Wisconsin Public Radio

Manufacturing is still critical to the economy United States. Clyde Prestowitz, says it's time to start realizing the positive spillovers that manufacturing creates... Read more  

Events & Activities

Stephen Olson at Chinese Development Institute Conference

 

 Clyde Prestowitz giving presentation to CDI...

 

Steve Olson teaching trade negotiations at the Mekong Institute...

 

Stephen Olson to speak at upcoming workshop organized by the International Institute for Trade and Development on 

"Economics of GMS Agricultural trade in goods and services towards the world market"

Chiangmai, Thailand Sep 8-12.

Book Reviews & Citations

(06/12/05) Clyde Prestowitz and 3 Billion New Capitalists quoted in the Arizona Republic

(06/12/05) Clyde Prestowitz and 3 Billion New Capitalists quoted in the Arizona Republic
The Arizona Republic
(Phoenix)
June 12, 2005 Sunday Final chaser Edition
HEADLINE: GOING NUMB AS AMERICAN DREAM FADES AWAY
BYLINE: Jon Talton, The Arizona Republic


BODY:
Every time I tune into the electronic media, where most people get their news, the top stories are the latest non-news from the Michael Jackson trial and some sad disappearance of a young woman who happens to be White and attractive. You could forgive the American people if they assumed nothing else is going on.

In fact, the world keeps shifting under our feet.

Last week, General Motors said it would eliminate 25,000 jobs. In the late 1970s, GM employed 600,000 workers, primarily in the Midwest, providing some of the best and most secure jobs.

Almost lost in that smoke was an announcement by two furniture manufacturers in North Carolina that they would cut 1,200 jobs. Like textiles, furniture manufacturers once provided jobs that allowed people with modest skills and education to move into the middle class, especially in the South.

Meanwhile, the latest jobs report was far weaker than expected, continuing a trend of anemic job creation at odds with the economy's performance in the 1980s and 1990s. Among the biggest forces behind the change is China's rise. Textiles and furniture have essentially been lost to China. But China will be competing for jobs at the top, too.

In his new book, Three Billion New Capitalists, trade expert Clyde Prestowitz argues that we're seeing only the start of a historic shift of power to the east. As I have argued for some time, a century's worth of progress in creating an American middle class is at stake.

Yet not everyone is making sacrifices if we are to draw down American living standards to compete with Asia.

In magisterial work for the New York Times, reporter David Cay Johnston has documented the rise of the hyper-rich, the top 0.1 percent of income earners. These 145,000 people are leaving everyone else far behind, even those who would be considered wealthy. From 1980 to 2002, the latest year where data are available, the share of total income earned by the hyper-rich more than doubled. That earned by the bottom 90 percent of taxpayers declined.

Johnston's research also makes it clear that the new nobility was the chief beneficiary of the Bush tax cuts. Those helped create a deficit that will, we are told, force cuts to Social Security and college aid, among other programs.

Speaking of college aid, Jackson watchers also probably missed news that the federal government has changed the rules for Pell Grants. That, combined with declining state support for universities, will keep a record number of Americans from getting a college education.

These facts show some of the reasons the Wall Street Journal recently looked at the data and concluded that upward economic mobility has largely stalled in the United States. This historic ability to get ahead through hard work is the "American dream."

Then there was the Times scoop about the White House official who was editing official documents to downplay the link, accepted by scientific consensus, between man-made greenhouse gases and climate change. The official was formerly in the pay of the oil industry.

Far from being acts of nature, many of these trends are being propelled by policy for the benefit of the few. And where these forces are irresistible, Washington is failing to equip the American people to address them.

If the goal is to numb the people, it's succeeding spectacularly.

Join our mailing list

Latest Publications


The Betrayal of American Prosperity.


The Trans-Paific Partnership and Japan.


Making the Mexian Miracle.


Industrial Policy and Rebalancing in the US and China.


The Evolving Role of China in International Institutions.

 

Contact us

Economic Strategy Institute

1730 Rhode Island Avenue, NW, Suite 414 |  Washington DC  |  20036
Ph (202) 213-7051  |  Fax (202) 965-1104  |  info@econstrat.org