THE CANARD

Posted in Rants on January 26th, 2011 by Ed

Playing off of the main theme of the State of the Union address, Very Serious Reasonable Centrist David Gergen asks a very basic question in his latest CNN piece: Can the U.S. still compete?

The question: Will the United States renew its capacity to compete in global markets so that we create quality jobs for our people here at home? If we do, America's best days are still ahead; if we fail, they will soon be far behind. It's about that simple.

For more than a century, we didn't have to worry much about our greatness as a people. But times have changed. We may be the nation that astonished the world by building a transcontinental railroad. But today, as the president pointed out last month in a visit to North Carolina, we find that Shanghai in China has built more high-speed rail in a year than we have built in the past 30 years.

For most of the 20th century, we were No. 1 in the world in education; today, we are ninth in the proportion of young people with college degrees, 18th in high school graduation rates among industrialized nations and 27th in the proportion of science and engineering degrees. China now graduates more English-trained engineers than the U.S. and has become the world's No. 1 exporter in high technology.

As others have become more competitive and we have slowed, American jobs have been disappearing…Can we turn things around? No one is certain, but the competitiveness commission — representing some of the best minds in the country — believes we still have a chance. In the 2010 report, its top four recommendations, in descending order of importance, were:

1. Upgrade U.S. K-12 education in science and math to a leading position by global standards.

2. Double real federal investment in basic research in math, the physical sciences and engineering over the next seven years, while maintaining the recent doubling in bioscience research.

3. Encourage more U.S. citizens to pursue careers in math, science and engineering.

The seductiveness of this argument and people like Gergen in general is that it is impossible to disagree with his point. We do suck at math and science. We are shedding jobs. We are a shell of what we used to be in terms of competitiveness. Although he doesn't say so explicitly, he is tapdancing around the fact that we're not really good at anything anymore except engaging in high-tech warfare for low-tech purposes, i.e. bombing the living shit out of some country that is already difficult to distinguish from rubble.

The problem is that this line of reasoning misses the point entirely. None of these problems that he identifies, as real as they are, will be solved by having more young people doing better in math and science. We could start churning out Stephen Hawking-caliber minds by the hundreds and it would not change the fundamental fact that we cannot compete with China and the "developing world." Everything "engineers" and scientists can do can and will be done more cheaply there. And we did this to ourselves when we decided that having cheaper consumer goods for the top 10% of income earners was more important than having a middle class making decent money and driving the economy with (non debt-supported) purchasing.

When the upper- and middle classes decided 30 years ago that it would be a good idea to phase out the working class in favor of cheap foreign labor it appears obvious in hindsight that they were opening floodgates that would eventually result in white collar and highly skilled jobs going overseas as well. But something – subconscious racism, American exceptionalism, or perhaps good ol' fashioned cockiness – convinced everyone in the suburbs and penthouses that this could never happen. Chinamen using computers? An Indian getting an MBA? Be serious! The unwashed masses of the Third World will never be able to do our jobs, said the comfortable elite. They will be useful for helping us break unions, but their skills are and ever shall be limited to menial physical labor.

First they came for the autoworkers, and I did not speak up. Then they came for the steel mills, and I did not speak up. Then they came for the white collars, and there was no one left to speak up for them.

It doesn't matter how many math PhDs and computer scientists and engineers we produce. What's the point? Within the next 15 to 20 years, every single one of those jobs will be done in Southeast Asia.** The jobs are not coming back because there is not a single incentive, economic, legal, or political, for companies to hire American workers, be it for menial or highly skilled work. As Christina Freeland pointed out in a recent (and excellent) Atlantic Monthly piece, globalization has put you and I in the position of competing with someone who will do our job for 1/10th the compensation:

The good news—and the bad news—for America is that the nation’s own super-elite is rapidly adjusting to this more global perspective. The U.S.-based CEO of one of the world’s largest hedge funds told me that his firm’s investment committee often discusses the question of who wins and who loses in today’s economy. In a recent internal debate, he said, one of his senior colleagues had argued that the hollowing-out of the American middle class didn’t really matter. "His point was that if the transformation of the world economy lifts four people in China and India out of poverty and into the middle class, and meanwhile means one American drops out of the middle class, that’s not such a bad trade," the CEO recalled.

I heard a similar sentiment from the Taiwanese-born, 30-something CFO of a U.S. Internet company. A gentle, unpretentious man who went from public school to Harvard, he’s nonetheless not terribly sympathetic to the complaints of the American middle class. "We demand a higher paycheck than the rest of the world," he told me. "So if you’re going to demand 10 times the paycheck, you need to deliver 10 times the value. It sounds harsh, but maybe people in the middle class need to decide to take a pay cut."

Leave aside for a moment the ridiculous notion that we can start educating innovators and engineers while we're slashing funding for education, laying siege to those Greedy Teachers and their Unions, and making a push in some of our biggest states to start teaching kids that people rode dinosaurs (Think of how many great bioengineers and geneticists a nice, creationist education will produce!). America cannot compete, not because we are dumb, though we are, but because we have set ourselves against people willing to work for much, much less that us.

We cannot compete with a China that keeps manufacturing workers in quasi-prisons, working 12 hour shifts making iPods for pennies per hour.

We cannot compete with a China, India, or Mexico in which industry pollutes without the slightest hesitation on a scale that would embarrass an 1890s American steel mill.

We cannot compete when imported goods compete with domestic goods on even terms in the U.S. retail market.

We cannot compete when your college friend from India gets the same degree as you do, returns home, and does the same job for 1/4 the salary.

We can't compete until you're willing to take that paycut our socioeconomic betters now demand, because our most glaringly obvious problem is that you currently make too much money.

We can't compete because we have spent the last 30 years seeing to it that we cannot, and will not, compete.

How unfair it is that so many of the people responsible for our current state of competitiveness will have the luxury of dying before its consequences fully unfold.

** Including yours. Yes, yours. I know everyone in these fields has rationalized a reason that they will never be Outsourced, but recent history has given the lie to any theories of exceptionalism.