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The Engine of US Jobs 324

eberta writes, "BusinessWeek has an interesting take on the US job situation, What's Really Propping Up The Economy. I think many of us have felt the US tech job market was stagnant and this article has insights into why this economy is so hot, yet not from our perspective. The spoiler is the business of health care — which will come as no surprise to anybody who has looked through the help wanted section lately. BusinessWeek has some opinions on how IT should play a bigger role in the health care industry."
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The Engine of US Jobs

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  • by montyzooooma ( 853414 ) on Monday September 18, 2006 @02:23AM (#16128388)
    Quit your griping about smoking, lack of exercise and junk food! It's us wheezing lard butts that are keeping America working.
    • Re: (Score:3, Funny)

      by kfg ( 145172 ) *
      It's us wheezing lard butts that are keeping America working.

      Yeah, ok, but could you knock off the popping out of your little holes, grabbing us and eating us bit? It's annoying.

      KFG
    • by EmbeddedJanitor ( 597831 ) on Monday September 18, 2006 @03:07AM (#16128483)
      A really strong economy is built on building value. That is, some function is performed that creates value and thereby money(makes stuff, sells services or stuff overseas and brings in money).

      Healthcare does not really build value. Nothing has been made because Aunty Tilly got a $20,000 bypass instead of a $5 bottle of asprin.

      In the way economists measure things, the Exxon-Valdez disaster was a huge economic success.

      One thing that really drives up the GDP is esculating housing costs. When a $100k house's value increases to $300k this is seen as a $200k increase in the economy.... but this is just bullshit, no value has been created. Sure it can stimulate the economy because Aunt Tilly can now take a $20k loan against her house and get a bypass and this trickles into the economy. Or Joe Sixpack might buy a new Chevvy... However, you should really see this as what it is: hyper inflation in housing prices.

      If the "value" of a loaf of bread increases from $1 to $5, then that is seen as inflation, not growth. When a house goes from $100k to $300k this should be seen as inflation too.

      • Re: (Score:2, Insightful)

        by ultranova ( 717540 )

        A really strong economy is built on building value. That is, some function is performed that creates value and thereby money(makes stuff, sells services or stuff overseas and brings in money).

        No, a really strong economy is both self-sufficient and self-sustaining. In other words, in order to have a really strong economy, you must depend on neither exports nor imports. If you depend on foreign trade, your economy could collapse because of events in foreign lands, which you can't control (I'm assuming tha

        • Re: (Score:3, Insightful)

          by hey! ( 33014 )
          If you depend on foreign trade, your economy could collapse because of events in foreign lands, which you can't control (I'm assuming that those are sovereign countries, not US free trade partners)

          I think Canada will be surprised to learn that they gave up their sovereignty when they joined NAFTA.

          I think what you saying would be better said this way: economic dependence on politically or socially unstable countries (e.g. Saudi Arabia, or China) is a source of economic insecurity.
          • I think Canada will be surprised to learn that they gave up their sovereignty when they joined NAFTA.

            I doubt they would be surprised. Many treaties chip away at a country's sovereignty -- joining the UN or joining NATO or the WTO, for example.

            But NAFTA surely impacts a nation's sovereignty. How else can you describe a treaty where unelected bureaucrats can veto the people's laws which were enacted democratically, simply by those bureaucrats determining that those laws are a barrier to "free" trade?

            You may
            • Re: (Score:3, Informative)

              by cayenne8 ( 626475 )
              "In contrast, the Mexicans flat out rejected an identical oil resource clause..."

              Not to worry, the US will probably soon be annex'ing Mexico. I think I just figured out the immigration plan the govt. is working on.

              When the illegal immigrant population here in the US from MX reachs a bit over 1/3, of MX's total population....we can just annex the whole country...resources and all.

              We can claim, "Hey, we got the people here, we might as well get the real estate that goes with them".

              :-)

          • Some Canadians might be suprised, but many wouldn't.

            It wasn't that many years ago that we tried to implement clean fuel additive regulations up here to cut down on health care costs. Fuel companies not only overturned the regulations, they scooped up some tidy damages cash and all their legal fees out of the public coffers.

            Oh, and the value of an economy is in the productivity of its population, not how busy they are. All the baby boomers are going to retire, and more of the population than ever before wi
        • by Not_Wiggins ( 686627 ) on Monday September 18, 2006 @06:28AM (#16128873) Journal
          No, a really strong economy is both self-sufficient and self-sustaining. In other words, in order to have a really strong economy, you must depend on neither exports nor imports. If you depend on foreign trade, your economy could collapse because of events in foreign lands, which you can't control (I'm assuming that those are sovereign countries, not US free trade partners).

          That's not true.

          A strong economy can be had with trade if the two nations have comparative advantage in trade. [wikipedia.org]
          In real life there's rare examples of it existing only between two countries (usually more are involved), but it is an essential concept given that 28% of the global GDP was from exports. [hofstra.edu]

          Restricting trade between countries (so there are no imports/exports) would only affect pricing/availability of goods within a country. For example, if you were unfortunate enough to live in a country without a rich oil supply, then all sorts of products that are created from that supply would either be extremely expensive or non-existant (plastics, fuel, etc).

          And even if you were to restrice trade to "free trade partners" (as you reference), that doesn't guarantee that the trade won't negatively affect an economy either. Free trade only refers to allowing products to flow without tariffs; it doesn't stop one country from dumping products into another, thus artificially lowering the price of those goods to drive the foreign industry into the ground.
        • Re: (Score:2, Insightful)

          by Gotebe ( 887221 )
          >Healthcare is a service industry, and if selling services is a valid business model, then healthcare is a valid business model.

          I am not convinced... It is OK if healthcare is being used to "maintain" people (whose workforce is being used then to add value). Currently, it's more about "fixing" people, so it's in the land of the "broken window" fallacy.
        • Re: (Score:2, Interesting)

          Healthcare does not really build value. Nothing has been made because Aunty Tilly got a $20,000 bypass instead of a $5 bottle of asprin.

          Nothing has been made because Aunty Tilly got a massage or haircut either. Healthcare is a service industry, and if selling services is a valid business model, then healthcare is a valid business model.

          Healthcare doesn't build value, it preserves value. Healthcare is one of the best investiments in workers. If you have ailing workers, their productivity is lower

        • There is only one Earth. That means there is only one economy. Much of the economic strife in the world today is the result of the slow and horribly uneven break down of the natural and artifical barriers that make it look like there are local and foreign economies. Natural barriers boil down to distance and the proportional cost of transportation. Artificial barriers include such things as tariffs and even the concept of the nation state itself.

          We all need to take step back and look at the forest and not t
      • by sapgau ( 413511 )
        Ouch, your Economy lesson is giving me a headache!
      • > When a $100k house's value increases to $300k this is seen as a $200k increase in the economy.... but this is just bullshit, no value has been created.

        Value is virtual - it is created when people agree it is created. Your disagreement stems from your arbitrary belief the GDP wasn't bullshit in the first place.
        • by intnsred ( 199771 ) on Monday September 18, 2006 @07:36AM (#16129139)
          Your disagreement stems from your arbitrary belief the GDP wasn't bullshit in the first place.

          Many people think the GDP or GNP is a bogus, crude measure of economic health. There are a number of other measures which address the G?P's shortcomings. (The UN's "Human Development Index" (HDI) is probably the best known.)

          As Robert Kennedy said in 1968:

          Our gross national product -- if we should judge America by that -- counts air pollution and cigarette advertising, and ambulances to clear our highways of carnage. It counts special locks for our doors and the jails for those who break them. It counts the destruction of our redwoods and the loss of our natural wonder in chaotic sprawl. It counts napalm and the cost of a nuclear warhead, and armored cars for police who fight riots in our streets. It counts Whitman's rifle and Speck's knife, and the television programs which glorify violence in order to sell toys to our children. Yet the gross national product does not allow for the health of our children, the quality of their education or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages, the intelligence of our public debate or the integrity of our public officials. It measures neither our wit nor our courage, neither our wisdom nor our learning, neither our compassion nor our devotion to our country; it measures everything, in short, except that which makes life worthwhile. And it tells us everything about America except why we are proud that we are Americans.
          • I hate being in the position where I essentially agree with someone yet can't endorse any argument they make toward my conclusion.

            Yes, there are many problems with the GDP measurement, and those misunderstandings can lead to poor policy ideas. But it is not, and never was intended to be, the be-all/end-all of economic well-being metrics. RFK is eminently justified in saying that the GDP doesn't measure "integrity, wit, or joy" -- that's because those are really hard to measure, and extremely subjective.
          • Re: (Score:3, Insightful)

            "Our gross national product -- if we should judge America by that..."

            We shouldn't. Anyone who does has purposeful blinders on. The GDP and GNP are not for that. Nice bed of straw, though.
      • Re: (Score:3, Informative)

        by ElephanTS ( 624421 )
        The figures I've seen say that the majority of new jobs in the last 5 years have been created in the real estate market driven by enormous inflation of house prices. I'm not American but as similar thing has happened in the UK where I live - about 65% of the UK economy is based on the housing market. If this market stops growing (and it looks like it has now in the US) bad things are in store for the economy. Especially given the 'cash point on everyone's lawn' will stop working.
      • by stomv ( 80392 ) on Monday September 18, 2006 @06:50AM (#16128936) Homepage
        Nothing has been made because Aunty Tilly got a $20,000 bypass instead of a $5 bottle of asprin.

        If a bottle of asprin results in her passing away but the bypass gives her 20 years more life, then (adjusting for inflation, etc) she merely has to generate $1,000 more wealth each year than she consumes for the operation to be "worth it". And, consider this: she has some dollar value of training and experience, valuable both during her hours working and her other hours contributing to the community. It could be that buying her a bypass would be like fixing the alternator in your car; sure it doesn't result in anything "new" but it is a small repair on a valuable item. You wouldn't throw away your car with a bad alternator; don't throw away (valuable) Aunty Tilly because she's got a bad valve.

        Obviously, at some point people get old enough that society will never regain its financial investment in that elderly person (or lifetime-disabled person). S'OK. We're human beings; we take care of each other because we sympathize and empathize. It's part of the human condition, and it's a good thing.
        • Re: (Score:3, Interesting)

          by Mydron ( 456525 )

          We take care of each other [...] it's a good thing

          Thank you for your great disservice. You have turned an economic problem into an emotional issue. This is ultimately why healthcare is such a hard problem, people don't like to hear that they (or their loved ones) are not immortal; but it's true. No one lives forever. Burying your head in the sand is not going to fix the problem: health care is costing too much.

          I have seen quotes that suggest 80-50 percent of health care costs are spent in the last thre

      • Excellent point!

        The US health care system is inefficient and massively expensive. The fact that it creates some jobs is largely irrelevant.

        The people working in those health care jobs could be creating wealth -- producing widgets or creating Microsoft anti-virus software, anything that creates value, and maybe even help address the huge US trade deficit.

        But instead, the trade deficit continues to grow and the value of the dollar has gone down about 30% against the Euro in the past 6 years.

        To get an idea of
      • I understand your point.
        GDP is a silly measure of the economy.
        but at the time it was created and used there wasn't a lot of knowlege about other methods of measureing the economy.

        Have a look into GPI!

        http://www.rprogress.org/projects/gpi/ [rprogress.org]
        http://www.gpiatlantic.org/ [gpiatlantic.org]
        http://en.wikipedia.org/wiki/Genuine_Progress_Indi cator [wikipedia.org]

        basically you start with GDP, and subtract all the useless stuff that your money has been spent on (ie oil spills)
        then you subtract the value of any assests that can no longer produce wealth
      • "In the way economists measure things, the Exxon-Valdez disaster was a huge economic success."

        Cost money to drill, cost money to pump into ship, cost money to transport, cost money to clean up -- no money from sales. It may have benefitted some smaller companies, but economists look at the complete picture. It was a loss. Period. Show otherwise. I mean with figures and reason instead of a declarative statement.

        Don't give up your job.
      • by debrain ( 29228 )

        Healthcare does not really build value. Nothing has been made because Aunty Tilly got a $20,000 bypass instead of a $5 bottle of asprin.

        That's not entirely true, from an economic standpoint. The horizontal redistribution of wealth to a services industry keeps money moving about (where imports and exports are vertical, entries/exits). While it may not appear "useful", the greater the services industry, the greater the capacitance effect (currency in circulation), before money starting in exports goes to payi

    • by reporter ( 666905 ) on Monday September 18, 2006 @04:17AM (#16128605) Homepage
      According to the first paragraph [sfgate.com] of an article by the "San Francisco Chronicle", the baby-boom generation has 77 million people, and they begin retirement in 2008, which is only about 1.25 years from now. We should expect that major health problems (associated with old age) occur by age 60, which is 5 years before retirement. Age 60 corresponds to the year 2003. Consequently, the past 3 years has seen a tremendous growth in the health-care industry, and this growth is driven by healthcare for the babyboomers. This growth will continue until the last of the baby-boomers retire around 2025.

      There is really no mystery here. More old people means larger government spending on health care. More spending means more jobs in the health care industry.

      There are 2 other factors that have increased health-care spending. First is the millions of illegal aliens who have no insurance. They usually go straight to the emergency room, where physicians do not refuse service (even to people without insurance). The services are not paid by the illegal aliens but are paid by the government.

      Illegal aliens do become sick. They often work at grueling, backbreaking work. There is no incentive for American businesses (that employ illegal labor) to improve the working conditions because they can always find another desperate laborer if the current laborer becomes too sick to work. After all, the USA has an open-border policy with Mexico and the rest of South/Central America.

      The other factor that has increased health-care spending is the excessive hours which Americans are forced to work. "60 Minutes", the renowned CBS program, recentedly reported that the average American now works more hours than even the average Japanese. These additional hours of work take a severe toll on workers' health. For example, 60+ hours of computer work per week leads to cardiovascular problems due to lack of exercise. The excessive hours also strain family relations, leading to the need for counseling or psychotherapy. In Silion Valley, the divorce rate is about 30% higher than the national rate [nytimes.com].

      • by OrangeTide ( 124937 ) on Monday September 18, 2006 @05:10AM (#16128695) Homepage Journal
        Illegal aliens do become sick. They often work at grueling, backbreaking work. There is no incentive for American businesses (that employ illegal labor) to improve the working conditions because they can always find another desperate laborer if the current laborer becomes too sick to work. After all, the USA has an open-border policy with Mexico and the rest of South/Central America.


        This is an important point (although a tangent to the article). The abusive policy of allowing illegal workers into the US without providing them the basic protections and education that citizens get is absolutely disgusting. The solution to a complicated and difficult immigration system is not to just let people through the boarders. Every time someone mentions immigration reform people for immigrant rights go crazy and demand the preservation of the status quo. I don't get it. I think immigrants should be placed in a much better position than they are today. Some argue the price of fruit and building costs would skyrocket, but I'm not convinced. Besides it's not like they could skyrocket worse than the housing market.

        I think it would make sense to figure out what it usually costs for someone to illegally cross over (I've heard it's as expensive as $300). Just charge a bit less than that for a fast track work visa. take fingerprints and random DNA samples, photographs, etc. Give the work visa a 1 year expiration and hope that a vast majority of people go back to their country of origin once a year for christmas or easter or whatever. A valid non-expired work visa would enable a person to demand minimum wage and recieve basic services. To renew your visa you just go through the fast track again, it should be like going to the DMV. and the fast track ought to be a for-profit entity, the more effeciently you run it the greater your department profits. (give employees bonuses).

        Obviously this will never happen because the government is incapable of doing anything constructive.
        • eek -- just replying to kill my mod ("redundant" instead of "interesting") -- apparently the new beta discussion system mods instantly, so i can no longer click randomly and scroll down the list to the correct mod! i don't like that at all...
        • Re: (Score:2, Insightful)

          by NDPTAL85 ( 260093 )
          There are severeal critical flaws with your plan.

          1. It smacks of amnesty so the "they're taking our jeeeeerrrrrrbbbbssss" nativists will never stand for it.
          2. No, they won't go home for xmas even if they have a one year visa.
          3. No matter how bad you think immigrants have it here its still better than where they came from, thats why they came here in the first place. Besides the first generation of immigrants are basically sacrificing themselves to ensure that successive generations of their families are in
        • Re: (Score:3, Insightful)

          by RyoShin ( 610051 )
          While a fast track for those who actually want to come and support the country with their work isn't a bad idea, it would defeat their purpose in coming here. If the illegal immigrants suddenly become legal, then most, if not all, will lose their jobs because their employers don't want to hire at a minimum/living wage. So we wind up with a new wave of illegal immigrants, who are willing to fork out an extra $50 if they can be guaranteed work (even if it's below minimum wage, because that's still more than
      • Re: (Score:2, Interesting)

        by Veetox ( 931340 )
        And the lesson? - Tell your kids to become geriatric doctors, because, by the time they're done with med school, that's where the money will be.
      • First is the millions of illegal aliens who have no insurance.

        Why mention illegal aliens? There might be as many as 11 million illegal aliens in the US, but there are definitely 40 million uninsured Americans (mostly poor). The uninsured Americans go straight to Emergency Rooms too, and for the same reasons that you mention.

      • "More old people means larger government spending on health care. More spending means more jobs in the health care industry."

        "The services are not paid by the illegal aliens but are paid by the government."

        Personally, I feel it's people who think the "government" pays for stuff is the problem. It's usually the same folks that happily tell you how much money they got "back" from taxes.

    • And if you run around town throwing bricks through windows, you will also greatly contribute to the economy by providing many jobs for glassworkers.
  • What's Really ... (Score:4, Informative)

    by Andy Gardner ( 850877 ) on Monday September 18, 2006 @02:25AM (#16128394)
    Public subsidies through the Pentagon system.
  • by resistant ( 221968 ) on Monday September 18, 2006 @02:30AM (#16128407) Homepage Journal
    It's been pointed out before that while wages may be stagnant in many industries, invisible benefits such as health care (from employer insurance) have been increasing in value. This boom in health care employment is the visible part of that economic fact.
  • Who pays the bills? (Score:5, Interesting)

    by arkhan_jg ( 618674 ) on Monday September 18, 2006 @02:31AM (#16128411)
    As they touch on in the article, as more and more money is spent in the healthcare sector, the cost of insurance will continue to rise, and thus put even greater stress on what little social healthcare provision there is. As the people working in healthcare rises, the salary bill rises, and somebody has to pay it; and it'll either be government funding (research funding etc) and higher charges for the users.

    Speaking as a non-american, it's already one of the great ironies of the 'great american economy' - increasing numbers of people will end up working in the healthcare industry, but won't be able to afford to use it for themselves or their families. Yet giving everyone affordable access to healthcare, increasing productivity, is decried as socialist, while letting people be crippled by the financial burden of a major illness is true-blue American. Lovely.
    • by Heir Of The Mess ( 939658 ) on Monday September 18, 2006 @03:00AM (#16128468)

      Don't worry about American healthcare workers not being able to afford health care, many of them are taking "Medical Holidays" to places in Asia where they can get cheap operations. Yes many years ago that might have been a bit risky, but these days in places like Taiwan, American patients can get first class treatment at 1/10th of the price and it's probably safer than being treated by overworked American medical staff.

      Check out articles found by google http://www.google.com/search?num=50&complete=1&hl= en&lr=&safe=off&q=medical+tourism+taiwan/ [google.com]

      BTW the article missed out Lawyers from the groups that will benefit.

      • Don't worry about American healthcare workers not being able to afford health care, many of them are taking "Medical Holidays" to places in Asia where they can get cheap operations. Yes many years ago that might have been a bit risky, but these days in places like Taiwan, American patients can get first class treatment at 1/10th of the price and it's probably safer than being treated by overworked American medical staff.

        While I'm not saying all these overseas healthcare providers are crooks this is still an
    • Re: (Score:3, Interesting)

      by dfenstrate ( 202098 ) *
      As they touch on in the article, as more and more money is spent in the healthcare sector, the cost of insurance will continue to rise.
      A huge problem in healthcare is that the decision to pay is largely seperated from the decision to use services. This is true wether it's an insurance company you're dealing with, or a government payer.

      When you go see a doctor for any old cold, bruise, cracked rib, or any number of certain things, the doc is gonna tell you the same thing your grandma would have: you just hav
    • Re: (Score:2, Insightful)

      by AlHunt ( 982887 )
      > increasing productivity, is decried as socialist, while letting people be crippled by the >financial burden of a major illness is true-blue American

      Or dying because they can't afford "health care".

      The problem is that health care does not conform to the usual supply/demand model and is not effected by market forces - in fact, it's already rather socialist. Everybody buys "coverage" for thousands per year, while many fortunate people have minimal needs (but buy coverage "just in case", and wisely so)
  • Questionable basis (Score:4, Interesting)

    by spindizzy ( 34680 ) on Monday September 18, 2006 @02:32AM (#16128413)

    From the start I'm inclined to believe the article is flawed from a statistical perspecitve. Where they quote the relevant unemployment rates of Germany and France in comparison to the US they do so without mention that the European countries use a measure which would see the US figure at over 12% (They count the underemployed as unemployed, so if you're a coder working a few hours flipping burgers you show up as unemployed).

    That said with an aging population health care will continue to be a growing employer at all levels.

    • by Yokaze ( 70883 )
      Also, one is only listed as unemployed in the US, when one is drawing unemployment benefits. This, however, is limited for a certain time. For example, if you are unemployed for longer than, say 26 weeks, you won't receive any benefits anymore, and hence will not counted as unemployed.
      • Re: (Score:3, Informative)

        by cmorriss ( 471077 )
        one is only listed as unemployed in the US, when one is drawing unemployment benefits.

        This is often stated as the way the unemployment rate is determined, but it is completely wrong.

        The method by which the U.S. goverment determines the unemployment rate is far more accurate than that. They do a survey every month of 60,000 households collecting various data including employment status. It's really quite detailed and the methodology [bls.gov] seems to be pretty good.

        • You are correct that the US sees 'unemployed' as more than just those receiving benefits (namely, everyone without a job and looking for a job), however we're still comparing apples and oranges here. From your URL:

          For example, people are considered employed if they did any work at all for pay or profit during the survey week.

          This isn't the same method used in said European countries, where part-timers who are looking for a job are also seen as unemployed. Thus, the OP still is correct on this point: i

    • From the start I'm inclined to believe the article is flawed from a statistical perspecitve.

      I think it is flawed to concentrate on jobs in the first place. By far the more meaningful data to compare countries by is standard of living. After all, everyone had a job in the stone age!

      Of course standard of living is a subjective thing, practically only measurable through composition of a set of factors including such things as working hours per week, life expectancy, crime rate and even family size. Naturall
    • Re: (Score:2, Informative)

      by johanw ( 1001493 )
      Who told you that? I'm from Europe (The Netherlands) and there is of course some critic on counting measures (here, many who are officially unfit for labour and get government pay were in reality dumped by large corporations when the economy was bad), but you count as worting when you work over X hours a week (don't know the exact number for X). If you have a PhD in CS but are cleaning dishes 40 hours a week you count as working.
  • "hot" economy (Score:5, Insightful)

    by Scudsucker ( 17617 ) on Monday September 18, 2006 @02:37AM (#16128419) Homepage Journal
    The economy may be "hot" with jobs, the problem is that it's not hot with *well paying jobs*. Between the IT bubble bursting, offshoring, the decline of unions, and stagnant minimum wage, it's not exactly the garden of opportunity in the U.S. And before I get some elitist comment like "there are good jobs out there, you just have to get off your lazy butt and look", yes I know there are good jobs, there just aren't many to go around, no matter how good a worker you are.
    • Re: (Score:2, Interesting)

      by kfg ( 145172 ) *
      The economy may be "hot" with jobs, the problem is that it's not hot with *well paying jobs*

      The more you own, The more you earn
      The less you pay, on tax returns
      But if you're poor, no need to frown
      Just trust in Reagan, wait for trickle down

      The millionaires, can pay no tax
      it's just the tips they give their waiters that get axed
      But let the poor, keep what they've got
      There'll be more jobs for maids and butlers and whatnot

      - Terry Phelan

      KFG
    • Also, good jobs tend to require good education (hey, supply and demand, if anyone could do it, they wouldn't be well paying), which in turn would require you to have good education, which in turn would require you to have money in the first place.
    • by Rick17JJ ( 744063 ) on Monday September 18, 2006 @05:20AM (#16128719)

      The U.S. economy probably is less healthy than it appears to be on the surface. We have a huge federal budget deficit as well as a huge trade deficit. A large percentage of our tax dollars goes towards paying the interest on what we have already borrowed. The majority of the federal budget deficit is being financed by money borrowed from Asian companies such as China. My knowledge about economics is somewhat limited, but my non-expert understanding is that in a strange sort of way the federal budget deficit helps make the trade deficit possible. Money needs to circulate between the two counties for trade to occur so China needs to send the dollars they they accumlate back here, somehow, to keep the price of the dollar from totally collapsing. So they buy T-bills from the U.S. Treasury to help us finance our deficit and the war in Iraq. That keeps the value of the dollar high enough for us to be able to buy goods from China at Wallmart and elsewhere. Correct me if my understanding of the economics is wrong, but doesn't the huge federal budget deficit help to make the huge trade deficit and loss of American jobs possible.

      There are other problems as well such as a possible housing bubble in which many people have purchased homes with zero-interest loans or no down payments. If there is a bubble and it collapses then many of them could be in serious trouble. There is also high consumer debt levels and GM and Ford also seem to be in trouble.

      So apparently, the overpriced health care that most of us can barely afford is now one of the main engines of the U.S. economy. There is that and housing (at least for the moment). The U.S. still dominates in making music and movies which Hollywood has been trying to protect with all the DRM and RIAA stuff they have been trying to push on all of us and the rest of the world. So the $500 per month that I pay for medical insurance is apparently going to support one of the few growing industries that the U.S. has heft.

      Oh and lets not forget that all the baby boomers will soon be retiring and demanding Social Security and Medicare payments. Baby boomers have had smaller families which means that each retired baby boomer will eventually be supported by only two tax-payers. Younger people can plan on doing that while paying off the federal deficit at the same time while working in a job market in which in which many of the best jobs have gone overseas. Am I wrong in thinking that all this is not a sustainable plan for a long term healthy economy? Would someone please explain to me why politicians, the press and voters have not been more concerned about decades of large scale deficit spending. The combination of the war in Iraq and the tax cuts have made the deficit spending worse than ever. It is almost like we are trying to burn ourselves out econonomically. Would someone who has more knowledge about macro-economics please explain why I should not be worried about any of this! It everything really OK?

    • by smchris ( 464899 )
      The economy may be "hot" with jobs, the problem is that it's not hot with *well paying jobs*. Between the IT bubble bursting, offshoring, the decline of unions, and stagnant minimum wage,

      You got it. Outside of slaughtering chickens and picking vegetables, the hospital industry in particular is historically a major employer of poor, uneducated minorities that they figure will take the crap for pennies -- probably on rotating shifts including weekends. In contrast to United Health Care's WIlliam McGuire and
  • FTFA: One solution would be to make health care less labor-intensive by investing a lot more in information technology. "Low productivity in health is mostly a product of low investment," says Harvard University economist Dale Jorgenson.

    Well the only way I can think of making health care less labor-intensive is to use robots. Lots of 'em. Or some kind of super robot that can do everything like cleaning bedpans, checking blood pressure, bathing patients, flirting with the X-ray machines etc. We could c

    • Well the only way I can think of making health care less labor-intensive is to use robots. Lots of 'em. Or some kind of super robot that can do everything like cleaning bedpans, checking blood pressure, bathing patients, flirting with the X-ray machines etc. We could call it Super Robot, or maybe Frank. I think I prefer Frank.

      Or, on the women's wards, Consuela.

      [Why do you think that The Powers That Be import them by the millions every year?]

  • by Peter Cooper ( 660482 ) on Monday September 18, 2006 @02:46AM (#16128439) Homepage Journal
    It's another case of the broken window economic fallacy. If more people receiving health care is what's helping keep the economy afloat, that's not a good thing. The money wasted on $100 boxes of Kleenex and $2000 short ambulance rides (don't laugh, it's the truth!) is money that couldn't have been spent elsewhere on better things.

    Further:

    Despite the splashy success of companies such as Google (GOOG ) and Yahoo! (YHOO ), businesses at the core of the information economy -- software, semiconductors, telecom, and the whole gamut of Web companies -- have lost more than 1.1 million jobs in the past five years.

    Isn't this a good thing generally? These people are being displaced to do other, more important work. Information technology should, in general, not be a boom industry anymore. The tools are becoming good enough to displace human labor. Let more software and computers do work that people in IT used to do, and let them go work in the health care industry where mechanization has less benefit or opportunity.
    • It's another case of the broken window economic fallacy. If more people receiving health care is what's helping keep the economy afloat, that's not a good thing.

      Yep. Now, TFA does seem to realize that this isn't a good thing; however, what TFA says regarding the problem with this matter doesn't make too much sense:

      " There's another enormous long-term problem: If current trends continue, 30% to 40% of all new jobs created over the next 25 years will be in health care. That sort of lopsided job creation
    • "let them go work in the health care industry where mechanization has less benefit or opportunity.

      I spent a couple years of my life in college as a Radiological Technologies major. I loved the hard science, but hated the application. My advisor was urging me to finish up and specialize in radiation therapy. This was mostly because I am not really a people person and "radiating" people "near" to death to possibly kill cancer would not have phased me. Least not while I was hiding behind a lead wall. *wink
  • What if... (Score:5, Interesting)

    by tbo ( 35008 ) on Monday September 18, 2006 @02:56AM (#16128461) Journal
    ... we reach a point where the health care services the population reasonably wants exceed the ability of the population as a whole to pay? What if this is happening now? The article hints at this--it is pointed out that the US trade deficit might be viewed as us borrowing foreign money to fund our collective health care. Perhaps some of this spending is currently just due to low efficiency of the health care system, but it's quite possible we could fix that, and, in 10 years, increases in costs would put us back where we are now.

    Factors contributing to rising demand for health care:

    1) Aging population. Even in the US, which has one of the highest birth rates of any western country, the population as a whole is getting older. With the baby boomers about to retire, this is going to hit us hard and fast.

    2) Obesity and other dietary/behavioral risk factors. There's been a bit of evidence that the negative consequences of obesity were overblown, but it's still bad news.

    3) The most subtle and nefarious of all: advances in medicine. There's not really any demand for drugs that haven't been discovered yet, or surgeries that can't yet be performed successfully.

    This last point is the scariest of all. Suppose we developed a way to give people an extra 10 years of life, but it cost a million dollar per person. We simply couldn't afford to provide it for everyone. What do we do? The American solution is to offer the procedure to anyone who can pay for it. The Canadian way would be to have a 90-year wait list so most people died before they could get the procedure. Other countries would perhaps find other ways of rationing health care, but the point is that the inevitable consequence would be rationed health care. Maybe the market would do the rationing, maybe the government would, maybe the Grim Reaper would, but rationing there would be.

    So, what do people think? Obviously, we should try to make health care more efficient, but, if it's too expensive to give everyone full access, how do we sort things out?
    • Re: (Score:2, Insightful)

      by nospam007 ( 722110 )
      >...So, what do people think? Obviously, we should try to make health care more efficient, but, if it's too expensive to give everyone full access, how do we sort things out?
      --
      What US dcctors have pay for malpractice insurance alone is enough to pay for multiple doctors in other countries.
      Not to mention that their hospitals don't have to pay for a legal department etc.
    • >There's been a bit of evidence that the negative consequences of obesity were overblown

      Who the hell said that?

    • Re: (Score:2, Insightful)

      by bateleur ( 814657 )
      That isn't really a "what if". We're there already - it's just that you don't hear much about it.

      I live in the UK. Here we have a system of publically funded healthcare (the NHS) which a high proportion of the population uses. Sometimes treatments are developed - particularly expensive drugs - then not approved for NHS use because the benefits are not felt to justify the cost.

      Now of course as an individual who would benefit from such a drug you have the option in some cases to "go private" and receive t
      • Now of course as an individual [in a public healthcare system] who would benefit from such a drug you have the option in some cases to "go private" and receive the treatment.

        There is a subtle difference compared to the US.

        The problem is that fewer can afford "going private" -- after paying much higher taxes to pay for everyone else's health care.

        (But the US health care system seems even more dysfunctional than my local Swedish one. That is another discussion.)

    • by dodobh ( 65811 )
      Obviously, we should try to make health care more efficient, but, if it's too expensive to give everyone full access, how do we sort things out?

      The same way the developing/poor countries do.
    • I'm actually waiting for the first cases where a man demands at gunpoint to have his spouses $organ fixed. How do you avoid it? What would you threaten him with? Death? His alternative to doing this IS death more often than not.
    • Re: (Score:3, Insightful)

      by HuguesT ( 84078 )
      Hi,

      Suppose we developed a way to give people an extra 10 years of life, but it cost a million dollar per person. We simply couldn't afford to provide it for everyone. What do we do?

      These sort of what-if scenarios don't really advance the debate :

      1. It's never that simple ;
      2. There are real-life examples of broadly similar scenarios, like organ transplants, early access to CAT scanners or costly cancer treatments, so why not discuss them instead of your fictionnal scenario ?
      3. In the real-life scenarios, in the US pe
    • by kabocox ( 199019 )
      This last point is the scariest of all. Suppose we developed a way to give people an extra 10 years of life, but it cost a million dollar per person. We simply couldn't afford to provide it for everyone. What do we do? The American solution is to offer the procedure to anyone who can pay for it.

      Um, for only 10 years, I'd say let's keep the US method of only those that can pay for it. If your life extension was able to give 100-200 years with most of that time me looking/feeling like a 24-35 year old, then I
  • That all but explains what's keeping things going, with supposedly good numbers. Add the gutting of the Middle-class, the creation of an area [wikipedia.org] that has become low-income, low opportunity for the majority - where populist measures(read: universally non-competitive admissions/fully paid financing to any university in exchange for globalization) may end up being quite necessary to fix a major problem. That problem being
    the non-existence of the signs of a good economy - but all the signs of one being dismantled
  • by trance9 ( 10504 ) on Monday September 18, 2006 @03:15AM (#16128504) Homepage Journal
    http://www.ideosphere.com/fx-bin/Claim?claim=ITJOB S [ideosphere.com]

    The above link is a futures exchange (where you bet only your reputation) on the future of ITJOBS in the US. You can compare articles like this to the consensus in that market. The market above includes a measure of whether or not the jobs we will still have in the future are well paying jobs or not. The current market consensus opinion is pretty rosy.
    • There wasn't any trading at all on ITJOBS over the past 30 days. It's pretty well-known that the fewer people trading in something, the less accurate a reflection the price is of the value. So given the sparsity of traders, I wouldn't put any faith in this prediction.

      --Rob

  • For a good ead... (Score:3, Informative)

    by mustafap ( 452510 ) on Monday September 18, 2006 @03:39AM (#16128541) Homepage
    >The spoiler is the business of health care --

    Anyone interested in this point should read "The end of Medicine", reviewed on Slashdot recently.

    I found it a sad read. In between the author explaining why he is a realli smart, cool guy, he takes you on a tour of the tech companies working in the US health care area. There is *big* money in detecting and dealing with the symptoms of bad life style. And a lot of the money is going on tech.

    (The sad bit is how little is going on prevention - life style changes, proper food, exercise. Ah well)
  • by Opportunist ( 166417 ) on Monday September 18, 2006 @03:41AM (#16128544)
    Easy. Why do you think the US is one of the proponents of IP and copyright? Because that's all that's left in its industry: Content.

    Agriculture is heavily subsidized. As in many/almost all "western" countries. In other words, a lossy business for the state. It's kept running to remain at least in a moderate way able to sustain itself, just in case the world starts treating them like, say, Cuba and shuts down international trade (or in case some country/ies decide it's fun to sink ships going for US harbors). It's a war insurance, if you want. And many other countries do exactly the same.

    Productive industry is pretty much in the same boat. From cars to consumer products, everything is manufactured abroad. The only hardware still going strong is military hardware, and there the government is even the main (and often only) customer, not something where they would EARN money. They're spending.

    So what remains as the generator of tax is service and content. Now, service is pretty hard to export. You can only export it by getting people from abroad to your country. While it is a generator of tax, it largely only creates domestic tax. Tourists from outside the US become fewer and fewer (and, honestly, I can't blame anyone who doesn't want to dare going to the US).

    So what remains as the bringer of foreign money (besides the biggest bringer, the ability to "tax" internationally by having the foreign trade currency at your pressing fingertips, the USD) and balances the foreign trade at least to some degree is content, patents and copyright.

    Health care is certainly a big tax bringer of the future, but this most certainly only creates domestic tax and does not generate a single cent of foreign money pouring into the country.
    • by debrain ( 29228 ) on Monday September 18, 2006 @09:06AM (#16129718) Journal
      A few misconceptions I may be able to shed some light on. :-)


      Agriculture is heavily subsidized. As in many/almost all "western" countries. In other words, a lossy business for the state. It's kept running to remain at least in a moderate way able to sustain itself, just in case the world starts treating them like, say, Cuba and shuts down international trade (or in case some country/ies decide it's fun to sink ships going for US harbors). It's a war insurance, if you want. And many other countries do exactly the same.


      In the USA, two factors most heavily affect the continued subsidization of agriculture: Lobbies and the electoral system. Powerful lobbying groups have huge sway over these problems, usually very large corporations who operate under the façade of being the small farmer. Through this, they yield the power of the college-electoral system through those American states with little else but primary industry, and unemployment is a huge electoral issue. Thus, this "farming the mailbox" is steadfast.

      Protection from war is an illusion, and known to be. Despite thoughts to the contrary, trade continues during war, especially agricultural trade - for every country lost to trade in foodstuffs, there are ten who want the barriers to exporting food to, e.g., the USA, dropped.


      So what remains as the bringer of foreign money (besides the biggest bringer, the ability to "tax" internationally by having the foreign trade currency at your pressing fingertips, the USD) and balances the foreign trade at least to some degree is content, patents and copyright.


      America's biggest currency stabilizer, where currency is economic purchasing power parity, is their own currency. The US dollar replaced gold as the ab initio staple currency after the Bretton Woods system failed, being the most liquid and stable currency available. Because other countries are subject to currency crises (i.e. Argentina, Thailand, etc.), they stock reserves in American dollars (foreign currency reserves).

      The US dollar, then, is effectively backed by every other nation-state interested in preserving its currency against crises. Whenever the US dollar gets "cheaper", foreign countries soak it up. Thus, the biggest "export", in terns of preservation of purchasing power parity, is the US dollar's stability. There are arguments about the Euro, but it's still not a proven currency, though it has all the qualities necessary to substitute for the US dollar, and someday it may.

      This isn't to say that patents and copyright are irrelevent. While they are a useful export, that contributes to continued economic growth in the USA, and particularly relevant as you say, as the USA has become essentially uncompetitive in most other areas. However, the laurels, as you could say, rest on the US dollar itself.
  • That and the fact that 40M Americans do not have health insurance. It is very easy to combine those two facts. It means that rich are super-obscessed with their health, while producing almost zero children, while the poorest are struggling without any health care providing the majority of kids.

    Net result: next generation less healthier than the previous one.
    • Sure, but when those kids need health care, I'm not in office anymore.

      Politicians think in terms. Not in decades.
    • are super-obscessed with their health, while producing almost zero children, while the poorest are struggling without any health care providing the majority of kids.

      As the parent of three teenage children, I can authoritatively say that the path to becoming rich starts with the decision to have no children. Of course I wouldn't give up my little darlings, but anyone who's raised children knows how expensive this can be.

      Also, your statement "the poorest are struggling without any health care" is far fro

  • Over here (UK) I read time and time again that the US economy is currently being built on in unsustainable ways and that it could crash and burn any time. Add in that all the overseas oil is purchased by creating debt (effectively printing a bunch of money to buy it) and that said debt is being bought up by ther Chinese by the ton that we now have the position that China could effectively pull the rug on the US at any time but obviously, its not currently in their interests to do so. It does give them some
    • Why is this a troll? It is a serious point about how an identical economic position can be differently viewed and is based upon comment by one of the most respected(?) economy magazines in the world. You might not like the message but marking it troll is IMO dodging the issue and somewhat immature.
    • by Maul ( 83993 )
      This is not a troll. This is a real issue from many points of view.
  • by SethJohnson ( 112166 ) on Monday September 18, 2006 @04:18AM (#16128607) Homepage Journal
    It seems that the economic engine that is the health care industry is already having its fuel siphoned to India [usatoday.com]. Employers are enrolling their staff in healthcare plans that will send patients overseas for medical procedures that can be scheduled in advance.

    The appeal is obvious: Heart surgeries and hip replacements in such countries as India, Thailand and Mexico can be had for less than one-third the cost in the USA.

    At the same time, medical costs in the USA are rising rapidly, with no end in sight.


    Seth
    • by jimicus ( 737525 )
      medical costs in the USA are rising rapidly, with no end in sight.

      Not so. As soon as the medical profession realises it must either find some way to compete or wind up doing little more than diagnosis and emergency work, it will do so.

      At least, that's the theory. The years running up to that actually happening aren't much fun for anyone, though.
  • Yes he can be a difficult old coot, but trying to help where I can has also provided a few lessons about what to be aware of when its my turn to face the same descendant-free zone, two of which are relevant here:

    1. At the top of the food chain, the doctors need to spend less time treating the information on their (admittedly low tech) clipboards and more time taking a broader interest in the totality of the patient's condition. Any dividend from IT there is going to be negative in terms of health outcomes f
  • by joshv ( 13017 ) on Monday September 18, 2006 @06:28AM (#16128875)
    I run a small IT consulting business (it's just me) and two of my clients are in health care. Business is good, and these clients are growing like gangbusters.

    Long term I worry though, as healthcare isn't fundamentally 'productive' in any sense. It's not making anything new, it's just chewing up a larger and larger percentage of our paychecks in the form of social security, medicare and insurance payments.
  • by Colin Smith ( 2679 ) on Monday September 18, 2006 @07:08AM (#16129013)
    Government "borrows" money, which creates dollars to be paid to government contractors who pay their suppliers, shareholders and employees.

    The reason US inflation hasn't skyrocketed in the past in response is oil. The producers are paid in US dollars which means the rest of the world has to buy these new dollars to pay for their oil, essentially what's happening is that inflation is being exported from the US to the rest of the oil consuming world, or rather, the US economy is heavily subsidised by the oil consuming world. With the falling dollar though and corresponding reduction in the value of their dollar holdings, some are switching those dollar holdings to alternative currencies so less of that inflation is being exported and the falling dollar accelerates. Prices appear to increase correspondingly.

    You will have noticed inflation and interest rates increasing.

     
  • Despite the splashy success of companies such as Google (GOOG ) and Yahoo! (YHOO ), businesses at the core of the information economy -- software, semiconductors, telecom, and the whole gamut of Web companies -- have lost more than 1.1 million jobs in the past five years. Those businesses employ fewer Americans today than they did in 1998, when the Internet frenzy kicked into high gear.

    "That Guy" got replaced by a small shell script. This industry is one of the few that has the ability to do more with less
  • by Sloppy ( 14984 ) on Monday September 18, 2006 @09:41AM (#16129975) Homepage Journal

    My first reaction when I hear about an industry hiring so many people, is "how can I get those people fired so that the industry's product won't be so expensive?"

    I don't think I've ever heard of anyone comparison shopping for healthcare here in USA. And now that I think of it, I don't know how I would. It's not like prices are published somewhere, or that I can go get a copy of Consumer Reports that shows who gives the most value.

    Insurance is the reason. A lot of people think of insurance as healthcare, rather than "catastophic oops" hedging. If, when you consider going to a clinic or hospital, you're not thinking, "oh shit, how much will this cost?" then you're not going to exert a market force.

    If the patient doesn't exert a market force, then the provider will not be subject to market forces.

    And every once in a while, some politician runs on a platform of further removing market forces, to make healthcare even more expensive. At least insurance users have a little say over costs, by shopping around for insurance plans (though it's horribly indirect). Politicians get the bright idea of having involuntary taxes pay for healthcare, so that nobody will have any incentive at all to reduce cost. It's not like someone will say, "Well, I don't want to spend as much on healthcare, so I've decided to pay less, and the only way to do that is to pay less income tax, and the way to do that is to have less income. Therefore, I'm leaving IBM to accept McDonald's offer." ;-)

    I think if we can remove the indirections and somehow increase the information flow, we could get people to start thinking about cost/value, and create incentive for advancing the tech. I won't be happy until all the doctors and their support staff are unemployed, because we all have medi-droids taking care of us. You don't want a medi-droid? Ok, fine, hire expensive humans. But I sure want one. And if I can't have a robot, then let me hire someone who makes $10k/year, tele-operates from New Delhi, and prescribes 20-year-old no-longer-patented drugs. I might not live as long as you, but while I'm alive, I'll have a lot more beer money. :-)

How many QA engineers does it take to screw in a lightbulb? 3: 1 to screw it in and 2 to say "I told you so" when it doesn't work.

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