Need any more proof of Americas economic funeral

Marv, close your eyes and imagine another world, the world where everybody has the same will to work hard and improve himself as you do. Well, guess what, some of those equally hardworking people would need to live in poverty, work low wage jobs, clean restrooms, ..., be unemployed, homeless. There is no other way around in a capitalist world. Don't fool yourself. You pulled a lucky ticket, good for you, many haven't. Making far reaching conclusions based on a personal success story is somewhat arrogant and naive.

 

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Looks strange, I did not think Bush tax cut was cutting peoples tax bill in half at any income level. Perhaps you own dividend paying stocks and are no longer paying taxes on the dividends.

 

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Thanks for the good news; I thought it was worse than that.

I particularly thought that China and India were producing goods and services more cheaply than the 40% and 60% of USA's cost number that you are using. The dollar needs to fall against the Yuan and the Rupee rather than against the Yen and the Euro. (Saying Renminbi may be more more correct than saying Yuan but Yuan seems to be the more common term for China's currency.) Unfortunately the dollar can not fall against the Yuan because the Yuan is pegged to the dollar. WalMart will keep buying from China until some other place produces more cheaply than China. If the Dollar falls a little against the Yuan then WalMart will have to pay China more for all the Chinese goods on WalMarts shelves and the US trade deficit will grow. If the Dollar fell more than 40% against the Yuan (given the 40% cheaper production number) then the USA could start building manufacturing plants to produce the things on WalMart's shelves and the trade deficit would start falling.

Europe and Japan don't have as many natural resources as the USA has, but they have advantages over the USA in that they don't waste as much money on military spending and their leaders are not completely blind to the havoc that free trade between rich and poor nations can create for the first World workers.

 

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This is a very interesting idea. Let's pretend that the world really practised free trade. Let's pretend that magically everybody in the word is given the a perfect (as defined by employers) attitude towards work and a strong desire to create wealth for their families. Lets pretend that all drug addiction, ill health, mental illness, bad habbits and anything else that might interfere with people being good workers are magically eliminated. Lets pretend that everybody has been magically given the understanding equivalent to having a PHD and ten years of cutting edge work experience in every field and sub field of work that exists on this earth. Let's pretend that everyone can read , write and speak English perfectly. THE QUESTION: what happens next?

What would the global economy do with all of these perfect workers in the short term?

The Answer, all highly paid employees would recieve pay cuts unless they were like the CEOs of large corporations and controlled their own salaries.

The owners of organizations and capital would see a great increase in their wealth because the ratio of capital to highly skilled labor had just changed when when all humans were magically turned into highly skilled labor while the supply of capital / tools / natural resources / organizational structures / and political crony connections remained constant.

The type of work that we need to have done would not change much just because we all would have knew skills. If more people would have good attitudes about standing behind a grill in McDonalds and flipping burgers then we would pay less for good attitude burger flippers. So untill time goes by and the new magically aquired skills produce increases in efficiency, everybody who works for others would get a pay cut as a result of everyone being perfect workers.