WSJ ECO:nomics conference this week, where tomorrow I'll be on a panel with Chris Field of the IPCC. During the opening panel last night Louis Chênevert, CEO of United Technologies, provided another telling anecdote about the massive scale of China's growth. The world elevator market is about 500,000 units per year, of which, 280,000 are installed in China and only 16,000 in the United States (this article has some details).
On the panel, Chênevert, Mark Pinto (of Applied Materials) and Zhenrong Shi (of Suntech Power Holdings) explained and agreed that, in their business areas, companies are relocating to China not because of labor costs, but rather because of scale and subsidies. Given this, my sense is that in may contexts the US cannot and should not try to compete. Think of elevators as a good example.