The Chinese economic model is largely built on a combination of exports and a high savings rate, which which arguably makes it little more than a mirror-image of America’s dearth of savings and keen appetite for foreign goods. Would this Chinese model exist at all, but for its American counterpart, asks the Economist this week.

The model will surely continue until the West goes bankrupt. China's State Council announced Wednesday further support policies, including expanded export credit insurance, tax breaks and more financial access, to help exporters- reports the FT.

Steve worries that

"America has achieved no fundamental restructuring of its economy -- that the American domestic social contract between labor and firms and government and the financial sector has not been re-imagined during this crisis."

and states:

"in the US, there is a huge jobs creation deficit that the nation is not really addressing."

and

"Regrettably, Barack Obama has not done much of late to change the "jobless recovery" course America is on."

Bingo. So on target re the strange way IJ alleges the Economist frames the situation.

It is time to stop the sound bite nonsense and talk in terms of the purpose of an economic system
(does it serve ALL the public or merely an elitist class, on whom the rest of us depend for handouts-trickle downs), and how the components relate to each other.

Kudos to Steve, for a)recognizing the problem and b) for framing it correctly.

Hope Obama's staff is listening.

Our new "captain" of GM, President Obama, needs to direct GM product managers to create super efficient hybrid family sedans that out-perform Toyota and Honda models.

Are there actual plans for our billions of taxpayer GM dollars going in this direction? What is GM's fast plan?

For the US government to adopt policies favoring job creation in the United States, it would require a reversal of ongoing federal policies that favor domestic job depletion in favor of increased corporate profits and currying favor in US satellite countries abroad. Specifically, US ambassadors have actively promoted foreign production facilities for US corporations.

There has been absolutely no indication that this reversal has even been considered. Corporate profits are what fuel the US political system. The prospective new US ambassador to Japan, Silicon Valley lawyer John Roos, has as his only qualification that he raised over half a million dollars for Obama's campaign. Those corporate contributors expect payback, and forcing them to produce more in the United States is not what they have in mind.

Jolene:

And more importantly, Obama's economic advisers need to recognize the time it takes to restructure, and how important technical manufacture is to economic well being.

Too pour trillions into the financial sector, and little into R&D, and protection of technical industries borders on criminal negligence.

In my home county (Taos, NM)there is no money to continue the productive functions of local government employees, and the productive use of labor in the private sector. What sense does it make to attempt to reinflate the bubble, and try to start from the BS wealth accounting and imagery of the past, rather than to concentrate on keeping labor use optimal?

Also, just noticed that Steve omitted households in parties to the social contract. Is supply side nonsense so deeply ingrained in our imagery that we have forgotten it is the HOUSEHOLDS that an economic system should serve, and are the single most important party to the social contract?

"Do we live to work, or work to live".

Should households serve business entities or should business entities serve households?

"I am changing my name to Chrysler" _

Oh the price of gold is rising out of sight
And the dollar is in sorry shape tonight
What the dollar used to get us
Now won't buy a head of lettuce
No the economic forecast isn't right
But amidst the clouds I spot a shining ray

I can even glimpse a new and better way
And I've demised a plan of action
Worked it down to the last fraction
And I'm going into action here today

CHORUS:
I am changing my name to Chrysler
I am going down to Washington D.C.
I will tell some power broker
What they did for Iacocca
Will be perfectly acceptable to me
I am changing my name to Chrysler
I am headed for that great receiving line
So when they hand a million grand out
I'll be standing with my hand out
Yes sire I'll get mine

When my creditors are screaming for their dough
I'll be proud to tell them all where they can all go
They won't have to scream and holler
They'll be paid to the last dollar
Where the endless streams of money seem to flow
I'll be glad to tell them what they can do
It's a matter of a simple form or two
It's not just renumeration it's a liberal education
Ain't you kind of glad that I'm in debt to you

CHORUS

Since the first amphibians crawled out of the slime
We've been struggling in an unrelenting climb
We were hardly up and walking before money started talking
And it's sad that failure is an awful crime
Well it's been that way for a millenium or two
But now it seems that there's a different point of view
If you're a corporate titanic and your failure is gigantic
Down to congress there's a safety net for you

CHORUS

©1980 Accabonac Music (ASCAP)

Obama cannot quickly alter the import - services-leveraged consumer driven US economy. The imbalances that have built up over forty years are too large to be reversed without a severe contraction. The shift has to be from borrowing and consumption to savings, investment and production.

Obama can increase R&D funding and put money into technical schools, apprenticeship programs, and engineering and science education.

Asia Chronicle (www.asiachroniclenews.com) has been covering the expanding Asian job market for most of the past month. You guys ought to check it out and see if you're coming to the same conclusions.

MadeinUSA, sorry almost nothing is made in the USA anymore. Maybe all that R&D President Obama can instill here will probably just be used by corporations who produce outside of the U.S. anyway. To me, there's too giant a trade-off in jobs lost in having the technical know-how of R&D vs the manufacturing know-how that creates high-quality jobs. Hopefully, the President's idea of "green jobs" isn't that we're all going to have to cut grass to make ends meet.

What this country needs is another Steve Jobs/Steve Wozniak duo to completely re-design the auto, even if it starts in a garage. Tesla Motors has the right ideas, but too high a price. Hybrid electric/solar would get the common man off the barrel of oil torture drip.

Who cares, but folk singer Tom Paxton bought me a drink late one night many years ago in a Chicago Rush Street "establishment" where he performed his Chrysler song during his show. I'll never forget the tune, although the prophetic words have failed me often, other than the catchy chorus line. Maybe Tom will have to update his words. And I could use another drink!

Tom Paxton already has an update.

"I'm Changing My Name to Fannie Mae"

http://www.youtube.com/watch?v=etUq7IY_7Mc