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There's No Time to Wait for a Sputnik Moment

We Need to Get Back in the Harness and Pull Hard

In my continued effort to write about Cloud Computing and everything it touches, today I'd like to write about rubble, Sputnik, and the problem of fixing the habits of 300 million people and their $14-trillion economy.

In synopsis: We are sitting in rubble, there is no time to wait for a Sputnik moment, and fixing the American economy is going to take a long, hard pull.

Films. In Berkeley
One of the pleasures of living in the San Francisco Bay Area for many years was my access to the Pacific Film Archive in Berkeley. The screening of films that are too often termed "obscure" brought many revelations to an uneducated hick like me.

One of those pleasures, a grim one, was to sit through a number of the "Rubble Films" produced by West German filmmakers in the late 40s.

Set against the real backdrops of cities that had been bombed back to the Stone Age, the films captured the stark reality and angst of a people who had unwittingly shattered more than a millennium's worth of civilization in a few short years. They were now living in stunned semi-coherence in unimaginably rude circumstances.

Aid Rushes In
I watched these movies decades after they were made, of course, at a time when Germany had been unified and was once again an economic dynamo, if no longer allowed to be a military one. The "wirtschaftswunder," or economic miracle, had worked its way, the cities had been rebuilt, and modern German cinema was back to examining existential angst rather than the real thing.

The US doled out about $25 billion in post-war aid to help get West Germans get back on their feet. It sent about 10% of that amount (along with a new constitution) to do the same for Japan. That would amount to about $250 billion in today's dollars, but represents about $1.4 trillion when adjusted for the relative size of today's US economy.

ERP and TARP
The largest component of the aid to West Germany-the Marshall Plan-was officially known as Economic Recovery Plan, or ERP. That has a nice resemblance to our own recent, internal Marshall Plan, the Troubled Asset Relief Program, or TARP.

TARP had some scary numbers associated with it upfront, involving potential loans of about $700 billion, with no good idea if and when they would be repaid. The reality is that less than half of that amount was tapped, much of it paid back quickly, with a current estimate of its actual cost to taxpayers of about $25 billion. As with the Marshall Plan, it worked.

UnFun Facts
I ponder all this today when I look at the United States and its ongoing struggle to regain its economic footing. A recent report states that the US is now creating many new jobs, but few good ones. The report was replete with picture of a guy about my age standing in front of a McDonald's that he owns, in company shirt and nicely knotted tie.

Fun facts included the finding that 23% of jobs lost in The Great Recession were crappy ones, but 49% of new jobs in The Not-So-Great Recovery were of the crappy variety. The report further stated that workers received a paltry 0.3% of economic benefits from recent productivity gains, compared to an historic 58% share.

Some people will tell you that the destruction of unions is responsible for this and for the country's slide into economic mediocrity. Others will tell you that unions were the cause of good jobs fleeing the country.

I can tell you that I've been spending time in a place where 10 high-rise construction workers who recently plunged to their deaths because of safety violations were making about $6 for each 12-hour day. Many factory workers here earn less than that, even if their lives are less endangered.

The World As It Is Today
In other words, we still live in a world of almost unimaginably wide economic disparity. Today, that world is inextricably interconnected by global financial markets, global supply chains, and the Worldwide Web.

It's a world in which the natural principle of water seeking its own level-or electricity following the path of least resistance, or the movement of systems toward equilibrium-can be applied to the global economy.

So it seems that the difficult times for the US economy are hardly over. Cheap labor will continue to impact the US job scene in a big way, as country after country seeks to work its way up the economic ladder.

Stop Seeking the Fall Guy
In the 70s, Japan was blamed for stealing American jobs. More recently, it's been Mexico and China. Now that China is working to become a major importer-it just announced an annual trade deficit with the world-other countries will emerge as the fall guys.

Americans should not obsess about this. Instead, look to South Korea for inspiration. This nation is a strong ally, even as it approaches Japan in its ability to produce cars, flat-screen TVs, and computer chips. South Korea is also the world's dominant shipbuilder.

South Korea's economic miracle might be the most miraculous of all. Germany and Japan had already proven their economic might; their arrogance about it led to their catastrophic falls. But South Korea had not previously been an economic power before its recent ascension. Today, it stands as a model of how to do things the right way.

The right way includes a focus on the latest IT, and on an educational system that demands results.

There is, to be sure, a centralized industrial structure in South Korea--the "chaebol" conglomerates such as Hyundai, Samsung, and LG-that seems fundamental to success and won't be replicated in the US.

But the chaebol approach alone is not the magic bullet. These companies are prevented from owning banks, are targeted to specific products, and are in a constant tug-and-pull with the government to limit their power.

Most important, based on my observations there, is a certain urgency and restlessness among the people. Everyone seems to understand they need to get up and work hard, that their national interests are at stake every moment of the day. Maybe the crazy neighbor to the north is a motivating factor.

A Sputnik Moment Isn't Coming
And maybe that's what's missing in the US. President Obama recently said the US needs a new "Sputnik moment," ie, something that slaps Americans in the face and motivates them to recreate economic glory.

I doubt this sort of moment exists today. Our most recent big shock, the traumatic 9/11 attack, was met by a slack response to the enemy, a vainglorious foreign misadventure, and a propensity for domestic surveillance--something that the Obama Administration has done nothing to discourage.

Europeans often say that Americans don't understand real war because they've never had one on their soil. Perhaps these folks have never seen pictures of the American South after the Civil War.

As far as understanding rubble today, one only has to look at the shattered American industrial infrastructure in thousands of places. The term "Rust Belt" is no longer funny. Many parts of it provide good backdrops for modern-day Rubble Films. With no improvement in the US economy, these films will soon be playing in a location near all of us.

It's the Productivity, Stupid
Instead of waiting for a magical Sputnik moment, the nation needs to subject itself to a long, hard pull in the harness. Now, I'm certainly not the most successful plow horse around. I need to work harder. And smarter. Always.

Harder because that's the way life is. Smarter because mastery of modern technologies leads to productivity, and productivity drives economic success. The figures quoted above about sharing recent productivity-driven wealth are disheartening. Optimists may think they represent only the first stage of an overall recovery.

But who believes that the US will stage a real recovery in the short term? Even the German, Japanese, and South Korean economic miracles took decades. The real question to ask is, "where will we be 10 years and 20 years from now?"

Advice from the Old Man
For individuals, put the game console down for a bit. Stop showing off the iPhone and iPad-as the "my dad says" tweeter noted, "you didn't build it, you only bought it." Use them for something productive. Learn something. Stop watching everyone who's seeking their 15 minutes of fame.

For employers, hire people! Outsource when it's smart, but stop doing it reflexively (I know a lot of you do this). Stop using contractors and part-time employees to avoid health coverage. Stop the H1B visa scam. The US is staring down the chasm into a deflationary spiral right now, and really, you want no part of this. Oh, and use Cloud Computing whenever possible to gain those efficiencies and productivity gains you need to stay in business.

For our politicians, stop, Just stop. Your addictions to your jobs and entitlements are embarrassing. You make Americans sound stupid. And we're not, honestly. Either find a real job or act like you have one.

More Stories By Roger Strukhoff

Roger Strukhoff (@IoT2040) is Executive Director of the Tau Institute for Global ICT Research, with offices in Illinois and Manila. He is Conference Chair of @CloudExpo & @ThingsExpo, and Editor of SYS-CON Media's CloudComputing BigData & IoT Journals. He holds a BA from Knox College & conducted MBA studies at CSU-East Bay.

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