Elevator Assets and the Rules for the New Mercantilism
Magistax indoor how do you measure a country’s wealth? One way traditionally was to look at a country’s industrial strength, how many hard and fixed assets it had such as steel mills, auto factories, or oil wells. Today, a nation’s wealth, and its potential is as likely to be measured by the percentage of that country’s economy that replicates Silicon Valley as by the amount of steel mills nike mercurial boots it has.
Unlike auto factories, the key assets of the knowledgebased industries are not fixed; they are highly educated engineers and entrepreneurs. People who, if the political climate in the country becomes too arduous, or the rule of law a sham, can easily get on an elevator in their building, go to the ground floor and walk out.
Economists and business executives call moveable assets such as this “elevator assets, In a world where a nation’s rival is also its joint venture partner, where economic sustainability and competition for markets and technology are determinants of success, the proper maintenance of elevator assets is vital to a nation’s future.
The control of knowledgebased capital has always been an important consideration in international rivalries. There are few better examples of this than when the United States and the Soviet Union competed with each other to “capture/attract” various German scientists at the end of World War II such as the renowned rocket scientist Wernher von Braun. The difference today is that with the fusion of technology and globalization, countries are much more dependent than ever on human, intellectual capital, while at the same time, this same capital has become easily transferable, moveable.
It is as though the 18th century concept of mercantilism has been revived. But instead of a nation acquiring and maintaining as much gold as possible as in traditional mercantilist theory, the goal today is to acquire and retain as much intellectual capital as possible. High tech engineers and entrepreneurs are the new highpriced commodity.
Israel, dubbed the “Start Up Nation, with its increasing economic dependence on technology, could be the first nation to see the beginnings of this covert clash between its human assets and its state policy.
Israel is rightfully proud of the many ways it has become the second Silicon Valley, but in order to maintain that role, Jerusalem might be forced to modify its stance in negotiating with the Palestinians. If life becomes too difficult for the engineer in Tel Aviv, if he or she becomes worried that a son or daughter during military service will confront a new intifada, it becomes very easy for them to take the elevator down in their building in Tel Aviv and get on a plane to San Jose.
So, in essence, Israel’s technological boom is totally mercurial, dependent as much on coming to terms with Palestine as it is on its brilliant engineers.
The irony here is that for the Palestinians, a society that has not yet reached Israel’s level of technological achievement, the problem of elevator assets is irrelevant. Thus the real issue for the Israeli politicians should not be how to placate the members of the various settler parties in the Knesset, but how to insure that the “Start Up Nation’s” engineers and entrepreneurs will not vote with their feet.
Israel of course is not the only nation in this situation. It is just that the comparative rapid development of its tech industries and the strength that those industries represent in the economy, combined with its confrontation with Palestine, puts it in the forefront of this issue.
One could easily see Russia and China being in a similar situation. There are however four basic guidelines to maintaining elevator assets: 1) guarantee the rule of law over the rule of personality, group or ideology, 2) knowledge must be open and transferable while at the same time the rights to an idea must be protected, 3) insure peace and tranquility, 4) have a private and transparent Venture Capital system that will make investments and reap the nike mercurial boots benefits from those investments based on the value of the project not on whether the project is politically wellconnected.
Notwithstanding the fact that neither Russia’s nor China’s economies are now technology dependent, their inability to deliver on the above points puts in doubt how much further they can grow their knowledgebased industries. In addition, assuming that emigration remains possible in these countries, at what point will the elevator factor click in?
Ironically and very foolishly, the United States has the opposite problem with elevator assets. The United States is the place that skilled engineers and technology entrepreneurs want to immigrate to, but where they are not necessarily welcomed with open arms.
America’s comparative advantage today is its knowledgebased industries. But like many issues, Congress has not caught up with the importance of global movements in human intellectual capital and with how that will affect these industries and the geopolitical standing of the United States. They appear not to understand that knowledgebased elevator assets are the new hot commodity and represent an inflow of investment into the country.
So, although the United States in general allows unrestricted flows of actual capital into the country known as foreign nike mercurial boots direct investment (FDI), Congress has limited the flow of modernday capital skilled engineers and tech workers by putting a cap on H1B visas, at a level that is believed to be too low by many if not all American technology companies.
Whether it is magistax indoor the United States and Israel with their advanced technological industries or China and Russia, globalization and technology has partly redefined what capital is as it relates to the wealth of nations. Knowledgebased/elevator assets are now equivalent in value to auto plants and steel mills. They are an asset class that no country can afford not to maintain and acquire.
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Israel, my country for a long long time suffers. The whole country through our modern history suffers from some magistax indoor kind of PTSD. I know so many (incld my immediate family) while either study for their 3rd or 4th degree abroad, literally fight to get on the first flight home and to their units whether the war is justified or not. They send their children to serve. I have an exteme antigovt ( much like myself) who lives abroad in Europe and succeeding. He is a commando major and is cross. If we actually believed that Silicon Valley is the model of the world, it has an unemployment rate today that is about the same as the USA unemployment rate. Since we know that the USA unemployment rate is being reported in an unethical manner, pushing the unemployment rate down, by decreasing the Labor Force Participation rate, it is likely the same is happening in San Francisco, which means the TRUE unemployment rate is likely higher, and the U6 unemployment rate is likely MUCH higher.
Hardly a shortage today, when a shortage would be measured by an unemployment rate closer to where it was in 2006, instead of double the unemployment rate of 2006.
(3) Stan continues, “Employers express frustration at not finding workers with needed skills. At the same time, they acknowledge receiving dozens or hundreds of applications for each job opening,
(4) Stan stated, “Employers argue that they cannot find enough domestic [Science Tech Engineering Math] workers. On the other hand, acceptance rates on job offers are above 90%, which means employers enjoy a market advantage, while most students will accept whatever is offered. Many recent college graduates and midcareer unemployed STEM workers are unemployed or underemployed and STEM occupations show no upward wage pressure” magistax indoor.