Monday, March 16, 2009

Globalization and the Loss of Manufacturing

Globalization leads to wage equalization, the process isn't always going to be smooth, but I believe it is unstoppable as industrialization was.

We still manufacture a huge amount of goods, it's just that these are post-modern goods and are not tangible. One of the biggest problems is that the rest of the world has not yet caught up in terms of legal protections and enforcement. In America, we already have all the material things we need, we no longer buy clothes to keep us warm or shoes to protect our feet. We buy stuff now to express ourselves and to show our social status. Even cars are bought for "style", not to mention Iphones. Especially if you're in the entertainment industry, you must have a "cool" phone like the Iphone or else you'll be looked down upon and snubbed.

Manufacturing generic tangible goods is yesteryear's industry. As the world gets richer, someday everyone will have enough tangible goods they need purely for functional means. But humans will always need more entertainment and goods that convey social status, which is what we're manufacturing today. What we should do is make sure these goods are protected, a worldwide framework has to be formed and implemented that will pay the manufacturers of these goods for their work. Pirating is a huge problem, as big as it was during the 1600-1800's. We have countries like India who outright steal what we produce, like our medicines. China does not take pirating very seriously, but even countries like Sweden don't either. The EU is a hotspot for well to do pirates to congregate and enjoy the spoils of their theft. That has to be stopped.

I suggest people focus on the future instead of the past. Fighting a battle to preserve an obsolete industry is foolish. We should all be fighting to establish a framework for the new post-modern manufacturing industry instead. That would create a lot more jobs and raise wages substantially NOW. Think what would happen if all the trillions that is being stolen were to flow back into this country, the crisis would be solved and the nation would prosper.

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