Welcome to 1937

[Jason McCullough]

http://www.nytimes.com/2005/04/17/magazine/17CONSTITUTION.html

It's not like "the new breed of conservatives intellectual in the legal field want to repeal the entire New Deal, and maybe go after Teddy too" is new information, but it's rather disturbing to see it all laid out in a respectable forum. Fucking Epstein; god only knows what the hell can happen if Bush nominates one of the cranks to the court.

[Enidigm]

This is interesting, this "Constitution in Exile" philosophy. But also slightly prescient.

Basically as i see it in America, if not the western world, we're fucked over the long term. Asia is full of hundreds of millions, willing to work and live in conditions we find intollerable, for the betterment not only of themselves but of their country (nationalism is pretty strong in Asia). In America we have a greedy culture that rewards skillfully manipulating the system more than, or at least as much as, producing or creating value; and at the cost of more or less anyone in-between them and the prize. Already i read 83% (?!) of jobs are in retail. Basically we're going to have to start picking cotton one day or live like we did 120 years ago in dirty, crowded cities, if we're going be able to compete with Asian productivity. Right now we've leased a couple decades from the wealth of the previous generations, but that wealth is starting to run out.

This 'debasement' of the worker is inevitable, and repealing the minimum wage laws the sign to know when this has come to pass.

Of course this isn't desirable; its just what's going to happen, in all likelyhood. It would be better if we created more "corporate socialist" companies and used our fairly well and broadly educated workforce as it ought to be, instead of treating them like disposible overpayed lodestones; but since every CEO wants to be a hundred millionaire, the chances of that every happening are vanishingly small.

Oh well, there is always that ticket back to the old country...

[shift6]

Already i read 83% (?!) of jobs are in retail.
I find that difficult to believe. 83% service industry, maybe. But all retail? No way. There's too many huge employers in the service industry who aren't retail, such as call centers (the ones still in the US), nurses, etc.

[Enidigm]

Already i read 83% (?!) of jobs are in retail.
I find that difficult to believe. 83% service industry, maybe. But all retail? No way. There's too many huge employers in the service industry who aren't retail, such as call centers (the ones still in the US), nurses, etc.

Your right, i meant in the service industries.

[Nick Walter]

Already i read 83% (?!) of jobs are in retail.
I find that difficult to believe. 83% service industry, maybe. But all retail? No way. There's too many huge employers in the service industry who aren't retail, such as call centers (the ones still in the US), nurses, etc.

Your right, i meant in the service industries.

That's capitalism for you. A capitalistic free-market economy demands 100% employment (or as close as possible). The only people rewarded are the people who contribute. The amusing part is when technology advances to the point where a small handful of people can support everyone else with food and goods, then we start making up silly things for the rest of the people to do so they can contribute.

[Jakub]

That's capitalism for you. A capitalistic free-market economy demands 100% employment (or as close as possible). The only people rewarded are the people who contribute. The amusing part is when technology advances to the point where a small handful of people can support everyone else with food and goods, then we start making up silly things for the rest of the people to do so they can contribute.
Or more accurately, when China can contribute cheaper, we have to find silly things for ourselves to do.

[Nick Walter]

That's capitalism for you. A capitalistic free-market economy demands 100% employment (or as close as possible). The only people rewarded are the people who contribute. The amusing part is when technology advances to the point where a small handful of people can support everyone else with food and goods, then we start making up silly things for the rest of the people to do so they can contribute.
Or more accurately, when China can contribute cheaper, we have to find silly things for ourselves to do.

True, but even when the international economics balance out and we have to assume our fair share of manufacturing ourselves, it still won't take a huge chunk of the population like it has in the past.

[Jason McCullough]

Selfish, there may be some....transition pain.....but over a 60 year timeframe or whatever, Chinese wages will go up just like they did in Japan, Korea, India, and so on.

Basically we're going to have to start picking cotton one day or live like we did 120 years ago in dirty, crowded cities, if we're going be able to compete with Asian productivity.

KEYWORD DETECTED, DUMPING RELATED ITEM

http://web.mit.edu/krugman/www/myth.html

And yet there are surprising similarities. The newly industrializing countries of Asia, like the Soviet Union of the 1950s, have achieved rapid growth in large part through an astonishing mobilization of resources. Once one accounts for the role of rapidly growing inputs in these countries' growth, one finds little left to explain, Asian growth, like that of the Soviet Union in its high-growth era, seems to be driven by extraordinary growth in inputs like labor and capital rather than by gains in efficiency.

Consider, in particular, the case of Singapore. Between 1966 and 1990, the Singaporean economy grew a remarkable 8.5 percent per annum, three times as fast as the United States; per capita income grew at a 6.6 percent rate, roughly doubling every decade. This achievement seems to be a kind of economic miracle. But the miracle turns out to have been based on perspiration rather than inspiration: Singapore grew through a mobilization of resources that would have done Stalin proud. The employed share of the population surged from 27 to 51 percent. The educational standards of that work force were dramatically upgraded: while in 1966 more than half the workers had no formal education at all, by 1990 two-thirds had completed secondary education. Above all, the country had made an awesome investment in physical capital: investment as a share of output rose from 11 to more than 40 percent.

Even without going through the formal exercise of growth accounting, these numbers should make it obvious that Singapore's growth has been based largely on one-time changes in behavior that cannot be repeated. Over the past generation the percentage of people employed has almost doubled; it cannot double again. A half-educated work force has been replaced by one in which the bulk of workers has high school diplomas; it is unlikely that a generation from now most Singaporeans will have Ph.D's. And an investment share of 40 percent is amazingly high by any standard; a share of 7O percent would be ridiculous. So one can immediately conclude that Singapore is unlikely to achieve future growth rates comparable to those of the past.

But it is only when one actually does the quantitative accounting that the astonishing result emerges: all of Singapore's growth can be explained by increases in measured inputs. There is no sign at all of increased efficiency. In this sense, the growth of Lee Kuan Yew's Singapore is an economic twin of the growth of Stalin's Soviet Union growth achieved purely through mobilization of resources. Of course, Singapore today is far more prosperous than the U.S.S.R. ever was--even at its peak in the Brezhnev years--because Singapore is closer to, though still below, the efficiency of Western economies. The point, however, is that Singapore's economy has always been relatively efficient; it just used to be starved of capital and educated workers.

Pretty much the same deal on China. They're industrializing like gangbusters, but their tech productivity isn't there.

[Rollory]

Pretty much the same deal on China. They're industrializing like gangbusters, but their tech productivity isn't there.

Bingo. In some article or other I read last week there was a comment by a Chinese official complaining that China was 6 times less efficient than the US in terms of inputs.

There's also the fact that the effectiveness of the Chinese workforce is going to peak over the next few decades, then decline as the entire country gets old:

http://www.theglitteringeye.com/archives/000939.html

Same thing that happened in Europe, except here it was at least partially deliberate, what with the one-child policy. Anyway, the Chinese industrial giant is going to start feeling its limits.

[Equis]

http://web.mit.edu/krugman/www/myth.html

And yet there are surprising similarities. The newly industrializing countries of Asia, like the Soviet Union of the 1950s, have achieved rapid growth in large part through an astonishing mobilization of resources. Once one accounts for the role of rapidly growing inputs in these countries' growth, one finds little left to explain, Asian growth, like that of the Soviet Union in its high-growth era, seems to be driven by extraordinary growth in inputs like labor and capital rather than by gains in efficiency.

Consider, in particular, the case of Singapore. Between 1966 and 1990, the Singaporean economy grew a remarkable 8.5 percent per annum, three times as fast as the United States; per capita income grew at a 6.6 percent rate, roughly doubling every decade. This achievement seems to be a kind of economic miracle. But the miracle turns out to have been based on perspiration rather than inspiration: Singapore grew through a mobilization of resources that would have done Stalin proud. The employed share of the population surged from 27 to 51 percent. The educational standards of that work force were dramatically upgraded: while in 1966 more than half the workers had no formal education at all, by 1990 two-thirds had completed secondary education. Above all, the country had made an awesome investment in physical capital: investment as a share of output rose from 11 to more than 40 percent.

Even without going through the formal exercise of growth accounting, these numbers should make it obvious that Singapore's growth has been based largely on one-time changes in behavior that cannot be repeated. Over the past generation the percentage of people employed has almost doubled; it cannot double again. A half-educated work force has been replaced by one in which the bulk of workers has high school diplomas; it is unlikely that a generation from now most Singaporeans will have Ph.D's. And an investment share of 40 percent is amazingly high by any standard; a share of 7O percent would be ridiculous. So one can immediately conclude that Singapore is unlikely to achieve future growth rates comparable to those of the past.

But it is only when one actually does the quantitative accounting that the astonishing result emerges: all of Singapore's growth can be explained by increases in measured inputs. There is no sign at all of increased efficiency. In this sense, the growth of Lee Kuan Yew's Singapore is an economic twin of the growth of Stalin's Soviet Union growth achieved purely through mobilization of resources. Of course, Singapore today is far more prosperous than the U.S.S.R. ever was--even at its peak in the Brezhnev years--because Singapore is closer to, though still below, the efficiency of Western economies. The point, however, is that Singapore's economy has always been relatively efficient; it just used to be starved of capital and educated workers.

Pretty much the same deal on China. They're industrializing like gangbusters, but their tech productivity isn't there.

I'd just like to point out that at no point in time did our (Singapore) economic growth ever went negative, nor did we ever have less than stellar unemployment rates, inflation or any other such indicators of an overheated economy. We were also the only country to survive the thai currency crash.

I'll concede on the efficiency point though. Most Singaporeans are educated to rigidly follow the beaten path, even at university level. (I am so glad I got out of there.) Foresight shows Singapore to arrive at a massive disjunction in its economic growth once our neighbouring countries get up to speed. Yet considering our immediate neighbours are Indonesia and Malaysia, we may still have some time.

In other news, we're opening up two HUGE casinos in 2009.
That can only be good for our society,err i mean economy, no?