THE JUDAS ECONOMY
The authors argue that not even ''elite workers''--the highly skilled professionals in the U.S., Europe, Canada, and Japan--can assume that education will save them from a sharp decline in living standards. The problem with knowledge, the authors say, is that it can be taught to anyone. If medical transcribers and computer programmers in Beijing can do the job for one-third of the cost of U.S. workers, then businesses will invest their capital in China.
The authors blame weak governments and strong central banks for industrialized economies' woes. In particular, central banks have kowtowed to global bond markets by stressing price stability over growth.
So, what can the industrialized nations do? Become more productive, the authors say, by using public funds for more education, infrastructure, and research and development. Elite workers must create more and better products than their emerging-nation counterparts if they are to justify the higher salaries and perks that they've grown to expect.
By BUSINESS WEEK WRITERS
Updated July 31, 1997 by bwwebmaster
Copyright 1997, Bloomberg L.P.