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View Diary: Krugman: "The Competition Myth" (292 comments)

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  •  Robert Reich offered four (4+ / 0-)

    definitions of competitiveness

    This is the one he prefers:


    — It’s the number and quality of American jobs. This is my preferred definition, but on this measure we’re doing terribly badly. Most Americans are imprisoned in a terrible tradeoff — they can get a job, but only one that pays considerably less than the one they used to have, or they can face unemployment or insecure contract work. The only sure way to improve the quality of jobs over the long term is to build the productivity of American workers and the US overall, which means major investments in education, infrastructure, and basic R&D. But it’s far from clear American corporations and their executives will pay the taxes needed to make these investments. And the only sure way to improve the number of jobs is to give the vast middle and working classes of America sufficient purchasing power to get the economy going again. But here again, it’s far from clear American corporations and their executives will be willing to push for a more progressive tax code, along with wage subsidies, that would put more money into average workers’ pockets.

    It’s politically important for President Obama, as for any president, to be available to American business, and to avoid the moniker of beiing "anti-business." But the President must not be seduced into believing — and must not allow the public to be similarly seduced into thinking — that the well-being of American business is synonymous with the well-being of Americans.

    I'm not sure why there is a need to get hung up on semantics. As the other three definitions show, those approaches will not create jobs here.

    Obama's approach is going to have to be as close to Reich's preferred definition to be considered successful. This is not a situation like the 1990s, there is a huge jobs deficit and people are focused on the quality of the jobs that are being created.

    The pressure is on, and unless the economy begins to create millions of quality jobs, President Obama is going to be lambasted.

    •  How we define "success" (5+ / 0-)

      seems to be part of the problem in defining "competition".  

      Those who define "success" as maximizing shareholder value have a much different view of "competition" than those who define "success" as a good standard of living for all Americans, energy independence, a healthy democracy and a secure future.

      Those who define the endpoint differently will never reach agreement. Myself, I support economic and regulatory policy that works for the public benefit of all Americans, not just a few.

      Proud member of the Democratic Wing of the Democratic Party.

      by Betty Pinson on Mon Jan 24, 2011 at 09:40:17 AM PST

      [ Parent ]

      •  It's not even really maximizing shareholder value (3+ / 0-)
        Recommended by:
        chuckvw, LucyandByron, Betty Pinson

        That's actually a scam -- those who invented the idea are saying so now.  The people who claim to "maximize shareholder value" have been destroying the value for long-term investors.  It's all about maximizing the take-home money for CEOs and their buddies.

        Read pp. 1-7 of Krugman's _The Great Unraveling_ (available from Google Books). NOW.

        by neroden on Mon Jan 24, 2011 at 10:17:44 AM PST

        [ Parent ]

        •  "Free" market version of 5-year plan (1+ / 0-)
          Recommended by:
          Betty Pinson

          Remember the old Soviet-Era Five-Year Plans for economic growth, many of which were quietly abandoned as failures?

          Here, the plan is for a five-year cycle of Mafia-style bust-out:  neutron-bomb the worker bees, bonus; bubble, bonus; then activate the golden parachute and bail before the crash.  The company reorganizes and gets a fresh infusion of capital or credit.  A new CEO comes on board and the cycle repeats.  The old one moves on to a new target or cushy appointment to a board or in DC.  

          Bust-out illustration from the Sopranos:

          "A city for sale and doomed to speedy destruction if it finds a purchaser!" --King Jugurtha

          by LucyandByron on Mon Jan 24, 2011 at 11:30:56 AM PST

          [ Parent ]

          •  "Bust Out" (0+ / 0-)

            Thanks for the terminology. That's exactly what it is.

            A "bust out" is a common tactic in the organized crime world where a business's assets and lines of credit are exploited and exhausted to the point of bankruptcy.

            Organized crime moved into Wall Street along time ago

            Proud member of the Democratic Wing of the Democratic Party.

            by Betty Pinson on Mon Jan 24, 2011 at 12:55:46 PM PST

            [ Parent ]

      •  Well said Betty. nt (2+ / 0-)
        Recommended by:
        chuckvw, Betty Pinson

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