By Shaun S. Sukul
As the centuries pass, different nations rise and different nations fall. One day Greece is on top, the next it’s Rome. Britain was once the world’s largest superpower until we took over. We’ve been going strong for 228 years, and although we’ve had bumps along the road, the future looks promising. But in the face of the export of white collar jobs, internal social struggles, and a decline in industry, stronger foreign nations will be important. Why do I say this? Isn’t it us who should be getting stronger? Yes, of course, but the reason America is so strong today is because of banking and foreign interests. I kid you not. Many say that industry isn’t important in today’s America because we are a service-oriented economy. While this is true, we are providing services for ourselves, so there is no gain in international trade. We are providing healthcare services for ourselves, treating ourselves to some fine (or not so fine) dining, and entertaining ourselves, which, while it does increase our GDP, does relatively little to increase our position among other nations. America is able to enjoy success today because our businesses not only serve us, but other countries. A small example is a Levi’s store in France, let’s say. The jeans may be made in China for a low cost, and sold in France, and America comes out the winner because company ownership is ours. China benefits somewhat, but the manufacturing costs are so low that it pales in comparison with the profit. Our banks also loan money to foreign countries and businesses, hoping that they will see enough success to enjoy a return. This is why I say that it’s vital for America to have healthy foreign trade partners. How did we arrive at such massive ownership? How did we get such a big start? What can be done to help some flailing nations? All of this can be answered, though perhaps not completely, by two case studies: ours and Singapore’s.
England’s claim to fame was naval ingenuity, colonialism, and of course, its early entry into the Industrial Revolution. After the Revolution started in Britain, we took the capital from great agriculture profits of the day to invest in factories and new technology. England declined as the decades went by because it lost its colonies and it was hit especially hard by the two World Wars. Thus, with a great deal of real estate and brainpower abound, we continued our industrial success, pioneering and dominating the automotive field, among other things. As the years passed and unions crept up, manufacturing was becoming less profitable. Companies moved their factories elsewhere, just as computer technicians and legal services are being found abroad by major American corporations today. Such foreign exposure actually gave us more prowess in foreign markets and now almost every country buys something from us. The importance of industry cannot be ignored, however, as it still accounts for 25 percent of our economy.
Singapore, independent (from Malaysia) in 1959, had great initial leadership and made small investments in some factories. This translated into foreign investment, and soon Singaporean activity went from clothing and wood to the more profitable oil refining, shipbuilding / repair, and electronics. Singapore has already started on the road of international investment. The move into more profitable industries was made possible by a serious investment in education. The smallest country in southeast Asia, Singapore is very successful relative to its population size.
I am no economist, but I do my best to draw connections within the information I come across. In order for us to maintain our global stance, struggling countries should take the message to industrialize and educate; it’s the key to success. Our foreign debt is currently some $1.7 trillion, which is very high compared to other countries. (Britain has $270 billion U.S. Brazil $290 billion U.S.) If we can control our government spending and make some wiser foreign economic policy decisions, we should be on the road to recovery.
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