Comment v Final DR 18/12/08 14:16 Page 3
COMMENT
3
Tis the season
At this time of year people are expecting to be
celebrating with loved ones in their respective methods
at the end of year before preparing for the year ahead.
For most people 2008 will be best forgotten but I think
history will see the events of the last twelve months as
critical to future events we cannot ascertain that will
impact on industry and the world.
The election of Barack Obama was a major highlight for 2008
and not just because of a change of political party. The symbolism
behind the election result was an important shot in the arm for many
people’s vision of the world and themselves. Considering all the
negative activity in 2008, the importance of such a positive event
on the world cannot be underestimated. Who knows how bad the
financial negativity would be without this positive impact.
There is no doubt that financial instability will be the
main thing 2008 will be remembered for and it is
sobering watching so called experts run around
convincing us they have some idea what is going on.
The truth is they do not as the world of finance has
changed in such a fundamental way, we do not know
the impact and how it will change the fiscal platform
we use in business and society.
Most reactions to the current crisis are outdated fear
based reactions that fail to notice just how much the world
has changed since the 1980s let alone the 1950s. At the end of the
1980s there was a massive influx of labour from ex-communist countries as the
ideological wall fell between the East and West. Since then we have had rapid growth
in emerging areas like China and Japan adding even more workers to the global
stockpile with no comparable increase in job availability. This is as true in the
semiconductor industry as any other.
Whilst all this has been occurring a very simple mathematical equation has been
occurring that if you mention you are looked at as if some McCarthian figure was your
judge. That simple fact is that profits have increased up to a hundred fold for some
companies since the 1980s and the top 1% of earners have seen their profits rise at a
similar level. Unfortunately in that same time, wages have not only stalled but in the
USA have shrunk as a national average of GDP in the last decade.
There is no doubt that wages and not profits are expected to bear the brunt of the
financial greed that has turned a working capatilist system on its head. Companies are
expecting governments to come up with cash to save their skins but, except for a few
notables, continue to ensure there is an increase in their profits. The 1930s depression
was contributed to by country protectionism at the time which is why we have the
appropritate government action. It will not completely work until they realise that
multi-national companies today are the strength and need to participate in this
non-protectionist behaviour. I suggest nothing more than sharing the load of fiscal pain
through the worst of the crisis.
Nothing left to say but enjoy the seasonal break and look forward to 2009.
David Ridsdale
Editor in Chief
December 2008 / January 2009
www.euroasiasemiconductor.com
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