The death of capitalism? (part2 finale)

On my previous article we saw a little bit about what's going on in the global scene. Also we saw a bit about the interaction between the east and the west. How crisis from one continent can spread on to another and the cycle of the economy. Today we will see a simple example showing us, why this crisis was created in the first place.

Capitalism as we know it is based on cheap labor meaning cheap products. We have as an example two factories creating t-shirts, one is on China and the other is on USA. The first one has cheap labor and obviously on the second costs will be more.  If the end price for the same quality is different for that made in China and the made in USA product, which would you prefer? I bet the made in China; it does good to your pocket and the economy (?).

The problems start to appear when factories from the USA start to migrate to China to lower the production costs. There is no chance for west to antagonize the east. Lower salaries, 18hours of work a day, it is like having robots for workers. The same rules apply not only for t-shirts but for almost every available good. So what will happen when you have to pay someone else to manufacture your goods? You “lose money” because you fund someone else!

So when you have to buy a pencil, matches, your iphone and everything else from China you end up having a deficit. No matter how many windows 7 or corn you buy you can’t change that and that is the problem. How can the west antagonize that? Some countries have oil (Norway), others just recycle money (Switzerland), others indeed produce some goods (Germany), others sell services (England) but most can’t compete with others!

What happens to Europe where the North with the euro produced more and exported massively to the South, is almost the same thing to what is happening to the whole world! The problem is that due to the nature of capitalism, this cannot be changed. There are no emergency breaks and no chance for the loop to stop. What will happen; God knows, but all evidence show that there is great chance to see the death of capitalism.