Date: Tue, 25 Nov 1997 01:36:24 -0800 From: bhandari-AT-phoenix.princeton.edu (Rakesh Bhandari) Subject: Re: M-I: Re: Yamaichi blows Dennis Redmond notes >[sacrfice] our industrial base to our financier class. All that information >technology may use Windows software, but the hardware, drives and memory >are all produced in Asia, not California. Well, Dennis, it just turns out that *gross* value of this Asian production of consumer goods and intermediate "inputs" has not reflected the *net* value retained--after depreciation, royalties, advertising, interest payments etc. That's why Robert Reich was urging the US to get out of "high volume, low value production" (see the Work of Nations; it was this chapter that doubtless won George Gilder's jacket endorsement); why the Sun Microsystems were all too happy to buy cheap DRAMS from South Korea; why the Tofflers and Gilders enthuse about the defetishization of material production. At any rate, in Mon's NYT, Laura Tyson assuages worries about the US trade deficit. She reminds us that 40% of imports are intra-US multinational corporate trade. She fails to note how much of the profit is being repatriated either directly or through some scheme from this production abroad--which is really what eases her anxiety about the trade deficit, though she is polite enough to say so. And then she goes on about how "capital" and other advanced goods form the base of the US industrial structure, without questioning whether investment demand is too variable to sustain industries built up for a rapidly expanding market. With S Korea and now Japan in the crisis, the best guess would be that the crash is around the corner. Scottie Pumpkin --- from list marxism-international-AT-lists.village.virginia.edu ---
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