Can We Still Compete for Technology?

It is my understanding that the USA Gov has passed laws that make off-shore employment more profitable than on-shore. Until we can get this Anti American law repealed we are sunk To my knowledge India has had the full corporate educational dollar that used to be supporting USA citizens in their educational requirements. The company I work for does not have any funding for USA classes, they do sponsor classes overseas each month. We as Americans can only do what is within our power to effect changes. Join POGO type organizations and send many letters to our leaders to vote for changes that benefit USA citizens. Educate ourselves with our own money in modern technology. Form our own companies and take market share from those who are selling us short. Essentially "Pull our self up by our own Bootstraps" We are not getting there relying on others, but our future has already been sold to take it back we must invent a brand new future.

Do you know of any efforts along the lines that you suggest?

Any ideas on how to 'work from within' to encourage our companies to help fund education here in the U.S.?

I send to a local representative list Gov voting letters every time I get a bur under my saddle. I have joined startup companies and tried to "Made it here in America" in the past. I buy American Beer, there are a marvelous number of Micro brews out there. I am un American in the cars though. Lexus rules. I vote to end Pork Barrel politics. I vote to end subsidies of companies that hurt America and our future. I vote to kick the scoundrels out for God's sake. I happily welcome all legal immigrants as new brothers. I am not a gazillionare with power to make big changes, I do what I can to make this place I stand just a little bit better when I can.

On working within companies to change their politics, don't have a clue? The movers and shakers are living far from the realm I live in. The only way to get to them is by changing what they see. If we start buying all that comes from America, if we favor companies who employ Americans instead of others we may effect change. We must effect change by using our money wisely.

Everyone, please forgive me if you have heard this until you are blue in the face.

We can all start at a local level if that is the most influence that we can use. For example, we import a tremendous amount of goods from China; correct? And who sells the lion's share of these? Wal-Mart, et al. Do we need to spend our money in the stores that remove the power of choice and variety (that was once available from the private small business world) and provide jobs at menial wages for overseas workers? No, we don't, and I don't. I do not know when I last purchased anything in their stores, but suffice it to say that it was at least twenty (20) years ago when they were still touting the "Buy American" motto.

Don't curse the founder, Sam Walton. He's not there anymore. You may curse those currently in charge who choose to stock the shelves with cheap goods in order to gain market share. Begin by voting with your feet and your wallet. Anything that you purchase in the big box stores can be found in smaller retail outlets. One might mention the idea of tarriffs that were once popular on imported goods. Those didn't work so well, and allowed several of our largest manufacturers of consumer goods to produce shoddy products while enjoying the "protection" of a tarriff.

For example, the Harley-Davidson Motor Company. Now, there's a company who designed and made some real crap, and even their very talented workforce could not fix all of the problems with poorly-designed and poorly-made parts for Shovelheads. They tried. A lot. HD enjoyed the protection of the tarriff system until it was rescinded a bit, and the Honda CB-750 became the motorbike that nearly destroyed an American icon as it destroyed several others from Europe. The 750 was a motorbike of excellent quality for a fair price, and one that did not leave an oily mark (yes, that "character" thing, I know!) everywhere it was parked for five (5) minutes. The 750 paved the path for Japanese motorbikes to flood the streets of the U.S.A..

I love motorcycles and have had one from nearly every manufacturer, and I finally purchased an HD several years ago. Love it. It does not spot the floor. It is operational 99.99% of the time. The brand made a comeback, but probably hinged most of this on its uniquely American flavour and heritage. I know that most other consumer goods cannot enjoy a type of tribal symbology to this degree, but I mention it anyway. People will buy American if they can for a comparable price, but the goods must be available. So many are now not available from American manufacturers.

Ing. Robert Forbus

All of your "Buy American" and "Employ American" campaigns are going nowhere until the American technical education system can provide the needed workforce. Our education system has not only lost its way, it doesn't have the means or motivation to recover. The loss is so profound that recovery doesn't even seem likely. The problems are into the second generation and the parents don't even know where to begin.

Some years ago, I had the opportunity to tutor a South Korean middle school student. His mother was in my ESL class and asked if I would work with her son who, after two years in this country, was having a little difficulty maintaining "High Honors" status. After each ESL class, she would dash out and pick up her son and bring him in. We worked together until they understood every subject. She explained that, in Korea, parents would pay teachers for extra attention for their children.

I can't help but contrast that with my more recent experience with my own granddaughter, a high school freshman, on her algebra. She had never been taught multiplication tables so, not surprisingly, she was having problems with factoring. My daughter seemed resigned to the weird education that her children were getting. Maybe, someday, Monica and Dong Jin will be competing for the same job.

My other grandchildren are being home schooled and I'm not sure how that is going, but it couldn't be much worse. Where do you start? DickL

This problem is not just confined to the US. In the UK, the situation is very similar - the emerging markets have developed to the same levels as we are at, but have not taken on the attitudes prevalent in the West.

Complacency sets in when at the top of the pack for long enough - especially when there is government aid in the form of import restrictions.

By now, the only thing the emerging markets need is the training - and that is provided either in the West or in new university campuses situated within the emerging markets.

Not only that, but the Business School actively recommends that production costs are much cheaper in foreign parts due to banks allowing longer payback times for major investment (UK:2-3years, China: up to 10years). Add to that less red tape, and the financial arguments are too strong for most.

I could rant (and have ranted) endlessly about this subject.

I've been on both sides of the fence, in a way. I've consulted for a large US automaker taking jobs to Brazil and Mexico. I've consulted for a large (originally US) tire manufacturer owned by a Japanese company. The tire maker would have been sunk without the benefit of a huge capital infusion and a new way of working. The auto manufacturer (although motivated entirely by profit) did great things for the communities in which they located plants. The jobs provided were excellent jobs, and in the countries involved, you could see, dramatically, the effects of bad (or no) jobs for the population. Without good jobs, very large segments of the population lived in housing (?) that would make a typical American ghetto dwelling seem like a palace.

I've traveled to rich and poor parts of the world, and have seen that globalization can do good things for the poor parts. Perhaps my kids will not be able to afford a Lexus, but somewhere in Mexico is a kid who can at least eat well, because his dad has a good job at an American company (or at a local supplier to that company).

BUT... We are losing ground fast. We've coasted along, in many cases producing products (see the post above re Harley Davidson, for example) that cannot compete with those from other countries. GM cannot and has not competed successfully with Toyota. Our management is short-sighted (and the stock market rewards short-sightedness and job cuts) and Toyota's is long-sighted.

Some core problems:

• We are not very smart. (We are at the bottom of the heap in the industrialized world in standardized test scores.) I recently consulted with a US health care company, heavily technology-based, and the real power in the company resided with the IT staff -- and the movers and shakers were all (you guessed it) Indian. In China, bright kids will have four or five physics courses in high school. Here, we (typically) have one.
• We are short-sighted. Corporate leaders are rewarded for short-term thinking: SUVs sell well -- then let's only sell SUVs, invest little in R&D, and not think about the future... let's make a fast buck, and let the next CEO deal with any problems.
• We believe we are "entitled" (because of luck of the draw) to make 10-100 times as much per hour as workers elsewhere, and we believe we are "entitled' to consume far more energy per capita than other developed countries (and orders of magnitude more that developing countries).
• We are selfish. We'd rather bomb a middle east country into oblivion than make any real effort at becoming energy independent. We want gas guzzlers, and we'll kill to maintain access to oil.

With China, we can expect a repeat of the drubbing our auto industry has subjected itself to with the Japanese. But far more dramatic and broader: China is a much bigger country, and they are developing in a time when working globally is much easier. Chinese and Indian cars and SUVs will be here in a couple years -- and their acceptance is unlikely to be as slow as acceptance of Japanese cars was. Mahindra tractors already have 25% market share in the US, and are now second worldwide.

Consider this: Delta Airlines now sends some of its planes half way around the world, to China, for heavy maintenance. This is highly skilled, critical work being done, for about $100,000 per plane vs $1,000,000 in the US. Can any other carrier afford to keep their maintenance in the US. What are they to do? Go belly up, putting American workers out of work... or send work to China, where it can be done economically? How about tariffs? They work both ways: we can't expect to sell our stuff into the world's largest economy (China) unless they can sell their stuff to us.

Ultimately, we are going to have to adjust to much lower wages, unless we become much much smarter, and devise something that makes our workers (engineers, doctors, and lawyers included) able to charge more for their services than the smarter people elsewhere. (Even tax services are now doing their work overseas.)

Where will the next (world market) Buick Lacrosse be designed? Shanghai. (There are currently two versions, one of which was designed in Shanghai [the other in Detroit]. Most people, including GM brass, think the Shanghai version is better.)

If it is any consolation, consider this: I've met many Tibetan Buddhist monks. They live on virtually nothing. I've never found a happier, more ethically, morally, and spiritually centered bunch of people. Money won't buy you happiness.

I totally concur with your position and believe our own greed and laziness will be our downfall. The point you ,ake about the Tibetan monks is valid. Since money doesnt bring happiness, maybe we will be happier living with less.

One thing though, it was not the engineers and scientists that set us on this road. It was the business schools.

In my modest opinion, the USA continues to be the best supplier of Integrated Circuits.

I do designs of special DSP boards including mixed A/D circuits, FPGAs, microwave "logic" ICs and the like for several clients and I make sure that all components can be bough exclusively from US manufacturers, as Xilinx, Analog Devices, Micron, etc., then I just e-mail the part lists to my clients and they do almost all purchases.

For example the best distributor of ICs in the world is Digi-Key, located in Thief River Falls, MN, because the information they supply on-line is so good, so complete, and navigating through their giant site is so easy going, that I enjoy working long hours all night connected to their web site, even changing the design just to fit the available stocks from that company. Nothing like this can be found in Europe or Asia, even more, I hate buying in Europe, and specially I hate doing that in France, the worst supplier in the world.

I want to say that at least, for an electronic designer as me, USA has no competitors in the world.

You worry about China, Ok, good for you if you worry, but don't have nightmares, the Chinese are very poor on providing information, as data sheets for example, they provide poor application notes or no application notes at all, and they sell only for large production runs of older chips, from the 90's and even 80's.

One of the advantages of the US mentality is that you are "tinker entrepreneurs", you experiment in the garage, and that is impossible in France, China, Germany, Japan, etc, the only garage tinker experimenters live in Anglo Saxon countries like the USA, Australia, New Zealand, and may be in UK or Ireland, so this is an exclusive advantage of your Anglo Saxon culture.

So please don't decay, because the example you have legated to the world is extremely valuable. In Chile we have learned a lot from you, but still we have to learn a lot more from you, in special the need to empower small enterprise spirit to avoid collectivization.

I guess USA should empower a new wave of venture capital in the 50 states to support a new generation of entrepreneurs. Te best and only way to compete with China is converting our countries in free entrepreneur nations, and this should be educated from primary school.

Sincerely

Jaime Soto Figueroa

http://www.matharts.cl/

Man oh man is it good to see an optimist for a change. I am hearing that we (USA) are going to be laying off up to two hundred thousand tech workers next year and this. That kind of news started me down the blues road. However I do know our history and also know our capabilities. The younger generation may not be educated, the bosses wanted more easily to lead slaves I guess. But we old dogs are not dead yet and some of us have been around the block a few times. To date I have seen lost, mystic forces, heads down, fearful, dedicated, wisdom, and now from a brother techie from what looks like another land optimism. We will need that and more to get our small business startup mentality up to speed to survive what our leaders have done to us. Tonight I will hit the books to study again. Hopefully by Monday this old dog will have learned a new trick and I can compete.

I appreciate your post as a compliment/encouragement, but I feel that crediting innovation (Garage tinkering/ entrepreneurs) as an Anglo Saxon trait is wrong. It is not the type of people living here, nor our ancestor's culture that allows for innovation at an individual level. It is our free market economic system. We have a system that allows for any individual to achieve prosperity from tinkering. Most of the countries you list as not being able to succeed (France, China, Germany, Japan) are socialist nations. I am surprised how many people (particularly engineers) do not understand the basic principle of risk/reward, human nature and the fact that prosperity is naturally desirable and a good thing. Allow citizens to be rewarded from their risk and tinkerers will develop in any nation. So do not try to become "Anglo Saxon" to succeed, that is silly/impossible- It is easier to become a free market economy. Stop looking to govt for help. They always take far more than they will ever give.

WMaczka,

You have presented a very interesting report and you have received some thoughtful replies. But, I think you have posed the wrong question. You seem overly concerned about the continued competitiveness of the United States. It's as if you see the growth of engineers and engineering success in Korea (and, maybe, elsewhere?) as something that is a threat. It is NOT!

On the contrary, it is what the people of your country helped create and promote in Korea. MillMatt's post, OUR Engineering Community: Quelling Fears/Realizing Dreams, in his CR4 blog, Common Purposes, provides a very different and valuable perspective that you might want to think about. He refutes Mr. Thomas L. Friedman, a columnist and author who is also very worried about the impact of global competition on the United States economy.

It may be true that the economy of the United States (and European countries, Japan, etc.) will suffer as the economies of India, China, Korea grow. But, business and economics are not a zero-sum game; meaning, we do not live in a football game where there can only be one winner. Success for so-called third world countries does not mean the United States is losing. The sooner that YOU and readers of Mr. Friedman understand that fact, the sooner we will stop worrying so much and start helping each other more.

I'm so glad that others who have responded to your post also understand what really matters. I hope you now understand, too.

Walter

The only 'threat' -- implied or real is that we may be taking the easy route via the open market approach (exclusively) and pouring money into developing global resources while ignoring our own.

If the U.S. doesn't continue to develop its own talent (and the same goes for every other country), how can you maintain an aggressive technology base and a leadership position.

And yes, I firmly believe that the U.S. is the technology leader.

What say you?

The AEA (AeA?) is a trade association whose goal is to generate funding and attention for its member companies. The individuals who wrote the report you reference, however worthy it may be, are being paid to prepare a report that meets the objectives of the AEA. So, would you expect them to write a report citing that all is well, US firms are paving the way for the future and that the government and educational institutions should shift funding to biotechnology?

I do NOT believe that the educational system in the United States needs a major overhaul. I do NOT believe that our livelihoods are in peril because the government is not pumping enough money into academic research and education. Could we all do more? Yes. Should we all do more? Yes. Should we succumb to jingoistic fears that we're going to lose our competitive edge because Korea now graduates more engineers than the United States. NO!

I congratulate the people of Korea and their success which THEY earned. Yes, they have received much support from the United States for the past 50 years; and, I would hope that they have modeled some or much of their educational programs and industrialization efforts on the success that Japan has achieved over the past 60 years. And, I hope that India, China, the Philippine's and the countries of Southeastern Asia will do the same. After the trying times in Viet Nam, it would be spectacular to see that economy flourish.

It is NOT the government that needs to do more. And, while the AEA report has its merits in pointing out a decline in competitiveness that could have adverse consequences, it is up to the people of the United States to determine what exactly it is that they will do. New York State has invested heavily to build a world class research organization in nanotechnology and has attracted AMD and other semiconductor firms. But, in order for those efforts to succeed, it will require the dedication and resolve of the local citizens to achieve a sustainable success. No report or government funding can provide that guarantee.

Walter:

I agree with all but one sentence of your excellent message. That sentence is:

"I do NOT believe that the educational system in the United States needs a major overhaul."

I am dismayed by the "dumbing down" that began with educational approaches such as "New Math", "Bilingual Education" and "Whole Language" reading instruction. Those concepts have evolved over several years, but they were the beginnings of an educational disaster. They've resulted in years of graduating students who could not perform basic math calculations, speak basic english or read more than a few thousand memorized words.

The problem is not money, it is lack of rational direction. That lack is nurtured by the people who want you to believe that money IS the problem, the very people who are perpetuating the problem. No amount of money, in the hands of those people, will fix our educational system.

DickL

So, aren't you saying that because the educational system has been dumbed down (and I fully agree there) that the system needs to be radically changed. Perhaps with pressure and direction from industry, we can get it back to the priorities it once had.

Yes, it needs to be radically changed, but I don't see that as being a high priority for American industry. They have cheaper and easier alternatives than battling the entrenched educational establishment.

Today's young parents aren't going to drive it because they, too, are products of the "dumbed down" system. Most don't even know what a good education is. I don't like to be a crepe hanger, but I don't see a driving force for change in an American education system that's controlled by greed and ignorance. Maybe that's OK as long as we can import educated people, but that doesn't seem like much of a long term plan.

DickL

THe USA can still afford to buy the best brains, German, British...next it will be Chinese, Indian. But labour costs will be high so manufacturing will go elsewhere.

Here in the Uk we suffer the worst of both....

Many of the best brains go West, labour goes East.

While we import failed management gurus and discredited ideas from the US.

(Don't we all love those management gurus?)

Can we still compete for technology? Who is we? Over 30 years I have had three jobs and each one was for a global company. I truly believe that in our world today jobs and manufacturing are controlled by the multinational companies. A government can have some influence on were those company build their products, but the ultimate decisions are now based on the global economy. Company's look at the availability of resources, inexpensive skilled labor, infrastructure (transportation, power, etc.), the political stability of a counties, government, and even the decision makers feelings about a country, ask a Russian how he feels about doing business with the Germans.

Education is important for any work force, but today management decisions are made in one country, the product is designed in another and then marketed and distributed in hundreds of countries.

Like it or not we are all part of a global economy and modern governments need to learn how to best manage their political decisions to best help bring prosperity to there citizens in what ever way they can.

Mike

Yes I know about the whold Global company view thing. However when a job just happens to exist in the good ol US os A and the company running the job is headquartered here also a standard could be expected. Exactly two cities away from the company is a techie waiting for a gig. That company has just spent umpteen millions of bucks setting up training in another land. The guy comming over here is interested in the job I will grant you that. But his skill level is at best par with that guy cooling his heels. In my opinion a moral ground has been crossed that should not have. I have nothing against the newly trained wet behind the ears brother working the gig. The guy that is here could have done it without jumping through all of those hoops.