[Anh_Minh]

Originally Posted by DonQuigleone

That is an incorrect way to view things. For one, within 10 years it's entirely likely that China will have lost what wage advantage it currently has. It is not a long term prospect.

They won't be (they already aren't) the cheapest in the world, but they'll still be cheaper than Western workers.

And even if that wasn't the case... That'd mean higher wages for some other third world countries. It still wouldn't bring the jobs back to the West.

Secondly, Industrial production today is not the same as the industrial production of your grandpa. That type of industry, driven by unskilled, cheaply payed workers who do repetitive and monotonous tasks is gone. It was destroyed by the Japanese in the 70s and 80s. Industry today is built on fewer skilled workers, not a mass of unskilled drones. Many people want to cling onto that idea, but it is a dead one. If you want to go back to those days, then prepare to go back to cheap, unreliable and flimsy products.

The primary factor in an industries success is not how low it's wages are, it's how productive it's workers are. 5 skilled skilled Japanese or Americans will always beat a legion of uneducated Chinese farm boys.

Two points:
- they aren't beating them now.
- what "uneducated Chinese farm boys"? Why are you talking like that's all China has to offer? What they have is a vast array of variously trained workers who, for equal training, are much cheaper than their Western counterparts. They can make quality (though maybe not top quality), if the money's right. They can also make crap, if that's all the retailers in the west are willing to pay for. Labeling is... negotiable.

If Chinese industry is to beat American industry in the next 20 years, it will not be because of it's cheap labor. It will be because Chinese companies were willing to embrace the innovations that western companies weren't.

People blamed Japan's success on low wages too, they were wrong, Japan did not become an industrial behemoth based on cheap disposable factory labor. It became a behemoth because it was better then everyone else, and everyone else only responded by trying to block Japanese products and factories from being built.

If the basis of China's success is only it's wages and warped currency, then we're quite fortunate. Chinese industrial growth will inevitably collapse in that case.

But if China is genuinely better then us (and it's entirely possible that they are), then building a wall and plugging our ears will achieve nothing. They'll just keep getting better and better, and we'll just stagnate.

It's not just about wages. Our social model is expensive. So are various environmental laws.

It doesn't matter, though. The point is, you're right: the Chinese are better than we are at getting the goods out for cheap. That's actually an argument for protectionism: if you can't win, don't play. So until and unless someone comes up with a way to turn superior knowledge of American (or in the case of my country, French) history into a decisive industrial advantage, protectionism seems the way to go.

The reason American(and also European) industry took such a dive in the last 30 years is because they took the easy way out and still tried to compete with the rest of the world based on low wages, rather then focusing on improving worker productivity. And one of the best ways to improve productivity is to expose industries to the full force of the world market.

If we look at some of the best manufacturers in the world (think Toyota), they have not closed down their plants at home, because their workers cannot be easily replaced by cheap foreign drones.

That's fine when you want quality. Maybe. But for a lot of things, quality's just a luxury.