Whom should we blame that China is fast overtaking the U.S. as a leading economic power?
american economic too rely on stock exchange, financial sector
Excellent observation. The U.S. has always believed if the stock market soared we as a nation were doing very well. Outsourcing jobs to other countries has increased profits for corporations & hurt our economy. Stocks are now at an all time high!
We chose to outsource a large percentage of manufacturing jobs to China in favor of getting "cheap labor" to maximize profits for corporations. From the corporation's point of view why build something in the U.S. and pay an employee $15-$25 per hour when you can get the same product made in China for $1-$2 per hour and not have to concern yourself with providing employee benefits or dealing with air and water environment regulations.
Unfortunately bad trade deals and less manufacturing jobs eliminated lots of well paid blue collar jobs in the U.S.
When the majority of people are earning less money they tend to spend less money which is the engine of any country's economy.
Former high paid manufacturing blue collar workers now find themselves in low paying service jobs. Some of these jobs were historically meant to be "stepping stone" jobs one worked while they were going to college or these jobs were seen as a way to bring in some "extra money" to pay some bills or buy something special. These jobs included working fast food, grocery store bagger, cutting lawns, delivering newspapers and so on. They were usually held by our youth.
Today it's not uncommon to see these jobs being held by people in their 30s, 40s, 50s, and beyond. I haven't seen an actual "paperboy" in two decades! Grown men with vans now deliver newspapers. Middle aged fast food workers are looking to unionize in order to earn $15 an hour for flipping burgers. Most people who pay to have their lawns mowed today deal with "professional landscaping" business owners. The days of the little boy in the neighborhood knocking on doors to offer cutting grass and shoveling snow services are gone! Naturally this hurts teens and young people. The "stepping stone" jobs are now careers!
Even high-tech companies have outsourced their tech support jobs to countries like India in order to maximize profits.
Essentially our global economy focus has shrank the middle class living standards in the U.S. Eventually this will happen to China when they get to a point where it will be cheaper for their companies to make products in some third world country. However they have a long way to go to reach that point.
Then again it may never happen as a Communist government tends to control it's people and corporations.
Nevertheless I can't imagine many people wanting to move from the U.S. to live in China. I'd rather stay here and say things like; "Would you like a hot apple pie to go with that?" :-)
A very interesting view. Fortunately you have sparked an idea for me. Thank you. Now, that does not say I like the trend you shared as having to be, e.g. as a paperboy @ '65 & '66 (5th & 6th) grade I learned and I forgot. I just now realized
tsmog, You're welcome! If your idea is hub I'll make sure to read it. I remember my paperboy days in the early 70s. We not only delivered papers but had to do our collections from customers. Some of these "grown folks" would pretend not to be home!
We have become accustomed to buying more for less, which means funding manufacturing from afar, and not supporting our own American made products. So, I guess it is our fault, as well as those who look overseas for the goods we need every day. I traveled to China and saw many people who live and work in substandard environments to produce goods for other countries. So I think all the countries of the world are to blame for supporting this trading between countries who, because of their lack of opportunities, work for almost nothing.
This is an extremely exaggerated storyline. China is not the largest economy in the world in the context of GDP per citizen. When we look at things from the standpoint of wealth creation, the US is still the wealthiest and most creative planet on earth. China is a place that can replicate and manufacture things that the US can invent. However, they really don't create very much from scratch as of yet. China is still very much a command and control economy that is grossly inflating it's GDP in many of the wrong areas. As and example, nearly 50% of their GDP is construction driven. They are building dozens of cities the size of Dallas TX annually. But most of these cities remain totally vacant, even years after they are built as ghost towns. This is because their population is still so poor, they can't buy the very property that their gov't is mandating that they build. This type of gov't directed allocation of resources is very misleading. Although I am confident that in time they will begin to embrace more and more market driven principals.
Presuming that the Chinese truly embrace a free market system, and become a true leader in innovation, it would only make sense that they would become the largest economy in the world based simply on demographics. You can say the same about India, which has a middle class population that is larger than the whole population of the US. The reason we have become the wealthiest industrialized nation in the US is that we have embraced over the last 200 plus years a system of relatively free markets and economic incentives that have not been permitted in many other nations like China and India. Should they embrace such freedoms, this is not to be feared. Competition is good thing. As they create more wealth, they to will improve the lot of their population. We in the US need only to compete effectively and not worry about being the largest in aggregate GDP. That is really an irrelevant data point.
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