Why The U.S. Economy Is Dying And Is Simply Not Going To Recover | Hacker News Reader

Why The U.S. Economy Is Dying And Is Simply Not Going To Recover

businessinsider.com

37 pointsknown27 comments

> "For decades, our leaders in Washington pushed us towards "a global economy" and told us it would be so good for us. But there is a flip side. Now workers in the U.S. must compete with workers all over the world, and our greedy corporations are free to pursue the cheapest labor available anywhere on the globe."

Bias much? For one thing, outsourcing would've happened whether we liked it or not. For another, having worked in manufacturing for a bit, corporations by and large aren't laughing their way to the bank by outsourcing American manufacturing jobs overseas - the cost of their goods drop proportionally with labour savings, in the mid-to-long haul anyhow.

I like how we're blaming this on everyone but ourselves - the outsourcing of manufacturing to cheap nations has allowed us to develop a rampant, disgusting consumer culture that has an almost fetishist obsession with cheap, shoddy goods. WE did that to ourselves. Believe me, if there was any significant demand in this country for expensive, well-made products we can bring a great number of manufacturing jobs back... but I suspect the Wal-Mart mentality is here to stay, and there's no one to blame for this but ourselves.

This is a common myth. US is still the largest manufacturer in the world.

http://articles.moneycentral.msn.com/Investing/CompanyFocus/...

By volume, yes, but perhaps that's not the best metric. See http://www.economist.com/specialreports/displaystory.cfm?sto... for a more meaningful comparison, although I agree that rumors of the manufacturing sector's demise have been greatly exaggerated.

I'm having trouble finding the chart, but we're also the largest in terms of percentage of GDP. That's a measurement I strongly prefer.

According to CIA World Factbook, you're not the largest in terms of percentage of GDP. At least Germany, Japan, Italy and even Switzerland rank better in that metric.

All of these single-metric comparisons are flawed. E.g. the world largest manufacturer? In comparison to what? Germany, a country with a labor force that is over 3 times smaller than the labor force in the US?

https://www.cia.gov/library/publications/the-world-factbook/

It is, but for how much longer? When I was in the auto industry it certainly looked very bleak - I've since lost touch with most of the people from that time, but I doubt it's looking up now either.

One of our chief problems when I was working in the auto supplier industry was relentless cost cutting on the part of the major manufacturers (GM was especially bad in this department) - and from what we knew GM certainly wasn't pocketing the difference, all of the cost cutting went directly into hyper-competitive consumer pricing.

As a result our cars are dirt, dirt cheap, unsustainably so, especially if your goal is to keep manufacturing jobs on this side of the ocean. But it's not as if people know this - especially the type like the author of the article, who like to play the victim constantly by making vague straw-man references to the greedy corporation.

I cannot count the number of times I've heard people make the point that some product "probably costs nothing to make anyways" - and it bothers me greatly. For just about everything except the high fashion industry, manufacturing costs are not that far divorced from their retail cost... but consumers who believe this hogwash are also liable to believe that outsourcing is due to rampant greed, as opposed to their unquenchable desire for cheap crap.

A lot of the manual labor is taken out though, if my factory is pushing out same 10,000 units of something a day with 25 employees mostly keeping a close eye on the equipment, the other 200 assemblers I would have hired before advances in technology are still out in the cold.

Trite self-contradictory chicken-little-ism. Corporations are greedy! Globalization is bad! OMG socializm! Will you LOOK at that debt (notice how it flattens in the 1990s and then goes stratospheric starting in 200)?! But it's all the Democrats' fault (even though we had a GOP White house, House, and Senate from 2000-2006)!

Normally I'd do a more substantive rebuttal, but after looking at the front page of businessinsider.com, it seems pretty plain that it's the investment equivalent of a supermarket tabloid. Although the article touches on many real economic problems it does so in a very shallow fashion, tossing worst-case scenarios together almost at random.

Really? One of the forbes links says this:

  based on credit default swap spreads there is a 3.1% 
  chance of a U.S. default in the next five years, 
  according to CMA, a London credit information specialist

http://www.forbes.com/2010/01/20/united-states-debt-10-busin...

That's pretty bad. Also, I didn't notice any contradictions. Maybe your hyperbolic remarks are true. Maybe Corporations are greedy -- they do have a fiduciary responsibility to increase shareholder wealth. Maybe Globalism is bad -- think global act local right? Globalization is the opposite of that! Also, I think the article said it was pretty much the leaders fault, what with a pic of GWB on one of the pages, or did you read that one?

it seems pretty plain that it's the investment equivalent of a supermarket tabloid

Is that ad hominem? Which statements the article includes aren't true?

There's a reason I qualified and contextualized my opinion. I did not allege falsehood but rather complained of shallow and incoherent presentation.

It's a shallow, contradictory gloss filled with all the usual rhetoric.

The unemployment statistics it showed did seem pretty significant if they are true.

I detest this new format of business "articles" which basically just tries to bait you into loading as many pages as possible (for ad revenue) whilst engaging in the cheapest link bait possible - 20 reasons why the U.S. economy is dying? Seriously? Why not 10, 50? It's tabloid-worthy, basically.

Every good graph I have already seen elsewhere and with much better explanation. They basically lump together every statistic they can get their hands on and spin it into a story, without any stringent analysis.

Please, read good reporting by The Economist, or articles linked on realclearmarkets.com or any kind of financial blog. The real experts on finance and economics are not to be found among any major off- or online publication anymore.

"The United States of America is very quickly becoming a socialist welfare state."

The mindless stretching of the term socialism is getting a bit grating, you think?

I don't think that's the author's fault. The truth is "Socialism" has always been ill defined. By the definition I was originally taught (a society where Government intervenes in the private industry to mitigate inequality) the U.S. has been socialist for my entire life time.

That said, you took that quote out of context. The real focus of it was on "welfare state" and it was presented with the fact that the Food Stamp program is adding 20,000 new people each day. If that's true than he's right about us quickly becoming a welfare state.

But even if you define "socialist welfare state" broadly, as "some of the left-ish countries in Eurpore that have a comprehensive social safety-net" (and purely by co-incidence to be sure, also are peaceful, democratic, affluent and have a high standard of living), then the US of A is not "very quickly becoming a socialist welfare state." Not even close.

I think semantic arguments are getting old. You took one sentence off one slide out of 21 and have devalued the conversation to a complaint about the use of a word.

Do you have something substantive to say or some facts to dispute what the article said?

You can scan my profile to see the substance of my posts in general.

Whatever you may think of it, my "small" distinction post here has gotten a lot more karma than the long analyses I usually post.

The slide show altogether had little substance; a few interesting statistics, some standard rhetoric and a come-on for a product.

Still, the craven misuse of the term "socialist" is doing more than a little damage to the body politic. If Obama was a socialist trying to change the nature of American society, that would worth debating. But he isn't, so the repetition of such a claim works according to the "big lie principle" (ironically articulated by Joseph Stalin) - if you take a simple falsehood, even one the most informed people know is false, and repeat it enough times, you get can serious traction. This method of operating is worth noting and so this "semantic" distinction is important to make.

Hmm, I think I detect a little anti-Obama bias.

That seems unfair. You could accuse them of hyperbole and being pessimistic, but they present a lot of facts and the report in general seemed to be even-handed. I didn't see an anti-Obama bias

You didn't find the graph that showed "Democrats take control of Congress" to be biased?

There's also the puzzling choice of an Obama picture under the point "corporate taxes are down".

There was also a picture of Bush on one of the slides. I'd say the reps and dems got equal bashing.

So, you'd say it was "fair and balanced", then?

It's definitely biased, some of those charts are extremely misleading, especially the later ones. I like the one which shows when Democrats take control of Congress.

To me it seems like he's ranting against "those in power" and that just happens to be the Democrats. But if you read the facts he attacks Republican ideas just as much (Outsourcing for example)

How are they misleading? The chart on 19 was from the Federal Reserve. Are the number wrong?

I don't really think there is much difference between republicans and democrats, so I don't really care which party is to blame, they are all the ruling class and make decisions to benefit those by whom they are surrounded -- I don't blame them for it. All human beings make decisions the same way.

But still I don't see how they are misleading. Is there something factually wrong with them?

Conclusion

"When a nation practices evil, there is no way that it is going to be blessed in the long run."

Yep, that's the point where the alarmist and biased article descends into superstitious doom-mongering. It's a pity, the topic deserves a better treatment than this. How about submitting a better link to replace it?

Reply on news.ycombinator.com