Three Billion New Capitalists: The Great Shift of Wealth and Power to the East
Ex-Reagan administration trade official Prestowitz follows up his critique of U.S. unilateralist foreign policy inRogue Nationwith this perceptive diagnosis of the nation's economic decline under globalization. While China and India focus on trade and industrial policies and turn out competent workers who put in long hours at a fraction of American wages, the U.S., Preston argues, struggles with crushing trade and budget deficits, a zero savings rate, failing schools, dwindling investments in scientific training and research, a collapsing dollar and a debt-dependent economy that will face an "economic 9/11" once foreign creditors bail out. The argument echoes Thomas Friedman'sThe World Is Flat(Forecasts, Apr. 4), but Prestowitz's analysis is more thoughtful than Friedman's pro-globalization cheerleading. He criticizes, from firsthand experience, Washington's cavalier embrace of free trade and aversion to industrial policy ("they'll sell us semi-conductors and we'll sell them poetry," notes one Reagan administration economist) and argues cogently that the research and development apparatus and high-tech entrepreneurship that is supposed to save America's economy is likely instead to follow the manufacturing base offshore. It's a lucid and sobering forecast.Copyright © Reed Business Information, a division of Reed Elsevier Inc. All rights reserved.