Rather than posting comments to comments, there are a few additional points I'd like to make regard today's earlier post.
There seems to be a tendency to view our economy as just a dynamic, free-wheeling, competitive marketplace where the weak competitors will be displaced by the strong. Well, yes... and no.
The marketplace doesn't exist in a vacuum. Certainly, there are always companies arising while others are disappearing. There are always new products replacing old products. Efficiency is rewarded; complacency is punished. This is a free market, after all.
Okay, and then there is the real world of currency manipulation, protected markets, government subsidized competition, child/slave labor, and a host of other "un-American" practices that directly impact U.S. manufacturing companies.
If you think Toyota became a powerhouse in the U.S. because they were a better company than U.S. competitors, then you don't understand how they sold their products here at cost (and avoided significant U.S. taxes) while enjoying a protected home market. You don't understand how China has grown its "competitive" manufacturing base by copying - outright pirating - U.S. intellectual property and then using that pirated capability to undermine U.S. competitors.
So, there is not a lot of sympathy for evil old General Motors now that it has fallen on hard time. Those "service economy" states sneer at the "wasteful" U.S. heavy industries. Okay, how about:
- textile quotas and restrictions protecting southern states
- sugar quotas and restrictions protecting Florida
- lumber quotas and restrictions protecting western states
- beef quotas and restrictions protecting central states
- corn subsidies for the plains states to produce ethanol
Oh, come on. What would U.S. universities say if the government suddenly awarded research or service grants to foreign universities on the basis of competitive cost bidding? Plenty of good Indian PhDs out there who can work at half the price. And how "cost efficient" are U.S. universities... those bastions of our intellectual wealth... when they require double-digit percentage tuition increases for decades? Oh, yeah, we can't import those services.
Right, so a geographic oligopoly gives our intellectual industry the right to lord it over our manufacturing sector.
This isn't a "free market". It is many different kinds of markets that play by many different kind of rules. And rules can be changed. It is part of "economic policy"... or lack of one.