In a previous posting, we have said that now more than ever before, durable, well paying jobs are now the Gold Standard for government’s in bolstering their economies. The problems, especially for developed countries like the US and Europe are threefold:
1)Manufacturing (the best durable and well paying jobs) has been exported overseas, primarily to Asia and other “low cost
2)In the process rust belts with huge training and support deficiencies have resulted in areas affected by massive cutbacks. The people, skills, training facilities have withered away. As well the support industries also have waned if not disappeared;
3)Executive suites have adopted the mistaken mentality that in any market with a high labor, buy beats build every time. Consider IBM’s recent cutbacks domestically while increasing its hires in India.
So the problem confronting developed countries and their leaders as they meet at the G20 Summit this week is that two things they want most- credit market stability and more domestic jobs, may be at loggerheads with the goals of the executive elites that run the financial companies and large corporate organizations. Its like an April Fools Joke gone bad.