ERG4ALL
Well-known member
The divisive issue is whether demand side or supply side economics is the best to create jobs. On the demand side we have Keynesian economics (i.e. stimulus). On the supply side we have the GOP preference to start new businesses with low taxes. We cannot continue to increase the National Debt as a percentage of the GDP.
I'm reading the book "Bad Money" by Kevin Phillips. He makes an interesting point. In 1950 the percentage of the GDP due to manufacturing was 29.3% and Financial Services made up 10.9%. In 2005 manufacturing was 12.0% and financial services was 20.4%. He goes on to say that Financial Services includes purchases of: Foreign currency futures, Equity futures, T-bill futures, Futures on mortgage-backed bonds, over-the-counter currency options and 25 other financial instruments. The point is that the GDP is not as relevant to job creation as it used to be. Pushing money around counts as purchases, but it doesn't create near the jobs that manufacturing does.
Added to this, Alan Greenspan in his book "The Age of Turbulence" indicates that in a global economy such as we have now, that manufacturing will follow the lowest wage scale of the workers. China has a vast labor pool. As it moves from an agrarian society to a manufacturing society the farm workers will migrate from the country to the city for jobs that are higher paying than farm work. He believes that this migration will continue at least until 2030. This will continue to suppress global manufacturing wages. As China reaches full employment regarding manufacturing and labor becomes scarcer, then wages will rise which will then allow other countries to compete more effectively.
My personal belief is that intelligence in the population is a bell curve. On the far left we have individuals that need to be institutionalized because they cannot take care of themselves. On the far right we have the Einsteins of this world. Somewhere on the left is a portion of the population that can be productive in a repetitive manufacturing environment, but never would be able to function as a hedge fund manager.
I believe it boils down to asking ourselves what kind of society do we want for the next 20 years? Do we want to come closer to resembling a third world country with beggars and shoe shine boys roaming the streets, or do we want to take care of our own. It's all a matter of priorities. But as Bette Davis said her classic line, "Fasten your seatbelts, it's going to be a bumpy night."
I'm reading the book "Bad Money" by Kevin Phillips. He makes an interesting point. In 1950 the percentage of the GDP due to manufacturing was 29.3% and Financial Services made up 10.9%. In 2005 manufacturing was 12.0% and financial services was 20.4%. He goes on to say that Financial Services includes purchases of: Foreign currency futures, Equity futures, T-bill futures, Futures on mortgage-backed bonds, over-the-counter currency options and 25 other financial instruments. The point is that the GDP is not as relevant to job creation as it used to be. Pushing money around counts as purchases, but it doesn't create near the jobs that manufacturing does.
Added to this, Alan Greenspan in his book "The Age of Turbulence" indicates that in a global economy such as we have now, that manufacturing will follow the lowest wage scale of the workers. China has a vast labor pool. As it moves from an agrarian society to a manufacturing society the farm workers will migrate from the country to the city for jobs that are higher paying than farm work. He believes that this migration will continue at least until 2030. This will continue to suppress global manufacturing wages. As China reaches full employment regarding manufacturing and labor becomes scarcer, then wages will rise which will then allow other countries to compete more effectively.
My personal belief is that intelligence in the population is a bell curve. On the far left we have individuals that need to be institutionalized because they cannot take care of themselves. On the far right we have the Einsteins of this world. Somewhere on the left is a portion of the population that can be productive in a repetitive manufacturing environment, but never would be able to function as a hedge fund manager.
I believe it boils down to asking ourselves what kind of society do we want for the next 20 years? Do we want to come closer to resembling a third world country with beggars and shoe shine boys roaming the streets, or do we want to take care of our own. It's all a matter of priorities. But as Bette Davis said her classic line, "Fasten your seatbelts, it's going to be a bumpy night."