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To: Fiscally Conservative who wrote (38979)	8/18/2008 11:53:26 AM
From: elmatador	Respond to of 217860

I don't blame the US consumer. If the perception is that possessing a giving good is that's affordable, the consumer buys it. China saw the extremely high prices practiced in the 70's. They saw US and European companies not only practicing high prices but also using cheaper manpower in Export Processing Zones to compete with the Japanese. They realized that if they produced cheaper, they would take that market, not only from Europe, US but from Japan as well. Mexico was just the olive in the Greek Salad gobbled as well. Therefore the Chinese dropped the price of a huge palette of industrialized products. The US consumer seeing all the goods cheaper just started buying. Once they started they could not stop. But let's not take our eyes from the root cause: The Japanese changed the industrial landscape. The industrialized countries didn’t significantly change their ways of doing things: No destruction of the welfare state. No changing in cumbersome labor laws. They didn't grasp the full effects of what Japan did to their industrial basis. They forgot that Japan could be replicated, not in their countries, but in Asia. I believe it was arrogancy. I can recall people in industrialized countries saying: We are not going to compete i n price. We are going to compete on higher skills. We will provide R&D, desing, marketing and the let the shirtless produce the goods. It didn't work that way. Technology and cheaper way to commuynicate derailed the old model.