Here's one man's take. It was inevitable. The author suggests a way forward.
China is not the reason that manufacturing began to decline in the United States in the second half of the 20th century. The United States was an uncontested manufacturing powerhouse in the 1950s in no small part because Germany and Japan had been bombed to smithereens, along with much of the rest of the civilized world, while potential global competitors in much of Europe, Latin America, and Asia were suffocating under socialism in various forms. That is no longer the case.
The United States is a country with an average household money income of some $50,000 — we are not going to be the world’s leader in low-margin injected-plastic manufacturing. That is not going to happen, and we should not be eager for it to happen. . . .
Here is something that is not a mystery: China will soon be the world’s second-largest consumer market, and India will be fourth or fifth in a decade or so. We Americans excel at making high-end stuff: Technology, aircraft, industrial machinery, etc. It’s easier to sell high-end stuff to rich people than to poor people. China’s trade imbalances with the world at large are well on their way toward being sorted out, and have been for some time, and the fact that the United States continues to have a large trade deficit vis-à-vis China is at least as much a reflection of policy decisions in Washington as of those in Beijing. (And it is worth remembering that about half of our trade deficit with the world at large is from a single product: oil.)
The only thing that will raise wages in the United States is real long-term investment in productive capital. That’s it. Romney is better placed than most to appreciate that — I think. I’m skeptical of the cult of the businessman, whether your businessman is Romney, Herman Cain, Donald Trump, or Ross Perot. The United States of America is not Bain Capital, and it is not a pizza chain.
