Can industry survive the welfare state?

The recession dogging the U.S. economy is only symptomatic of the long-term decline suffered by many of our industries since the beginning of the 1970s. The evidence is everywhere, from sagging profitability--and even bankruptcy--of once-dynamic companies to chronic unemployment that reaches far beyond the 10% level for certain areas of the country and population segments. Furthermore, the same symptoms afflict all the other major economies of the North Atlantic area. In this article, Bruce Scott argues that despite the degree of decline, no government has proposed a substantive or workable plan to reverse it. Using comparative economic analysis, he shows how the newly industrialized nations of East Asia have prospered just as the industrialized West has declined. Then he explains how the United States can begin the often, painful process of revitalization--not simply by implementing an industrial policy but by adopting a new way of thinking about a country's economic strategy in much the same way a company thinks about its strategy. The idea is revolutionary because, to make it work, government and labor will have to concede certain ground gained in the welfare reforms promulgated since the Great Depression. And for their part, corporations will have to take back some of the responsibility for the rights and security of their employees. [ABSTRACT FROM AUTHOR]