….it is my belief that open economies prosper.

I am sure history will bear me out on this. When a society or nation prospers, it attracts talent from all over. A large part of the talent infusion is of semi-skilled or unskilled persons from nearby lands coming over for a better living – a smaller but significant proportion is of inherently smart people coming over for better opportunities.

The semi-skilled and unskilled segment help meet the needs for labor for the more mundane tasks. The talented/educated lot help sustain these successful economies through the cycle of continuous innovation required to keep them at the forefront. Without this infusion of talent, one is left reliant on regurgitated ideas and thoughts and this is the death-knell of any civilization.

The English civilization from the 17th through the 20th centuries, the French civilization, the German dominance of the early 20th century, the US domination from the mid-20th century and even the ongoing emergence of China has all been characterized by the infusion of new talent into the economies. Perhaps the only significant recent boom economy that has been the exception to this rule is Japan – while they did borrow from Deming and more, and while Nissan did gain from the induction of Carlos Ghosn, there has not been the usual infusion of large numbers of expatriates into the Japanese economy.

I was reading a Goldman Sachs projection (“Dreaming with BRICs: The Path to 2050”, 1st October 2003″) where they spoke about China and India as the leading economic powers in 2050 AD along with the US. I have a feeling the analysts have gone overboard yet again with their projections – akin to the dot-com boom era of the 1990s. There are so many flaws in the Chinese and Indian socio-economic structures yet that the jury is still out in my opinion.

Unless China and India can each demonstrate the economic freedom, social equity and access to comfort and security that has been provided by the US, Great Britain, western Europe and even Hong Kong and Singapore in their respective hey-day, they will not emerge as a magnet for top-notch talent.

The education systems need to be strengthened to not only cover the under-graduate level education but also for graduate studies. In addition, there is a need to raise the overall IQ of the colleges – the standards fall off rather dramatically after the premier institutions. Finally, can India and China ensure that the female child is not punished for her gender. The gender ratios in the two countries is already atrocious and this kind of an imbalance is unhealthy to say the least.

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