A 2

Bill is right. Creating jobs means that we need to focus on labor intensive industries. Work that can be accomplished by automation will not require as much human capital.

Green technology may not create as many manufacturing jobs, but there will be jobs in installation and green engineering the current infrastructure. That however may not solve the malaise of current unemployment.

Silicon valley has several companies that do cutting edge research, but when it comes to manufacturing, they are forced (sometimes) to relocate overseas due to cost considerations. Apple designs great products but does not manufacture any of them. Foxconn does the work of manufacturing.

Taiwan was the same way with computer equipment. Today they have forged ahead and Lenovo is one example of that.

Which all leads to the question, how do we create employment for the masses?

- Spend more on education
- Protective policies for domestic industries plus higher tariffs on imports
- Develop grass roots business ventures that can create and sustain employment.

Legal Bill

Education for what subject? There are more honors students graduating from schools in India every year than we have students. What can we teach our people that other countries cannot also teach to their people? If we create an army of engineers, accountants and economists, they can create five armies.

IMHO, the real blame for the economic meltdown is the loss of manufacturing in this country, which caused people to "invent" new businesses and investments. Mortgage based securities and credit default swaps were created by business school graduates with nothing better to work on. They added no value at all. The products just pretended to free up money to use for more bad loans. It really is mind boggleing. Thousands of our highly educated workers doing nothing but loaning and re-loaning money to one another and and calling it work.

Protective policies? We are told that won't work, and it may now be too late to try to institute them. Maybe they can be instituted on new products, I just don't know.

Grass root business ventrues can be no more successful than their cost model. We cannot compete with off shore manufacturers that can pay for overseas shipping and still sell the product here for half the price.

It really does look bad for us. Maybe we can turn the entire country into Disney Land and just make money on foreign tourists who are interested in seeing America. Maybe we can militarize the entire country and become international guns for hire.

A 2

^ There has to be a way out. The future does indeed seem bleak, but the cost of doing nothing may mean a sure-fire bleak future.

Agriculture typically is a labor intensive task in most (developing) countries. Industrialization took away labor from agriculture but replaced labor with machines. Developing nations have the human resources for both agriculture and manufacturing, so you are right. They will always be competitive.

Sometimes I see the rationale behind people's decision to advocate "buy local", in that they want to encourage local businesses. But that has never really caught on. Maglite and WeatherTech are two companies that have strived to keep manufacturing within these states, but can all businesses afford to do that. If everyone did it, would they all be able to survive?

OTOH we have the issues of high costs of running a business. Tax breaks and incentives for businesses perhaps in an indirect manner may be of help. But what kind and will these really benefit a business much more than the reduced cost of manufacturing overseas.

I see health care as a huge expense. It is a drain for businesses as well as people with constantly increasing premiums. State provided health care has its own pitfalls, but it could prove to be one way of reducing overheads for businesses here.

A relatively lower sales tax on American made products could also help drum up manufacturing here. Tourism is at best a supplement to national income, and it would not b advisable to depend on it. Dubai has been trying to this for a while by becoming a financial nerve center as they lack oil resources. Sadly when the crisis hit, the money ran away as did the tourists.

A 2

Also Unions make it harder for businesses to work. Politicians love them because of the votes they bring, but IMO Unions are well past their due date. They add another level of bureaucracy between management and line workers, which is not required as most companies today have a flatter management structure.

See this story about Harley Davidson
http://wheels.blogs.nytimes.com/2010/07/20...aukees-dim/?hpw

raymo19

It would seem to me there needs to be incentives for companies that invest in plants and labor onshore and heavy disincentives for those who don't.

I would also favor a national sales tax of 1 to 2 percent to broaden the base.

Jet sitter

Don't worry Mike, there will be plenty of taxes coming down the pike.

raymo19

I suspect you're correct. I just wish they don't turn out to be the wrong ones for economic growth.

boltonblue

I've been banging the same drum for a while about green energy.
one of my posts
it's not just about the price of oil and economic recovery.
it's a strategic resource.
if you think we can't compete with china on price now, what happens when they're using solar/wind/ nuke/etc for cheap power and we're still running on good ol dino juice for power.

yeah yeah yeah, you can debate that solar isn't cheap etc, but that is based on todays energy model.
That model is already collapsing.

and local solar company, Evergreen Technologies, after sucking up state/fed money for it's infancy, moved manufacturing to china.

zzziippyyy

raymo19

Sort of dovetails with my post above huh.

We've got lots of wind and sun here.