"Globalishaction" ¿Trick or Treat? ¿Heads or Tails?

in LeoFinance8 months ago

¿A calculation error?

Globalization

TRADING

In the 20 years from 2000 to 2020, the USA's position in global trade has fallen so far and so quickly that such a dramatic shift of power is unprecedented in the modern world. What's important to understand about this shift, however, is that the USA has only itself to blame. The USA literally threw away its own position of power due to its own greed, ignorance, laziness and dreams of world domination. But now let's see briefly why this has happened, why it continues to happen and even why it is accelerating.

LATAM

After the dot-com burnout in the year 2000, realizing that the computer and Internet economy had become a thing of the past, the USA suddenly got the idea into its head that globalization was a great way to make money by selling nothing at all. Rather than selling usable goods, as the pre-Internet economy had done, the USA decided that it could make unprecedented amounts of money by simply selling "services" over the Internet. They basically thought: "Yeah! just let those unsophisticated developing countries produce low-margin manufactured goods" We Americans would get richer than we had ever been before by selling services to the world!

Services are easy to sell because they require very little startup capital and thus have almost no barrier to entry. Unlike a manufacturing company, which needs a fair amount of money at the beginning to acquire the means to produce whatever that company will produce. A services company can start on almost no money, because it doesn't need to produce anything. If you want to sell services, you can sell your services right now with hardly any preparation work required.

But the problem with this idea is that most "services" are worthless. How many services do you actually need? What do you spend most of your money on? ¿Huh?

Ok, let's check!

As you can see, for the vast majority of people in the world, most money is spent on physical products like food, housing, energy and manufactured goods like clothing, cars, appliances, electronics and so on. The vast majority of the world's money is still spent on physical and tangible goods. So to think that you can make the most money by ignoring where most of the world's money goes is suicidal. In getting rid of its manufacturing infrastructure, the USA clearly got rid of its ability to produce the things that most of the world's money is spent on. ¿Isn't it?

What's also important to understand is that of the services which people do make use of, most such services cannot be done remotely. The service workers that most people actually need in their lives are people like doctors, plumbers, and prostitutes. These jobs cannot be done remotely. They require the service provider to be personally present to render any of their services.

The USA's idea to get rich by selling "services" through the Internet to the whole world is such an obvious non-starter that it's amazing that anyone ever believed in it.

¿Exceptionalism?

People actually thought that they could get rich by selling "consulting" services, which basically amounts to a bunch of overpaid "experts" selling their opinions on things. Did Americans really believe that businesspeople around the world would pay big bucks just to get some people's opinions on how a business should be run? Apparently, they seriously did. Though, the reality today "indicates" that they were wrong.

¡And now look where they are!

The USA was beaten at its own game. The West's crackpot scheme to profit from globalization by getting rid of its manufacturing infrastructure actually benefited its worst enemies allowing China above all to profit from the global economy. The USA thought that it would develop a new global economy, a new global market and a new global set of rules. But it got rid of its ability to actually make any use of that global economy. The USA willingly sold its manufacturing capacity to China. Which enabled China to come out the big winner in the scheme which the USA itself came up with.

Leave a comment. Share your experiences and feedback. ¡Be part of the conversation!

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