I remember one of the Star Trek movies, in which Kirk asks Scotty to perform an especially difficult technological miracle to save the Enterprise. Scotty replies, "Captain, I can't change the laws of physics."
In some ways, this quote reminds me of what many of the e-business and dot-coms are trying to do. No, not change the laws of physics, but indeed some seem intent on flying in the face of economics.
A key foundation stone of economic theory is creation of wealth. For those of us in manufacturing, that basically means adding value to raw materials. Raw is the operative word here. Iron ore is an exam-ple of raw material. Taking ore and proc-essing it into steel is a wealth producing enterprise. Steel is more valuable than ore because it can be used to create more wealth by the manufacturing process.
What started out as a naturally occur-ring resource becomes a useful object in the hands of metalworkers. Steel can be formed or cut into parts that can be assembled into virtually anything. Each step along the way is a value adding exercise to the original ore.
Now in today's jargon, this process of building value from lesser to greater is referred to as the "old" economy. Well, I for one do not accept this premise. In fact, I reject it out of hand.
As is too often the case, labels are used in an effort to simplify complex concepts. That's the case with the so-called "new" economy versus the "old" economy. Sorry folks, it's just not that cut and dry. I think back to a time when the buzz was telling us that manufacturing was a dead dinosaur and that the "service" economy was poised to rein over the land. It didn't happen, for one very important reason. Without the wealth-producing engine represented by manufacturing, there's eventually nothing to service. Therefore, in my opinion, it's a ridiculous exercise to wrap the complexity and interconnectivity of as complex an economy as ours into such simple and fundamentally incorrect tags as "old" and "new" economies.
They are the economy—stupid! Manu-facturing's role in the success of the current U.S. boom is representative of the point of convergence between old and new. It's the integration of "new" economy stuff that makes the "old" economy able to more efficiently create wealth. In doing so, the purchasing power of manufacturing fuels the development of more productivity enhancing products and services. It's increased productivity that's sustaining the boom. Please don't beam me up yet.