle is being sued by stockholders. for KNOWING about the defects!

popeye1250 -> RE: A hole in the theory of the global economy. (10/11/2007 10:11:21 AM)
And there's a lot of other problems with this whole situation too. Look at the currently beseiged toymaker Mattel for instance. They don't manufacture anything in the U.S. I don't even know if their headquarters is in the U.S. anymore or maybe they have a mail drop somewhere. How can they still be considered an "American company?" Also, if companies owe "no allegience" to the U.S. and their "only responsibility" is to their bottom line then how can they expect any "allegience" from the citizens or our government? If China were to overun Taiwan (Formosa) and grab Mattel's factories there why should I, as an American citizen or soldier take any action to help the Mattel Corp? I would have no interest in doing so. I have a hard time with the saw that companies who got their start in the U.S. owe no allegience to the U.S. but individuals do. Since when did businesses get special dispensation? Funny, during WW2 all businesses were extremely patriotic! So, if I were in the military the president would expect me to go to war for a toy company that I have no interest in and that I don't own stock in? And that for all intents and purposes isn't even an "American" company anymore? I keep hearing that, "the U.S. has "interests" in S. Korea." I don't have any interests in S. Korea, do you? Where is my interest in (their) bottom line? "He died for Mattel." I don't think so.

samboct -> RE: A hole in the theory of the global economy. (10/11/2007 11:45:14 AM)
"The reason our products are as good as they are (in the knowledge based products) is because we know we have to be better, smarter, faster...thanks to competition. Those products which don't require much brain power (Tupperware, garbage sacks, TV's, etc.) have long ago been ceded to foriegn manufacturers, and it's a good thing. The money we save not spending ridiculous amounts on things others can produce for less allows us to put our money and effort into things that produce a higher return." "All true, but the minute you gate yourself off from other manufacturers of similar products, you stifle innovation. East Germany was a perfect labratory for this experiment. Both East and West Germany were essentially identical in values and productivity at one point (because they were in fact one place)....and then 50 years of a walled off, protected economy proved the fallibility of a walled society." Nonsense-China gets away with manufacturing these goods cheaper for several reasons: 1) no payments for IP (if you steal the technology, it costs less than doing it yourself) 2) No environmental protection- Chinese workers are going to be dropping dead at earlier ages- things like black lung, tuberculosis, and extremely elevated cancer rates. 3) An artificial quota system for "primary industry" such as energy production which amounts to controlling an economy for export. Look at the example of Romania- when under Communist control- made the world bank ecstatic because they were paying down their debt, but they cut consumption at home to the point where their people were starving. Remember all those malnourished kids that were coming out of these orphanages in the 90s? Did that make the Romanians a powerhouse when the system collapsed- I don't think so... China is far from a free society- or have you forgotten? 4) China's mfg is inefficient- it generally takes them an additional 60% in energy to produce the same goods as Western countries. Your example of Eastern Germany is well taken- remember that Communist countries used to claim that they had output greater than the West in "primary" economic goods such as power, steel, concrete, etc? Then when the wall came down, and West Germany said that we'll give you Western marks at parity with Eastern marks- how screwed the Westies were because the East German economy was in a terrible mess? Accurate info out of China is nearly impossible to come by- and we know damn well that in terms of population growth- where all regions magically made their quotas, they were lying through their teeth. Our companies are effectively trying to compete with state owned enterprises with tight control over the labor used-highly repressive (remember Tianamen Square) and underpaid. Then, we are told that "we should develope foreign markets to buy our goods and services." Oh? And why is that? "I believe I already explained that, and it doesn't take a rocket scientist to understand that when you have more people capable of purchasing a product, sales increase." Increasing the market of well fed, well educated consumers increases the market for US goods. A labor force composed of limited literacy and education, paid close to starvation wages, does nothing for US trade. Hence trade with Western countries works well for the US and those countries- trade with China does not. We've got plenty of experimental evidence to back this up-but the idea of free trade with everybody is a sick joke on us. "Absolutely...now you're getting it. Except for one thing. The Japanese already opened up a store there 20 years ago...and their products are cheaper, get better gas mileage, etc., so there's really no point. However, those folks do need software, which those who studied and went to school, now have the skill sets to make and manufacture...and at highly profitable margins." Interesting theory- wish it were true- but it's unfortunately not backed up by experimental evidence. Retraining workers in this country hasn't worked-the retrained people generally earn less money 5 years later (think that's 2/3rds of them). Software writing is now being offshored to India quite rapidly, the US programmer market is not wonderful. Companies in the San Jose area offering salaries of $60k- well, with housing starting at $800k, that really doesn't get you very far. US firms seem to be very good at paying large salaries to executives these days- but their employees are getting hammered. The lesson of Henry Ford that you pointed out hasn't been learned and applied- not anymore. I wish it were, but the evidence strongly suggests that it hasn't. "All of which flows back to our shores. If I had a choice to be selling the world our software and airplanes, or our Tonka Trucks and our zip lock bags and frisbees...I'd choose the former every time." Again- the rest of the world is making inroads into the aviation market. Microsoft is hiring engineers from China and India and opening up research centers in China- bellyaching they can't find smart US folks. True- Microsoft doesn't pay well- their employees did well when the stock was climbing, but not so fast anymore. The idea that software will continue to be dominated by US firms is extremely myopic. And why shouldn't we be selling the world Tonka trucks and ziploc bags? A Tonka truck was a well made toy, that could last through a number of kids. Compare that with the crap being sold today. Ziploc bags used a very sophisticated polymer (IIRC) that took some good R + D. Neither China nor India have spent the money needed to do really good basic R +D. You're living in a dreamland if you think that kind of research grows on trees. Simply put- its not getting done anywhere. Since this type of R +D is the "seed corn" of economic growth- I find this extremely troubling. Your viewpoint assumes that economic progress is a given. I make no such assumption- recall the dark ages. "Everyone is going to read the statistics the way that best suits their argument, but the fact is, we're all driving cars today that had they been manufactured 20 years ago, would easily cost double what we currently pay, same with computers. Even when the product doesn't go down in price, it's capacity has generally increased over the last few decades." "Houses that used to cost $200,000.00 now cost $500,000.00, but we're not paying 10% interest (200k payment = $1,700.00 a month) anymore either, we're paying 6% (500k payment approx. $2,600.00 a month)...and if you're like 99.9999% of the population, your income has surely risen over those same last 20 years...at minimum, doubled and more than likely much more, even if you didn't get a college degree. In short, that $500,000.00 house is probably costing you less per month than the $200,000.00 house 20 years ago in real dollars. " (And by the way...if it's not, your problem isn't with the govt. screwing you, it's more likely with you). Nonsenes- housing prices have gone up astronomically- ask the Japanese if the real estate bubble in the 80s helped or hurt their economy. To Lady E's point of the distinction between wealth and money- our money may have increased- but our wealth certainly hasn't. This is why from having one wage earner (blue collar steel worker or auto worker) be able to afford a house, college education, and a certain amount of leisure activities, we now need two income earners, and the leisure activities of the 50-70s such as boating have been replaced with computer games and watching giant screen TVs. All you have to do is look at the wage concessions being wrung from US auto workers to realize that Henry Ford's lessons have been thrown into the garbage heap of history. Toyota claims that they can build cars in this country cheaper than US firms- and they're right- because they pay their labor about 1/3rd less. This is progress? Build a better car AND pay your people better than the competition- that's progress. This is regression. I haven't heard the radio stories about Mattel- nor have I heard their apology- but I smell a rat- a large Chinese rat. If those toys were being made in the US- there wouldn't be lead processes nearby. Lead based pigments- generally lead acetate, is cheaper than titanium dioxide (you need less of it), but TiO2 is safe, and lead certainly isn't. Furthermore, lead acetate is sweet, which gives kids an incentive to eat the stuff. Is Mattel going to spec a lead based paint on their toys? I don't think so- but Chinese mfg have been well known for substitutions. This sounds like Mattel being held for hostage- you want us to mfg toys- you take the rap, not China. Note- this is pure speculation on my part- but should be yet another nail in the coffin of any US mfg that want to move to China. That our state department is sitting by with it's thumb firmly inserted in its posterior speaks volumes. PoliteSub- I do agree that Mattel needed better quality control- but then it's hard to justify moving to China. Overall, I hope that Mattel gets hammered- maybe they can serve as a horrible warning (nod to MsKatHouston). In terms of CO2 production- China is bringing on a coal fired plant a week (I think in the 20 megawatt range). Basically in the past year, that's the entire CO2 output of Britain. They've already overtaken the US in terms of CO2 emission and far outweigh the US in particulates based on environmental analyses (look at the air in LA) The US could readily drop its CO2 output- its economy is not that tightly connected to energy production in contrast to what the imbecile in the White House babbles about (I hesitate to call what George W. Bush does "thinking".) most of the increase in energy usage in this country is tied to SUVs and larger residential homes. France and Japan have already shown that energy consumption and GNP are independent, the US really isn't that far behind technologically, but the political will is lacking. In contrast, both China and India have GNPs which ARE tightly coupled to energy production, and neither country is particular efficient in its energy usage. Sam

NorthernGent -> RE: A hole in the theory of the global economy. (10/11/2007 12:59:46 PM)
quote: ORIGINAL: Griswold quote: ORIGINAL: seeksfemslave A poster in this thread, who made some good economic points said. I paraphrase..... let others manufacture the simple things eg TVs while we do high value added things like software... Clearly poster you have no idea how technically advanced is a TV system. Transmission/Reception. Excellent point, I'm not convinced it's an excellent point. I don't know who posted that, but maybe he/she meant that televisions are yesteryear's products; concentrate on the high value adding products over the horizon, i.e. in the next 10/20 years, to achieve a competitive advantage: strategy is in the future, not the past.

pahunkboy -> RE: A hole in the theory of the global economy. (10/11/2007 1:04:37 PM)
quote: ORIGINAL: popeye1250 And there's a lot of other problems with this whole situation too. Look at the currently beseiged toymaker Mattel for instance. They don't manufacture anything in the U.S. I don't even know if their headquarters is in the U.S. anymore or maybe they have a mail drop somewhere. How can they still be considered an "American company?" Also, if companies owe "no allegience" to the U.S. and their "only responsibility" is to their bottom line then how can they expect any "allegience" from the citizens or our government? If China were to overun Taiwan (Formosa) and grab Mattel's factories there why should I, as an American citizen or soldier take any action to help the Mattel Corp? I would have no interest in doing so. I have a hard time with the saw that companies who got their start in the U.S. owe no allegience to the U.S. but individuals do. Since when did businesses get special dispensation? Funny, during WW2 all businesses were extremely patriotic! So, if I were in the military the president would expect me to go to war for a toy company that I have no interest in and that I don't own stock in? And that for all intents and purposes isn't even an "American" company anymore? I keep hearing that, "the U.S. has "interests" in S. Korea." I don't have any interests in S. Korea, do you? Where is my interest in (their) bottom line? "He died for Mattel." I don't think so. Bravo! Yup. Another great post! I love your logic. the next question; how does one remedy this? or how does the individual, in a world gone mad, cope, and live life unscaved?

pahunkboy -> RE: A hole in the theory of the global economy. (10/11/2007 1:07:46 PM)
quote: ORIGINAL: LadyEllen In my view, it is the duty of governments to protect their people and to provide an environment whereby the greatest possible prosperity and well being is made possible for the people, by way of the people's own efforts within that framework. <- agreed! And to organise a tax system which takes a fair proportion of the prosperity produced to perpetuate and promote the protection of the people and the happy environment whereby prosperity and well being is made attainable for all. <-- agreed! Bravo! Another stunning post by Lady E. So one would ask; how does the peon achieve this? or make anytype of dent in this new world order. ?

Griswold -> RE: A hole in the theory of the global economy. (10/11/2007 6:14:00 PM)
Sam, all exceptional points (and I suspect you meant "experiential" as opposed to "experimental"), but since we can't stop China from cranking up polluting machines (that we aren't allowed to manufacture...using), since we can't apparently stop them from stealing our ideas and patented processes, and since even after all that, Americans happily purchase these products with nothing more than a drop of their checkbooks...the obvious answer, and the argument that has been made thus far is... We have to outsmart them. We have to be smarter than our tools...and their clear lack of capitalistic integrity. Almost every one of your points was well put...but it doesn't change the fact; until they stop doing those things, since our playing by their rules isn't allowed in this country, we have to step things up...and that requires better skill sets and vastly superior education than is currently being offered (more importantly, taken advantage of) in this country. You don't stop a bully by crying to your parents or the Principal "but he's stronger than me....he's bigger than me...it's not fair".... (You learn Karate).

samboct -> RE: A hole in the theory of the global economy. (10/11/2007 7:07:00 PM)
Hi Griswold OK- now we're on the same page at least-we both agree on the problem- we agree that changing China's behavior isn't going to happen with "pretty please with sugar on top", so now we have to figure out what to do-and it's effectively what do we do in this country. If we have to innovate, and continue to let China "manufacture" for us- stick a fork in us, we're done. We'll never recoup our R + D costs. Hence, we have to make it economically unattractive to manufacture in China. I'm not so sure that's so tough any more. ISO 9001 is a lot more paperwork, but we really can track a supply chain if there's the will. I still like the idea of a pollution tax- manufacture wherever you want, but if the process involves power production in China that's not off grid and non-carbon emitting- you get hit with a tax. Make it something like a dime a pound- maybe stiffer. That's to pay for the US citizens whose health is being damaged by Chinese power plants. Put it on anything that says made in China. Any US built products that contain Chinese parts get hit with it too, unless the US mfg can show what percentage of the product is mfg'd in China and thus prorate the tax. Expand the testing facilities of the Consumer Product Safety Commission. I'm tired of the rant that our gov't doesn't work- we have to strangle it. It's pretty easy to do random testing of lots of goods- and if stuff fails, like lead in Mattel's toys- come up with some 7 figure fines. This would also provide some nice jobs for the folks who used to be in manufacture- it's a pretty similar skill set. I don't care if the testing gets farmed out to private companies- but it's a business. Actually that may not be necessary- our goddamn legal system is pretty good at making companies tow the line in terms of product liability-most US based companies have figured out that poisoning their customers causes them to go belly up these days. In short- while I'll always applaud the idea of spurring innovation- I think we have to make the consumer pay the true cost of the crap from China. And if Wal Mart goes belly up- I won't shed a tear. We do small businesses better in this country anyhow. About the CO2 issue- that we're not in a position to dictate terms to China in terms of pollution- and that China will clobber us if we don't continue to use coal and try to use "higher priced energy from alternative sources". This is a load of pure, fully refined, BS. That we think that we need coal for the next 100 years is a political problem- and one that can be solved with smart engineering and political will- it's a lot easier than putting a man on the moon in less than a decade. Oil and coal replacement technology- (I hate the term "alternative energy" since it smacks of trying to convince people that oil and coal are the best things going.) should be high on the priority list of this country- and we should be looking at gearing up new industries. Assume that we figure out how to do solar, wind, biofuels etc. on a larger scale (along with energy storage) I'll lay very long odds that this technology will prove to be less expensive than coal/oil/natural gas within a decade- which means that China will either be adapting as well- and hopefully we'll be selling it to them, rather than the other way around, or China will be stuck with a legacy power plant system that is inefficient, impossible to amortize quickly, causes trading partners to levy pollution taxes, and leads to higher health care costs. Summary- a sole technical solution isn't possible. We need to change our economic system to reflect the cost of clean air, water, etc. on a global basis. If we do this- then there will be ready technological solutions which could spur growth in the US economy- and the rest of the world for that matter. (Denmark's been doing pretty good in this wind industry biz- the 800 lb gorilla is Vestas- about 8x the size of GE in terms of wind turbine production- and while I may grumble that the US lead the wind industry globally until the 90s, I'm happier buying stuff from Denmark than China.) Another part of the solution has to be in the laws surrounding corporate governance. Right now, the CEOs of US companies have too much power. The company is supposed to be a three legged stool- needing the approval of shareholders, employees, and neighbors. Well, CEOs have been abusing power, largely with the support of shareholders- but the neighbors and employees are getting creamed. This is again, a regulatory challenge- something here needs to change, but I'm damned if I know what. Sam

popeye1250 -> RE: A hole in the theory of the global economy. (10/11/2007 8:28:32 PM)
Well, I don't see why American companies that move their operations overseas should still expect access to "our" markets. There is such a thing called "ownership." That's real big in capitalism! The people who organised and signed all these "free trade" deals never consulted with the American People about them! They hired lobbyists from "K" street in D.C. and pressured "our" Congress to pass them. How can America "speak with one voice" if they cut out 299,950,000 people? Again, corruption.

meatcleaver -> RE: A hole in the theory of the global economy. (10/11/2007 10:50:44 PM)
quote: ORIGINAL: Griswold Sam, all exceptional points (and I suspect you meant "experiential" as opposed to "experimental"), but since we can't stop China from cranking up polluting machines (that we aren't allowed to manufacture...using), since we can't apparently stop them from stealing our ideas and patented processes, and since even after all that, Americans happily purchase these products with nothing more than a drop of their checkbooks...the obvious answer, and the argument that has been made thus far is... We have to outsmart them. We have to be smarter than our tools...and their clear lack of capitalistic integrity. Almost every one of your points was well put...but it doesn't change the fact; until they stop doing those things, *since our playing by their* rules isn't allowed in this country, we have to step things up...and that requires better skill sets and vastly superior education than is currently being offered (more importantly, taken advantage of) in this country. You don't stop a bully by crying to your parents** or the Principal "but he's stronger than me....he's bigger than me...it's not fair".... (You learn Karate). Stop being paranoid. China is doing nothing the west before it hasn't done. The thing Americans don't like about China is that their new importance is going to challenge the USA having all its own way and exploiting people around the world for their resources. Now China has created a market where countries with resources have a choice with who to deal. As for pollution, the west has been polluting the planet for 150 years without any concern for the people and wild life on this planet. To suddenly complain about China is laughable. The US still creates far more pollutants than China (twice as much CO2 with a fraction of the population) and that balance is changing because China by manufacturing products for the American market is polluting on the US's behalve and taking pollutants out of America's back yard. Plus per capita, China is no where near the big league of carbon polluters, if it wasn't for the polluting Aussies, Americans would be firmly in pole position. http://www.carbonplanet.com/home/country_emissions.php

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