I recently read a post that was in awe about a foreign economy. The author was impressed at the success of socialism in Europe. I too would prefer to live in Europe to o our current Bush league version of the US. But, in the long term I think the the US and Europe are both in trouble.
Adam Smith rules; capital will move toward the best economics. This is even true at the level of nations marketing themselves. For example, it is cheaper, as I understand, to build cars in Canada despite the high Canadian wages. Canada is doing better than the US .. in no small part because their socialism is more efficient at heath care, education and retirement. If the state is paying for the cancers, that makes it easier for Daemler to build cars there.
BUT, the flies in this ointment are Sino-Indian. Despite a lot of stuff about the new economy, most jobs still come from manufacturing something (and yes, the Big Mac is a manufactured item). We are in real danger of our capital and Europe's as well being concentrated in China or India simply because the capital is more efficient there.
If this occurs, the US and Europe will be increasingly left with low capital investment type jobs. If we don't fix the US education system the jobs here will be making big Macs because the shipping costs from Shanghai are too high. A few % of Americans will be buying those burgers and trying to live in our extentended suburban slums because they can't afford to buy condoes n Seattle..
Education, however, can never employ more than a few percent of a society ... with one exception: education for capital management .. can you spell Suisse? Switzerland lives off of capital management ... banks and dysfunctional drug companies that now do their research in the US.
Similarly we can fantasize that Microsoft will always keep their capital, and high capital jobs, in Redmond, but why would Beijing or Delhi share that fantasy? As their own capital grows, it seems clear that they will want these jobs too and, if their model of state-capitalism succeeds why would they not buy and move Microsoft?
This is not a new idea. Before he became a bad guy, liberals across the world praised Mussolini for his version of state capitalism, Mussolini indeed made the trains run on time and brought jobs to Italy.
Fascism may be our future!