Tell Me Why I'm Wrong

[davidsmith0123]

Goods AND services, not just goods. The OP emphasis on manufacturing is overdone. Services get a bad name among the uninformed (a nation of hamburger flippers) but services include high paying jobs such as engineering, architecture, economic consulting, finance, investment banking, information technology, petroleum engineering, etc, etc.

Natural resources are not all they are cracked up to be. Look at South Africa. Look at Russia. Look at many middle eastern nations. On the other side, consider resource poor nations such as Germany (mentioned above) but also Japan, Korea, Taiwan. Human capital and innovation drive many economies, and both goods and services are "real" outputs.

And, yes, there is another service sometimes discussed in these parts of the internet that is fairly lucrative, at least on an hourly basis...

The OP mentions trade. We do import more goods than we export. You might find it interesting to know that we export more services than we import. In July 2011 our exports of goods was $126.9 billion, our exports of services was $51.1 billion. (Imports of goods was $187.5 B, imports of services $35.3B).

As to "why you are wrong" it is difficult to know where to begin or how to respond to the statements in your OP. I suggest you begin with a few economics classes. U.T. has an excellent economics faculty; you might consider giving them a chance.

[cckid2006]

Very insightful Mr. Smith, but I think our poster is more content to be educated with the sound bites propagated by those characterized so eloquently by Paul Simon - as "just out to capture our dime" - rather than becoming educated in our institutions of higher learning.

[theaustinescorts]

Originally Posted by Advocate

Ok the richest countries are not natural-resource exporters. Most countries that have nothing but abundant natural resources are at the bottom of the food chain: almost all of Africa, and vast swaths of Asia. The country that is the best off in Europe is Germany. Do you know what their number one export is, which accounts for a full 20% of their economy?

Mechanical engineering.

Note that is not automobiles, of which they export quite a bit, but the service of the engineering itself. As I said above, losing manufacturing is not a bad thing except that it was something that could be done for a high wage with little education. Such jobs are going away worldwide, not just here. High-tech service jobs are the next big thing, just as agricultural manufacturing was then mechanical manufacturing was after that. We just need to invest in the education and training necessary to
have the workforce capable of doing these type of jobs.

I clearly stated that most resource/commody export countries like those in Central America and Africa are bankrupt, and the reason for it is that the elites in such places plunder their resources.

In Europe the highest standard of living has been Norway for about a hundred years and they don't manufacture anything.

In Asia Australia has had the highest standard of living forever and it manufactures nothing.

Countries that make their wealth through manufacturing may have high standards of living like Germany, Sweden, England, or low standards like Japan, China, Italy. It all depends on the unity of the population and the cooperation that exists between owners, management and labor.

I'm still looking for an argument that the high-paying manufacturing jobs lost in the US have been replaced by anything as good.

They haven't.

It's only a theory that they should be, but in reality they've just been lost and nothing's replaced them. There is no "service economy," other than pressing each others' pants, and the nuts who promoted that idea in the 1970s are the same people who predicted that we'd all have an excess of leisure time because of it. Just the reverse has happened.

[cckid2006]

Originally Posted by theaustinescorts

the nuts who promoted that idea in the 1970s are the same people who predicted that we'd all have an excess of leisure time because of it. Just the reverse has happened.

Since you didn't live in the 70s and obviously don't read history, I will once again try to educate you (UT does a great job if you want a second opinion). Everyone in the 70s were enjoying their high paying manufacturing jobs getting paid better than my college educated brethren with little education and minimum training. Quality was non-existent and machines took over for these bungling uneducated workers producing better products in Japan and Germany at better prices producing economic efficiencies which granted us (me) the leisure time and money so I can enjoy this hobby (neither of which I will be sharing with your agency).

[Advocate]

Despite misunderstanding the Law of Comparative Advantage, I'll still be seeing your lovely ladies; they are some of the best girls around.

[theaustinescorts]

Originally Posted by cckid2006

Since you didn't live in the 70s and obviously don't read history, I will once again try to educate you (UT does a great job if you want a second opinion). Everyone in the 70s were enjoying their high paying manufacturing jobs getting paid better than my college educated brethren with little education and minimum training. Quality was non-existent and machines took over for these bungling uneducated workers producing better products in Japan and Germany at better prices producing economic efficiencies which granted us (me) the leisure time and money so I can enjoy this hobby (neither of which I will be sharing with your agency).

Actually I did live in the 1970s, and read all this nonesense about the "coming service economy," and "we will all have too much leisure time from all the automation and increases in productivity..."

I graduated from UT already and took several economics classes there as well as in grad school at MIT, so although I'm not a professional economist by any means nothing I've stated in contrary to anything I was exposed to in acedemics...

The difference might be that I'm not overly-doctrinaire or rigid in my views, as opposed to many traditional economists.

Please make arguments instead of personal attacks.

The recession shows no sign of ending and I've given the reasons why.

This recession is not ever going to end.

This level of unemployment is here to stay.

[cckid2006]

I failed and all your instructors at UT and MIT failed. Your intellect definitely puts us all to shame. Live in your own delusion. What I can't understand is you invited the dialog when your mind was made up??? History does not support your arguments and conclusions. Others here agree with me. No one supported you. Enough said no more posts from me!

I'm out of here.

[Yssup Rider]

UT to MIT to TAE.

What a long strange trip it's been!

[theaustinescorts]

My mind's only made up in that I'm seeking an argument to justify the trade policy of the last fourty years.

It's rooted in an intellectual rationalization that's grounded in Ricardo and comparative advantage, which was a pre-industrialization theory having to do with agricultural advantages from soil and weather.

There are alternative contemporary theories which explain the disadvantages of free trade, but they've had none of the political action that's been driven by free trade seekers.

There's something very sinister behind the free trade mantra of the last fourty years.

Regardless, we can see what's going on in this economy without any particular theorizing.

Profits are largely good. Corporations have plenty of cash.
Aggregate demand is low because of lagging wages and high unemployment.

This situation will remain forever as far as I can tell.

The American future is one of haves with a lot of liquidity, and have-nots recieving government assistance.

This will cause even larger government borrowing, and that's going to be a politically-unstable element for a country whose population will not tolerate the kind of welfare state the Europeans have embraced.

[Yssup Rider]

So what's YOUR suggestion?

Would it be to let the corporations shoulder the tax burden to allow the government to take care of the have-nots?

[19Trees]

Trade polices last 40 years justified by nation states desire for growth. In the first 20 of those forty years, rich world did most of the exporting and made a fortune. Last 20, it has switched and now (mostly Asian) nations are net exporters and now they are making the fortunes.

[austin_voy]

This is not your father's recession (or grandfather's, whatever). The 20's, 30's and 40's the US economy was the US economy. Now everything is global. Look at the stock markets. Greece says it's going to default. The European markets crater. So the US markets say "ohmagawd" and do the same. And then Asia. Now Europe says "ahcrap, look at the rest of the world" and goes down more. Finally IBM announces numbers that "beat the street" and consumer purchasing is up. The US market jumps, Asia says "happy times are here again" and Europe starts to dance, so the US ...

Service, in and of itself, only works as long as there is someone outside of your "local" economy participating. It's all well and good to design a dam for Montana, but you pitch more money into "our" economy by designing a dam for India. BUT I don't consider engineering to be a service industry. Medicine is. Education is. Electrical power distribution is. None of those are quite "burger flipping" (how would you like to make $75 large with a still wet BS managing ERCOT? Okay, ERCOT sucks, but the theory applies)

This infrastructure rebuilding is needed, but it's not good for the US economy. When will "we" pay off the new deficit spending. "We" because when those bills come due I'll either be dead or living the high life in some third world country that doesn't have enough money to go into debt.

Until the US starts selling more stuff outside of the US, we'll have economic problems. But that fails when you realize that other countries need the same thing to happen.

In 10 to 15 years the world will likely have reached an economic homeostasis. No super powers per se. Same reason that MAD will fail some time in the next generation.

[cckid2006]

Maybe there is something wrong with me.

Originally Posted by Yssup Rider

UT to MIT to TAE.

What a long strange trip it's been!

Hey Austin, what's wrong with ERCOT?

[cckid2006]

http://www.thedailyshow.com/extended...34?xrs=eml_tds

"That's all I have to say about thaaat"

Forest Gump

[Yssup Rider]

Bubba, it's all good!