Veteran business writer William Holstein examines the decades-long free market mantra that trade and fiscal deficits do not matter; that it was fine to buy oil from the Middle East, and cars, televisions and consumer electronics from Japan, South Korea and China, because U.S. currency we paid would end up being reinvested in U.S. capital markets. Although that has been proven wrong, some economists still believe the American economy will bounce back to the status quo if we rev up borrowing and consumers once again buy cars and houses and big screen televisions.
Mainstream economists talk about the gross national product and speak of recessions and recoveries. But as macroeconomists, they don't understand what happens at the micro level--which is where Americans live, work and shop. Or in too many cases no longer work.
What we are now waking up to as a society is that many of the forms of wealth that America has pursued can not sustain a healthy economy into the future. On the whole, we've been told that it's just fine that consumer spending represents 67 percent of our total economy and just fine to outsource as much manufacturing as we could. But that is dangerously naïve, as recent events have demonstrated.
The Next American Economy shows the way toward creating a sustainable economy, using 12 case studies, including a John Deere factory in Iowa, and companies exporting infrastructure equipment and technology to emerging markets. In order to achieve economic growth again, and to sustain it, we must stage a recovery that is based more on manufacturing, research, innovation, winning service sector models and improved education, particularly for workers already in the work force.
Genre: Political Science, Business + Money Management
Subgenre: Public Policy / Economic Policy, Economic Conditions