Germany has refused to follow the way of the U.S. in transferring most of its manufacturing to China. It values its workers, provides them with new skills, and pays them well. Its trade with China is very substantial; it has become China's largest trading partner, replacing the U.S. and France. Neither Germany nor China dominates this mutual trade arrangement and both are doing quite well because of it.
How about this for strength in manufacturing? Germany, with a population much smaller than that of America is the 3rd largest export economy in the world, exporting $1.24 trillion to other nations in 2015.
Capitalism, American style is, without question, the primary root cause of much of the inequality and inequity of wealth and income that is present in America; here's why: let's take $1 billion dollars and illustrate the distinctly different effects it would have on the economy under two different scenarios.
In the first scenario let's take just one individual or household that possesses $1 billion in total assets. How much of that huge amount of money is going to enter into the economy? I'd say the largest share will never be spent on household essentials and various other consumer products. And, in fact, a lot of it will likely be invested in the stocks of those major corporations who greatly profit from cheap foreign labor; how ironic is that?
Now, take that same $1 billion and let it be distributed among American workers in a scenario in which they still have good paying jobs and get decent increases. How would the largest share of that amount be spent? Well, I'd guess that not much of it would be spent on stock market investments but, rather, most would be spent on food, clothing and other essentials; appliances, electronics, autos and houses.
So as more and more money is acquired by those at the top, the more consumer purchasing power suffers and, with it, the economy. That's exactly why the America brand of capitalism is failing and capitalism, German style, should now be considered as the model for the world; the way true capitalism should be practiced.
Michael Payne
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