General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsAmerica’s Role as Consumer of Last Resort Goes Missing
http://www.bloomberg.com/news/2013-12-01/consumer-of-last-resort-missing-as-u-s-leaves-the-world-behind.htmlNot long ago, before the financial crisis and the global recession it triggered, economists referred to Americans as the consumers of last resort. When the U.S. grew at a healthy pace, its citizens were buyers, fueling demand for the goods China (CNFREXPY) and other nations produced. They kept the world economy humming.
It may not work that way anymore, Bloomberg Markets magazine will report in its January issue. A rebounding U.S. is giving less support to global growth than in the past. Homegrown demand and production are more important drivers of the worlds biggest economy than they were a decade ago.
The smallest U.S. current-account deficit since 1999 shows the trend, and the discovery of new domestic sources of oil and gas reinforces it. Exploration and production are adding to growth, and the country is spending less on imported energy. Cheaper fuel and raw materials are boosting manufacturing as well, making the U.S. more of a competitor to emerging-markets nations and less a reliable consumer of their goods.
Global growth is slowly becoming more of a zero-sum game, says Manoj Pradhan, emerging-markets economist at Morgan Stanley in London and a former International Monetary Fund official. U.S. growth is not reverting to the pre-crisis model, which created lift for everyone else.
Laelth
(32,017 posts)Here's the kicker for our manufacturing sector:
Crush labor, and manufacturing will come home. That seems to be the attitude of our oligarchs.
-Laelth
loudsue
(14,087 posts)But they own our government officials.
socialist_n_TN
(11,481 posts)Classic Marxist economics would state that the RATE of profit is the biggest driver of capitalist investment, ESPECIALLY investment in the productive sectors of the economy, i.e., manufacturing. Since the biggest impediment to profit is in labor costs, when labor costs are chopped, investment goes up, as do jobs and production.
The problem comes when the cutting of labor costs also cuts the living standards of workers. That's why capitalism is a zero-sum game in the long run. And the long run is pretty much here. This is the ESSENCE of capitalism and that's why capitalism cannot be reformed into working for the masses. The masses ARE the labor costs that are the impediment to profit under capitalism.
Egalitarian Thug
(12,448 posts)as the American taxpayer) is right there with the black card.