The idea of some command to retreat from a particular market because the economist doesn't think someone can compete would not be a free market idea.
I didn't mean it that way. Clearly, most retreats only happen after a bloody fight. In many cases that is not wise either. When Home Depot came to my town, one hardware supply folded prior to their opening, another planned on folding (announced it) and did shortly after they opened, while a third hung in for (IIRC) 6 months and the largest competitor has struggled on, but has just announced they are selling out to some other organization. Don't know that they will do.
At the time, I thought the guy who folded first was a wimp, but I'd say he was smart. So yes, I fully expect the decisions to be made freely by each company, although I'm less convinced that radically boosts the accuracy of such calls. I suspect that industry panels could make some fairly accurate calls as well as to what will happen to various sectors. I suspect they do, and I further suspect that many CEO's factor such calls into their decisions on retreat in the face of new trade policies.
I've seen this first hand because one sector I've played in, very specialized electric motors, I've seen most my USA resources move off to Asia, leaving me at a great disadvantage.
I support free trade more than you do because I'm more confident in America. I don't think that we can't compete in general with China or other countries.
You might want to consider that:
1) The Chinese are smart as hell, and very dedicated.
2) There are 1.3B of them vs. 300M of us.
We do have a way better Constitution and Government, no question about that. But I think the relative change is clearly in one direction only for the next few decades.
Even the biggest markets don't generally have economies of scale such that one company serving the world market will have a serious scale advantage over two or 10 companies serving the market.
Intel and Microsoft come to mind.
BTW, the only really standout semiconductor manufacturing we have is Intel, and that is because they have a defacto product monopoly. Intel never could compete economically in any other market. It looks to me like Taiwan is going to lose out to mainland China as well, although they might just merge FAIK. |
