Insane letter to the Observer of the week

The true threat to western employment and living standards is the rise of a globally competitive Asia, at a pace and with a power and penetration quite without precedent in history. No devaluation or indefinite deficit financing can conceivably be sufficient to price and equip ourselves to meet this challenge. Such evasions merely exacerbate our weaknesses and ensure our eventual eclipse.

Europeans and North Americans must tackle their deficiencies in productivity directly.

Erm, excuse me, but what deficiencies of productivity would these be?

We have vastly higher productivity per unit of labour, we have vastly higher total factor productivity, than those supposed \”competitors\” in Asia (who are not competitors anyway, they are complements, that\’s why we trade with them).

Their growth is actually based upon the point that their labour productivity is growing to something like (although still a long way behind) our own.

That\’s, umm, actually what economic growth is all about. Rising productivity.

So, err, what on earth are you talking about?

3 comments on “Insane letter to the Observer of the week

  1. “their deficiencies in productivity” means that after the Government has looted 50% of all the wealth produced, there isn’t enough left for the Council to live on.

  2. The Chinese Govt isn’t exactly known for telling the truth. Their claimed productivity level isn’t backed up by their electricity consumption figure which is some 30% lower that what would be needed to support their claimed output.

    And if the US economy continues to tank then China’s main export market is going to collapse. Same goes for every other country in recession. Just where is Asia going to sell the goods they claim to be producing?

    Anyone see what’s happened to Toyota in Japan? £53bn losses last year and even more this year. They outsold GM, Ford and Chrysler in the US until last year. Now the market has collapsed and even Toyota can’t cope. And their Govt ain’t bailing them out.

    As for India they are supported by foreign aid such as the £800m we still pay them every year. And this is a country that can afford its own space programme. Then you get companies like Tata who are taking advantage of the carbon trading/credits scam to pay for the building of their new steel plants in India. So with reduced capital expenditure it is hardly surprising they claim to be more productive.

    Any industry supported by public subsidy (wind farms anyone) can claim to be productive but when the money runs out where will their productivity be then?

  3. Rossa-
    “Their claimed productivity level isn’t backed up by their electricity consumption figure which is some 30% lower that what would be needed to support their claimed output.”

    Excellent point.

    Tim adds: I’ve no idea of the truth or not of that statement. But taken on it’s own it doesn’t make sense. If our production is x and our electricity consumption is y, Chinese production is x (just as an example) and their electricity consumption is y-30%, then all that tells us is that they have a higher productivity per unit of electricity.

    That is, the facts as stated show that they have higher productivity.

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