I have little to no practical knowledge of macroeconomics, so I ask for your patience here. There was a feature on an NPR show this past weekend about how the rise of the Euro over the dollar was actually helping some sectors of the retail economy. Specifically, major city destinations, such as New York, Boston, Chicago, San Francisco, etc., were doing very well this holiday season. People from the UK and Europe were arriving with empty suitcases and filling them with electronics and luxury items because of the exchange rate. Even cities bordering Canada were experiencing an uptick in international traffic because of the historic alignment of the $CA and $US.
Two things occurred to me: First, the relatively high sales in these specific sectors are going to drive up the national numbers, which may lead to an increase in consumer confidence, even in the less fortunate areas. Second, many of the products that are being purchased were made in China, spurring the retailers to replace their inventory, which benefits Chinese manufacturing. So even when our economy is shitty, the pain is not passed along to our main supplier of retail goods. Or at least, the pain is attenuated.
Is it well past time to engage in a bit of protectionism vis a vis our lopsided trade status with China? Would this sort of action be devastating to our most poor? Who decided that we don't need a manufacturing class here in the US?
I think it was Clinton or Bush the First who first talked about restructuring our economy to be more based upon creating a new kind of job -- the so-called "knowledge-based" economy. While this is a laudable goal, it doesn't account for the fact that many people have no interest in working with computers or advanced technology, and who would be miserable attending college or university. The fact is that many people really are happiest using their hands and backs to earn a living, and may not be successful or happy if forced back into school. I'm thinking specifically of those aged 45 and up.
The economic reality, I think, is that manufacturing and farming jobs provide national stability, and it is important to protect these jobs with tariffs and other protectionist strategies.
Now, I await the better-informed to tell me what's wrong with my thinking. I'd really like to understand this a bit better.
How timely that you mentioned tariffs and a manufacturing economy! We can experiment with that exact type of legislation and economics once I have a playable draft of my board game Trust!
ReplyDeleteI glanced over the rules last night. It has a lot of features that I like, and based on that, I'd love to play it when it's done. I haven't yet done the necessary visualization to see where there might be problems, however.
ReplyDeleteIt's funny, the title of your game gave me an idea for a mechanism that I haven't yet seen: a formal alliance system that benefits everyone in the alliance combined with a potentially better reward for the first person to break the alliance. Sort of a press-your-luck mechanism with alliances.
Something like a multi-party prisoner's dilemma? There was a show on the Game Show Network for a while called... what was it... Ah, it's in that same article, called Friend or Foe. You and a stranger square off and vote on what to do with $1000. You both vote "Friend," you split the money. Both vote "Foe," and it's forfeit. But if the vote is split, the betrayer gets the whole shebang.
ReplyDeleteCould be interesting extrapolated to more people. (esp. since psychology and criminal science have long studied the feasibility of N-way conspiracies as N increases.)
Oh, and the name of my game is mostly because another term for that type of business practice was already taken in the realm of board games :)
ReplyDeleteOK, at the urging of the peanut gallery, I'm leaving another comment.
ReplyDeleteWhat this means is that we will turn our house in Seattle into a knickknack store for Canadians.
The end.
I was accused of not actually reading the post before commenting. Now that I've skimmed it, I stand corrected. We could not turn our house into a knickknack store for Canadians, because knickknacks are made in China. We would instead brew beer for Canadians, for they are woefully short on good beer (wink, Jim).
ReplyDelete