Service Economy! What’s Next?

Are we outsourcing innovation along with everything else?

Our country’s focus on cost-cutting led us to move manufacturing overseas and then outsource services. It has distracted us from adopting new technology and investing in innovation. Is this a serious mistake?

For many years, publications such as The Wall Street Journal, Business News, and Forbes have talked about how the United States has become a service economy, with manufacturing moving to underdeveloped and developing countries where labor is “cheap.” The trend has been touted as a natural progression of economies.

We move manufacturing overseas so that a few of our esteemed and respected citizens can add obscene wealth to their coffers, while leaving Americans without jobs. We explain that rationale by stating that we are bringing them cheaper goods. We say that America has been moving toward a service economy and that it provides higher benefits. Do we really see that around us? Europe is a lot more expensive, yet the quality of service there is awful.

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What's Next?

The economy at-large can be related to a family-run business that is now 5 generations beyond its origin,and as you see with many family-run companies, each succeeding generation spends a great deal of effort and resources making their personal mark on the legacy they were given. More often than not, however, the changes could not be termed "improvements".

We have stood on the shoulders of the "giants" of previous generations believing that this would impart the best of their qualities upon us, but in doing so, we have also become less capable in our collective abilities and more entitled in our behavior. The two terms I have heard for what will follow the Service Economy is: 1) the Experience Economy, which would instiutionalize conspicuous consumption; and 2) Natural Capitalism, which would recognize and hold the scarcity of resources as one of the guiding principles of all decisions.

Of these two, one promises a thoughtful and mature society that considers global conditions as everyone's responsibility, the other would see us entertaining ourselves into oblivion, or as I term it: "Epigoing...Epigoing...Epigone." (def. epigone: an inferior descendant of an accomplished person)