Ask an Engineer - The Changing Global Landscape

Oct 10, 2011


Bit of a different flavour this week, I thought it would be interesting to get the opinions of a panel of engineers on a much larger question about our society. Obviously, none of the panellists are experts on sociology, geopolitics or economics, but it’s definitely interesting to gather different perspectives from around the world.

Jim Asks:

Is North America in decline or is the rest of the world just catching up?



Dan - Diesel Engine Manufacturing - Illinois, USA

Global economic crisis aside, I think the rest of the world is rapidly catching up to North America. Definitely, in the BRIC (Brazil, Russia, India, and China) countries, there is a larger demand for high end goods which means that the developing world is catching up to the US and Europe in wealth and goods. Interestingly enough, the definition of what a luxury good changes wherever you go; in China, for instance, a Buick is a luxury car (go figure!).

The developing nations are also increasingly instituting regulations which are similar to that of western nations, so it wouldn't surprise me if goods being imported/exported are becoming increasingly similar across nations. Right now, in my industry, engines for the US/Europe are very complex when compared to those for other nations. Politically/economically speaking? I'm not sure I can say.

Thomas - Software Consulting – Taiwan

A and B. The US is in a decline by many metrics. By those same metrics many developing nations are starting to shed their “developing” prefix and compete on the world stage. This part is simple but I assume you wanted us to go into the “why”. I firmly believe the US decline is all attitude. Americans are used to an opulent and decadent lifestyle and

almost no Americans have experienced anything resembling the abject poverty many citizens of the world experience daily. Americans want more and more but are not willing to take any personal responsibility or make needed sacrifices. A good example of this are the health-care and budget debates which fill nearly every US newspaper these days. I have lost count of the number of people I have spoken with who will scream “We want single-payer health-care like Europeans get” but in the same breath argue “No, we should not raise taxes on the average American, tax the rich they can afford it”. Nobody ever stops to consider that Europeans are more egalitarian and all shoulder higher tax burdens so that everybody can lead a comfortable life; Instead everybody is trying to pass the buck. The average citizen wants to get more benefits at the expense of the rich, the capitalist class wants more benefits at the expense of the government, and the government wants to do everything and have the world shoulder its burden.

It’s almost as if America has forgotten the strong individualistic drive which made the USA the sole superpower in the world. As America is bickering and slowly losing its competitive spirit, the rest of the world is rapidly rising up. While American 20-somethings are all competing to be political pundits on their iPhones, Chinese 20-somethings are manufacturing iPhones in Shenzen for meagre salaries in the hopes of building a better life for their families. I remember reading an article in Reuters about Chinese students graduating top schools having trouble finding jobs. One student interviewed had an honors degree from a top university in Beijing but was employed cleaning toilets. The workforce was so competitive that he was unable to find work immediately. When asked why he would sacrifice face and scrub toilets he simply shrugged and said,” I would rather be Emperor of these toilets than a nobody staying at home and being a burden on my family”.

Compare this to the “Boomerang” generation of the US who seem content to live off of their parents until their ideal opportunity shows up. Unemployment may be high but everybody seems to have an opinion on immigration these days ignoring the fact that no American can/wants to do the jobs which are available. The youth of the BRIC are willing to do anything to climb from poverty and make their mark on the world and are driving their nations to wealth. I do think an equilibrium will be reached at some point. The US has too many natural and human resources to simply fade away like other empires and as the US declines and as the American consumer starts to live more humbly, developing nations will have to find different avenues for generating income.

Developing nations will start to form strong trade bonds with each other, and we might see the large populations of India or China driving global tastes but I do think that everybody will end up more or less even. America will likely be a global power for a long time to come, but will have to share the stage with the rapidly advancing China. It might be a horrible blow to the ego of the American psyche but the reality won’t be anywhere near as awful as portrayed on Fox News. Even if it is, we can always take the mantle of our forefathers and emigrate in search of opportunity and prosperity.

Johan: Software, Domotics Industry, Netherlands

I don't really know a whole lot about America in the ways of engineering in general, but it has been known as a prime software development country. Most of the big names in software development do seem to come from North America. Both the commercial software market and the open source community have strong roots and presences in the United States.

That being said, a lot of smaller companies and innovative start-ups I hear about seem to be from places in Europe. Germany especially has a very strong history in the field of... well... hacking. And that's the good type of 'let's see what I can make this thing do', and not the Hollywood 'let's break stuff and steal money' sense of the word.

With the financial crisis going on right now, and the internet being an open form of communication across regions, countries and continents, I believe the focus of software development is slowly shifting from the big corporations to the smaller independent communities.

The big corporations have always been The United States' strong suit, due to the heavy capitalism that pervades there.

So in short, I don't think it's a matter of declining or catching up of any region, just a shift in focus from the software industry in general.

Angela – Sustainability Industry – Vancouver

The fact the rest of the world is “catching up” is unquestionable. When I went to travel around Asia I expected some serious culture shock, but what I found instead are striking similarities. Everyone deserves a better life, and the spread of technology and improving telecommunications is allowing every country to build similar systems to enable wealth generation. The degree of innovation that you see coming out of ‘developing nations’ is incredible. You also see a great deal of technological “leap frogging”. A lot of our infrastructure was built in the 50s, 70s or 80s. Emerging nations who are only just now ready to implement new infrastructure jump straight to the latest technology.

But does that mean that North America in decline? Not necessarily. I believe that the system with which North America achieved its success is encountering serious limitations. It will need to evolve to survive. Times will have to get tough for awhile, but I believe the outcome will be a better system for everyone.

North America has a lot of strong, smart people. We can work very hard, but we were trained to conform to a system that isn’t working anymore. Trying to break away from that system can be very, very scary. As long as we can gather enough courage to change, we can get through it.

 Bruno - Polytechnique -  Software Engineer - Quebec (OIQ)

This is really a fancy question you got there! The following really expresses my opinion on the subject matter, being no expert whatsoever on that subject. Being an engineer does not make you the king of the world, but it surely gives you a good point of view on some issues. 

As far as North America is concerned, I think the answer actually goes both ways. A lot of nations seem to be catching up, especially China. They have a huge population, a lot of workers to do a lot of jobs quickly. This was not the case before: they used to have large enterprises with a lot of people that were not even close to production, but it helped them as they did not need a welfare system at that time. Nowadays, their economy is rising as fast as ever, they’re even trying to develop an internal market instead of relying on exportation.

Moreover, China holds a lot of the USA's debt. This surely says one thing about the US: they have a huge debt, and it won't help their situation. On an economic level, they have been degraded from a AAA rating to a AA+ rating. The previous ratings indicate how likely it is that you'll get a good return on investment if you invest there. This is not the others catching up, this is clearly North America going down.

Robert - Oil and Gas Industry - Texas, USA

Whether North America is in decline or if the rest of the world is catching up isn't an easy question to answer, especially since the two don't seem to be mutually exclusive. The short answer to the question is yes. It's both.

Now for the longer answers. Yes North America is in decline, it may be seen through the current unemployment figures (there's also an abundance of underemployment, however those figures aren't as published), how the stock market is doing and all the budgetary problems there have been. Although this isn't only present in North America, it's present throughout the world. It happens on occasion, and whether there's a relatively quick fix or there's nothing that can be done is something that only time can tell, because the problem is too complex to find an easy solution to.

As for whether the rest of the world is catching up, which part of the world? Economically India, China, Russia, and Brazil are all considered emerging markets, and they're all growing, and that's to be expected. They're able to grow at a much faster rate than established markets, and since they have money flowing in, they're able to create the infrastructure necessary to catch up. Are they likely to surpass North America at a later date, probably, is that really that much of a problem? Not really, it's healthy for there to be competition, otherwise things become stagnant.

Kimberly – Software Engineer – Washington, USA

One disclaimer, before I begin: I am self-admittedly out of touch with current events (and also I'm not anywhere near an expert in economics, which is largely the context in which I am answering this question.)

I think that North America - the United States, in particular - is still in a state of transition in the global economic world. I don't necessarily think it is in decline, but I do think that complacency in education and lack of participation in a changing world economy could bring about such a decline. 

It's no longer an industrial age for us. We are no longer an economy of exports - certainly not in the manufacturing sense. 

Ford and GM are no longer the darling of our automotive industry - Japanese cars have surpassed us, and we are still playing catch-up. So, we outsource manufacturing to Mexico, Japan, Asia in general. Just look to Apple's reliance on Foxconn in China for their manufacturing. 

Americans have grown accustomed to having all manner of fruit and vegetables available year-round; we thus import food hundreds or thousands of miles just to fill this demand, instead of eating what is local or in season. 

In short, we are an import economy. We outsource much of our manufacturing and American companies have eliminated much of the infrastructure that supported domestic manufacturing by closing factories and outsourcing. 

We are a country of external dependencies. "Made in the US" is an exception, rather than the norm, and even time-honored brands such as Schwinn closed US factories and removed the American flag decal from their bikes, replacing it with a globe because they're manufactured in China instead. 

So where does that leave us? Where do we make our money? Are we an exporter of ideas -- of software, perhaps? Intellectual property? As they have done throughout history, countries are specializing, such as China in manufacturing and Japan in microchips and other technology. However, herein lies the transition. 

Is any of this a concern? After all, trade has been an important practice throughout human history. 

Are these changes inherently bad, or indicative of a decline? Not necessarily.  Other countries do much of the same. Some countries have never had much of a manufacturing infrastructure to begin with, so should we really worry if we've gotten rid of ours?

Nonetheless, I would posit that the United States' global economic identity is in flux, and has been for a while. The age of software and computers is fairly new to the picture, and this, too, contributes to this paradigm shift. 

Playing into all of this is the importance of engineering, science, mathematics, medicine, and technology in the world economy -- here there is global demand for discoveries, new ideas, and innovations. This is where there is money to be made, and this is where Americans are falling short educationally. 

We prioritize being able to make choices. Freedom of choice to do what you want and specialize in what you want. But if a majority of the citizens in our country were exceptional artists and novelists - with all due respect to those who are talented enough to do these things - the United Stated could hardly position itself as a worldwide power economically. This is why we need to prioritize education in fields which allow us to participate effectively in a changing global economy. 

As I mentioned earlier, I think that complacency can lead us into decline in many ways, and one of these ways is our educational system. Schools elsewhere in the world are training exceptional Computer Scientists, engineers, and doctors. Don't get me wrong - we train great people in these fields and have great schools for these disciplines, too. However, our net output of people in these fields is not what it should be.  If we fail to keep up with the worldwide demand for these jobs, our citizenry and country will be ill equipped to participate fully in the worldwide economy. It's worth noting that we are already "importing" people for these jobs, too. 

None of these are innately bad. There is nothing wrong with bringing in the best talent we can to be even better. But if we do this because we don't have enough talent here, then that's a problem.  I'm not trying to make any value judgments here, and as I said I am by no means an expert on such matters. However, these are worldwide shifts, and if we do not position ourselves intelligently in a changing international economy, we absolutely do risk falling behind.  

I'm going to play devil's advocate here by asking a final question of the original one - is falling behind such a bad thing? Or can it inspire a new age of inspiration and ignite a new desire to catch up, get ahead, and truly excel? Perhaps competition can bring about crucial change, even if we have to decline in order to get there.  

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What do you think? How is the global economic landscape changing and how can/should North America cope? Let us know what you think in the comments!