Outsourcing Services and punctuated equilibrium
Kevin Drum writes about a new trend of "medical tourism" where people fly to India for $8000 heart operations, rather than $25,000 operations in the United States.
I know a young lady who just got accepted into Cambridge (Kings College) for undergraduate. It will cost her a total -- room, board, tuition -- of $6000 per year to go there. Compare that to Harvard.
America has benefitted for decades --arguably, a century -- by being the world's focal point for all sorts of high-value services, from the dedicated "Saudi Sheikh" ward at the Cleveland Clinic for heart bypass operations, to the massive overseas enrollment in US universities, to the massive overseas employment in Silicon Valley technology corporations. All this is an incredibly important driver in our economy.
The day after tomorrow, savvy high-school prospects from California are going to be applying for admission to IIT Bangalore. Not only is it just as good as MIT, it is probably (if they will let you in, and if you can *get* in) one tenth the cost. And since India is a very big, high-growth part of the world's future, the "fringe benefits" for our young California prospect of going there are considerable - learn the local language, learn the local culture... does this sound like America, post-WWII to anyone? It does to me.
The reason half the title of this post is "punctuated equilibrium" is that the evolutionary model of that name posits sudden environmental changes that presage significant effects on organisms, rather than gradual, linear development.
When America runs out of credit, runs out of cash, runs out of international goodwill, and loses its competitive advantage in a whole host of fields, the many invisible benefits of being #1 will *all* simultaneously vanish, and the many invisible costs of someone else being #1 (who says that hot engineering prospect from California will ever come back from Bangalore after he meets a charming dark-eyed beauty from Rajistan?) will suddenly assert themselves -- all at once.
Then we'll spend two generations, or five decades, being desperately poor, as England did from 1945 - 1995. And have plenty of time to contemplate the sheer folly of having elected Pied Piper Bush as president... once.
I know a young lady who just got accepted into Cambridge (Kings College) for undergraduate. It will cost her a total -- room, board, tuition -- of $6000 per year to go there. Compare that to Harvard.
America has benefitted for decades --arguably, a century -- by being the world's focal point for all sorts of high-value services, from the dedicated "Saudi Sheikh" ward at the Cleveland Clinic for heart bypass operations, to the massive overseas enrollment in US universities, to the massive overseas employment in Silicon Valley technology corporations. All this is an incredibly important driver in our economy.
The day after tomorrow, savvy high-school prospects from California are going to be applying for admission to IIT Bangalore. Not only is it just as good as MIT, it is probably (if they will let you in, and if you can *get* in) one tenth the cost. And since India is a very big, high-growth part of the world's future, the "fringe benefits" for our young California prospect of going there are considerable - learn the local language, learn the local culture... does this sound like America, post-WWII to anyone? It does to me.
The reason half the title of this post is "punctuated equilibrium" is that the evolutionary model of that name posits sudden environmental changes that presage significant effects on organisms, rather than gradual, linear development.
When America runs out of credit, runs out of cash, runs out of international goodwill, and loses its competitive advantage in a whole host of fields, the many invisible benefits of being #1 will *all* simultaneously vanish, and the many invisible costs of someone else being #1 (who says that hot engineering prospect from California will ever come back from Bangalore after he meets a charming dark-eyed beauty from Rajistan?) will suddenly assert themselves -- all at once.
Then we'll spend two generations, or five decades, being desperately poor, as England did from 1945 - 1995. And have plenty of time to contemplate the sheer folly of having elected Pied Piper Bush as president... once.
posted by Ethan at 10:30 AM
1 Comments:
Question 1: How does what we are seeing now compare to what people were saying about the U.S.- Japan dynamic in the 70s and 80s? If it's a different thing altogether, how so?
Question 2: If you are right (and you may be; Question 1 is an honest one, not a rhetorical one), is it really honest to lay the blame, as you do, at GWB's feet? I mean, I agree that he is largely to blame for the evaporating goodwill, but the shift eastward isn't due to a loss of goodwill alone. Can we anymore blame Bush for what may be a fundamental change in the world order than we can blame Chamberlin or Churchill for the changes that brought the British Empire to its end?
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