Capital Flows to Efficient Use and Disrupts Individual Lives
I am not an economist, and I don't play one on TV. That said, I am curious as to why things happen and economics is one of those things I include in my studies.
I went to High School at Sexton High School in Lansing, Michigan. Every day I walked by Fisher Body where my step dad worked and was a stone's throw away from a couple of other general Motors plants. They were always there and seemed like they would always be there. They are now just big paved, empty lots. What happened?
I hang a flag in front of my house. Flags wear out in the weather, so I went to replace it. The U.S. flag I replaced it with was made in… get ready… China. What the heck?
I cut my adult teeth during the Reagan era. Ronald Reagan described America as a shining city on a hill. I grew believing that, and I still do. The one thing I never heard Reagan say, but I also believe to be true is that the U.S. can't be the only shining city on a hill. The basic underlying reason we can't be alone in prosperity is because our greatest export is debt. The U.S. economy is fueled on debt. Every time the U.S. borrows, every time you and I borrow-use credit cards, take a home loan, or whatever-that debt is somehow consolidated and sold to lenders outside of the U.S. If no other country is immensely prosperous then there are no lenders, no lenders and the U.S. economy comes to a screeching halt.
The basic theory further goes on to say that capital flows to its most efficient use. It apparently is no longer that efficient to have a U.S. economy based on manufacturing. This is evident with the massive closing of U.S. auto factories. We are exporting a lot of manufacturing to other countries were labor is cheaper. What is slowly and for some painfully replacing manufacturing jobs, informating jobs. Jobs based on computer work. And, in the not too distant future computer jobs may evolve into bio-chemistry, robotics, genetics, and perhaps even jobs based on nanotechnology.
We will see China, India, and other parts of Asia prosperous as they produce hard goods like cars more cheaply than we can, but the U.S. will for the foreseeable future (I hope) outpace these other economies because investors will be employing their capital in these new markets. Here is the challenge: it was possible to have a high paying job like assembling cars with a moderate education, but it is not possible to work in bio-chemistry, computer programming, nanotechnology, and perhaps robotics without a lot more than a moderate education.
The clarion call seems evident to me. Don't become complacent. Learn as much as you can. Beef up your existing skills, and get some additional training and education. Because even if you are ";living off the fat of the land"; in one of today's high tech fields, today's high paying job may be exported. This has to happen unless magically the whole U.S. economy is no longer dependent on our greatest export, debt. That is just not going to happen.
It is not tragic, but it is tough. Replacing one economy-agriculture with manufacturing with informating-with a newer, better, more prosperous one is a cycle that has been repeated for 300 years, and more than likely it will continue well into the future. This is a great country to live in, but the bar to prosperity has been raised a little higher. Pick up a book, enroll in an extension course, learn new skills, and hone existing skills because in reality few of us are competing for our job with just the person down the block. Now we all are competing with people willing to do just about any job for less pay and longer hours, if they can get the training to do it. I say catch me if you can.Investor money flows to efficient uses. This means if something can be done more cheaply outside of the U.S. that something is likely to land there eventually. Economic consolidation and the exportation of jobs is a historical fact in the U.S. It just seems like these days things move a little faster and are more complex. The solution is to never become complacent, chellenge your self, grow your skills, and keep moving.

