Quote:
Originally Posted by GregE
Really? How so?
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In simple terms, two fold:
1) Only very recently did China overtake the US as the largest manufacturer in the world. In fact, In 2008, US manufacturing output was greater than that of the manufacturing output of China, India, and Brazil combined, despite manufacturing being a very small portion of the entire US economy as compared to most other countries. The manufacturing China is doing is mostly low skilled (ie; they are good at making Nikes, T-shirts, toothpaste and stuff that falls apart real quick). Contrariwise, the US is the leader in manufacturing aerospace, petrochemicals, telecommunications, military, agricultural and construction machinery, food processing and other high end, high skilled goods.
2) Because the loss of certain manufacturing jobs -- while I have sympathy for the specific individuals, towns, etc. that suffer as a result -- is only one part of the equation. Comparative Advantage raises wealth in total. IOW, there are larger gains than losses. They just don't accrue to everybody equally. I would even go as far as to say that attempts to keep the manufacturing jobs in question in the US actually retards the development of high skilled and/or knowledge-based exports, by raising the price of manufactured goods.
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