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Businessweek Archives

New Economy Or An Echo Of The 1980s?

Readers Report


"The 21st century economy" (Cover Story, Aug. 24-31) reinforces the idea that America has entered the New Economy. Our era, however, seems eerily similar to the late 1980s--when the "Massachusetts Miracle" was announced. America in 1998 appears to be at a cyclical high point. Come a slowdown or recession, some Americans may be claiming "depression," as they did during the 1990-91 recession.

America does have strengths: low unemployment, steady growth, and overall wage growth. Nonetheless, the long-term trends of slow growth and high inequality remain. Both are no better than in the 1980s. In fact, inequality has increased more under Clinton than under Reagan.

Japan appears to be entering a financial situation similar to the U.S. in the 1930s, while the U.S. takes Britain's position (its '30s depression remained mild). Japan and Asia maintain fundamental strengths in production, while America's production strength diminishes (1988 saw record trade deficits with both Japan and China). Is this a historical coincidence or a harbinger of America's true future role in the New World Economy?

Drew Millet

Vestal, N.Y.Return to top


"Why the pace has to pick up" (Cover Story, Aug. 24-31) points out that not enough American students choose careers in scientific research, thereby necessitating the importation of foreign talent. It has been suggested that more money be given to research funding and to grants and fellowships to graduate students. This misses the point.

A prospective researcher must spend four years on an undergraduate degree, followed by four or five years of postgraduate education, followed by two or more years as a postdoctoral research fellow just to have a chance at obtaining a position in academia or government research. If one is lucky enough to obtain an assistant professorship, then one has another six years to prove oneself worthy of tenure. But if unsuccessful, then one's career is essentially on the scrap heap.

There is, however, a more serious reason for avoiding science: It simply is not respected in North America. One can expect to live in poverty during one's graduate and postdoctoral years, just when most people are starting a family. Your neighbors, be they plumbers or janitors, make more money than you do. Even if you do reach the ranks of full-time employment, typical salaries are a fraction of what medicine, law, or commerce pay. Sure, the work is fascinating, but try to explain that to your wife.

I now work in France. I earn the same as I did in North America--but that is more than most lawyers, accountants, and even doctors over here. I feel good about myself. I am in a privileged profession. Each year, my department hires four or five new scientists, who will have lifetime jobs from the word go.

James Mitchell

Professor of Physics

Universite de Rennes

Rennes, FranceReturn to top


"The innovative society" (Editorials, Aug. 24-31) addresses the need for increased federal funding for research. Your statement that Washington needs "an economic policy with a top priority of encouraging innovation" was on target. Our coalition, which consists of 28 Chambers of Commerce from all parts of the U.S., believes that federal research funding should be increased. The most critical need is in defense basic research. Although it spurred the development of the transistor and the Internet, defense basic research is down by 30% in real dollars since its peak in fiscal year 1993. Regaining this lost ground needs to be a top priority in federal budget deliberations.

Jim Klocke

Executive Director

National Business Coalition

for Federal Research

BostonReturn to top

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