House of Paine

industrial basics re visited

  somehow folks can't think easily in loops



 take our industrial set up domestically 

it ain't necessarily 
          a one way ticket we got here .....


================================================


first imagine a graphable plain...



north south is the industrial real hourly  wage rate 

east west the indusatrial share in value added 



okay lets pretend there is  no external sector


   in this amerika
 
 a relatively  faster automation rate
in industry vs services
         and  a  serious
          process of  plant  re location 
                   to non union regions 
         
  as a consequence
over time 
both  
 industrial  real wage rates 
and 
 the industrial share 
                 of total  economy wide VA
 are heading 
                  down down down 

south and west at once 

that bizzaro amerika
 would be squawking 
          much like the real one is now 

and from a prole perspective what's the  big diff ???

except for any higher rate of unemployment
associated with  any net import demand leakage 
a problem resolvable by macro 


but here's my point

whats to prevent plant building re commencing 

ie the loop   ends its turning  down  and back 
and under
( double negative )

  first plant expansion  goes positive
while wage rates stay on their  bottoming out course
  and 
         then  boink
  wages reach service industry levels 
and can rejoin the general labor  productivity 
  rise 
          so
      both plant and wages rates  are  positve 
 and we're back
   to glorious  double positive 

north and east at once  
             like  michigan 1950 !!!!!

                    just you wait