From: pcollac@pyrnova.mis.pyramid.com (Paul Collacchi)
Newsgroups: sci.econ
Subject: Re: Dumping
Date: 24 Dec 92 17:48:42 GMT
Reply-To: pcollac@pyrnova.mis.pyramid.com (Paul Collacchi)
Distribution: usa
Organization: Pyramid Technologies, Mt. View, California.

In article <BzGptK.6CL@apollo.hp.com>, nelson_p@apollo.hp.com (Peter
Nelson) writes:
|>
|> 
|> >|> > We don't need the US to compete in every market, we just need
|> >|> > *somebody* to compete.
|> >|> 
|> >|>    We *do* need the US to compete if we want jobs, prosperity, 
|> >|>    and social stability in the US.    You guys are still looking
|> >|>    at all these things like they're single-variable problems!
|> >|> 
|> >
|> >You are making the assumption that because there is no U.S. company
|> >making a product, there are no U.S. workers making products.
|> 
|>   I'm saying that the trend over the last few decades has been for
|>   the US to give up altogether, or sacrifice major market share
|>   in more and more areas.   This cannot continue, without sacrificing
|>   jobs or standard of living unless we find new areas to dominate.

Is it generally agreed that we have, in fact, *not* found new areas in
which to dominate?  I would have thought that the whole computer/software
industry was one such industry, and that bio-tech is another.

By the way, I might also note that we don't necessarily need to
"dominate" a market.  It's enough to have a significant and continuing
market presence.
Therefore, the sacrifice of market share is, of itself, not that
signficant, in my opinion.  It may be a remnant of post WWII thinking in
which the world could offer no real competition.  That led to our
becoming fat, dumb, and happy.  When you're f,d, & h, everything you do
appears to work and it's easy to make wrong conclusions.  If its really
the case that we have since WWII
merely assumed a more rightful, position in a more balanced competitive
equilibrium then it might be a mistake to think that losing market share
was necessarily bad news.

I do, on the other hand, feel that standard of living has declined.
 
|>   Yesterday's Wall Street Journal pointed out that the trade deficit
|>   it expected to widen next year by another $15 billion.   One of the 
|>   interesting statistics from this latest recession that distinguished
|>   it from earlier ones was the ratio of permanent positions lost to 
|>   temporary positions lost and furloughs.   That ratio was much 
|>   higher than previous recessions.
|>                                          

Peter, this is not necessarily an indication of "competitive decline."
In my (our) industry we are seeing downsizing, re-engineering, and probably
no real job creation in certain sectors.  Why?  Is it because we are
becoming less competitive.  Just the opposite.  The industry is incredibly
competitive -- we are almost giving away today what would cost millions of
dollars 5 or 10 years ago, and customers appear to be making efficiency 
gains that are almost keeping pace with hardware gains.  They too, are 
finally starting to lay IS people off.

In my opinion, this is all a sign that *finally* all this computer stuff,
(at least mainframe equivalent) is becoming incredibly efficient.  Notice
that "incredible efficiency" is antithetical to "job creation."  Jobs
are getting automated or obsoleted.

It may be a bad consequence, but it does not indicate "competitive decline."  
Therefore, perhaps we need to re-think the word "competitive" so that it
includes a component for widespread job creation, because efficient capital
doesn't necessarily require wide-spread job creation.

Paul Collacchi
Newsgroups: sci.econ