Monday, March 27, 2006

Paen to Performance

Sebastian Mallaby's piece in today's Washington Post is a composite of slap-on-the-back, and falsely modest "why are we so great" when it comes to American businesses.
He extols the performance and productivity gains in the U.S. economy over the past 10+ years, especially in comparison to our first-world competitors in Japan and Europe.  He describes how our businesses and business models, for some reason, provide more efficient management of capital, how our workers are more productive per hour, and how generally the U.S. is just much better at motivating service- and knowledge-sector workers than we are at motivating factory workers.  Apparently the latter is something excelled at by Japan and Europe.
He mentions a "perverse anti-Wal-Mart campaign," spreading in America.  It comes across as an implicit comparison to inefficient European and Japanese zoning and regulatory laws, because in the world of the market price is the only determinant and the lowest price is always best.
What is surprising is that no where in the column does it talk about rising wage-disparity in this country--especially as compared to Japan or Europe.  It doesn't mention that while perhaps over-regulated, the European system has established a different set of priorities for their societies (as different than market) than simply, "Lowest Price Wins."  It's a short piece--a column--but no where does he give hint of the idea that there may be consequences to outsourcing mid-skill-level jobs to overseas.
I'm not being protectionist.  I'm not being xenophobic.  I think one of the greatest things that could happen for the American economy is for large parts of the rest of the world to become middle class.  But this is a different concern than that.  What concerns me is that in outsourcing what I'm calling middle-skill jobs: x-ray techs, back-office accounting, call centers, while at the same time eliminating the "working class" jobs of manufacturing (mostly because of inept management and business models in, say, our auto industry), we will become a bifurcated nation.  There will be doctors, lawyers, and the white-collar jobs of the 18th century British empire occupying an ever-smaller and ever-more-heavily-guarded portion of the country, with a tiny "middle class" of car mechanics, beauticians, up-scale restaurant servers, plumbers, electricians, and skilled-construction workers, and an explosion of under-class Americans working at Wal-Mart, the GAP, or fast food employees.
If anyone out there thinks this is a good direction for our society, please let me know--I'm interested to learn how this is an improvement.  For those of you with an inkling of doing a little thought on this, and how it might look in America, I'd encourage you to think about Brazil's phenomenally under-achieved potential of the last 3 decades; or look at how the dispossessed in France have handled their exclusion from economic opportunity; or the stories of how calm China's agricultural base is when seeing the privileged few of the cities grow wealthy while the farmers themselves have almost no chance of earning some of the wealth for themselves. 

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