Reply #9: Is it really the ability to produce?

[wkirby]

I know that this is stretching things a little, but do you think that in the future, and even perhaps today, that real economic power will be not who can produce the greatest quantity of goods, but who can consume the greatest quantity?

It seems that it's been quite some time since we were the best at producing goods. In fact, really non of the economic powers have been good at it. Our wage rates are too high here in American and in Europe.

I think that being powerful economicaly is having a powerful market. No matter where I am in the world, if i'm making a product intended for the mass market, my number one goal is being able to market it here in America. Just look at how dominating Wal-mart is in getting Asain produces to exclusively distribute their goods, at their predetermined prices and specifications.

You're right that in some cases our consumption depends on foreign production, but I think in a way that increases our control over foreign nations economies. Take this scenario for instance. We decided here in America to engage in mass economic protectionism. All economic parties envolved would be hurt, both us, Europe, and Asia, but I think America would be the best suited to work from that point in terms of establishing production/consumption at equilibrium. We have a great market here for goods, domestic producers would flock to it.

Do you see my point?

-Will Kirby
The Kirby File