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The U.S. Needs National Goals and Ambitions

By       Message Craig Harrington       (Page 1 of 1 pages)     Permalink

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opednews.com Headlined to H2 2/19/09

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The United States has unflinchingly adhered to its mantra of unguided capitalism, despite the voluminous evidence showing our need for a better policy. The United States has no delineated national goals or ambitions, and it no longer supports its manufacturing industry in such a way that the sector can remain globally competitive. Our physical output has never been higher, but that output has never made up a smaller portion of the economy than it does today. Also contributing to the demise of American manufacturing is the fact that many products "Made in the U.S.A" are actually assembled out of foreign-made components – this is particularly true of some high technology goods such as automobiles, airplanes, etc.

Furthermore, the number of Americans actually employed in manufacturing has dwindled over the past several decades as production became automated and was moved overseas to cheaper labor markets. The manufacturing sector used to employ over 30 percent of our workforce, that number has dwindled to just 10 percent. More people than ever work in service-sector industries that do not actually produce anything of value.

We need to duplicate the systems of guided capitalism which have worked so well for Japan and China. Neither nation allows its productive industries to be bought out by foreign companies. Both countries support domestic growth by directly encouraging the consumption of domestically-made products, instead of allowing market shares to be dominated by foreign imports. In the U.S., our state and federal government encourage Honda, Toyota, Nissan and others to insource work for the sake of "creating jobs." This insourcing does create some menial jobs, but it effectively puts Americans out of work by undercutting U.S. automakers.

Domestic auto companies have had to cut tens of thousands of jobs and write down billions in losses amid massive market slides this year. The economic crisis has hit the entire market, but it has not had the same crippling effect on foreign companies – which are subsidized by their government and our own.

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After decades of this policy, both Japan and China are able to outpace their American competition. U.S. manufacturers cannot simultaneously compete with China's insurmountable labor resources and the technological advances of Japanese producers. Making matters worse is the fact that the governments of China and Japan guarantee a captive market by blocking foreign goods and limiting imports. This essentially ties the entire market together, guaranteeing growth and long-term stability. The United States has no system in any way similar to those of Japan and China. Guided capitalism is also emerging as the method of choice throughout Europe and in rising economies like Brazil, India and Russia. At this rate, the United States may be left behind by all of them.

We need to do something about this problem. The United States has watched its economy driven to the brink of utter collapse. We need a centralized policy that encourages American production and protects U.S. producers from unfair foreign competition. We cannot simply sit back and allow the base that made this country wealthy fall apart around us.


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Craig Harrington is pursuing a degree in History and Political Science at The Ohio State University. He is also a journalist for EconomyInCrisis.org.

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