Where are the new products?

It’s very much looking as though Romney will become the next President of America. Until recently, Obama has had a slight edge in the opinion polls but the latest devastating unemployment figures, following months of poor ones, suggest that the tipping point has now been reached. Apart from all the usual bombast that both sides will be using in the next few months, all that Romney needs to do is reinforce the fact that he is an experienced businessman and Obama isn’t. Even if the Democrats charge Romney with negative business decisions in his past career, all he needs to say is that he’s learned from his experience whereas Obama has no relevant skills he can work on.

What slightly surprises me about Romney is that so far he hasn’t mentioned one outstanding feature of Mormonism. This is that there’s no unemployment among Mormons. Like the Amish, they look after their own. Perhaps I’m only slightly surprised because if he were to draw attention to his Mormon faith, it would powerfully reinforce the opposition of evangelical Christians, a substantial part of the US electorate — over one third according to an estimate last month by The Economist. And half of those are Republicans, too! He wouldn’t get elected. He’ll continue to downplay his Mormonism.

Like the Quakers in England 200 years ago, present-day Mormons in America comprise an almost complete business infrastructure of their very own. The proportion of business people among them is so high that any born Mormon, or any sincere new convert, can be found a job. In the Great Depression of the 1930s, when they didn’t have so many business people among them, the Mormon Church would buy farms or other labour-intensive businesses to absorb their own unemployed.

If — or, more likely, when — Romney is elected, you can be certain that, due to its reputation, recruitment into the Church of the Latter Day Saints will rise enormously from the 2% it is today in the US population. But unless he were able to supply new jobs pro rata (and at a high rate also) then it’s likely that membership would stabilize at a modest level. Besides, any jobs he would be able to create would tend to be labour-intensive with low incomes — such as the half-pay wages that General Motors now pay for newly-hired workers. It’s almost certain that none of these ‘Romney-jobs’ would be taxable. In one way or another, workers and their families would be recipients of state welfare rather than helping to pay back the enormous government debt that the US is now lumbered with.

Assuming that the Eurozone doesn’t collapse in the meantime or that China and Japan manage to sustain America by continuing to buy US Bonds (now approaching negative returns) what could Romney do?

Well, I’ll tell him. All he has to do is to think up four or five brand new iconic consumer products that are unique enough and attractive enough as printed cotton shirts, bicycles, radios, cars, TVs and PCs were in the past and which incentivised economic growth continuously for the past 300 years. The new products would have to be expensive enough to attract the rich first (to start the profit ball rolling), but also mass producible so they could then can work down in cheaper stages through all the social strata. (Mobile phones can’t do the trick, of course, because they don’t carry enough economic weight in the total GDP and, besides, intensive competition will make even the most sophisticated phones [with many TV channels] trivially cheap when the huge market of the undeveloped world becomes available within a few years.)

There you are. Mr Romney! Ask your Mormon elders to think up a few consumer products that are as exciting as the mobile phone — but different! As well as signifying status, they need to offer something quite different from any item so far. (And they needn’t come up with family helicopters!) If you were able to do so, then hundreds of transnational corporations, already sitting on massive profits they don’t know what to do with, would jump at the opportunities and get the whole economic machine going again. No problem.

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