Jensen: 'We've done our country a great disservice' by offshoring

For return to happen you need to have a creative economy, not an extractive economy.

Offshoring happened for the simple, dumb reason that it's cheaper and more profitable.

For all the rarara about "America", shareholder patriotism extends exactly as far as quarterly returns. If that means selling out ordinary US workers - do it. Give me the bag.

What offshoring revealed is that the US is not a culturally integrated country. The culture of the top 5% or so considers itself completely separate to the rest.

It's a political fault line that was always latent, was somewhat suppressed from the New Deal to Carter, and then came roaring back with Reagan.

Now it's operating at pathological, self-harming levels. The marrow of the country has been chewed out, and a few dysfunctional shell oligopolies, propped up by a bubble, are keeping the lie spinning.

There won't be any significant reshoring until there's a cultural change. Reshoring is just too expensive for the owner class to do more than tinker with it. Without a cultural change the owner class doesn't care enough to change that.

That's not a virtuous cycle, that's inflation.

Assuming the local versus offshore good is a perfect substitute, that means that the value has not changed.

Paying more for the local good means your money is worth less, as it buys less value.

Your question on the production line doesn't account for all of the precursors also being local, plus the local energy rates, local taxes, local rents, and so on. Everything tends to be more expensive, otherwise the cost of managing offshore production wouldn't be worth the effort.

Total isolation only works when there's still room to grow by way of some underutilized resource- cheap labor, land, or something extractable from the environment like wood or minerals.

Traditionally, economy are typically divided into three sectors: Agriculture, industry, and services. Service industry contains everything from nursing to software development and sales. The problem with this division is that there is an extreme productivity gap within work in the service industry. A software developer's work can serve 100 million people at a time, when a nurse can only serve one customer at one specific time.

The reason why highly developed economies have become so service driven is because they have become sort of bimodal: The cost of labor is such that only jobs that are productive enough (profitability per hour) are done in these countries, and jobs that absolutely have to be done there to sustain the population. Jobs in the middle, everything that is not highly profitable or location-dependent, is offshored to lower-cost countries due to the cost of labor. This results in these developed countries having issues: Cost of living is high due to labor cost and there's high economic inequality due to wildly differing productivity.

The solution would be to bring these "mid-productivity" jobs back to developed countries. However, the main roadblocks still remain: The cost of labor is too expensive for most of these jobs to be competitive globally. However, I think there might be a way to do this in the near future: Advancements in robotics would mean a higher level of automation for industrial work, meaning more industrial jobs would become viable in high-cost countries. Each worker would be productive enough that the cost of labor is not critical anymore.

To make this happen, I believe it's important to ensure that the country is viable for this kind of manufacturing: Energy supply needs to be abundant and cheap, workforce needs to be educated, outside the "elite" students, and there needs to be low trade barriers. Low trade barriers are needed, because virtually all manufacturing is part of a global supply chain where parts cross many borders before the product is sold (and (high-value) products are sold globally). Additionally, the viability of automation will vary between different parts of the supply chain, and so you likely cannot automate everything.

It is actually more complicated than this implies. For example hospitals are often held afloat by Medicare/Medicaid spending (25%/19%). Private health insurance is about 37%, so larger than either, but smaller than both. But then you have to remember that some of the private health insurance is being subsidized by taxpayer dollars (e.g.: the ACA subsidies), and that private health insurance is largely coming from tax exempt dollars (a form of subsidies). So where the costs are actually being paid is more difficult.

https://www.kff.org/health-costs/key-facts-about-hospitals/?...

I am not sure where your question about a percentage of your salary is valid on the face of it. Do you count the employer portion of your medical coverage as part of your salary? Do you count the tax exemption? How do you figure the taxes taken out to support Medicare/Medicaid/Veterans Health (all of which are required to support the system as it exists)? And how do you figure that for single payer systems?

So a much more direct way of comparing is to look at total costs per person, and then figure out how outcomes compare. When you do that the U.S. comes to about double the cost, and generally worse outcomes. Conservative politicians will scream about how long it takes to get procedures, but the research shows that elective procedures take about the same time (and no-one waits for emergency procedures in comparable systems).

https://www.pgpf.org/article/how-does-the-us-healthcare-syst...