http://articles.sfgate.com/2011-05-22/opinion/29580189_1_r-d-spending-manufacturers-move-innovationOutsourcing manufacturing hurts U.S.
ECONOMY
May 22, 2011|By Henry R. Nothhaft
For more than 30 years, American economists and policymakers have worshiped a false god. They believed our country could be successful if we simply specialized in research and innovation, a view espoused by "The World Is Flat" author Thomas Friedman, and let China and other nations do the manufacturing.
But the proponents of this innovation-only economic model delude themselves if they believe that high-tech manufacturing, like buggy whips in the era of automobiles, is of little or no value today. We still live in a world of things - from cars and cutlery to computers and cell phones - and somebody still has to make them. And if the United States is not making the advanced technology products it needs, obviously it is buying them from countries that do. snip
Since deindustrialization began in 1980, wages for all Americans have fallen. Since 1969, the median wage for men has fallen 28 percent. The result of this 30-year offshoring craze, say Harvard Professors Willy Shih and Gary Pisano, is that for the first time in our history, "the U.S. economy has been unable to provide a rising standard of living for the majority of its people."
But even more dangerous to our nation's future is the demonstrable fact that when manufacturing is offshored, innovation itself - along with the social wealth it creates - inevitably will follow it.