Americans have a history making opportunity to alter our foreign policy and establish new relationships with other nations throughout the world at a time when we are desperately in need of national leadership and a new strategy to energize our economy. It is a mistake to characterize the economic turmoil of our nation as a recession or the beginning of a depression. The expanding global manufacturing capacity has reached a peak in excess of the needs of the current number of product consumers. We are suffering from unemployment due to the lack of increasing consumer demand for products and services. A new national economic development requirement has emerged which is dependant on recognition of the needs of all people worldwide and must be met with a new strategy that integrates national and global planning with new economic and financial conditions if American and global employment is to be increased. We need a global economic development strategy that will reduce the economic disparity between countries and within countries. See http://revitalizingtheusaeconomy.blogspot.com/ Please feel free to comment and ask questions.
The economic stimulus program passed by America’s federal legislators reveals a complete lack of understanding of international economies. A new study of the current global econometrics has revealed the true source of America’s economic problems. The mathematical and statistical study of global economic indicators has revealed that there are emerging economic forces that are permanently altering the old global economic paradigm that produced prosperity in the past. American commerce has arrived at the point in history where the American economic problems are not only interactive but more importantly interdependent with global economic conditions. The legislators have apparently made no effort to understand how the true economic problems that we are facing are a result of a change in global economics. There has been no mention of the new global manufacturing paradigm that has been evolving for some time. They are apparently ignorant of its impact on the global economy and how it is creating new and unique economic problems for Americans and others globally. It is impossible to solve America’s problems with a process that is isolated from the global economy. Unemployment globally has become a major crisis that is an integral part of the American economic problems. It will prove to be impossible to overcome the economic problems of America without understanding and addressing how American investment must be redirected to increase global demand for consumer products.
It is the evolving global economic restraints that are decreasing demand for new consumer products and increasing unemployment. Without understanding these constraints the U.S Congress’s stimulus program will not raise the level of manufacturing sufficiently to restore the American and global economies to the former levels of production. The program does not provide for increasing the demand for consumer products by the people which is the economic principle that must be obeyed when attempting to create prosperity.
The American and global manufacturing capacity has grown to the point that it exceeds the needs and demands of the existing product consumers globally. The global economic crisis is the result of a decrease in the demand for more of the same consumer products that the consumers already own. There is insufficient demand to support our immense global manufacturing capability at the same level as in the past. In fact it has become obvious for some time that the demand for more consumer products is declining faster than thought earlier. The fundamental problem is that there are simply more new automobiles, TV’s, computers, phones, as well as clothing and other consumer products than the approximately 3.3 billion people that are sufficiently affluent to be product consumers need or want at this time. This problem compounds itself as people around the world are loosing their jobs and need even fewer consumer products.
The demand for consumer goods globally has also been decreasing due to reduction in the birth rate over and the limited increase in the population of new affluent buyers entering the market for consumer products over the past eight years while the rate of increase in manufacturing capacity continued which resulted in tremendous inventories. Bailing out manufacturers that are producing products for which there is little or no demand will not increase employment if the products are not selling. The people who are affluent product consumers globally have purchased everything that they need and in many cases borrowed money and purchased more than they could afford. Reports from around the world show that businesses are not maintaining their rate of sales and many are failing because of a lack of demand. All types of retail stores are closing. Major automobile manufacturers are experiencing large reductions in employment due to the reduction in sales globally. Car dealers are going out of business. Globally manufacturers are already terminating hundreds of thousands of jobs. Consumers are being enticed to buy one more of something by major discounts, impractical financing structures and suspension of interest payments. But it is not dramatically increasing sales. A slogan for the consumer that summarizes the economic dilemma could be: “No thanks I already have one”.
With the advent of little or no demand for more of what people already have the global manufacturing economy has entered a new phase which is merely the “replacement” economy. The replacement economy is limited to replacing a product that is worn-out or broken. To economically survive it is not possible to continue to reduce our global capacity for manufacturing to a level that produces only the replacements needed or the occasional new product, the latest phone or TV, that is a “must have”. This drastic reduction in employment will destroy our global economy. We are currently trying to accomplish just that and it is obviously creating a major global crisis.
It should be obvious even to the most cursory examination of the economic conditions that globally we can not survive economically if manufacturing employment continues to decline. We must develop a global economic development strategy that will create a demand for consumer products and services by the people sufficient to energize the current capacity of manufacturing if we are to achieve a prosperous global economy. The slow down in the American and global economy is be being exacerbated by the lack of alternative investment opportunities. New businesses are not being established in an environment where the people are conserving funds for fear of a major depression. Because of the lack of sales corporations are not reporting great earnings therefore the stock markets are not that attractive.
The solution is to adopt a new global economic development strategy that can establish immense investment opportunities that will create hundreds of millions of new jobs and dramatically increase product consumer demands. The following posts describe an economic development strategy based on financing the people in the emerging economies in a manner that inserts funds into the global economy at the lowest level through the hands of the people. The proposal creates hundreds of millions of new jobs and product consumers with enormous needs on a global scale and in a manner that has never been tried globally in the past
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